Board roles and responsibilities
The Board is the ultimate decision-making oversight and control authority in Hikma. The Board sets the strategic direction, monitors financial performance and challenges management ideas and performance. The Board promotes good governance within the Group, and seeks to ensure that Hikma meets its responsibilities to shareholders, employees, suppliers, customers and other stakeholders.
2016 Board key business
Matters reserved to the Board
Hikma maintains a formal schedule of matters reserved to the Board in the Board Governance Manual, which is reviewed annually. The Chief Executive is responsible for delivering Hikma’s strategic and operational objectives and has authority from the Board to deliver those objectives through matters which are not reserved and where authority has been delegated specifically. The Chief Executive reports on operational progress and corporate actions to the Board at each meeting. Where appropriate, the Chief Executive is assisted by internal and external advisers in presenting operational progress and key strategic decisions to the Board.
The formal schedule of matters reserved to the Board includes the following items:
- Operational management: Approval of strategy, operations oversight, performance review
- Structure and capital: Approval of changes to Group structure or changes to capital structure
- Banking and leverage: Approval of principal bankers and major lending arrangements
- Financial reporting and controls: Approval of financial announcements, accounts, dividends and significant changes to treasury and accountancy practice
- Internal controls: Assessing the effectiveness of the Group’s risk and control processes
- Contracts: Approval of significant contracts, investments and projects which meet pre-set monetary thresholds
- Communication: Approval of certain press releases, and all circulars and prospectuses
- Board membership and other appointments: Approval of changes to Board structure and composition, succession, auditors and Company Secretary
- Remuneration: Determining remuneration policy for senior management and Directors and officers and amending or introducing share incentive plans
- Corporate governance: Annually reviewing Board, Committees and individual Director performance, and reviewing corporate governance arrangements
- Capital expenditure: Approval of significant capital projects
Indemnities and insurance
Hikma maintains an appropriate level of Directors’ and Officers’ insurance. The Directors benefit from qualifying third-party indemnities made by Hikma that were in force during the year and as at the date of this report. These indemnities are uncapped in amount in relation to losses and liabilities which Directors may incur to third parties in the course of the performance of their duties.
Dialogue with stakeholders
Hikma is committed to clear and open communication with shareholders and stakeholders. We take account of the views of our stakeholders in our decisions and policies. If there are matters on which additional explanation is required, we are always happy to discuss them. Please contact the Company Secretary in the first instance by writing to email@example.com.
The Board maintains a regular dialogue with shareholders through its investor relations programme, directed towards ensuring a mutual understanding of objectives. The principal ongoing communications with shareholders are through the publication of Hikma’s Annual Report and Accounts, interim results and interim management statements. The Chairman meets major shareholders periodically to discuss governance and strategy issues in order to understand their views on the Company and to ensure their views are communicated to the Board as a whole. The Chairman, the Senior Independent Director and other Non-Executive Directors are available to meet with major shareholders on request. The Committee Chairs remain open to discuss any matters relevant to their areas of responsibility, either through contacting Hikma or at the Annual General Meeting (AGM). Shareholders are encouraged to attend the AGM and if unable to do so are encouraged to vote by proxy. Copies of presentations made at the AGM are available on the website after the event, together with the results of the voting. All Directors are expected to attend the AGM and full attendance has been achieved other than when exceptional personal circumstances have intervened.
Regular Board items and responsibilities
The Board is assisted in the delivery of its responsibilities by internal and external advisers:
|External advisers||Nature of advice|
|Bank of America Merrill Lynch||Broker|
|CenterView Partners||Investment adviser|
|Slaughter and May||Lawyers|
|Willis Towers Watson||Remuneration adviser|