During 2015, the board met eight times. The board's key activities in 2015 included the following:
In 2014 the board commenced a strategy refresh process, which was anticipated to continue during 2015. The timetable was impacted by the change of our Chief Executive Officer, and the process was placed on hold until James took up the role of Chief Executive Officer. We concluded a thorough review of our strategy during the year, the result of which was presented to investors at a Capital Markets Day held on 19 November 2015.
The board's input into the strategy review process was very effective, with all directors bringing ideas and suggestions based on their backgrounds and experience, and providing challenge to management suggestions where appropriate. Having agreed the new strategic approach, the board now has a key leadership role in supporting its successful implementation in 2016 and beyond, to ensure that we continue to deliver exceptional standards to customers, and long-term sustainable value to shareholders.
Change of Chief Executive Officer
We were sad to say goodbye to Peter Ventress following his decision to retire as Chief Executive Officer. Peter has made a significant contribution to the success of our business, and provided excellent leadership over the six years of his tenure. We commenced a comprehensive search to identify his successor, led by the nomination committee. We were delighted that James, whom we identified as the strongest candidate for the role, agreed to join Berendsen on 1 July 2015 to receive a comprehensive handover from Peter before taking on the role of Chief Executive Officer from 1 August 2015.
This handover period formed part of James' induction process that was designed by the Chairman with the assistance of our Company Secretary and the nomination committee.
In our announcement to the market of James' appointment, we highlighted that James has the right skills and experience to lead Berendsen in the next phase of its development, and we are already seeing this borne out in his significant input into our new strategic approach. We are confident that James will continue the tradition of strong executive leadership at Berendsen. The strong working relationship between Chairman and Chief Executive Officer has continued since James took on the role, with James and the Chairman are already working closely together due to both the handover from Peter and the ongoing strategy review process.
The independent role of our non-executive directors is extremely important to us and we ensure that they are provided with the information, culture and environment in which they are able to both support and offer constructive challenge, to the executive management team. Our programme of non-executive director site visits continued in 2015, and the feedback received from both the non-executive directors and the teams on site is that these visits are viewed positively by all parties.
We continued the approach of holding a number of board dinners during the year, usually ahead of a schedule board meeting. We have found that the dinners provide a more relaxed forum than the formal meetings in which additional debate between directors on complex matters can be conducted. As a result, we have found that the debate at the following formal meeting is usually more focused, with well-formulated constructive views espoused by the non- executive directors.
On 18 December 2015, the Chairman held his annual scheduled meeting with the non-executive directors without the executive management present. A full discussion was held looking back at the board's activities in 2015 and forward to our priorities in 2016. In particular, we discussed the appointment and induction of James Drummond, the performance evaluation process, and the implementation of the new strategy. Although the non-executive directors did not raise anything that had not previously been considered in meetings of the whole board, the session was found to be useful and we agree that it is important for the independent directors to discuss their views in a more private environment.
Non-executive directors' site visit programme
The independent role of our non-executive directors is extremely important to us. We are determined to ensure that they can play an active role in the development and management of our business. We do not believe they can develop a complete picture of how the group operates by simply reviewing board papers and attending board and committee meetings.
In order that our non-executive directors can meet local management teams and strengthen their knowledge and understanding of our local operations, issues and the culture of our group, we require that, at least once a year, they visit one of our sites or attend one of our group events.
In 2015, the board met with the management teams of the newly acquired UK Cleanroom business and German Workwear business. Following the board visit to Munich (Germany) in May 2015, the board approved plans to build a new facility in the Munich area. The meetings in September 2015 included site visits to our new Cleanroom facilities in Newbury (UK), and gave board members detailed insights into the development of our UK Cleanroom operations.
In 2016, the board will meet with the management teams from all business lines to discuss the implementation of our strategy and, will visit our garment design facility, Berendsen Sourcing, in Gothenburg (Sweden).
Our externally facilitated performance evaluation conducted in the latter part of 2014 and early part of 2015 confirmed that the board and its committees operate effectively with all directors contributing to the overall success of the group. In line with our three-year evaluation cycle, the performance evaluation process in 2015 was led by our Chairman with assistance from the Company Secretary. The positive nature of the external evaluation from the previous year allowed us to conduct a more focused evaluation this year, and we focused on establishing the board's view on the appointment and induction process adopted for our new CEO, James Drummond and also understanding whether the non-executive directors agreed with the Chairman's view that our strong governance culture had continued following James' appointment.
No significant issues were raised during the evaluation and that the general consensus of the board is that the governance structure, the board and its committees continue to operate effectively, and the positive culture on the board has been maintained.
See the Processes and Procedures section for more details.
Our remuneration committee conducted a full review of our remuneration policy during 2015. The remuneration committee was keen to await the finalisation of the strategy review so that any amendments to the policy could be matched to our strategy. Now that this is complete, we will be putting our revised policy to shareholders.
Meeting our major shareholders
We have continued to operate a comprehensive investor relations programme during the year with our executive directors meeting investors and analysts regularly, being supported where appropriate by both the Chairman and David Lowden as Senior Independent Director. In addition to the regular programme of investor and analyst updates and presentations, we hosted a shareholder dinner on
26 November 2015 which was attended by five of our major shareholders. We again received positive feedback and see the dinner as a valuable opportunity to understand the views of, and develop constructive relationships with, our major shareholders.
Board priorities in 2016
- Support the implementation of the new strategy
- Continue to develop and maintain best practice standards in corporate governance
- Support the further development of talent and succession planning
- Participate and assist with the review of the group's advisers.