Corporate governance report

The culture of the firm, built over many years, represents a key competitive advantage.

Michael Dobson, Chairman (photo)

Michael Dobson
Chairman

I am pleased to introduce this governance report in which we describe the operation of the Board and its Committees, and how the Board discharged its responsibilities during the year.

The Board pays great attention to the culture of the firm which we believe, built over many years, represents a key competitive advantage. Schroders above all values integrity and always seeks to act in the best interest of clients and shareholders. Our shareholding structure supports the long term approach we take in the management of our business and enables the Board and management to avoid being overly influenced by short term considerations.

We have made important changes to our governance structure to ensure it supports the Company as we adapt to a changing environment. We have appointed two additional independent non-executive Directors so that we have a majority of independent non-executive Directors on the Board.

With these appointments we have addressed some skills gaps that we had identified on the Board, specifically in relation to listed company experience and digital. We have also increased the level of gender diversity on the Board and we intend to achieve the targets for women of 33% amongst senior management and Board members by 2019 and 2020 respectively.

As part of our focus on the long term we have decided to cease issuing financial reports every quarter and we will now restrict information released at the end of the first and third quarters to movements in assets under management.

As set out in detail in the Audit and Risk Committee report, in 2016 we undertook a tender process to select new external auditors. This process was led by Rhian Davies and the Board will propose the appointment of Ernst & Young LLP as auditors in succession to PwC with effect from the financial year commencing 1 January 2018.

Our remuneration policy will be put to shareholders for approval at the Annual General Meeting in April. Philip Howard and his colleagues on the Remuneration Committee have assessed our policy in the context of a changing external environment as well as the Company’s own requirements. While maintaining the principal features of our existing policy we have made some important changes to align further the interests of management, shareholders and clients. Philip Howard explains this in detail in the Remuneration report. This being such an important area in terms of attracting, motivating and retaining talent, aligning the interests of different stakeholders and taking account of the public interest in these issues, the Board now considers remuneration on an annual basis.

I would like to thank all my colleagues on the Board for their contribution during the year.

Michael Dobson
Chairman
1 March 2017