Ryanair’s Memorandum & Articles of Association are available here:
Ryanair’s full Corporate Governance Report from the 2017 Annual Report is available here:
MSCI Research “Governance Metrics Report” June 2016 noted that Ryanair “falls into the highest scoring range for all the companies we assess relative to global peers indicating that the company’s corporate governance practices are generally well aligned with shareholder interests”
The Board of Directors (“the Board”)
The Board of Ryanair is responsible for the leadership, strategic direction and oversight of management of the Group. The Board’s primary focus is on strategy formulation, policy and control. It has a formal schedule of matters specifically reserved to it for its attention, including matters such as approval of the annual budget, large capital expenditure, and key strategic decisions.
Other matters reserved to the Board include treasury policy, internal control, audit and risk management, remuneration of the non-executive directors and executive management and Corporate Governance.
The Board has delegated responsibility for the management of the Group to the Chief Executive and executive management.
There is a clear division of responsibilities between the Chairman and the Chief Executive, which is set out in writing and has been approved by the Board.
David Bonderman has served as the chairman of the Board since December 1996. The Chairman’s primary responsibility is to lead the Board, to ensure that it has a common purpose, is effective as a group and at individual director level and that it upholds and promotes high standards of integrity and corporate governance. He ensures that Board agendas cover the key strategic issues confronting the Group; that the Board reviews and approves management’s plans for the Group; and that directors receive accurate, timely, clear and relevant information.
The Chairman is the link between the Board and the Company. He is specifically responsible for establishing and maintaining an effective working relationship with the Chief Executive, for ensuring effective and appropriate communications with shareholders and for ensuring that members of the Board develop and maintain an understanding of the views of shareholders.
While David Bonderman holds a number of other directorships the Board considers that these do not interfere with the discharge of his duties to Ryanair.
Senior Independent Director
The Board has appointed a Senior Independent Director, who is available to shareholders who have concerns that cannot be addressed through the Chairman, Chief Executive or Chief Financial Officer and leads the annual Board review of the performance of the Chairman.
The appointment and removal of the Company Secretary is a matter for the Board. All directors have access to the advice and services of the Company Secretary, who is responsible to the Board for ensuring that Board procedures are complied with.
The Board consists of one executive and eleven non-executive directors. It is the practice of Ryanair that a majority of the Board comprises non-executive directors, considered by the Board to be independent, and that the Chairman is non-executive. The Board considers the current size, composition and diversity of the Board to be within a range which is appropriate. The composition of the Board and the principal Board Committees are set out in the table below.
The Board has carried out its annual evaluation of the independence of each of its non-executive directors, taking account of the relevant provisions of the 2014 Code, namely, whether the directors are independent in character and judgement and free from relationships or circumstances which are likely to affect, or could appear to affect, the directors’ judgement. The Board regards all of the non-executive directors as independent and that no one individual or one grouping exerts an undue influence on others.
The Board has considered Kyran McLaughlin’s independence given his role as Deputy Chairman and Head of Capital Markets at Davy Stockbrokers. Davy Stockbrokers are one of Ryanair’s corporate brokers and provide corporate advisory services to Ryanair from time to time. The Board has considered the fees paid to Davy Stockbrokers for these services and believes that they are immaterial to both Ryanair and Davy Stockbrokers given the size of each organisation’s business operations and financial results. Having considered this relationship, the Board has concluded that Kyran McLaughlin continues to be an independent non-executive director within the spirit and meaning of the 2014 Code.
The Board has considered Michael Cawley’s independence given that he served as Deputy Chief Executive Officer and Chief Operating Officer of Ryanair from 2003 to March 2014. The Board has considered Mr. Cawley’s employment and has concluded that his previous employment with Ryanair which ceased in 2014 in no way compromises his independence of judgement and character and the Board is of the view that Mr. Cawley is an independent non-executive director within the spirit and meaning of the 2014 Code.
The Board has also considered the independence of Louise Phelan given her role as Vice President Global Operations at PayPal. PayPal is one of Ryanair’s payment service providers. The Board has considered the services provided by PayPal which are immaterial to both Ryanair and PaypPal given the size of each organisation’s business operations and financial results. Having considered this relationship, the Board has concluded that Louise Phelan is an independent non-executive director within the spirit and meaning of the 2014 Code.
The Board has also considered Howard Millar’s independence given that he served as Deputy Chief Executive and CFO of Ryanair from January 2003 to December 2014. The Board has considered Mr. Millar’s employment and has concluded that his previous employment with Ryanair which ceased in 2014 in no way compromises his independence of judgement and character and the Board is of the view that Mr. Millar is an independent non-executive director within the spirit and meaning of the 2014 Code.
The Board has also considered the independence of David Bonderman given his shareholding in Ryanair Holdings plc. As at March 31, 2017, David Bonderman had a beneficial shareholding in the Company of 7,535,454 ordinary shares, equivalent to 0.6% of the issued share capital. Having considered this shareholding in light of the number of issued shares in Ryanair Holdings plc and the financial interest of the director, the Board has concluded that the interest is not so material as to breach the spirit of the independence rule contained in the 2014 Code.
The Board has further considered the independence of Messrs. David Bonderman and Kyran McLaughlin as they have each served more than nine years on the Board. The Board considers that each of these directors is independent in character and judgement as each has other significant commercial and professional commitments and each brings his own level of senior experience gained in their fields of international business and professional practice.
Furthermore, in line with best governance practices, Ryanair has adopted a policy whereby all directors retire on an annual basis and being eligible for re-election, offer themselves for election. This therefore affords Ryanair’s shareholders an annual opportunity to vote on the suitability of each Director.
The Nomination Committee has confirmed to the Board that it considers all directors offering themselves for re-election at the 2017 AGM to be independent and that they continue to effectively contribute to the work of the Board. The Nomination Committee recommends that the Company accept the re-election of the directors.
Ryanair has complied, throughout the year ended March 31, 2017, with the provisions set out in the U.K. Corporate Governance Code and the requirements set out in the Irish Corporate Governance Annex, except as outlined below. The Group has not complied with the following provisions of the 2014 Code, but continues to review these situations on an ongoing basis:
- A number of non-executive directors participate in the Company’s share option plans. The 2014 Code requires that, if exceptionally, share options are granted to non-executive directors that shareholder approval should be sought in advance and any shares acquired by exercise of the options should be held until at least one year after the non-executive director leaves the board. In accordance with the 2014 Code, the Company sought and received shareholder approval to make certain stock option grants to its non-executive directors and as described above, the Board believes the quantum of options granted to non-executive directors is not so significant to impair their independence.
- Certain non-executive directors, namely Messrs. David Bonderman and Kyran McLaughlin, having been offered for annual re-election for the duration of their tenure, have each served more than nine years on the Board. As described further above, given the other significant commercial and professional commitments of these non-executive directors, and taking into account that their independence is considered annually by the Board, the Board does not consider their independence to be impaired in this regard.
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