Good Governance

Committee terms of reference

The terms of reference for the Remuneration, Audit and Nomination Committees were reviewed and, where appropriate, updated during the year.

Cross membership ensures that decisions of the three committees are consistent and, where appropriate, integrated.

Remuneration Committee

The Remuneration Committee was chaired throughout the year by Mr Brown, an Independent Non-executive Director. The other members during the year are shown on page 33 of the Annual Report. Apart from Dr Bond, who had served for more than nine years and was not, therefore, deemed to be independent under the Code in his last few months on the Board, all other members of the Committee were independent throughout the period of their membership.

This Committee is responsible for agreeing with the Board on the framework and policy for the remuneration of the Group’s executive management and for determining the remuneration packages of the Executive Directors. The Directors’ Remuneration Report is set out on pages 25 to 30 in the Annual Report.

Terms of reference of Remuneration Committee

Nomination Committee

The Nomination Committee is chaired by the Chairman of the Board, except to the extent that it deals with succession to the chairmanship of the Board, in which case the Senior Independent Director assumes this role. The other members during the year are shown on page 33 of the Annual Report. The Nomination Committee’s role is to monitor the composition and balance of the Board and recommend to the Board the appointment of new Directors. Where appointments to the Board are under consideration, the Committee will normally employ external search consultants, except where exceptional internal candidates have already been identified.

Terms of reference of Nomination Committee

Audit Committee

The Audit Committee is chaired by Mr Scholes, who is a Chartered Accountant. The other members during the year are shown on page 33 of the Annual Report. All served on the committee throughout the year except where indicated and all, apart from Dr Bond in his last few months on the board, were independent according to the code. The Board has satisfied itself that at least one member of the Committee has recent and relevant financial experience.

The Committee assists the Board in observing its responsibility for ensuring that the Group’s financial systems provide accurate and up-to-date information on its financial position and that the Group’s published financial statements represent a true and fair reflection of this position. It also reviews annually the Group’s systems of internal control and the processes for monitoring and evaluating the risks facing the Group.

A description of the Audit Committee’s work during 2010 can be found on pages 33 to 34 of the Annual Report.

Terms of reference of Audit Committee