Terms of reference

The Committee’s terms of reference which are available on the Group’s website encompass:

• Keeping under review the composition of the Board;
• Succession planning; and
• Board performance.

Activities during the year The Committee met three times during the year to consider:

Activities during the year

The Committee met three times during the year to consider:

Chief Executive and Finance Director succession

On 30 November 2010, the Group announced that Jonathan Lane intended to retire from his role as Chief Executive during 2011 and that following the appointment of his successor, he would stay with the Group in a newly-created role of Deputy Chairman. In this role, Jonathan Lane will support the Chairman and provide continuity, enabling the Group to benefit from his experience and knowledge gained over 25 years as Chief Executive of the Group.

Prior to commencing the process the views of shareholders were sought on the Group’s succession process.

The Committee appointed an executive search firm to assist with the recruitment of a successor to the Chief Executive. There was one internal candidate, Brian Bickell, the Group’s Finance Director. He and the three shortlisted external candidates went through an identical and rigorous selection process. The process concluded with a recommendation to the Board that Brian Bickell be appointed as Chief Executive with effect from 1 October 2011.

Once the appointment of Brian Bickell as Chief Executive had been announced in May 2011 the search for a new Finance Director commenced. An executive search firm was appointed to assist in the recruitment process. The Committee considered it was appropriate to appoint the same firm as was used for the Chief Executive recruitment. There were no internal candidates. The process culminated in a recommendation to the Board to appoint Christopher Ward. Full biographical details of Christopher Ward are set out in the Directors’, officers and advisors section.

The executive search firm for both recruitment assignments considered diversity and gender when selecting candidates for consideration. It is a signatory to the Executive Search Firms’ Voluntary Code of Conduct covering boardroom appointments.

Succession planning

Succession planning at Board and management levels continues as part of the regular work of the Committee.

John Emly will not stand for re-election and will retire at the 2012

Annual General Meeting having served on the Board since 2000. The Committee will review the composition of the Board during the course of the year ahead and may consider the appointment of an additional non-executive Director in due course.

Directors standing for re-election and election

At the Annual General Meeting held in February 2011, all Directors were proposed for re-election. In accordance with the UK Corporate Governance Code, all Directors will again offer themselves for re-election or election at the 2012 Annual General Meeting with the exception of John Emly, who will retire from the Board at the conclusion of the meeting.

Following the annual board performance reviews of individual Directors, the Chairman considers:

• that each Director subject to re-election continues to operate evaluation of the skills of the directors for re-election Director as an effective member of the Board, and
• that each Director subject to re-election and election has the skills, knowledge and experience that enable them to discharge their duties properly and contribute to the effective operation of the Board.

The Board, on the advice of the Nomination Committee, therefore recommends the re-election of each Director standing for re-election. Christopher Ward will join in January 2012. Following his appointment by the Board, a resolution will be proposed for his election at the 2012 Annual General Meeting.

On behalf of the Board

John Manser Nomination Committee Chairman

30 November 2011