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Board Committees

Committees of the Board support the Board in the fulfilment of its duties. Certain strategic decisions and authorities of the Company are reserved as matters for the Board with other matters, responsibilities and authorities delegated to its Committees.

Audit Committee

The Audit Committee oversees, monitors and makes recommendations as appropriate in relation to the Group's financial statements, accounting processes, audit (internal and external), risk management and internal controls and matters relating to fraud and whistleblowing. It is responsible for the functions specified by DTR 7.1.3R.

The Board considers that the Committee has accounting and/or related financial management expertise in its membership and at least one member is an audit committee expert. The Board further considers that each member of the Committee is financially literate and that the Committee’s composition complies with the independence rules of the New York Stock Exchange and the UK Corporate Governance Code. Between them, the members of the Committee possess significant logistics, distribution, commercial (including e-commerce), financial, human resource and listed company skills and expertise gained in large international businesses which are relevant to an international specialist distribution company listed on both the London Stock Exchange and the New York Stock Exchange.

The Audit Committee is made up of five Independent Non Executive Directors and, ordinarily, has five scheduled meetings each year.

 

Members

 

Member Role
Alan Murray Senior Independent Non Executive Director (Committee Chairman)
Tessa Bamford Independent Non Executive Director
Cathy Halligan Independent Non Executive Director
Brian May Independent Non Executive Director
Suzanne Wood Independent Non Executive Director

Role and responsibilities

The Audit Committee has wide-ranging oversight of responsibilities assigned to it by the Board. 

These are to:

  • assist the Board to fulfil its responsibilities relating to external financial reporting and associated announcements including:
    • Interim and annual financial statements, including financial reporting requirements;
    • Interim and annual results announcements made to the London Stock Exchange and the New York Stock Exchange;
  • review key accounting and auditing issues;
  • review the effectiveness of the Company’s internal control and risk management procedures;
  • report regularly to the Board on compliance in relation to the business activities for which it has responsibility within its terms of reference;
  • ensure that it has an agenda which is linked to events in the Company’s financial calendar;
  • review the Company’s policies and procedures relating to governance, risk and control and, in addition to the regular items, each member of the Committee may request reports on matters of interest;
  • establish policies and procedures for the Committee’s pre-approval of permitted non-audit and tax services ;
  • monitor independence, objectivity and compliance with ethical and regulatory requirements in relation to external audit;
  • review the effectiveness of the external auditor;
  • recommend the appointment and reappointment of the Company’s external auditors;
  • review at least annually a formal letter provided by the external auditors confirming their independence and objectivity within the context of applicable regulatory requirements and professional standards;
  • review the effectiveness of the internal audit function;
  • review litigation, contingent liabilities and tax matters, including compliance with statutory tax obligations; and
  • monitor fraud reports and the operation of the Company’s whistleblowing policy.


External auditor independence

The Company has policies and procedures in place to ensure that the independence and objectivity of the external auditor are not impaired. These include restrictions on the types of services which the external auditor can provide, in line with the Audit Practices Board Ethical Standards on Auditing. The services which the external auditors cannot be engaged to perform are set out in the Company’s External Auditor Independence Policy and details are provided below:
 

  • book-keeping services related to accounting records or financial statements;
  • design and implementation of financial information systems;
  • appraisal or valuation services, fairness opinions and contributions in kind reports;
  • actuarial services;
  • internal audit outsourcing services;
  • management functions including human resources;
  • broker or dealer, investment adviser or investment banking services; or
  • legal and other expert services unrelated to audit work.
     

When considering the award of non-audit work to the external auditor, an assessment is made to consider if it is more effective for the work to be carried out by the external auditor who has existing knowledge of the Company and all appointments are made on a case-by-case basis. The prior consent of the Audit Committee is required before the Company’s external auditor is appointed to undertake non-audit work. The external auditor will not be appointed to provide non-audit services where the Committee considers it might impair their independence or objectivity in carrying out the audit.

