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Corporate Governance
Statement of compliance with
the Code of Best Practice
The Company has complied throughout the year with the Provisions of the
Code of Best Practice set out in section 1 of the Combined Code.
Board effectiveness
The directors listed here constituted
the Board throughout the year except that Mr D Michels and Dr C Gibson-Smith
were appointed on 1 January 2003.The Board has a regular schedule of meetings
together with further meetings as required by the ongoing business of
the Company. There is a formal schedule of matters reserved for Board
decision.
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Attendance at Board Meetings
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| Mr J H Ritblat |
7 |
| Mr D A Higgs |
8 |
| Mr C Metliss |
7 |
| Mr J H Weston Smith |
8 |
| Mr N S J Ritblat |
8 |
| Mr M J Cassidy |
8 |
| Mr R E Bowden |
8 |
| Mr R W A Swannell |
7 |
| The Lord Burns |
8 |
| Mr G C Roberts |
8 |
| Dr C Gibson Smith* |
2 |
| Mr D Michels* |
2 |
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There were eight meetings during the year.
*Three meetings held since appointment to the Board on 1 January 2003.
As required for Combined Code compliance in companies where the chairman
and managing director roles are combined, there is a clear division of
responsibilities at the head of the Company as shown in the details of
directors, and a strong and independent
non-executive element on the Board. The Audit and Remuneration Committees
are entirely composed of independent non-executive directors.The Nomination
Committee which is responsible for making recommendations to the Board
on all new Board appointments consists of the six non-executive directors
together with Mr John Ritblat and Mr Weston Smith. Mr Higgs is Deputy
Chairman and Chairman of the Remuneration Committee. Dr Gibson-Smith is
the Senior non-executive director and is Chairman of the Nomination Committee.
Lord Burns is Chairman of the Audit Committee.
The roles of Chairman and Chief Executive will be split not later than
the time of the 2004 Annual General Meeting. It is the Board’s
intention to appoint a Chief Executive after a search process conducted
by the Nomination Committee, which will include internal and external
candidates. Mr John Ritblat will continue as Chairman for a period after
the appointment of the Chief Executive to ensure the orderly succession
and management of the Company.
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Attendance at Nomination Committee
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| Mr J H Ritblat |
2 |
| Mr D A Higgs |
2 |
| Mr J H Weston Smith |
2 |
| Mr M J Cassidy |
2 |
| Mr R W A Swannell |
2 |
| The Lord Burns |
2 |
| Dr C Gibson Smith* |
1 |
| Mr D Michels* |
1 |
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There were two meetings during the year.
*One meeting held since appointment to the Committee on 24 March 2003.
Under the Articles of Association of the Company, each director retires
at the third annual general meeting after the general meeting at which
he was last elected.
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Non-executive Directors
The Board considers that Mr Higgs, Mr Cassidy, Mr Swannell, the Lord Burns,
Mr Michels and Dr Gibson-Smith are independent non-executive directors.
Dr Gibson-Smith and Mr Michels are proposed for re-election by shareholders
having been appointed during the year. Their details are set out here.
Remuneration Policy and Committee
Details of the Group remuneration policy are set out in the Remuneration
Report.
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Attendance at Remuneration Committee
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| Mr M J Cassidy* |
3 |
| Mr D A Higgs |
4 |
| Mr R W A Swannell* |
3 |
| The Lord Burns |
3 |
| Dr C Gibson Smith** |
1 |
| Mr D Michels** |
1 |
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There were four meetings during the year.
*Three meetings held during Committee membership to 24 March 2003.
**One meeting held since appointment to the Committee on 24 March 2003.
Investor Relations
The Company values its dialogue with both institutional and private investors
and has a proactive approach to its relationship with them. There is a
regular two-way communication with investors and analysts as well as presentations
after the interim and preliminary results and site visits.
The website www.britishland.com
enables all shareholders to access the results presentations and detailed
information on the Company and its portfolio.
Shareholders are invited to write in to the Chairman (or any other Director)
and express their views on any issues of concern at any time. Shareholders
can also attend the Annual General Meeting (AGM) at which they have an
opportunity to ask questions and the Chairman presents a review of the
results and the current business activity. The Chairmen of the Audit,
Nomination and Remuneration committees are also available at AGMs to take
any relevant questions.
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Going concern
After making enquiries and examining major areas which could give rise
to significant financial exposure, the directors are satisfied that no
material or significant exposures exist other than as reflected in these
financial statements and that the Group has adequate resources to continue
its operations for the foreseeable future. For this reason they continue
to adopt the going concern basis in preparing the accounts.
Statement of Directors' responsibilities
The directors are required to prepare financial statements which comply
with the Companies Act 1985 on a going concern basis (unless inappropriate)
and which give a true and fair view of the state of affairs of the Company
and the Group as at the end of the financial year and of the profit or loss
for that period. In preparing those financial statements, the directors
are required to:
- select suitable accounting policies and then apply them consistently;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable accounting standards have been followed,
subject to any material departures disclosed and explained in the financial
statements; and
- prepare the financial statements on the going concern basis unless
it is inappropriate to presume that the Group will continue in business.
The directors are responsible for ensuring that proper and adequate accounting
records have been maintained and that reasonable procedures have been
followed for safeguarding the assets of the Group and for preventing and
detecting fraud and other irregularities.
The directors are also responsible for the Group's system of internal
controls, which is designed to meet the Group's particular needs and the
risks to which it is exposed.
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Auditors and Valuers
The Audit Committee meets with the auditors at least three times a year
to discuss with them the scope and conclusions of their audit. The Committee
is specifically charged under its terms of reference with considering
matters relating to the audit appointment, the independence and objectivity
of the auditors, and reviewing the results and effectiveness of the audit.
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Attendance at Audit Committee
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| Mr R W A Swannell* |
2 |
| Mr D A Higgs* |
2 |
| Mr M J Cassidy* |
2 |
| The Lord Burns |
3 |
| Dr C Gibson Smith** |
1 |
| Mr David Michels** |
1 |
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There were three meetings during the year.
*Two meetings held during Committee membership to 24 March 2003.
**One meeting held since appointment to Committee on 24 March 2003.
With respect to other services, provided by the auditors the following
framework is in place:
- Audit related services - The auditors are one of a number of firms
providing audit related services, which include formal reporting relating
to borrowings, shareholder and other circulars and various other regulatory
reports and work in respect of acquisition and disposals. Where they
must carry out the work because of their office or are best placed to
do so, the auditors are selected. In other circumstances the selection
depends on which firm is best suited;
- Tax Advisory - The auditors are one of a number of firms that provide
tax advisory services, including the preparation and submission of tax
returns. The selection depends on who is best suited in the circumstances;
- General Consulting - The auditors do not provide general consultancy
services except in rare circumstances, and then only after consideration
that they are best placed to provide the service and that their independence
and objectivity would not be compromised.
An analysis of fees paid to the auditors is set out here.
The Company employs ATIS REAL Weatheralls (formerly Weatherall Green &
Smith) as External Valuers to provide an independent valuation for accounting
purposes of the Group's properties and their report for the wholly owned
properties is produced here. CB
Richard Ellis BV and Jones Lang Lasalle value the Group's overseas properties,
FPD Savills value certain residential properties. The instructions to
ATIS REAL Weatheralls are in accordance with the Appraisal and Valuation
Manual of The Royal Institution of Chartered Surveyors and appear here.
ATIS REAL Weatheralls do not act in any other material capacity for British
Land and their fees for other services are less than 10% of their fees
for valuation services.
The arrangements with auditors and valuers have been approved by the Audit
Committee and are regularly reviewed in the light of changing requirements
and best practice.
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