We believe good governance is based on 'Living Our Values', an appropriate level of oversight, good communication, a focus on current and emerging risks, transparency in how we operate and a culture of continuous improvement.
Richard Mully Chairman
We aspire to the highest standard of conduct and together with a culture of continuous improvement in standards and performance, this ensures good governance extends beyond the Boardroom.
Leadership and purpose
The Board is collectively responsible for the long-term success of the Company, generating value for shareholders and contributing to wider society. It meets a minimum of six times a year and its principal responsibilities include:
- Oversight of the Company's purpose, values and culture and related policies
- The establishment, review and monitoring of strategic objectives
- Risk oversight and the Group’s system of internal controls
- Approval of:
- Major acquisitions and disposals
- Major developments
- Significant leasing arrangements
- Significant financing arrangements
- Board appointments
- Appointment of principal advisers
- The broad policy for the remuneration of the Executive Directors
- Financial reporting oversight including review of results, reports from Board and Management Committees and approval of policies
- Oversight of effective engagement with stakeholders
- Oversight and leadership on health and safety and sustainability
Division of responsibilities
The Board comprises of the Non-Executive Chairman, two Executive Directors and four independent Non-Executive Directors and is supported by the Company Secretary. The Chairman and the other Non-Executive Directors meet regularly without the Executive Directors, and at least once a year the Non-Executive Directors meet without the Chairman. In addition, individual directors meet routinely outside the formal Board meetings as part of each director’s contribution to the delivery of the Company’s strategy and review of operations.
The Executive Directors meet weekly with senior management as the Executive Committee, chaired by the Chief Executive, to attend to the ongoing management of the Group. Significant operational and market matters are communicated to the Non-Executive Directors on a timely basis outside of the Board meetings.
Each of the Non-Executive Directors is considered to be independent from the Executive management and free from any business or other relationship, which would materially interfere with their exercising of independent judgement.
Each year the terms of reference for the roles of Chairman, Chief Executive and Senior Independent Director are revisited by the whole Board.
Composition, succession and evaluation
To ensure the Group’s effectiveness, during the year the Nomination Committee undertakes a review of:
- The membership and composition of the Board, including that the balance of skills continue to be appropriate
- The recommendations arising from the Board evaluation which involves questionnaires and one-to-one meetings covering:
- The Board’s role, composition and operation
- Board, Committee and individual performance
- Board behaviours and protocols
- The Group’s overall human resourcing including succession and training and development plans
Our inclusive culture provides a solid foundation for our approach to diversity both of the Board and the wider business. Our Board policy on recruitment is that we expect our search consultants to ensure, where possible, at least 30% of potential candidates are women, in line with our overall intention to strive for a higher gender balance on the Board. This approach to recruitment is mirrored across the business to help to develop a strong pipeline of women within GPE at all levels. The benefits of broader diversity characteristics such as age, ethnicity, core skills, experience and educational and professional background also continue to be an active consideration in all recruitment.
Audit, risks and internal controls
The Board recognises its responsibility for ensuring the independence and effectiveness of the internal and external auditors, satisfying itself on the integrity of financial and narrative statements and both maintaining and monitoring the Group’s system of internal control and regularly reviewing its effectiveness.
At half year and year end, the Audit Committee also reviews and reports to the Board on the Group’s financial reporting, internal control and risk management systems and the independence and effectiveness of the auditors annually.
Key features of the Group's internal control include:
- A comprehensive system of financial reporting and business planning
- A defined schedule of matters for decision by the Board
- Clearly defined levels of authority and documentation procedures for transactions
- Close Executive involvement in day-to-day operations
- Regular Board review of strategy and progress
- Formal sign off of the Group’s Ethics and Whistleblowing policies by all employees annually
- Review by the Audit Committee of Internal Auditor’s reports
Nick Sanderson Finance and Operations Director
Our aim is to build strong and lasting relationships with all our stakeholders based on professionalism, fair dealing and integrity.
Relations with shareholders
Communicating with our investors is an important priority. Each year a comprehensive investor relations programme is devised to include roadshow meetings including the UK, US, Asia and Europe, investor and analyst events and property tours. In the year ended 31 March 2019, our directors and senior management held 179 formal meetings with shareholders and potential shareholders from 200 institutions.
We are also committed to providing investors with regular announcements of significant events affecting the Group, including its business activity and financial performance. This information is communicated on our website through results webcasts, analyst presentations, property videos, press releases and interviews with senior executives.
Our AGM provides an opportunity to communicate and answer questions from private and institutional shareholders. The whole Board is available before the meeting for shareholders to meet with directors on a one-to-one basis.
We know that remuneration plays an important retention role and needs to be competitive with other employment opportunities.
This is especially critical at a time in the London property cycle where demands on Executive Directors and employees are high. We are well aware of the scarcity value of proven performers, particularly those with strong development or leasing capabilities.
Our policy is to provide effective incentives for exceptional Group and individual performance. To achieve this, we base the corporate element of executive and employee reward on a small number of key performance indicators (KPIs), which are fully aligned with GPE’s strategy to generate superior portfolio and shareholder returns. These KPIs are:
- Growth in absolute Net Asset Value per share
- Relative Total Shareholder Return
- Relative Total Property Return