SECTION 7: SUCCESSION PLANNING

200 | Nominating Committee Guide • Ensuring effective communication with the shareholders. • Encouraging constructive relationships within the Board and between the Board and management. • Ensuring Non-Executive Directors (NEDs) contribute effectively and that their contributions are taken into account by the Board. • Promoting high standards of corporate governance. With such a broad range of responsibilities, the Board Chairman needs to be an experienced and committed leader who is highly adaptable, has good communication skills and the relevant knowledge, and is able to dedicate the time required for the role. In particular, he needs to be able to coordinate and lead the Board, and facilitate decision-making. 7.2.2 As part of general succession planning, it is important that the Board clearly determines the tenure of the Board Chairman. It is also good practice for the Board to identify at least one NED from within its ranks who has the right qualities, typically the Lead ID, if available, to cover the role of the Board Chairman in case of an emergency. The prospective candidate should have the respect of his peers, and the time and ability to lead the Board. The candidate can be identified during the annual performance evaluation of the individual directors by the NC. 7.2.3 The Board should discuss the Board Chairman’s succession planning at least once a year. If there is no suitable candidate, it becomes crucial to recruit new directors with the necessary qualities. 7.2.4 The CEO is well-placed to provide input in the succession planning for the Board Chairman because he works closely with the Board Chairman to develop strategies and implement the company’s growth plans. Although the CEO should not control the process nor should he be involved in the selection and decision process, it is important that the Board Chairman and the NC take his inputs into account in the succession planning. 7A-3 7A-4