 

Remuneration Committee

The Remuneration Committee reviews and recommends to the Board the framework and policy for the remuneration of the Chairman, the Executive Directors and the Executive Committee, taking into account the business strategy of the Group and how the Remuneration Policy reflects and supports that strategy. The Committee also reviews workforce remuneration and related policies throughout the Group and the alignment of incentives and rewards with culture.

The Committee is made up of the Chairman and four Independent Non Executive Directors, all of whom are independent in accordance with the requirements of Rule 10C-1 under the Securities Exchange Act of 1934, as amended, the rules of the New York Stock Exchange (“NYSE”), and the UK Corporate Governance Code. Committee meetings are both scheduled and ad hoc.

The Committee also seeks internal support from the Group Chief Human Resources Officer, the Group Chief Executive, the Group General Counsel and the Group Company Secretary together with other senior Group employees as necessary. Those who attend by invitation do not participate in discussions that relate to the details of their own remuneration.

 

Members

 

Member Role
Jacky Simmonds Independent Non Executive Director (Committee Chair)
Geoff Drabble Chairman
Cathy Halligan Independent Non Executive Director
Alan Murray Senior Independent Non Executive Director
Tom Schmitt Independent Non Executive Director

 

Role and responsibilities

The Board sets the Company’s Remuneration Policy. The Committee makes recommendations to the Board, within its agreed terms of reference, on the Company’s framework of executive remuneration and its cost. Its responsibilities are to:
 

  • determine, with the agreement of the Board, specific remuneration packages for each of the Executive Directors, the Chairman and the Group Company Secretary;
  • determine the remuneration, based on proposals from the Group Chief Executive, for the members of the Executive Committee (Note: the Chairman and the Executive Directors determine the remuneration of the Independent Non Executive Directors);
  • be responsible for Ferguson’s share incentive schemes for all employees;
  • carry out reviews of overall remuneration and related policies throughout the Group and the alignment of incentives and rewards with culture; and
  • prepare, for the Board's approval, the Remuneration report, which is presented to shareholders at each Annual General Meeting.
     

To reach informed decisions on executive remuneration, the Committee obtains detailed external research on market data and trends from experienced independent consultants.

Remuneration Policy

The current Directors’ Remuneration Policy ("2019 Policy") was approved by shareholders at the 2019 AGM and can be accessed in full using the link below. The 2019 Policy took effect from the date of the 2019 AGM and may operate for up to three years. All remuneration and loss of office payments will only be made if they are consistent with the approved Remuneration Policy in force at the time of payment or otherwise approved by ordinary resolution.

Nominations Committee

The Nominations Committee reviews the structure, size and composition of the Board and its Committees and identifies and nominates suitable candidates to be appointed to the Board (subject to Board approval) and considers succession generally.

The Nominations Committee is made up of the Chairman and eight Independent Non Executive Directors. The Board considers that the Committee’s composition complies with the independence rules of the New York Stock Exchange and the UK Corporate Governance Code. The Committee meets as required.

 

Members

 

Member Role
Geoff Drabble Chairman
Tessa Bamford Independent Non Executive Director
Cathy Halligan Independent Non Executive Director
Brian May Independent Non Executive Director
Alan Murray Senior Independent Non Executive Director
Tom Schmitt Independent Non Executive Director
Nadia Shouraboura Independent Non Executive Director
Jacky Simmonds Independent Non Executive Director
Suzanne Wood Independent Non Executive Director

 

Roles and responsibilities

The Nominations Committee's responsibilities are to:
 

  • regularly review the structure, size and composition of the Board and its Committees;
  • make recommendations with regard to any changes that are considered necessary, both in the identification and nomination of new Directors and the continuation of existing Directors in office;
  • evaluate the balance of skills, knowledge and experience on the Board and its diversity, including gender, and, in light of that evaluation, prepare the description of the relevant role and capabilities required of prospective candidates;
  • make its recommendations to the Board, after a rigorous interview process for shortlisted candidates;
  • retain external search consultants for appointments to the Board; and
  • advise the Board on succession planning for Board appointments, although the Board itself has overall responsibility for succession generally.
     

 

Major Announcements Committee

The Committee meets as required in exceptional circumstances to consider disclosure obligations in relation to material information where the matter is unexpected and non‑routine.

