EX-4.4 2 a2214090zex-4_4.htm EX-4.4

Exhibit 4.4

 

Strictly Private & Confidential —

Addressee only

 

Mr P Manduca

 

28 May 2012

 

Dear Paul

 

PRUDENTIAL PLC - LETTER OF APPOINTMENT AS CHAIRMAN

 

I am delighted to confirm that the Board of Prudential plc (the ‘Company’) has agreed to appoint you as Chairman with effect from 2 July 2012.

 

I am now writing to set out the terms of your appointment.  It is agreed that this is a contract for services subject to the Company’s Articles of Association as amended from time to time and does not constitute a contract of employment.

 

1.              Appointment

 

Your appointment as Chairman is for an initial three year term from 2 July 2012.  The Board may invite you to serve for additional period(s). Continuation of your appointment will be contingent on satisfactory performance and re-election at forthcoming AGMs.

 

The appointment may be terminated by and at the discretion of either party upon twelve months written notice.  Upon termination you will not be entitled to any compensation, other than accrued pro-rata fees, and you shall also cease to be a member of any committee of the Board.

 

2.              Fees, Shareholding and Dealing

 

2.1  Fees

 

You will be entitled to a fee for your services as Non-Executive Director and Chairman of £600,000 per annum.  This fee will be fixed for 3 years and will next be reviewed with any changes taking effect from 2 July 2015.

 

All fees are payable monthly in arrears, net of any tax and National Insurance contributions, which the Company is required to deduct, and are reviewed from time to time.

 

As Chairman, you will not be entitled to participate in any of the Group’s executive remuneration programmes or pension arrangements.

 


 

2.2       Shareholding

 

I draw your attention to Article 103 onwards of the Articles of Association of the Company which deal with a number of matters relating to Directors.  Article 110 requires you to be a beneficial owner of 2,500 Prudential shares and to retain them during the tenure of your office.

 

I would also like to make you aware of the Board’s shareholding guidelines.  As Chairman, you will be required to hold shares with a value equivalent to one times your annual base fee and you will be expected to attain this level of share ownership within five years of the date of your appointment as Chairman.

 

2.3       Share Dealing

 

During your term in office you will be subject to Prudential’s Share Dealing Rules, full particulars of which can be found on our Group intranet, as part of the Group Governance Manual.  These are updated as required to reflect changes in legislation and regulations, and will provide you with the necessary guidance on the steps you need to take and other considerations relating to share dealings.

 

If you have any questions on this please consult with Group Secretariat. Details of any share dealings need to be notified to Group Secretariat on the day of dealing so that the announcement to the relevant stock exchanges can be made within the required time limit.

 

3                 Duties, Committees and Time Commitment

 

3.1 Duties

 

Your duties as Chairman will be assigned by the Board and will be consistent with the current Terms of Reference attached at Appendix 1 of this document. These Terms of Reference are regularly reviewed and approved by the Board.

 

3.2 Committees

 

With effect from 2 July 2012, you will be appointed as Chairman of the Nomination Committee.  From 2 July 2012, your membership of the Audit and Remuneration Committees will cease, although you will be invited to attend meetings of the Audit, Risk and Remuneration Committees in your capacity as Chairman.  For the avoidance of doubt, your appointment as Senior Independent Director will also cease on your appointment as Chairman.

 

3.3 Time Commitment

 

We have agreed that Prudential will be your principal focus.  You have agreed that you will stand down from your role as Chairman of Aon Limited and from the Board of KazmunaiGas Exploration & Production plc as soon as possible.  You will devote such time to your duties as the Board reasonably considers necessary.  We would anticipate a time commitment of approximately three to four days per week.  We currently schedule a total of eight Board meetings per year.  The Board usually holds two or three of these meetings overseas in a location where Prudential conducts business, which coincides with a detailed presentation on that Business Unit by its senior management.

 

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4                 Car and Office Facilities

 

The use of a chauffeur driven car of a type in line with current company policy will be made available to you.

 

You will be provided with an office and secretary at the Company’s Head Office at Arthur Street as your principal place of work.

