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As approved by the Nomination Committee on 24 November 2023
The Board of Directors (the “Board”) of Halfords Group plc (the “Company”) has established, in line with the UK Corporate Governance Code 2018, (the “Code”), a Committee of the Board, henceforth known as the Nomination Committee (the “Committee”).
1.1. Members of the Committee shall be appointed by the Board, and save for the Chair of the Board, shall comprise only of independent Non-Executive Directors. No Executive Director may be a member of the Committee and the Committee shall comprise at least three Directors.
1.2. Members of the Committee shall be appointed by the Board on the recommendation of the Nomination Committee in consultation with the Chair of the Committee and shall be for a period of up to three years, which may be extended for up to two additional three-year periods, provided the Director still meets the criteria for membership of the Committee.
1.3. Only members of the Committee have the right to attend Committee meetings. However, other individuals such as the Chief Executive Officer, the head of Human Resources and external advisers may be invited to attend for all or part of any meeting, as and when appropriate.
1.4. The Board shall appoint the Committee Chair who should be either the chair of the Board or an independent Non-Executive Director. In the absence of the Committee chair and/or an appointed deputy, the remaining members present shall elect one of themselves to chair the meeting from those who would qualify under these terms of reference to be appointed to that position by the Board (this should usually be the Senior Independent Director). The Chair of the Board shall not chair the Committee when it is dealing with the matter of succession of the chair of the Board.
1.5. The members of the Committee shall be provided with appropriate and timely training, both in the form of an induction programme for new members and on an ongoing basis for all members.
2.1. The Company Secretary, or their nominee, shall act as the secretary of the Committee and will ensure that the Committee receives information and papers in a timely manner to enable full and proper consideration to be given to issues.
3.1. The quorum necessary for the transaction of business shall be two members, both of whom must be independent Non-Executive Directors.
3.2. In the event that a meeting of the Committee is required but a quorum might not be secured, an existing member of the Committee shall be empowered to appoint a substitute to attend such meeting in consultation with the Chair of the Committee.
3.3. Members may participate in a meeting of the Committee by means of a conference telephone, video conferencing facility or other suitable communications equipment.
3.4. Any decision of the Committee shall be taken on a simple majority basis. The Chair of the Committee shall have a casting vote in the event of equality in voting.
4.1. The Committee is authorised by the Board to determine the Companies policies within its Terms of Reference.
4.2. The Committee is Authorised to seek any information it requires from any employee of the Company and all employees shall be directed to co-operate with any request made by the Committee, provided that their role in providing such co-operation is clearly separated from their role within the Company.
4.3. The Committee should have oversight of the Group as a whole and, unless required by other regulation, carry out the duties below for the parent company, major subsidiary undertakings and the Group as a whole, as appropriate.
4.4. The Committee may sub-delegate any or all of its powers and authority as it sees fit, including, without limitation, the establishment of sub-committees to analyse particular issues and to report back to the Committee.
5.1. The Committee shall meet at least twice each financial year at appropriate intervals and otherwise as required.
5.2. Prior to the commencement of each financial year, the Chair of the Committee and the Secretary shall review the frequency of and the dates for the Committee’s meetings for the subsequent financial year and propose such dates for agreement by other members of the Committee.
5.3. Outside of the formal meeting programme, the Committee Chair will maintain a dialogue with key individual involved in the Company’s governance.
6.1. Meetings of the Committee shall be called by the Secretary of the Committee at the request of the Committee Chair or any of its members, no one other than a Committee member is entitled to attend meetings of the Committee, but other individuals such as Executive and Non-Executive Directors, senior management and external advisors may be invited to attend for all or part of any meeting as and when appropriate, particular care being taken to recognise and avoid, any conflicts of interest.
6.2. Unless otherwise agreed, notice of each meeting confirming the venue, time, and date together with an agender of items to be discussed, shall be forwarded to each member of the Committee and any other person required to attend no later than five working days before the date of the meeting. Supporting papers should be sent to Committee members and to other attendees, as appropriate at the same time.
7.1. The Secretary shall minute the proceedings and resolutions of all Committee meetings, as well as keeping appropriate records including the names of those present and in attendance.
7.2. Draft minutes of the Committee meetings shall be circulated to all members of the Committee. Once approved, minutes should be circulated to all other members of the Board by the Secretary unless, exceptionally, it would be inappropriate to do so.
8.1. The Committee Chair, or appointed deputy in their absence, shall attend the Company’s Annual General Meeting to answer any shareholder questions on the Committee’s activities. In addition, the Committee Chair should seek engagement with shareholders on significant matters related to the Committee’s areas of responsibility.
9.1. The Committee should carry out the duties below for the parent Company, major subsidiary undertakings and the Group as a whole, as appropriate.
9.1. The Committee shall regularly review the structure, size and composition (including the skills, knowledge, experience and diversity) of the Board (with particular regard to the balance of executive and Non-Executive Directors, including independent Non-Executive Directors) and make recommendations to the Board with regard to any changes it considers necessary.
9.2. The Committee shall ensure plans are in place for orderly succession to Board and senior management positions, and oversee the development of a diverse pipeline for succession, this should be based on merit and objective criteria with due regard to promote diversity of gender, social and ethnic background and cognitive and personal strengths, taking into account the challenges and opportunities facing the Company and the skills and experience needed within the Company and on the Board.