The Major Announcements Committee is made up of six members. The Committee meets as required.

 

Members

 

Member Role
Kevin Murphy  Group Chief Executive (Committee Chairman)
Geoff Drabble Chairman of the Board
Bill Brundage Group Chief Financial Officer
Ian Graham Group General Counsel
Mark Fearon Group Director of Communications and Investor Relations
Alan Murray Senior Independent Non Executive Director

Role and responsibilities

The Committee meets as required to consider the Company’s disclosure obligations in relation to material information where the matter:
 

  • is outside the scope of the authority of the Disclosure Committee; or
  • has been referred to it by the Disclosure Committee as being a matter that may involve an announcement relating to a decision of a strategic nature; or
  • is otherwise of such significance or sensitivity that it ought properly to be considered by the Committee.
     

The Committee’s terms of reference anticipate that it would meet usually only in exceptional circumstances where information has come to light which is of an unexpected, non-routine and material nature.

 

Other Committees

These Committees implement strategic decisions and executive or administrative matters.

Executive Committee

The Executive Committee addresses operational business issues and is responsible for implementing Group strategy and policies, day-to-day management, and monitoring business performance. 

The Executive Committee meets at least 10 times each year. These meetings usually take place prior to Board meetings.

 

Members

 

Member Role
Kevin Murphy Group Chief Executive (Committee Chairman)
Bill Brundage Group Chief Financial Officer
Mike Brooks  Chief Marketing Officer, USA
Bill Brundage Chief Financial Officer, USA 
Jim Cross Senior Vice President, Blended Branches
Chip Devine Senior Vice President, eCommerce and Omni-Channel Business
Ian Graham Group General Counsel
Sammie Long Chief Human Resources Officer
Mike Sajor Group Chief Information Officer
Alex Hutcherson Chief Operating Officer, USA
Jake Schlicher Senior Vice President, Strategic Brand Development
Bill Thees Senior Vice President, Businesses and National Accounts

Role and responsibilities

The Executive Committee responsibilities are: -

  • drive business performance and operational improvements
  • ensure that the corporate culture and values set by the Board are implemented across the Group, that the behaviors expected from associates are clearly communicated and that actual behaviors are aligned with the culture and values
  • develop and recommend to the Board the Group strategy and to monitor progress against the strategy
  • develop and recommend Group policies and standards to the Board and ensure that they are implemented, communicated, and maintained

Meet our Executive Committee

Treasury Committee

The Committee’s role is to consider treasury policy, including financial structures and investments, tax and treasury strategy, policies and certain transactions on behalf of the Group, and to review the performance and compliance of the tax and treasury function, within a framework delegated by the Board.

The Board retains responsibility for treasury and tax strategy. The Committee’s responsibilities are orientated principally towards implementing treasury and tax strategy and policies. The Committee makes recommendations to the Board in matters such as overall financing, strategy and currency exposure.

 

 

Members

 

Members Role
Bill Brundage Group Chief Financial Officer (Committee Chairman)
Jacqui Stewart Group Head of Tax
Phil Scott Group Head of Tax and Treasury
Julia Mattison Head of Group Financial Reporting
Ian Graham Group General Counsel
Richard Winckler
Chief Accounting Officer

Disclosure Committee

The Disclosure Committee meets as required to deal with matters relating to public announcements of the company and the company's obligations under the Listing and Disclosure and Transparency Rules of the UK Listing Authority and EU Market Abuse Regulation.

The Committee also assists in the design, implementation and periodic evaluation of the Company’s disclosure controls and procedures.

Announcements relating to any matters which the Board has designated as reserved matters, or matters of a substantive or strategic nature, are dealt with by the Board or by the Major Announcements Committee.

 

Members

 

Members Role
Bill Brundage Group Chief Financial Officer (Committee Chairman)
Kevin Murphy Group Chief Executive
Ian Graham Group General Counsel
Mark Fearon Group Director of Communications and Investor Relations

Ad hoc committees

The Board may appoint ad hoc committees to facilitate the implementation of its decisions or to consider specific matters in further detail between scheduled meetings. The Board may delegate matters of a substantive nature to a special purpose committee.