 

Both will be provided on a full-time basis to cover all your commitments including those outside Prudential.

 

5                 Life Assurance

 

The Company will provide life assurance cover of four times your annual fee plus an additional sum of four times your annual fee which would be used to purchase an annuity for your dependants. These benefits are subject to medical underwriting.

 

6                 Medical Cover

 

The Company will arrange appropriate cover under the terms of its medical insurance scheme (subject to the rules of that scheme from time to time) to provide private health care for you, your wife and dependent children under 21 years of age.  The Company reserves the right to request you to undergo a medical examination as a condition of providing cover.

 

7                 Expenses

 

Directors are entitled to claim for all travelling, hotel and other expenses properly incurred by them in connection with their attendance at meetings of the Board or Committees of the Board, general meetings or separate meetings of the holders of any class of shares or of debentures of the Company or otherwise in connection with the discharge of their duties.  Expenses incurred should be submitted to the Chairman of the Remuneration Committee, for approval.

 

8                 Induction, Evaluation and Development

 

Following your appointment as Chairman, the Company will provide you with such further induction to the role as may be appropriate.

 

The performance of individual Directors and the whole Board and its Committees is evaluated annually.  As Chairman you will lead this exercise.  The evaluation of your performance as Chairman will be led by the Senior Independent Director.

 

As a Director you will be invited to appropriate educational and/or professional development programmes.  The Company Secretary will consult each director annually to ascertain their specific professional development needs.

 

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9                 Conflicts of interests and disclosure obligations

 

It is accepted and acknowledged that you have interests other than those of the Company and we have discussed these and agreed that no conflicts of interest currently exist (other than those authorised by the Board).  In the event that you become aware of any future potential conflicts of interest, these should be disclosed to the Company Secretary as soon as apparent and also prior to accepting appointments.  In particular we would not wish our Directors to serve on the Boards of financial services competitors or for the Chairman to take up an executive role or a second chairmanship of another public company.

 

The Company has an obligation to notify details of other directorships held by its directors during the past five years to various regulators on an annual basis, together with non-statutory offices.  Any changes in your external appointments, including non-statutory offices, should be notified to the Company Secretary on an ongoing basis.  In particular, any changes in your directorships of other quoted companies worldwide need to be notified promptly, preferably the next business day, as the Company is required to announce this to various stock exchanges.

 

10          Confidentiality

 

All information acquired during your appointment is confidential to the Company and should not be released, either during your appointment or following termination (by whatever means), to third parties without prior clearance from the Board.  You accept that damages would not be a sufficient remedy for unauthorised disclosure of information.

 

11          Directors’ and officers’ protection

 

The Company has directors’ and officers’ liability insurance and it is intended to maintain such cover for the full term of your appointment.

 

The Company has also resolved to provide you with indemnity cover for directors’ and officers’ liability within the limitations imposed by law.  In addition, the Company will provide you with a limited indemnity for certain personal liabilities you may suffer in the course of your appointment, subject again to applicable statutory and other limitations, pursuant to the Company’s constitutional documents or otherwise.

 

The Board has also resolved to have a discretionary payments policy (subject to regular review), the existence of which Directors (executive and non-executive) and certain employees or members of the Prudential Group may rely on, to protect them from personal liability arising out of the bona fide performance of their duties on behalf of the Group.

 

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12          Independent professional advice

 

Occasions may arise when you consider that you need professional advice in the furtherance of your duties as a Director, and it may be appropriate for you to seek advice from independent advisers at the Company’s expense.  This would normally be arranged through the Company Secretary.  The Company will reimburse the full cost of expenditure incurred in accordance with the policy.  Details of the agreed procedure under which Directors may obtain such independent advice can be found in the Prudential Guidance Notes for Directors.

 

Yours sincerely

 

 

/s/ Andrew Turnbull

 

 

Lord Turnbull

 

Acting Chair of the Nomination Committee

 

For and on behalf of Prudential plc

 

 

Acknowledgement:

 

I acknowledge that this appointment letter does not constitute a contract of employment.

