Corporate Governance

Governance structure

Government Structure

The role of the Board and the Committees

The Board is responsible for delivering sustainable shareholder value over the long term and the overall financial performance of the Group. It sets the strategic direction and provides leadership and direction through effective delegation, oversight and review. The Board determines the Group’s risk appetite and the risk management framework and is also responsible for corporate governance and setting the tone from the top.

The Board delegates certain responsibilities to its principal Committees to assist it in carrying out its functions of ensuring independent oversight. Our principal Board Committees’ constitutions include independent Non-Executive Directors and play a key role in supporting the Board. A detailed report on the activities undertaken by each Committee is outline in our Annual Report.

The Board delegates the implementation of strategy and day-to-day management of the Group’s operations to the Executive Committees.

Regulated Activities

A number of the Group’s businesses include regulated activities and the Group has several regulated subsidiaries. The main such subsidiary is Automobile Association Insurance Services Limited (AAISL), which has a board which includes three independent non-executive directors. The Board works closely with the AAISL board to ensure that appropriate governance is followed in respect of all regulated Group activities.

Information Flow and Decision making

Our governance structure aims to enable appropriate, effective decision making with clear accountabilities. It sets out how the business is managed and operated at all levels and across all business areas. It aims to ensure that the risk profile of the business reflects the strategic objectives of the business, with the ultimate aim of protecting the business from reputational or operational damage. This structure dovetails with the governance arrangements of the regulated subsidiaries in the Group.

A key principle of the framework is the delegation of operational management to the Executive Committee with a matrix of authorities setting out how this is further delegated through the organisation.

The Executive management team gives strategic focus and is responsible for managing the operational and financial performance of the Group by coordinating the work of the specialist business areas. This enables the efficient and effective day to day operation of the Group’s businesses.

The Board is kept up to date with developments in the business, including the work of the leadership teams, through the Executive Chairman and Chief Financial Officer’s regular reports, which are discussed in detail at each Board meeting. Sufficient time is given both before and at the end of each Board meeting for the Executive Chairman to meet privately with the Senior Independent Non-Executive Director and Non-Executive Directors to discuss any matters.

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