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STRATEGIC REPORT OVERVIEW Shaftesbury Annual Report 2017

Governance

GOVERNANCE Shaftesbury Annual Report 2017

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Ourpeople

Executive DirectorsBRIAN BICKELL, FCAChief ExecutiveOverall responsibility for implementing the Group’s strategy and day-to-day operationsJoined the Group in 1986 Board appointmentAppointed Finance Director on 20.7.1987 and Chief Executive on 1.10.2011 External appointmentsDirector of Longmartin Properties Limited Board member of Westminster Property AssociationChairman, UK China Visitor AllianceBoard member of Freehold

SIMON J QUAYLE, BSC, MRICS Executive directorResponsible for the asset management and operational strategy in Carnaby, Soho and FitzroviaJoined the Group in 1987 Board appointmentAppointed Property Director on 1.10.1997 External appointmentsZSL development strategy board Revo strategy board

TOM J C WELTON, MRICS Executive directorResponsible for the asset management and operational strategy in Covent Garden and Chinatown Joined the Group in 1989 Board appointmentAppointed Property Director on 1.10.1997 External appointmentsDirector of Longmartin Properties Limited

CHRIS P A WARD, MA (OXON), ACA Finance Director Responsible for implementation of the Group’s financial strategy and all aspects of accounting and taxationJoined the Group in 2012 Board appointmentAppointed Finance Director on 9.1.2012External appointmentsWestway Trust: trustee, chairman of audit committee and member of property and regeneration committee

From left to right: Brian Bickell, Chris Ward, Tom Welton and Simon Quayle

GOVERNANCE Shaftesbury Annual Report 2017

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Non-executive Directors JONATHAN C NICHOLLS ACA, FCT*Non-executive Chairman and Chairman of the Nomination Committee Board appointment 1.9.2016 and Chairman on 1.10.2016ExperienceFrom 1985 various roles at Abbey National. In 1996 joined Hanson plc and became Finance Director in 1998. Joined Old Mutual plc in 2006 as Group Finance DirectorNon-executive director of Man Group plc 2004-2006Non-executive director and chairman of the audit committee of Great Portland Estates plc 2009-2016Non-executive director and chairman of the audit committee of SIG plc 2009-2017Other appointmentsNon-executive director, senior independent director and chairman of the audit committee of D S Smith plcNon-executive director, senior independent director and chairman of the audit committee of Ibstock plcSkillsOver 19 years’ experience of public company boards and their operationFinance, commercial, strategic, communication, investor relations and management skills20 years’ experience in property and related industries

JILL C LITTLE*Non-executive director and Senior Independent Director Board appointment 2010ExperienceJohn Lewis Partnership 1975 to 2012. Merchandise director 2002-2011 and Business and Development director 2011-2012 Other appointmentsChairman of the Commercial Group of the National Trust, NTE Limited and NTRE LimitedNon-executive director of Joules Group Plc and Nobia ABSkillsExtensive experience in the retail sectorCommunication and management skills

SALLY E WALDEN*Non-executive director and chairman of the Remuneration CommitteeBoard appointment 2012ExperienceFrom 1984 to 2009 with Fidelity International in senior fund management rolesOther appointmentsTrustee of the Fidelity FoundationDirector of the Pantry PartnershipSkillsExperience of financial markets and fund managementFinancial analysis skills Experience in remuneration structures

DERMOT C A MATHIAS BSC, FCA*Non-executive director and Chairman of the Audit CommitteeBoard appointment 2012ExperiencePartner in the corporate finance department of BDO LLP from 1980 Senior partner of BDO and chairman of the policy board of BDO International 2002-2009Other appointmentsNon-executive director of Rectory Homes LimitedGovernor of Activate LearningSkillsStrong financial skillsExtensive experience in leadership and management

RICHARD AKERS FRICS*Non-executive directorBoard appointment 28.11.2017ExperienceSenior executive of Land Securities Group plc (1995-2014). Joined main board in May 2005 following appointment as Managing Director of the Retail Portfolio.Director and President of the British Council of Shopping Centres 2009-2012. Other appointmentsNon-executive director, senior independent director and chairman of the remuneration committee and safety, health and environmental committee of Barratt Developments PLCMember of the advisory board of Battersea Power Station Development Company LimitedSkillsBroad range of real estate knowledge and experience, including retail property

HILARY S RIVA, OBE*Non-executive directorBoard appointment 2010ExperiencePreviously managing director of various high street brands including Top Shop, Warehouse, Dorothy Perkins and Evans Chief Executive of the British Fashion Council from 2005-2009 and remained in a non-executive capacity until November 2010 Other appointmentsNon-executive director and chairman of the remuneration committee of ASOS plcDirector of Shepherd Neame LimitedSkillsExtensive experience in the fashion retail sectorUnderstanding of consumer behaviour and strategic planning

* Independent non-executive directors for the purposes of the UK Corporate Governance Code. More detailed biographies are available on our website.