9.3. The Committee shall keep under review the leadership needs of the organisation, both Executive and Non-Executive, with a view to ensuring the continued ability of the organisation to compete effectively in the marketplace.
9.4. The Committee shall keep up-to-date and fully informed about strategic issues and commercial changes affecting the Company and the market in which it operates.
9.5. Be responsible for identifying and nominating for the approval of the Board, candidates to fill Board vacancies as and when they arise.
9.6. Before any appointment is made by the Board, evaluate the balance of skills, knowledge, experience and diversity on the Board and, in the light of this evaluation, prepare a description of the role and capabilities required for a particular appointment and the time commitment expected.
In identifying suitable candidates the Committee shall where appropriate:
• 9.6.1. use open advertising or the services of external advisers to facilitate the search;
• 9.6.2. consider candidates from a wide range of backgrounds;
• 9.6.3. consider candidates on merit and against objective criteria, having due regard to the benefits of diversity on the Board and taking care that appointees have enough time available to devote to the position; and
• 9.6.4. Consider other demands on a Directors’ time and to ensure that all significant commitments are disclosed with an indication of the time involved prior to appointment.
9.7. Prior to the appointment of a Director, other significant time commitments should be disclosed and any additional future commitments should not be undertaken without prior approval of the Board. The proposed appointee should also be required to disclose any other business interests that may result in a conflict of interest. These must be authorised by the Board prior to appointment and any future business interests that could result in a conflict of interest must not be undertaken without prior authorisation of the Board.
9.8. Ensure that, on appointment to the Board, Non-Executive Directors receive a formal letter of appointment setting out clearly what is expected of them in terms of time commitment, Committee service and involvement outside Board meetings.
9.9. Review the results of the Board performance evaluation process that relate to the composition of the Board and succession planning.
9.10. 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.
9.11. Work and liaise as necessary with other Board committees, ensuring the interaction between committees and with the Board is reviewed regularly.
The Committee shall also make recommendations to the Board concerning:
9.12. Any changes needed to the succession planning process if its periodic assessment indicates the desired outcomes have not been achieved.
9.13. Suitable candidates as new Directors, the role of Senior Independent Director and succession for existing Directors.
9.14. Membership of the Audit, Remuneration, Nomination and Environmental Social and Governance Committees, and any other Board Committees as appropriate, in consultation with the Chair of those Committees.
9.15. The re-appointment of Non-Executive Directors 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 knowledge, skills and experience required.
9.16. The re-election by shareholders of Directors under the annual re-election provisions of the Code or the retirement by rotation provisions in the Company’s articles of association, having due regard to their performance and ability, and why their contribution is important to the Company’s long-term sustainable success in the light of the skills, experience and knowledge required and the need for progressive refreshing of the Board, taking into account the length of service of individual Directors, the chair and the Board as whole.
9.17. 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 Company subject to the provisions of the law and their service contract.
9.18. The appointment of any Director to executive or other office.
9.19. Proposals on any area, that it deems appropriate, within its remit and where it believes action or improvement is necessary.
9.20. Proposals concerning plans for succession for both Executive and Non-Executive Directors and in particular for the key roles of Chair and Chief Executive.
10.1. The Committee Chair shall report to the Board after each meeting on the nature and content of its discussion, recommendations and action to be taken.
10.2. The Committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed, and adequate time should be made available for Board discussion when necessary.
10.3. The Committee shall produce a report to be included in the Company’s annual report describing the work of the Nomination Committee, including:
• 10.3.1. the process used in relation to appointments, its approach to succession planning and how both support the development of a diverse pipeline; and
• 10.3.2. how Board evaluation has been conducted, the nature and extent of an external evaluator’s contact with the Board and individual Directors, the outcomes and actions taken, and how it has influenced or will influence Board composition;
• 10.3.3. the policy on diversity and inclusion, its objectives and linkage to Company strategy, how it has been implemented and progress on achieving the objectives; and
• 10.3.4. the gender balance of those in the senior management team and their direct reports.
10.4. If an external search consultancy has been engaged, it should be identified in the annual report alongside a statement about any other connection it has with the Company or individual Directors.
11.1. The Committee shall have access to sufficient resources in order to carry out its duties, including access to the Company Secretariat for advice and assistance as required.
11.2. Be provided with appropriate and timely training, both in the form of an induction programme for new members and on an ongoing basis for all members.
11.3. Give due consideration to all relevant laws and regulations, the provisions of the Code and associated guidance, the requirements of the FCA’s Listing Rules, Prospectus Rules and Disclosure Guidance and Transparency Rules sourcebook and any other applicable rules, as appropriate.
11.4. Ensure that a periodic evaluation of the Committee’s own performance is carried out.
11.5. At least annually, review the Committee’s 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.
11.6. The Committee is authorised by the Board to obtain such external legal or other independent professional advice as it considers necessary to undertake its duties and to secure the attendance of any such advisers at any meetings of the Committee. (The Committee is exclusively responsible for establishing the selection criteria for such advisers and their appointment and Terms of Reference. The appointment and performance of the advisers shall be reviewed by the Committee on a regular basis and at least annually.)