Anglo American Annual Report 2012

GOVERNANCE ROLE OF THE BOARDTHE ROLE OFTHE BOARDThe Board of directors has a dutyto promote the long term successof the Company for its shareholders.Its role includes the establishment,review and monitoring of strategicobjectives, approval of majoracquisitions, disposals and capitalexpenditure and overseeing theGroup’s systems of internal control,governance and risk management.A schedule of matters reserved for theBoard’s decision details key aspects ofthe Company’s affairs that the Boarddoes not delegate (including, amongother things, approval of businessplans, budgets and materialexpenditure). For the full list, pleasesee the Company’s website.Every year the Board holds a two-daystrategy meeting at which thenon-executive directors (NEDs)contribute their expertise andindependent perspective in developingthe strategy of the Company.Role of the chairmanThe Board is chaired by Sir JohnParker. The chairman is responsiblefor leading the Board and for itseffectiveness.Role of the chief executiveThe CEO is responsible for theexecution of strategy and theday-to-day management of the Group,supported by the GMC and the ExCo,both of which are currently chairedby Cynthia Carroll. The functions andmembership of GMC and ExCo areset out on pages 94–95.The Company has adopted theInstitute of Chartered Secretariesand Administrators’ Statement ofDivision of Responsibilities betweenthe Chairman and the CEO.Role of the seniorindependent directorDavid Challen is the seniorindependent non-executive director(SID). He is available to shareholders,acts as a sounding board and confidantfor the chairman and is available as anintermediary for the other directorsif necessary.Independence of directorsThe Board has a strong independentelement and currently comprises, inaddition to the chairman, two executivedirectors and eight NEDs, all of whomare independent according to thedefinition contained in the Code. Fullbiographical details for each directorare given on pages 92–93. The lettersof appointment of the NEDs (as wellas the executive directors’ servicecontracts) are available for inspectionat the registered office of theCompany.None of the NEDs has servedconcurrently with an executive directorfor more than nine years. As DavidChallen has been on the Board for oversix years his re-appointment is subjectto particularly rigorous review. TheBoard believes that through hischallenging and questioning ofmanagement he continues to displayall of the qualities of independencepursuant to the criteria set out inthe Code.Board evaluationAn evaluation of the Board by anexternal facilitator, with no priorrelationship with Anglo American,was completed in February 2012.This involved a series of one- to-oneinterviews with board members togather views, and attendance at aBoard meeting by the facilitator.Overall, directors felt that the Boardwas functioning well. The compositionand balance of the Board is good, andcontinues to develop. The frequency ofmeetings is appropriate, and they arewell organised and well chaired, withan inclusive style encouraging open,healthy debate. It was agreed thatfinance and risk management, inparticular, were well covered and thatthe chairman was very effective atcommunicating with externalstakeholders – for example, investorsand media.96 Anglo American plc Annual Report 2012