I am delighted to introduce the Company’s 2015 Corporate Governance Report. I strongly believe that good corporate governance is a key driver of performance and is fundamental to the Group’s long-term success. We therefore endeavour to promote good corporate governance which is embedded within the culture of our organisation and underpins everything we do, rather than simply as the adherence to a set of rules.
The Company’s key operating subsidiary, Sesa Sterlite Limited was renamed Vedanta Limited to harness the value of the Vedanta brand and strengthen the links between our business, communities and stakeholders. The rebranding is a significant milestone and helps to promote a united and aligned identity to enable us to deliver world class excellence with low cost operations and greater value for our shareholders.
We have made encouraging progress during the year on improving the Group’s safety record and reaching our goal of becoming a zero harm environment. Whilst there has been a step change in safety consciousness across the Group, it is disappointing that despite our efforts we had eight tragic fatalities during the year and advancing safety management across the Group remains a key priority of management for the year ahead.
As Chairman, I am responsible for leading the Company’s Board of Directors (the Board or the Directors) and ensuring that it operates effectively to deliver long-term value for shareholders. During the year, we undertook a review of the balance of skills, knowledge and experience on the Board. As Messrs Aman Mehta and Euan Macdonald have both served as Non-Executive Directors on the Company’s Board for over nine years, succession planning has been a key priority. We have been focused on the search for suitable candidates with relevant experience in the natural resources industry to succeed them and successfully appointed Katya Zotova as a Non-Executive Director on 1 August 2014. Ms Zotova has a wealth of experience in the oil & gas industry having previously worked at Royal Dutch Shell and Citigroup’s oil & gas division. Her industry knowledge and experience will be highly beneficial to the Board in developing the Group’s strategy. I am pleased that the Company continues to have a strong, well balanced and diverse Board with a wide range of skills and experience including mining, oil & gas, corporate financial, legal and regulatory experience.
In line with our succession planning requirements, we continue to seek an additional candidate to join the Board with the relevant skills and experience to succeed Mr Mehta as the Chairman of the Audit Committee. As the majority of our businesses are based in India, we feel it would be beneficial to the Company to find candidates who have some experience of doing business in India while maintaining diversity of thought on the Board. We have appointed a Board recruitment consultant to identify suitable candidates with the relevant criteria determined by the Board and we hope to announce further appointments in due course. However, in order to promote smooth transition and orderly succession, we recommend that Messers Mehta and Macdonald be reappointed as Non-Executive Directors for another year until no later than the conclusion of the Company’s 2016 Annual General Meeting. The Nominations Committee undertook a thorough review of Messrs Mehta and Macdonald and concluded that they remain independent and continue to provide rigorous objective and constructive challenge to Board discussions.
We have previously made a commitment to achieve a minimum 25% female representation on the Board by 2015 as we believe that significant benefit can be achieved from a well-balanced and diverse board. We have made progress towards that objective with the appointment of Ms Zotova during the year. We are aware that we can do more in respect of this and it remains a key priority of the Board to make further appointments based on merit taking into account the diversity and other requirements of the Board and candidates’ skills and experience.
The Board also recognises the importance of encouraging diversity in all forms including gender as well as developing employees across the Group to provide for future succession to management roles. We continue to address the historical gender imbalance in leadership roles within the natural resources sector and have made a number of senior female appointments during the year including the President – Group, Sustainability, Corporate Social Responsibility and Communications, the Chief Executive Officer of Zinc International and Group Head of Treasury. Further information on our progress is given in the Nominations Committee report.
Our people are our biggest asset for the delivery of business results and long-term shareholder value. We have renewed our commitment to nurturing and developing talent within the Group and reviewed career growth opportunities, learning and development and reward and recognition programmes within the Group. The ‘Leadership Connect’ programme was started to build the Group’s leadership capability and ensure a pipeline of suitably qualified candidates for future succession to senior management positions within the Group. Another objective of the programme is to create leaders who can drive engagement within their teams to deliver superior performance for the Group.
Following the external facilitation of our Board evaluation last year, we carried out a detailed review of the Board’s effectiveness which was managed wholly in-house this year. This was done through the use of targeted questionnaires and we have produced an action plan to address the issues raised and strengthen our Board processes. Further information on the process and outcome of the evaluation exercise is provided within this report.
The Company’s 2015 Annual General Meeting will be held at 3.00pm on 3 August 2015 at Ironmongers’ Hall and I would encourage you to attend and participate in the meeting.
Executive Chairman13 May 2015
Governance Sections AVAILABLE AS PDF ONLY
- Board of Directors (Section PDF 267kb)
- Executive Committee (Section PDF 151kb)
- Corporate governance report (Section PDF 464kb)
- Audit Committee report (Section PDF 164kb)
- Nominations Committee report (Section PDF 164kb)
- Sustainability Committee report (Section PDF 158KB)
- Statement by the Remuneration Committee Chairman (Section PDF 143kb)
- Directors’ Remuneration Policy report (Section PDF 346kb)
- Annual Report on remuneration (Section PDF 328KB)
- Directors’ report (Section PDF 160kb)
- Directors’ responsibilities statement (Section PDF 36kb)