Company organisation

The Board currently comprises six executive directors including Peter Job, the Chief Executive, and eight independent non-executive directors including Sir Christopher Hogg who is the Chairman and who thus has responsibility for running the Board. Michael Green, who joined the Board as a non-executive director in July 1992 and who has served two three-year terms, has decided not to stand for re-election at the forthcoming annual general meeting. The directors record their warm appreciation for his contribution to the Board. The Board has not identified a senior independent non-executive director because it considers such an appointment to be unnecessary at present.

The Board carries the ultimate responsibility for the conduct of Reuters business. Its regular meetings take place every two months and, in addition, it has an annual strategy review meeting. Each year the directors, other than the Chairman, meet to review the role and performance of the Chairman and once a year the Chairman and the non-executive directors meet to consider the performance of the executive directors. In 1998 the Board also introduced a formal self-assessment of its effectiveness. It intends to undertake these self-assessments regularly and to include in them consideration of whether the directors have any training requirements. The executive directors present the annual budget to the Board for its approval. Actual results are reported to each scheduled meeting of the Board with appropriate trend analysis. Regular and ad hoc reports and presentations to the Board ensure it is supplied, in a timely fashion, with the information it needs. Non-executive directors receive a series of briefings about Reuters when they join the Board and they periodically visit Reuters offices throughout the world where they are briefed on various aspects of the company’s operations. All the directors have access to the company secretary and a procedure exists for directors in the furtherance of their duties to take independent professional advice if necessary at the company’s expense.

The Executive Committee, chaired by the Chief Executive, was responsible for the management of the business until the end of 1998. It met five times during the year. With effect from 1 January 1999 the company was reorganised into two business divisions, Reuters Information and Reuters Trading Systems and the geographical units of the company were brought together into a global sales and operations group responsible for the sale, installation, delivery and support of divisional products. Instinet continues to operate as an autonomous subsidiary. As part of the reorganisation a new committee structure was introduced and the Executive Committee was dissolved. The senior corporate management group, the Group Executive, now comprises the executive directors, Geoffrey Weetman (Director of Human Resources) and Stephen Mitchell (General Counsel and Company Secretary). It will normally meet 11 times a year. Amongst other senior management committees, there are the Strategy Review Committee, which has taken over from the Executive Committee the task of reviewing corporate strategy, plans and performance, and the Operations Committee, which has assumed operating responsibilities previously handled by the Executive Committee. See the functions of the 20 Members of the Strategy Review Committee.

The three principal committees of the Board are the Remuneration Committee, the Audit Committee and the Nomination Committee. The Board sets the terms of reference of these committees. The members of the Remuneration Committee and the Audit Committee are Bob Bauman, Sir John Craven, Sir Christopher Hogg, Roberto Mendoza, Dick Olver, Charles Sinclair and Sir David Walker. These directors, together with Michael Green and Peter Job, are the members of the Nomination Committee which is chaired by Sir Christopher Hogg and which makes recommendations to the Board on the appointment of directors.

The schedule of matters reserved for the Board’s decision includes treasury investment, borrowing and hedging policies, significant capital expenditure or disposals of assets, and all investments, acquisitions or disposals which are not in line with strategies previously adopted by the Board.

Also reserved for Board decision is any transaction by a group company likely to require listing particulars or a tender offer to be filed with the London Stock Exchange or to require a filing under the US federal securities laws with the SEC.

The Board must approve any agreement with any other party that entails or may involve the assumption of ongoing business risks, liabilities or commitments equal to or exceeding £50 million in aggregate during the life of the contract.

Non-financial risks, including possible damage to Reuters reputation as a leading news provider, or threats to the reliability of its computer systems, are examined by a Business Risks Steering Group which periodically reports to the Board on the management of risks throughout the group. There is also a dedicated risk management function at Instinet.

In 1997, Reuters established a compliance programme to consolidate and extend company compliance activities. During 1998, the programme was extended and refocused in a number of ways. A Compliance Overview Group has been established, chaired by the Finance Director. Its members include the heads of the compliance group, business risks, the legal department and the internal audit department. Its terms of reference require it to ensure that Reuters has an efficient and effective system for ensuring compliance, and that it harmonises the efforts of the various activities represented by its members.

The directors are bound by the company’s Articles to pay due regard to the Reuter Trust Principles. The Board views these principles as central to the company’s standing and commercial success and works closely with the Reuters Founders Share Company Limited to safeguard them. See the Trust Principles and other relevant information.

Company technical policies provide standards for the integrity, confidentiality and availability of internal and external information services and the systems on which they operate. These policies, together with the company’s Code of Conduct which sets out the standards of behaviour and integrity which all employees are expected to observe, are readily available on the company’s internal information database.