HSBC 2012 Annual Report Download - page 318

HSBC HOLDINGS PLC
Report of the Directors: Corporate Governance (continued)
Board of Directors > Directors / Corporate governance codes
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number of Directors who are to retire by rotation at
such meeting in accordance with the Articles of
Association. The Board may appoint any Director
to hold any employment or executive office and
may revoke or terminate any such appointment.
Shareholders may, by ordinary resolution, appoint
a person a Director or remove any Director before
the expiration of his period of office. On the
recommendation of the Nomination Committee
and in compliance with provision B.7.1 of the UK
Corporate Governance Code, the Board has decided
that all of the Directors should be subject to annual
re-election by shareholders. Accordingly, all of the
Directors will retire at the forthcoming Annual
General Meeting and offer themselves for re-
election. Each of the executive Directors is
employed, on a rolling contract which requires
12 months’ notice to be given by either party. None
of the non-executive Directors has a service contract
with HSBC.
Relations with shareholders
All Directors are encouraged to develop an
understanding of the views of major shareholders.
Non-executive Directors are invited to attend analyst
presentations and other meetings with institutional
investors and their representative bodies. Directors
also meet representatives of institutional
shareholders annually to discuss corporate
governance matters.
All executive Directors and certain other senior
executives hold regular meetings with institutional
investors. The Board receives a regular investor
relations activity report which provides feedback
from meetings with institutional shareholders and
brokers, analysts’ forecasts, information from
research reports and share price performance data.
Twice each year the Board also receives a report
from one of our corporate brokers on market views
and investor relations.
On several occasions during 2012, non-
executive Directors, including the senior
independent non-executive Director, met or
corresponded with institutional investors and
their representatives to discuss governance and
remuneration.
As senior independent non-executive Director,
Sir Simon Robertson is available to shareholders
should they have concerns which contact through
the normal channels of Group Chairman, Group
Chief Executive, Group Finance Director or other
executives cannot resolve or for which such contact
would be inappropriate. He may be contacted
through the Group Company Secretary at 8 Canada
Square, London E14 5HQ.
During 2012, the Board established a
shareholder communication policy which is
available on www.hsbc.com.
Conflicts of interest, indemnification of
Directors, relevant audit information and
contracts of significance
The Board has authority to approve Directors’
conflicts and potential conflicts of interest and
has adopted a policy and procedures for the
determination of terms of authorisation for such
situations. The Board’s powers to authorise conflicts
are operating effectively and the procedures are
being followed. A review of situational conflicts
which have been authorised from time to time and
the terms of those authorisations is undertaken by
the Board annually.
Our Articles of Association provide that
Directors are entitled to be indemnified out of the
assets of HSBC Holdings against claims from
third parties in respect of certain liabilities. Such
indemnity provisions have been in place during
the financial year but have not been utilised by the
Directors.
Each person who is a Director at the time of
approval of this report confirms that so far as he or
she is aware, there is no relevant audit information
of which the auditor is unaware and the Director has
taken all the steps that he or she ought to have taken
as a Director in order to make himself or herself
aware of any relevant audit information and to
establish that the auditor is aware of that
information. This confirmation is given pursuant to
section 418 of the Companies Act 2006 and should
be interpreted in accordance therewith and subject
to the provisions thereof.
None of the Directors had, during the year or
at the end of the year, a material interest, directly
or indirectly, in any contract of significance with
any HSBC company.
Corporate governance codes
HSBC is committed to high standards of corporate
governance. HSBC has complied during 2012
with the applicable code provisions of: (i) The UK
Corporate Governance Code issued by the Financial
Reporting Council; (ii) the Code on Corporate
Governance Practices set out in Appendix 14 to the
Rules Governing the Listing of Securities on The
Stock Exchange of Hong Kong Limited, from
1 January 2012 until its amendment and replacement