Nomination Committee

Chairman’s Overview

The Committee has focused on strengthening, broadening, balancing and understanding the range of skills, experience and diversity on the Board, its Committees and below Board level.

This year we have secured important appointments and overseen a number of changes to the composition of the Board. Andy Halford joined the Board in January as a non- executive director to succeed Jeremy Darroch as Chairman of the Audit Committee when he steps down from the Board on 19 June 2013. John Dixon, formerly Executive Director, Food was appointed to take charge of General Merchandise, following Kate Bostock’s departure from the Company in September 2012. Steve Rowe was appointed to the Board to succeed John as Executive Director, Food. Prior to his appointment to the Board, Steve had held a number of senior management roles, most recently as Head of Retail. Steve’s appointment demonstrates progress against the Committee’s focus on succession and development of internal talent below Board level. In addition Steven Holliday has agreed to remain on the Board for a further year to ensure continuity. On 21 May we announced that Steven Sharp, Executive Director, Marketing will be retiring from business. He will step down from the Board at the 2013 AGM and will continue to work in the business as Creative Director until 28 February 2014. Patrick Bousquet-Chavanne will take over responsibility for marketing and will be put forward for election to the Board as Executive Director, Marketing and Business Development at the 2013 AGM.

In conjunction with these appointments, we have also reviewed our Committee composition during the year, recommending the appointment of Andy Halford as a member of both the Nomination and Audit Committees

The lack of women on boards remains a significant focus for companies and regulators around the world. We are committed to increasing the participation of women across all levels of our business, not least the Board, however, we continue to view diversity in its broadest sense, and seek to ensure that this remains a significant feature of our Board. We have made progress against many of the objectives which we set out in our Board diversity policy which we published for the first time in last year’s Annual Report. We have reported against each of these objectives further below.

Board diversity policy

Last year we published our first Board diversity policy, which set out our targets and objectives to ensure that diversity, in its broadest sense, remains a central feature of the Board. This year, in line with best practice, we are reporting against each of the objectives in the policy:

Maintain a level of at least 30% female directors on the Board over the short to medium term

The number of women on the Board has fallen since last year from 31% to 21%, below the 30% target we set ourselves. This reduction resulted from the departure of Kate Bostock and the subsequent appointments to the Board of Steve Rowe as Executive Director, Food and Andy Halford as a non-executive director. However, the figure will increase to 23% following the departure of Jeremy Darroch on 19 June 2013. A number of women were shortlisted and interviewed for the non-executive director position and we remain committed to increasing the representation of women on the Board. However, all appointments will continue to be based on merit, measured against objective criteria and the skills and experience the individual offers.

Assist the development of a pipeline of high-calibre candidates by encouraging a broad range of senior individuals within the business to take on additional roles to gain valuable board experience

A number of internal initiatives are underway to actively develop, nurture and strengthen a pipeline of talent through the business, including:

  • a comprehensive talent review presented to the Board annually;
  • the introduction of our internal Leadership Development Service, which partners key talent across the business and assists them in focusing and broadening their skill sets and experience for future opportunities. Initiatives include assisting individuals to gain valuable board experience through non-executive roles outside M&S, primarily with NHS Trusts;
  • access to International Business School training;
  • executive coaching schemes;
  • senior management sponsored schemes;
  • non-executive director mentor schemes.

Consider candidates for appointment as non-executive directors from a wider pool, including those with little or no listed company board experience

The Nomination Committee works closely with our executive search agency, JCA, in drawing up long and short lists of candidates who offer a full range of experience and skills.

In searching for our most recent non-executive director, we identified and interviewed a wide and diverse selection of candidates, many of whom were women. All candidates were measured against our agreed criteria, which in this case included the necessary skills and experience to succeed Jeremy Darroch as Chairman of the Audit Committee.

Ensure ‘long lists’ of potential non-executive directors include 50% female candidates

The Board is committed to ensure high performing women achieve greater exposure to the nomination committees of FTSE 100 companies, which is why we have committed to ensuring that all of our non-executive director long lists in the short to medium term include 50% female candidates. During the year, one independent non-executive director was appointed to the Board. As part of that process and in conjunction with our executive search firm we ensured that at least 50% of the candidates on the long list were women.

Only engage executive search firms who have signed up to the voluntary Code of Conduct on gender diversity and best practice

The Board supports the aims of the seven principles of the Executive Search Firms Voluntary Code of Conduct on gender diversity. We only engage executive search firms who are signatories to this code. We continued to work closely with JCA during the year, who are committed to supporting us in increasing the representation of women on the Board. The Board confirms that JCA has no other connection with the Company.

Report annually against these objectives and other initiatives taking place within the Company which promote gender and other forms of diversity

The Board remains committed to reporting against the objectives in the Policy. A number of business wide initiatives have aimed at promoting gender and other forms of diversity:

  • promoted diversity in all of its forms through the Company’s Diversity Forum, which meets quarterly. It reviews diversity across the business, establishes internal measures and targets and sets future challenges (currently looking at the pipeline of women through the business);
  • hosted a series of Women’s Breakfasts. Laura Wade-Gery hosted a roundtable discussion on women in business as part of International Women’s Day;
  • launched MBA Leadership Programme to recruit and develop talented MBA graduates from international business schools;
  • pioneered flexible working policies. M&S champions a culture where some of the most senior employees work flexibly. For example Belinda Earl, recently appointed as Style Director works a 2/3 day week;
  • work with our suppliers across the globe to ensure women are treated fairly and equally;
  • proactively encourage an inclusive culture through the Marks & Start initiatives, including the most recent Marks & Start Logistics programme, which works specifically to get disabled people into the workforce at our distribution centres.

Report annually on the outcome of the Board evaluation, the composition and structure of the Board as well as any issues and challenges the Board is facing when considering the diverse make-up of the Company

We continue to regard the Board and Committee evaluation process as an important means of monitoring our progress as a Board. Further details on how we have progressed during the year and details of the 2013/14 Action Plan can be found in the Effectiveness section. We continue to work closely on the succession of executive directors, identifying the high-calibre talent across the business. We have also continued the process of progressively refreshing the make-up of the non-executive directors, both vital elements in enhancing the Board’s diversity.

The Board diversity policy helps to keep diversity at the front of the Board’s mind when considering its composition, whilst also driving initiatives across the business. As we continue to pursue our international strategy it is ever more important to ensure the Board has international experience and outlook and that the management is reflective of the customers and communities which we serve. Much is talked about gender diversity and we remain committed to achieving our target of 30% female representation on the Board in the short to medium term. The development of a strong and diverse pipeline of senior management including measures to assist those talented women throughout the business to rise to the highest levels continues to be an area on which the Board is focused.