Ultimate responsibility for the management of the Group rests with the Board of Directors. The Board focuses primarily upon strategic and policy issues and is responsible for the Group's long-term success. It approves the Group's strategy, oversees the allocation of resources and monitors the performance of the Group in pursuit of this, all within the context of ensuring that the Group operates within a framework of prudent and effective controls which enable risk to be assessed and managed.
The Chairman and THE Chief Executive
The division of responsibilities between the Chairman and the Chief Executive has been agreed by the Board and is set out in writing.
The Chairman leads the Board, ensuring its effectiveness and promoting high standards of corporate governance. He ensures that there is a clear structure for the operation of the Board and its Committees and encourages open communication between all Directors. In conjunction with the Company Secretary and Chief Executive, he sets the Board agenda and ensures that the Board receives accurate, relevant and timely information about the Company's affairs. The Chairman meets routinely with the Chief Executive and Company Secretary to discuss relevant matters. The Chairman also serves as Chairman of The Vitec Group plc. The Board considers that the Chairman is able to, and does, devote sufficient time to his duties at Vesuvius.
The Chief Executive manages the Group. He is responsible for developing the Group's strategic direction for consideration and approval by the Board. He has day to day responsibility for managing the Group's operations, for the application of the Group's policies and for the implementation of the agreed strategy. He is accountable to, and reports to, the Board on the performance of the business.
The non-executive Directors
The Non-executive Directors bring a wide range of skills and experience to the Board. They represent a strong, independent element on the Board and are well-placed to constructively challenge and support management. They help to shape the Company's strategy, scrutinising the performance of management in meeting the Company's objectives and monitor the reporting of performance. Their role is also to satisfy themselves with regard to the integrity of the Group's financial information and to ensure that the Group's financial controls and risk management systems are robust and defensible. As members of the Remuneration Committee, the independent Non-executive Directors determine the appropriate level of remuneration for the Executive Directors, and as members of the Nominations Committee the Non-executive Directors play a pivotal role in Board succession planning and the appointment of new Executive Directors.
The Senior Independent Director
The Board nominates one of the Non-executive Directors to act as Senior Independent Director and provide an alternative contact at Board level, other than the Chairman, to whom shareholder matters can be addressed. The Senior Independent Director also acts as a sounding board for the Chairman and, should it be required, can act as an intermediary for the concerns of other Non-executive Directors. He is responsible for undertaking the annual evaluation of the Chairman's performance and for leading the recruitment process for a new Chairman, when required.
The Company Secretary
The Company Secretary supports the Chairman on Board corporate governance matters, in particular in planning the agenda for the annual cycles of Board and committee meetings, and ensuring information is available for the Board in a timely manner. He ensures that there is an appropriate level of communication between the Board and its committees and between senior management and the Non-executive Directors. He also keeps the Board apprised of developments in relevant legislative, regulatory and governance matters, facilitates Directors' induction and assists with professional development as required.
The Board has a formal schedule of matters reserved to it and delegates certain matters to committees as outlined below. It is anticipated that the Board will convene on seven formal scheduled occasions during 2013 as well as holding a number of ad hoc committee meetings to consider non-routine business. In addition, it is envisaged that the Chairman and the other Non-executive Directors will meet routinely on their own without the Executive Directors present. At least once each year the Non-executive Directors will meet without the Chairman present to discuss matters such as the Chairman's performance.
Specific matters reserved for the Board include: reviewing Group and divisional performance; approving significant transactions including acquisitions, divestments, capital expenditure and changes to the Group's capital structure; setting and approving the Group's strategy and annual budget; approving the Group's financing and treasury policies; declaration of dividends; succession planning; and approving Board appointments and the remuneration of the Non-executive Directors. Furthermore, the Board considers health, safety and environmental matters and maintains overall responsibility for the Group's system of internal control and risk management processes.
The principal governance committees of the Board are the Audit, Remuneration and Nominations Committees. In addition, the Board delegates certain responsibilities on an ad hoc basis to the Finance and Share Schemes committees.
|Role||Chair of Committee||Membership||Minimum number of|
meetings per year
|Audit Committee||To monitor the integrity of financial reporting and to assist the Board in its review of the effectiveness of the Group's internal controls and risk management systems.||Jeff Hewitt||All independent Non-executive Directors.||Three.|
|Remuneration Committee||To determine the appropriate remuneration packages for the Group's Chairman, Executive Directors, and Company Secretary, and to recommend and monitor the level and structure of remuneration for other Senior Management.||John Sussens||All independent Non-executive Directors.||As necessary, (it is anticipated that at least three meetings will be held each year).|
|To advise the Board on appointments, retirements and resignations from the Board and its committees and review succession planning for the Board.||John McDonough, the Chairman (except where considering his own succession or replacement in which case the Committee is chaired by John Sussens, the Senior Independent Director).||The Chairman and any three Non-executive Directors.||As necessary.|
|Finance Committee||To approve specific funding and|
treasury related matters as set out in the Group's delegated authorities or as delegated from time-to-time by the Board.
|The Chairman||The Chairman, Chief Executive, Chief Financial Officer and Group Treasurer.||As necessary.|
|To facilitate the administration of|
the Company's share schemes.
|Any member.||Any two Directors.||As necessary.|
Each committee has written terms of reference agreed by the Board. These are available to view on the Company's website — www.vesuvius.com.
In addition to these formal Board Committees, the Group also operates an Executive Committee. This Committee, which is chaired by the Chief Executive, assists the Chief Executive in discharging his responsibilities. It is responsible for the executive management of the Group's businesses and comprises the Chief Executive and Chief Financial Officer, the Company Secretary, the five Business Unit Presidents, and the three Vice Presidents of Human Resources, Research and Development, and Manufacturing, Engineering, QHSE and Purchasing. The Executive Committee is scheduled to meet six times during 2013.
The attendance of Directors who served between 31 October 2012 (when the formal Board of Vesuvius plc was appointed) and 31 December 2012, at the Board and principal committee meetings held during this period, is shown in the table below. The maximum number of meetings in the period when the individual was a Board member is shown in brackets.
|Board||Audit Committee||Remuneration Committee||Nominations Committee|
|John McDonough CBE||1(2)||n/a||n/a||1(1)|
The Directors also held a number of informal meetings prior to their appointment to the Board to discuss matters pertaining to the demerger of Cookson Group and the set up and constitution of the new plc.
Messrs Bryan Elliston and Richard Malthouse served as the initial Directors of the Company from the date of incorporation until the formal Board was appointed on 31 October 2012. They attended two Board meetings of the Company during this period.