Nomination/Remuneration Committee - Terms of Reference

Membership
The Nomination/Remuneration Committee ("the Committee") shall be made up of three members, namely, the Society’s Chairman, the Vice-Chairman and a non-executive director jointly appointed by the Chairman and Vice-Chairman.

Only members of the Committee have the right to attend Committee meetings. However, other individuals such as the Chief Executive, members of the Executive and external advisers may be invited to attend for all or part of any meeting as and when appropriate.

The Society's Secretary shall attend all Board sub-committees in fulfilling his obligations as Secretary and assist the smooth running of the Board and its committees by setting agendas; preparing papers; presenting papers; as required; and advising the Board and its committees on Board procedures and compliance with the Annotated Combined Code.

Appointments to the Committee shall be for a period of up to three years, which may be extended for two further three-year periods and annually thereafter, provided the director remains independent in accordance with the Society's Independence Policy.

The Board shall appoint an individual, other than the Chairman of the Board, to be the Chairman of the Nomination/Remuneration Committee. 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.

Secretary
The Society’s Secretary or their nominee shall act as the Secretary of the Committee.

Quorum
The quorum necessary for the transaction of business shall be two 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.

Meetings
The Committee shall meet at least once a year and at such other times as the Chairman of the Committee shall require.

Notice of Meetings
Meetings of the Committee shall be summoned by the Secretary of the Committee at the request of any of its members.

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, any other person required to attend and all other non-executive directors, no later than five 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.

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

Minutes of Committee meetings shall be circulated promptly to all members of the Committee and, once agreed, to all members of the Board, unless a conflict of interest exists.

Annual General Meeting
The Chairman of the Committee shall attend the Annual General Meeting prepared to respond to any members’ questions on the Committee’s activities.

Nomination Duties
The Committee shall:

• 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;
• give full consideration to succession planning for directors 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;
• be responsible for identifying and nominating for the approval of the Board, candidates to fill Board vacancies as and when they arise;
• before any appointment is made by the Board, evaluate the balance of skills, knowledge and experience on the Board, and, in the light of this evaluation prepare a description of the role and capabilities required for a particular appointment. In identifying suitable candidates the Committee shall:
  • use any appropriate means, including use of contacts within the dental profession, open advertising and 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.
• 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 marketplace;
• keep up to date and fully informed about strategic issues and commercial changes affecting the Society and the market in which it operates;
• 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; and
• ensure that on appointment to the Board, directors receive a formal letter of appointment setting out clearly what is expected of them in terms of time commitment, Nomination Committee service and involvement outside Board meetings.

The Committee shall also make recommendations to the Board concerning:

• formulating plans for succession for both executive and non-executive directors and, in particular, for the key roles of Chairman and Chief Executive;
• membership of the Audit, Risk and Nomination/Remuneration Committees, in consultation with the chairmen of those Committees;
• 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;
• any matters relating to the 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 Society subject to the provisions of the law and their service contract; and
• the appointment of any director to executive or other office other than to the positions of Chairman and Chief Executive, the recommendation for which would be considered at a meeting of the full Board.

Remuneration Duties
The Committee shall:

• determine and agree with the Board the framework or broad policy for the remuneration of the Society’s Chief Executive and the executive directors.  The remuneration of non-executive directors shall be a matter for the Chairman and the Chief Executive. The remuneration of the Chairman shall be a matter for the Board as a whole. No director or manager shall be involved in any decisions as to their own remuneration;
• in determining the remuneration policy, take into account all factors which it deems necessary.  The objective of such policy shall be to ensure that members of the Society’s Executive are provided with appropriate incentives to encourage enhanced performance and are, in a fair and responsible manner, rewarded for their individual contributions to the success of the Society;
• review the ongoing appropriateness and relevance of the remuneration policy;
• approve the design of, and determine targets for, any performance related pay schemes operated by the Society and approve the total annual payments made under such schemes;
• determine the policy for, and scope of, pension arrangements for each executive director;
• ensure that contractual terms on termination, and any payments made, are fair to the individual, and the Society, that failure is not rewarded and that the duty to mitigate loss is fully recognised;
• within the terms of the agreed policy and in consultation with the Chairman and/or Chief Executive as appropriate, determine the total individual remuneration package of each executive director including any bonuses and incentive payments;
• in determining such packages and arrangements, give due regard to any relevant legal requirements, the provisions and recommendations in the Annotated Combined Code and associated guidance;
• review and note annually the remuneration trends across the Society or Group;
• oversee any major changes in employee benefits structures throughout the Society or Group;
• agree the policy for authorising claims for expenses from the Chief Executive and Chairman;
• ensure that all provisions regarding disclosure of remuneration, as equivalent to the relevant sections of the Directors’ Remuneration Report Regulations 2002 and the Annotated Combined Code, are fulfilled; and
• be exclusively responsible for establishing the selection criteria, selecting, appointing and setting the terms of reference for any remuneration consultants who advise the Committee; and to obtain reliable, up-to-date information about remuneration in other Societies. The Committee shall have full authority to commission any reports or surveys which it deems necessary to help it fulfil its obligations.

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

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

The Committee shall produce an annual report of the Society’s remuneration policy and practices which will form part of the Society’s Annual Report and ensure each year that it is put to members for approval at the AGM.

Other
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 recommend any changes it considers necessary to the Board for approval.

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

In connection with its duties the Committee is authorised by the Board to obtain, at the Society’s expense, any outside legal or other professional advice.