Overview and basis of reporting Directors’ training was also assessed as part
Corporate Hiscox Ltd (‘the Company’) is the Bermudian
domiciled holding company for the Group. The
of the annual evaluation described on page 38.
The appointment and removal of the Company
governance Company has a premium listing on the London Secretary is a matter for the Board as a whole.
Stock Exchange. The corporate governance Whilst the Board acknowledges the value that
framework for companies registered in Bermuda knowledge and experience of the organisation
is established by the Company’s constitution can bring, it also recognises the need to
together with Companies Act legislation, and progressively refresh its membership over
for premium listed companies the UK Corporate time. Non Executive Directors will normally
Goverance Code applies. During 2012, and up be expected to serve for six years. They may
to the date of this Report and Accounts, the be invited to serve for longer, but service beyond
Group has complied with the provisions of the nine years is unlikely. Any service beyond six
UK Corporate Governance Code in all material years is subject to particularly rigorous review.
respects. It was announced during the year All Directors are entitled to seek independent
that Robert Childs would succeed Robert professional advice at the Company’s expense.
Hiscox as Chairman. Whilst Mr Hiscox remains A copy of the advice is provided to the Company
Chairman at the date of this report it is clear Secretary who will circulate it to all Directors.
that Mr Childs will not meet the independence
criteria set out in the Code when he is appointed The Board meets at least four times a year
and this is explained below. and operates within established Terms
of Reference. It is supplied with appropriate
The Board of Directors and timely information to enable it to review
The Board comprises four Executive Directors, business strategy, trading performance,
including an Executive Chairman, and eight business risks and opportunities. The Board
independent Non Executive Directors, including of Hiscox Ltd met four times during the year.
a Senior Independent Director. Biographical The Board considers all the Non Executive
details for each member of the Board are Directors to be independent within the meaning
provided on pages 34 to 35. In order to ensure of the UK Corporate Governance Code
that the composition of the Board remains as there are no relationships or circumstances
appropriate the Remuneration and Nomination which would interfere with the exercise of their
Committee monitors the composition of the independent judgement.
Board and is required to consider the balance of
skills, experience, independence and knowledge The Board’s Terms of Reference include
before any appointment is made and this is also a Schedule of Matters Reserved for Board
reviewed as part of the Board evaluation process Decision, a copy of which can be found on
as described on page 38. There is an induction the Group’s website: www.hiscox.com. Aside
process for new Directors. The roles and from the opportunity which the Non Executive
activities of the Chairman and Chief Executive Directors have to challenge and contribute
are distinct and separate. The Chairman is to the development of strategy in the regular
responsible for running an effective Board Board meetings, the Non Executive Directors
including oversight of corporate governance also attended an annual meeting of senior staff.
and overall strategy and meets periodically The Board retains ultimate authority for high-level
with the Senior Independent Director. The strategic and management decisions including:
Chief Executive has responsibility for running setting Group strategy, approving significant
the Group’s business. mergers or acquisitions, approving the financial
statements, declaration of the interim dividend
In accordance with the UK Corporate and recommendation of the final dividend,
Governance Code one Director submits theirself approving Group business plans and budgets,
for appointment, and the remaining Directors approving major new areas of business,
submit themselves for re-appointment, at approving capital raising, approving any bonus
the Annual General Meeting of the Company. or rights issues of share capital, setting Group
The external commitments of the Directors are investment guidelines, approving the Directors’
disclosed in their profiles on pages 34 to 35. Non remuneration, approving significant expenditure
Executive Directors are appointed for a specified or projects, and approving the issue of share
term. Their terms of appointment state that their options. The Board has, however, authorised
continuation in office is contingent upon their the boards of the trading entities and business
satisfactory performance and prescribe the divisions to manage their respective operational
time commitment required of them in order to affairs, to the extent that Company Board level
discharge their duties. The terms also state that approval is not required.
appropriate preparation time is required ahead
of each meeting. A review of the remuneration The Board’s committees
of the Non Executive Directors, which does The Board has appointed and authorised
not include performance-related elements, a number of committees to manage aspects
was carried out in 2012 but did not result in any of the Group’s affairs including financial
change. Robert Childs will not receive any further reporting, internal control and risk management.
performance related remuneration once he is Each committee operates within established
appointed as Non Executive Chairman. Directors written terms of reference and each committee
received briefings on solvency regulation at two Chairman reports directly to the Board.
of the Board meetings held during the year.
36 Corporate governance Hiscox Ltd Report and Accounts 2012