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Corporate Governance

Nominations Committee

Reference to "the Committee" shall mean the Nominations Committee. Reference to "the Board" shall mean the Board of Directors.

1. Membership

1.1 Members of the Committee shall be appointed by the Board. The Committee shall be made up of at least four members, the majority of whom are non-executive directors.

1.2 Only members of the Committee and other non-executive directors have the right to attend Committee meetings.

1.3 Appointments to the Committee shall be for a period of up to three years, which may be extended for two further three year periods provided the majority of the Committee members remain independent.

1.4 The Board shall appoint the Committee Chairman who shall be either the Chairman of the Board or a non-executive director. In the absence of the Committee Chairman and/or an appointed deputy, the remaining members present shall elect one of themselves to chair the meeting. The Chairman of the Board shall not chair the Committee when it is dealing with the matter of succession to the chairmanship.

2. Secretary

2.1 The Secretary of the Society or the Board's nominee shall act as the Secretary of the Committee.

3. Quorum

3.1 The quorum necessary for the transaction of business shall be two non-executive members. A duly convened meeting of the Committee at which a quorum is present shall be competent to exercise all or any of the authorities, powers and discretions vested in or exercisable by the Committee.

4. Frequency of Meetings

4.1 The Committee shall meet at least twice a year and otherwise as required.

5. Notice of Meetings

5.1 Meetings of the Committee shall be summoned by the Secretary of the Committee at the request of any of its members or at the request of external or internal auditors if they consider it necessary.

5.2 Unless otherwise agreed, notice of each meeting confirming the venue, time and date together with an agenda of items to be discussed, shall be forwarded to each member of the Committee and any other person required to attend no later than 5 working days before the date of the meeting. Supporting papers shall be sent to Committee members and to other attendees as appropriate, at the same time.

6. Minutes of Meetings

6.1 The Secretary shall minute the proceedings and resolutions of all meetings of the Committee, including recording the names of those present and in attendance.

6.2 Minutes of Committee meetings shall be circulated promptly to all members of the Committee and, once agreed, to all members of the Board.

7. Annual General Meeting

7.1 The Chairman of the Committee shall attend the Annual General Meeting prepared to respond to any member questions on the Committee's activities.

8. Duties

8.1 The Committee shall:

8.1.1 regularly review the structure, size and composition (including the skills, knowledge and experience) required of the board compared to its current position and make recommendations to the Board with regard to any changes;

8.1.2 give full consideration to succession planning for members of the Board and other senior executives in the course of its work, taking into account the challenges and opportunities facing the Society, and what skills and expertise are therefore needed on the Board in the future;

8.1.3 be responsible for identifying and nominating for the approval of the Board, candidates to fill Board vacancies as and when they arise;

8.1.4 before appointment is made by the Board, prepare a description of the role and capabilities required for a particular appointment. In identifying suitable candidates the Committee shall:

8.1.4.1 use open advertising and/or the services of external advisers to facilitate the search; consider candidates from a wide range of backgrounds, and consider candidates on merit and against objective criteria, taking care that appointees have enough time available to devote to the position;

8.1.5 keep under review the leadership needs of the Society, both executive and non-executive, with a view to ensuring the continued ability of the Society to compete effectively in the market place; keep up to date and fully informed about strategic issues and commercial changes affecting the society and the market in which it operates; and review annually the time required from non-executive directors. Performance evaluation should be used to assess whether the non-executive directors are spending enough time to fulfil their duties;

8.1.6 ensure that on appointment to the Board, non-executive directors receive a formal letter of appointment setting out clearly what is expected of them in terms of time commitment, committee service and involvement outside Board meetings, and outlining the Society's induction programme.

8.2 The Committee shall also make recommendations to the Board concerning:

8.2.1 formulating plans for consideration by the Board for succession for both executive and non-executive directors and in particular for the key roles of Chairman, Vice-Chairman and Chief Executive (but see 8.2.3 below);

8.2.2 membership of the Audit and Remuneration Committees, in consultation with the Chairmen of those committees;

8.2.3 the re-appointment of any non-executive director at the conclusion of their specified term of office having given due regard to their performance and ability to continue to contribute to the Board in the light of the knowledge, skills and experience required; the re-election by members of any director under the 'retirement by rotation' provisions in the Society's rules having due regard to their performance and ability to continue to contribute to the Board in the light of the knowledge, skills and experience required; and any matters relating to the continuation in office of any director at any time including the suspension or termination of service of any executive director as an employee of the Society subject to the provisions of the law and their service contract;

8.2.4 the appointment of any director to executive or other office other than to the positions of Chairman, Vice-Chairman and Chief Executive, the appointment of which would be considered at a meeting of the full Board.

9. Reporting Responsibilities

9.1 The Committee Chairman shall report formally to the Board on its proceedings after each meeting on all matters within its duties and responsibilities.

9.2 The Committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed.

9.3 The Committee shall make a statement in the annual report about its activities, the process used to make appointments and explain if external advice or open advertising has not been used.

10. Other

10.1 The Committee shall, at least once a year, review its own performance, constitution and terms of reference to ensure it is operating at maximum effectiveness and the Chairman, where appropriate, should recommend any changes considered necessary to the Board for approval.

11. Authority

11.1 The Committee is authorised to seek any information it requires from any employee of the Society in order to perform its duties.

11.2 The Committee is authorised to obtain, at the Society's expense, outside legal or other professional advice on any matters within its terms of reference.