From left to right: Jonathan Nicholls, Sally Walden, Dermot Mathias, Jill Little, Richard Akers and Hilary Riva

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GOVERNANCE Shaftesbury Annual Report 2017

Corporate websiteshaftesbury.co.uk

Other websites carnaby.co.uksevendials.co.ukchinatown.co.ukthisissoho.co.ukstmartinscourtyard.co.uk

Management team Details of the senior leadership team and the Company Secretary are set out below. Together with the executive directors, they comprise the Executive Committee. See page 75 for information on the committee.

PENNY THOMAS LLB (HONS), FCISCompany SecretaryJoined 2005Advises the Board on governance. Responsible for compliance, company secretarial and group-wide sustainability. Member of sustainability and community investment committees.

JULIA WILKINSON BSC MSC MRICSPortfolio & Group Restaurant Strategy ExecutiveJoined 1997 Group restaurant and leisure leasing strategy and Opera Quarter, Coliseum and Fitzrovia asset management.

ANDREW PRICE BSC (HONS), MRICSPortfolio Executive Joined 2001Group-wide acquisitions strategy and Chinatown asset management. Chairman of community investment committee.

ROB KIRK BSC (HONS), MRICSPortfolio ExecutiveJoined 2004Carnaby and Soho asset management and group-wide property management and environmental strategy. Member of sustainability committee. Board member - Soho Neighbourhood Forum.

SAM BAIN-MOLLINSON BA (HONS) MSC MRICSHead of RetailJoined 2011Group retail strategy and retail leasing.

CHARLES OWEN BSC (HONS), MRICSPortfolio Executive Joined 2012Seven Dials and St Martin’s Courtyard asset management and group-wide planning.Member of community investment committee.

KAREN BAINES FCIMHead of Group Marketing & CommunicationsJoined 2016Consumer, trade and corporate communications, marketing and events.

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GOVERNANCE Shaftesbury Annual Report 2017

ACCOUNTABILITY

THE CHAIRMAN• Independent

Chairman

• Leadership of the Board

NON-EXECUTIVE DIRECTORS• Meetings of non-executive

directors held without executives

• Senior Independent Director identified

THE ROLE OF THE BOARD• Schedule of matters

reserved for the Board

• D&O cover and deeds of indemnity

DIVISION OF RESPONSIBILITY• Separation of roles

of Chairman and Chief Executive

• Statement of responsibilities - page 104

THE LEVEL AND COMPONENTS OF REMUNERATION• Annual Remuneration

report - pages 92 to 100

FINANCIAL AND BUSINESS REPORTING• Annual report which is fair, balanced

and understandable - page 83

• Auditor’s report - pages 105 to 110

• Business model description - page 11

• Going concern - page 102

UK CORPORATE GOVERNANCE CODE1

Full compliance - see page 74

AUDIT COMMITTEE AND AUDITORS• Audit Committee report - pages 82 to 84

• Recent and relevant financial experience - Dermot Mathias

• Whistleblowing policy - page 29

• Review of need for internal audit function - page 84

RISK MANAGEMENTAND INTERNAL CONTROL• Robust assessment of

principal risks - page 59

• Effectiveness of risk management and internal control systems - page 60

• Viability statement - page 64

Governance at a glance

LEADERSHIP

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GOVERNANCE AT A GLANCE Shaftesbury Annual Report 2017

UK CORPORATE GOVERNANCE CODE1

Full compliance - see page 74

REMUNERATION

RELATIONS WITH SHAREHOLDERS

EFFECTIVENESS

COMPOSITION OF THE BOARD• Independent Chairman

• Balance of 4 executive directors and 4 independent non-executive directors

• Skills and experience - pages 68 to 69

COMMITMENT• Time commitment

considered when electing and re-electing directors

RE-ELECTION• All directors stand for

annual re-election

• 2 non-executive directors have more than 6 years’ service and are subject to rigorous review

DEVELOPMENT• Induction of Chairman

and non-executive director - page 81

• Directors’ training is monitored and updates on regulatory and legislative changes provided

• New compliance training programme

EVALUATION• Full external Board

performance evaluation - page 77

APPOINTMENTS TO THE BOARD• Nomination Committee

process for new non-executive director appointment - page 80

INFORMATION AND SUPPORT• Company Secretary

advises the Board through the Chairman

• Access to independent professional advice

• Good information flows between management and the Board

DIALOGUE WITH SHAREHOLDERS• Over 225 meetings with

investors and potential investors in the year, including portfolio tours

• Chairman and Senior Independent Director available to shareholders

PROCEDURE• Remuneration policy

summary table - pages 90 to 91

• Annual remuneration report - pages 92 to 100

• No director is involved in fixing their own remuneration

CONSTRUCTIVE USE OF GENERAL MEETINGS• Accessible AGM with voting on

a poll, separate resolutions and proxy voting (for, against or withheld)

• Committee Chairs available at AGM to answer questions

• Notice sent out at least 20 working days before meeting

1 Available at www.frc.org.uk