The Board of Vodafone Group Plc contains a majority of Non-Executive Directors and the Company seeks to ensure that the role of the Non-Executive is taken only by individuals of the highest calibre and integrity. The Nominations Committee of the Board, which recommends appointments to the Board, has resolved that only individuals who are independent in character and judgement may be appointed as Non-Executive Directors of the Company.
1. Role
The obligations and responsibilities of a Non-Executive Director are to the Company and they are required to act at all times in the best interests of the Company, exercising their independent judgement on all matters. Non-Executive Directors have the same general legal responsibilities to the Company as any other director. Together with the other directors of the Company they have collective responsibility for promoting its success by directing and supervising its affairs. The appointment of a Non-Executive Director is subject to the Company's Articles of Association.
Key elements of the Non-Executive Director's role are:
- Challenging and developing strategy
- Scrutiny of management performance
- Ensuring the robustness of systems of risk management
- Determining, if necessary with independent advice, appropriate remuneration packages for Executive Directors, succession planning and the appointment and, where necessary, the removal of Executive Directors.
2. Appointment and Term
All Non-Executive Directors are appointed for an initial three year term, but with the expectation that they will serve at least one further term of three years, subject to satisfactory performance and re-election by shareholders in accordance with the Company's Articles of Association.
Following appointment, each Non-Executive Director is expected to take a special interest in a particular aspect of the Company's business. This is agreed with the Chairman.
The anticipated time commitment involves attendance at all Board meetings (the Company currently has eight each year, one of which will generally be held outside the UK in a country in which the Company has a business operation), the Annual General Meeting (usually held in July each year) and at least one Company/site visit per year. Non-Executive Directors are expected to devote appropriate preparation time ahead of each meeting. In addition, the standing Board Committees (the Audit Committee, the Nominations Committee and the Remuneration Committee) meet about four times per year (and in some cases more frequently) and Non-Executive Directors are expected to become a member of at least one of these Committees.
3. Fees
Fees for Non-Executive Directors of the Company are determined by the Board as a whole in accordance with the requirements of good corporate governance, the Financial Services Authority's Combined Code and the Financial Services Authority's Listing Rules.
Fees are generally reviewed every three years. The basic annual fee for a Non-Executive Director is £85,000 per annum (the current fee is applicable from 1 July 2003) and a further fee of £10,000 per annum is paid in respect of the chairing of a standing Board Committee.
Non-Executive Directors are entitled to be repaid all travelling expenses properly incurred in performing their duties in accordance with the Company's Articles of Association. No pension or other benefits are provided and Non-Executive Directors are not eligible to participate in share option or other incentive plans. Payment of all fees ceases immediately when the appointment of a Non-Executive Director of the Company terminates for any reason.
4. Competitive Businesses
Non-Executive directors are required to agree that they will not, without the consent of the Board, be engaged or interested in any capacity in any business or with any company which is competitive with the business of any company in the Vodafone Group.
5. Independent Professional Advice
The Board has agreed procedures for directors, including Non-Executive Directors, in the performance of their duties, to take independent professional advice if necessary, at the Company's expense.
6. Insurance
Non-Executive Directors have the benefit of a policy of insurance to indemnify directors against personal liability and defence costs which might result from claims against directors for negligence, breach of duty or breach of trust in relation to the Company.
7. Other Terms
Through their letters of appointment, Non-Executive Directors accept duties of confidentiality, that their appointment may be terminated if they are incapacitated for a period exceeding three calendar months and an obligation to return all property belonging to the Company upon termination of their appointment. The performance of all Non-Executive Directors is evaluated annually in accordance with processes established by the Nominations Committee.
8. Appointment Letters
Copies of the appointment letters containing the terms and conditions of appointment of Non- Executive Directors are available for inspection by any person at the Company's registered office, Vodafone House, The Connection, Newbury, Berkshire RG14 2FN, during normal business hours and at the Company's Annual General Meeting (for 15 minutes prior to the meeting and during the meeting).