Role of the board
Matters reserved for the main board
NB. In the event of uncertainty around whether a matter should be referred to the Board or not, it is advised that the matter is referred.
Strategy and Management
- Responsibility for the overall management of the group.
- Approval of the Group’s long-term objectives and commercial strategy.
- Approval of the annual operating and capital expenditure budgets, the Group financial plan and any plans developed in connection with refinancing, and any material changes to them.
- Oversight of the Group’s operations ensuring:
- Competent and prudent management;
- Sound planning;
- An adequate system of internal control;
- Adequate accounting and other records;
- Compliance with statutory and regulatory obligations.
- Review of performance in the light of the Group’s strategy, objectives, business plans and budgets and ensuring that any necessary corrective action is taken.
- Extension of the Group’s activities into new business or geographic areas.
- Any decision to cease to operate all or any material part of the Group’s business.
Structure and Capital
- Changes relating to the Group’s capital structure including reduction of capital, share issues (except under employee share plans) and share buy backs.
- Major changes to the Group’s corporate structure.
- Changes to the Group’s management and control structure.
- Any changes to the Company’s listing or its status as a PLC.
Financial Reporting and Controls
- Approval of the half-yearly report, interim management statements and any preliminary announcement of the final results.
- Approval of the Annual Report and Accounts, including the Corporate Governance statement and Remuneration report.
- Approval of the dividend policy.
- Declaration of the interim dividend and recommendation of the final dividend.
- Approval of any significant changes in accounting policies or practices.
- Approval of treasury policies, including foreign currency exposure and the use of financial derivatives.
- Approval of tax strategy and related risk management strategy and framework.
- Ensuring maintenance of a sound system of internal control and risk management including:
- Receiving reports on, and reviewing the effectiveness, of the Group’s risk and control processes to support its strategy and objectives;
- Undertaking an annual assessment of these processes;
- Approving an appropriate statement for inclusion in the Annual Report;
- Major capital contracts:
- Any program or project involving total capital or non-recurring current expenditure in excess of £1 million.
- Approval of any joint venture or partnership, or other form of collaboration, involving loss of control over any part of the Group business or the contribution of assets by the Group.
- Contracts which are material strategically or by reason of size or which create a perceived increase in risk for the Group, entered into by the company in the ordinary course of business, for example bank borrowings and significant acquisitions or disposals of fixed assets.
This includes customer contracts and supplier contracts as well as the approval of borrowing facilities, loans, overdrafts and other forms of indebtedness requiring approval of the syndicated banks under Facility or Loan agreements in force from time to time.
- Contracts of the company not in the ordinary course of business.
- Major investments, including the acquisition or disposal of interests in the voting shares of any company or the making of any takeover offer.
- The grant of any guarantee or indemnity not in the ordinary course of business or for an amount greater than £10 million. If the risk associated with the guarentee or indemnity is deemed to be minimal, only Board-level approval is required instead of the approval of the whole Board.
- Approval of any significant changes to the Contract Risk Framework or Contract Risk Policy in use across the Group.
- Contracts with liability caps above insurance levels or unlimited liability, unless the liability relates solely to indemnities which are considered to either be low risk and industry-standard, and are defined as such in the Contract Risk Framework, or which cover specific risks which are entirely within the control of KCOM and are considered to be low risk.
- Approval of resolutions and corresponding documentation to be put forward to shareholders at a general meeting.
- Approval of all circulars, prospectuses and listing particulars.
- Approval of press releases concerning matters decided by the Board.
Board Membership & Other Appointments
- Changes to the structure, size and composition of the Board, following recommendations from the Nomination Committee.
- Ensuring adequate succession planning for the Board and senior management.
- Appointments to the Board, following recommendations by the Nomination Committee.
- Selection of the Chairman of the Board and the Chief Executive Officer.
- Appointment of the Senior Independent Director.
- Membership and Chairmanship of Board Committees.
- Continuation in office of Directors at the end of their term of office, when they are due to be re-elected by shareholders at the AGM and otherwise as appropriate.
- Continuation in office of any Director at any time, including the suspension or termination of service of an Executive Director as an employee of the company, subject to the law and their service contract.
- Appointment or removal of the Company Secretary.
- Appointment, reappointment or removal of the external auditors to be put to shareholders for approval, following the recommendation of the Audit Committee.
- Appointments to Boards of subsidiaries.
- Approval of any proposed appointment of a Director to a Non-Executive Director position in another company.
- Determining the remuneration policy for the Directors, Company Secretary and other senior executives.
- Determining the remuneration of the Non-Executive Directors, subject to the Articles of Association and shareholder approval as appropriate.
- The introduction of new share incentive plans or major changes to existing plans, to be put to shareholders for approval.
Delegation of Authority
- The division of responsibilities between the Chairman, the Chief Executive Officer and other Executive Directors, which should be in writing.
- Approval of terms of reference of Board committees.
- Receiving reports from Board committees on their activities.
Corporate Governance Matters
- Undertaking a formal and rigorous annual review of its own performance, that of its committees and individual Directors.
- Determining the independence of Directors.
- Considering the balance of interests between shareholders, employees, customers and the community.
- Review of the Group’s overall corporate governance arrangements.
- Receiving reports on the views of the company’s shareholders.
- Approval of policies, including:
- Ethics & Anti-Fraud Policy;
- Share Dealing Policy;
- Health & Safety Policy;
- Environmental Policy;
- The making of political donations.
- Approval of the appointment of the Group’s principal professional advisers; including the solicitor panel, the external auditors and stockbrokers.
- Prosecution, defence or settlement of litigation involving above £1 million or being otherwise material to the interests of the Group.
- Approval of the overall levels of insurance for the Group including Directors’ & Officers’ Liability insurance.
- Major changes to the rules of the Group’s pension scheme, or changes of trustees or changes in the fund management arrangements.
- This schedule of Matters Reserved for Board decisions.
- Approving signature authorities proposed by the Executive Chairman or Chief Executive Officer.
- Authorising the sealing of documents and the grant of powers of attorney.
Matters which the Board considers suitable for delegation are contained in the Terms of Reference of its committees.
In addition, the Board will receive reports and recommendations from time to time on any matter which it considers significant to the Group.
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