60
John Lewis Partnership plc Annual Report and Accounts 2014
OUR GOVERNANCE APPROACH CONTINUED The Partnership Board continued
Board independence The Partnership Board has determined that the composition of the Board provides a balanced leadership, appropriate for a business that is co-owned by Partners. Together, Elected Directors and Non- Executive Directors form a majority of the Partnership Board.
Retirement by rotation The Partnership does not operate a system of retirement by rotation or annual election by shareholders. The Partnership Board considers that a rigorous process of accountability exists to ensure compliance with the Partnership’s Constitution, especially Principle 1. The Constitution’s governance mechanisms provide opportunities throughout the year to review and scrutinise the efficacy of each Director.
Conflicts of interest The Partnership Board maintains procedures that allow for the regular review of potential conflicts of interest. All Directors are required to declare pertinent interests and absent themselves from any discussion that might give rise to a conflict of interest. A register of interests is maintained by the Director of Legal Services and Company Secretary.
At no time during the year did any Director hold a material interest in any contract of significance with the Partnership or any of its subsidiary undertakings, other than a third- party indemnity between each Director and the Company, as granted by the Company’s Articles of Association and service contracts between each Executive Director and the Company.
The Company also provides an indemnity for the benefit of each trustee of the Partnership’s Pension Fund, in respect of liabilities that may attach to them in their capacity as a trustee. As a trustee of the Partnership’s Pension Fund, Patrick Lewis also has the benefit of this indemnity.
The Partnership Board has looked closely at the other appointments held by Directors, details of which are contained in their biographies on pages 62 to 63. The Partnership Board considers that the Chairman and each Director are able to devote sufficient time to fulfil the duties required of them under the terms of their contracts or letters of appointment.
Directors’ and Officers’
liability insurance The Partnership has purchased and maintained throughout the year Directors’ and Officers’ liability insurance in respect of itself and its Directors.
Effectiveness of
the Partnership Board During the year the Partnership Board, facilitated by an independent firm, Board Intelligence, undertook the second part of an externally facilitated evaluation of its performance and effectiveness. The evaluation has been designed to take place over a three-year period. The first stage, undertaken last year, focussed on the performance and effectiveness of the Board. The second stage has included a review of the performance and effectiveness of the Partnership Board’s committees. Board members and committee members were asked via survey to comment on the committees’ roles, priorities and effectiveness. Meetings were then held with Board Intelligence and the Chairman and with each of the Committee Chairmen to discuss the themes and improvement ideas that arose from the surveys.
The committees have adopted the key recommendations of the evaluation which were to review and develop their roles and responsibilities, as well as their relationship and interactions with the Board and management. The resulting revised committees’ terms of reference are available at
www.johnlewispartnership.co.uk.
Board Intelligence has no other connection with the Partnership.
Independent professional advice All Directors of the Partnership Board have unrestricted access to the Director of Legal Services and Company Secretary and to other executives within the Partnership, on any matter of concern to them in relation to their duties. The Partnership has undertaken to reimburse legal fees to the Directors if circumstances should arise in which it is necessary for them to seek separate, independent legal advice in furtherance of their duties. Should the Elected Directors ever consider it necessary to seek independent legal advice, they can rely on the Partners’ Counsellor to provide the budget.
Company Secretary The Director of Legal Services and Company Secretary is responsible for advising the Partnership Board on all corporate governance matters, ensuring that Board procedures are followed and that there is a good flow of information, facilitating induction programmes for new Directors and assisting with Directors’ continuing professional development.
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