The Board sets the strategic direction and risk appetite of the Group and is the ultimate decision-making body for matters of Group-wide strategic, financial, regulatory or reputational significance.
The Board discharges its responsibilities as described in the high-level flow diagram below. A summary of the matters reserved for the Board are also found below.
- Changes relating to capital structure or status as a PLC
- Approval of annual capital plan
- Approval of risk appetite and liquidity risk appetite
- Approval of interim and ﬁnal financial statements, dividends and any signiﬁcant change in accounting policies or practices
- Any share dividend alternative
- Approval of Barclays' Group strategy, medium-term and short-term plans
- Reviewing delivery of the strategy and measure performance against plan
- Major capital projects, investments, acquisitions, mergers or disposals
- Board appointments and removals
- Board Committee establishment and membership
- Succession planning for key positions on the Board
- Charter of expectations of key positions on the Board
- Approval of the framework for determining the policy and specific remuneration of the Chair and executive directors
- Approval of non-executive director remuneration
- Major changes in employee share schemes
- Authorisation for directors’ conflicts or possible conflicts of interest
- Recommendations for appointment or removal of auditors
- Approval of all circulars, prospectuses and significant press releases
- Principal regulatory filings and filings in other jurisdictions as required
- Approval of allotment of shares
- Rules and procedures for dealing in Barclays securities
- Terms of reference and membership of Board committees
- Approval of Board and Board committees performance evaluation process
- Determination of independence of non-executive directors
- Approval of Corporate Governance framework
- Approval of division of responsibilities between the Chairman and Chief Executive
- Appointment (or removal) of Company Secretary and Chief Risk Officer
Roles on the Board
Executive and Non-Executive Directors share the same duties. However, in line with the principles of the UK Corporate Governance Code, a clear division of responsibilities has been established. The Chairman is responsible for:
- leading the Board and its overall effectiveness
- demonstrating objective judgement
- promoting a culture of openness and constructive challenge and debate between all Directors
- facilitating constructive board relations and the effective contribution of all Non-Executive Directors
- ensuring Directors receive accurate, clear and timely information
Responsibility for the day-to-day management of the Group is delegated to the Group Chief Executive Officer who is supported in this role by the Group Executive Committee.
As a Board we have set out our expectations of each Director in Barclays’ Charter of Expectations. This includes role profiles and the behaviours and competencies required for each role on the Board, namely the Chairman, Deputy Chairman (to the extent one is required), SID, Non-Executive Directors, Executive Directors and Committee Chairs. Pursuant to the Charter of Expectations, Non-Executive Directors provide effective oversight and scrutiny, strategic guidance and constructive challenge, whilst holding the Executive Directors to account against their agreed performance objectives. The Non-Executive Directors, led by the Nominations Committee, have primary responsibility for the appointment and removal of the Executive Directors.
The SID provides a sounding board for the Chairman, acts as an intermediary for the other Directors when necessary, and is available to shareholders if they have concerns that have not been addressed through the normal channels.
The Charter of Expectations is reviewed annually to ensure it remains relevant, and accurately reflects the requirements of the Code and the Regulations, and industry best practice.
The Board is empowered through its Articles of Association to delegate all or any of its powers, authorities and discretions to any committee or committees as it thinks fit. The principal Board Committees are the Board Audit Committee, the Board Risk Committee, the Board Nominations Committee and the Board Remuneration Committee
The Board has defined the roles and objectives of each of the Board Committees, and provided specific levels of discretion within which they can operate.
An effective Board is one that delivers for stakeholders. We assess the effectiveness of our Board, its committees and Board members each year, as required by the UK Corporate Governance Code (the Code). Although the Code only requires an externally facilitated evaluation every three years, for each of the past four years we have used the services of an external agency to facilitate the assessment of the effectiveness of the Board. This year, the Nominations Committee decided to ask our SID, with the support of the Company Secretary, to conduct the assessment. They are well placed to do this, having been closely involved in the transition to a new Chairman and the evolving composition of the Board and the way it operates. You can read more about our 2019 process and our progress against the 2018 review in the 2019 Annual Report.
Progress against 2018 Board effectiveness review
The 2018 externally-facilitated effectiveness review outlined the following key recommendations:
- Board size and composition: The 2018 review highlighted that the Board, at 15 members, was large relative to peers and suggested that a Board of 10 to 12 members is optimal, with 8 to 10 Non-Executive Directors, provided that diversity, succession planning and skills mix criteria continue to be met.
2019: The size of the Board was reduced to 11 (post AGM) and is currently 13. The Committee believes that the size of the Board is now more appropriate, with more work to do to reduce it further in size, and that its effectiveness, and the balance of skills, experience and diversity on the Board, have been enhanced during 2019
- Culture, purpose and values: The 2018 review recommended that the Board ensure that the Company’s purpose and values are fully aligned with its culture and that all Directors lead by example and promote the desired culture.
2019: Deep dives have been held by the Board covering purpose, values and culture and considerable progress has been made in relation to these recommendations.
- Director training and development: The 2018 review recommended that enhanced training be provided for Board members and senior executives on UK corporate governance, and that refresher training sessions and more opportunities for site visits be made available.
2019: Training on UK corporate governance has been delivered in 2019 to Non Executive Directors and to key executives, and a new programme of training sessions for Directors has been implemented, with sessions held to date focusing on technical aspects of some of the more complex areas of the business, in particular within the CIB. Opportunities for site visits in the US and the UK have been made available to all Board members.
- Board objectives: The 2018 review recommended that to enable the Board to spend more time on longer-term and strategic issues a short set of annual objectives would help to bring focus to key issues and would result in papers and meetings being more effective.
2019: Through the programme of deep dives, which covers a rolling 18-month period and reflects the Board’s key priorities and objectives, and through the effort to address the deep dive topics effectively in the papers to the Board, the Committee believes that this recommendation has, in substance, been addressed. Time is now devoted to strategy and strategic issues at every meeting of the Board, rather than once a year.
2019 Board effectiveness review
Feedback indicated that recent changes in the composition of the Board have made it more effective, with the new mix of skills and experience enhancing the quality of discussion. Board members commented that meetings are characterised by constructive dialogue on strategic issues, and healthy challenge in an open and collegiate environment. The quality of management’s input to Board meetings is felt to have improved, in part as a result of more active Board engagement in shaping materials for debate. The induction of the new Chairman has been effective, enabling him to quickly understand the organisation and provide effective challenge and a strong platform for inclusive debate. The integration of BBPLC and BPLC board meetings is viewed as efficient, whilst still enabling the appropriate focus on matters relevant to each entity.
The review yielded a number of recommendations, a high level summary can be found within the 2019 Annual Report.
More detail on the findings for each Board Committee can also be found in the 2019 Annual Report.