 

I confirm that by having accepted this appointment, I am able to allocate sufficient time to meet the demands of the role.

 

 

Signed:

/s/ Paul Manduca

 

 

 

Paul Manduca

 

 

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Appendix 1

 

Prudential plc Chairman Terms of Reference

 

The Chairman is responsible for:

 

1.              Managing Board business

 

1.1       the protection of shareholders’ interests;

 

1.2       the leadership and the governance of the Board as a whole, the setting of the Board’s agenda, presiding over meetings of the Board to ensure its smooth and effective running in discharging its responsibilities to the Group’s shareholders and organising the management of the Board’s business;

 

1.3       ensuring that information provided to the Board is timely, accurate and clear;

 

1.4       ensuring, in collaboration with the Group Chief Executive, that sufficient time is allowed for consideration by the Board of the strategic and other issues facing the Group and that the Board is presented with sufficient analysis appropriate to the scale and nature of the decisions that it is asked to make;

 

1.5       ensuring, in collaboration with the Group Chief Executive, that the appropriate issues are brought to the Board in accordance with its Terms of Reference, that there is open and honest debate and that there are clear lines of authority, reporting and delegation in force which are effectively implemented;

 

1.6       ensuring the overall effectiveness of the Board and the implementation of its decisions;

 

1.7       developing, in conjunction with the Nomination Committee and the Group Chief Executive, an effective Board as regards its composition, skills and competencies.  This will involve developing procedures and processes for effective corporate governance, and a systematic and regular review of the performance of the Board as a whole, its Committees and the contribution of individual Directors and, further, acting on the outcomes of such regular review;

 

1.8       the establishment of Board Committees such as Audit, Remuneration, Nomination and Risk Committees with the appropriate delegated authorities which are clearly defined by Terms of Reference, and for ensuring the timeliness and completeness of information and essential reports to and from these Committees; and

 

1.9       organising regular meetings of the Non-Executive Directors without Executive Directors present.

 

2.              Membership and Composition of the Board

 

2.1       before recommending an appointment, evaluating the balance of skills, knowledge and experience on the Board to make recommendations to the Nomination Committee relating to the appointment of new Directors;

 

2.2       ensuring that the Directors receive a full formal and tailored induction programme and that they keep their skills and knowledge up-to-date;

 

2.3       ensuring that the development needs of directors are identified and met, supported by the Company Secretary.  Directors should be able to continually update their skills and knowledge required to fulfil their role on the Board and its Committees.

 

2.4       identifying the development needs of the Board as a whole to enhance its overall effectiveness as a team;

 

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2.5       ensuring, in conjunction with the Group Chief Executive, that there is succession planning for all Executive Director positions; and

 

2.6       maintaining an effective and constructive liaison with the Non-Executive Directors, encouraging their engagement so as to maximise their contribution to the work of the Board and also ensuring constructive relations between Executive and Non-Executive Directors.

 

3.              Governance

 

3.1       leading the Board’s determination of appropriate corporate governance and business values and of their dissemination through the Group; and

 

3.2       establishing with the Board as a whole the ethos, values and culture of the Group.

 

4.              Relationship with the Group Chief Executive

 

4.1       providing support and advice to the Group Chief Executive; and

 

4.2       discussing with the Group Chief Executive the broad strategic plans that the Group will follow prior to submission to the Board and ensuring that the Board is aware of the necessary resources to give effect to the components of that strategic plan. The Chairman will also be expected to play a role, together with the Group Chief Executive, on strategic issues.

 

5.              Representing the Group externally to shareholders and other stakeholders

 

5.1       representing the Group externally at a business, political and community level, together with the Group Chief Executive. In particular, it is part of both the Chairman and Group Chief Executive’s roles to represent the Group’s views and position as determined by the Board on key public policy and industry matters and to communicate them effectively to governments, other public organisations and regulatory authorities. The Chairman and Group Chief Executive will decide which of them will lead on any particular matters;

 

5.2       balancing the interests of different categories of stakeholders, (e.g. shareholders, customers, employees, regulators) and preserving an independent view and ensuring effective communication with stakeholders on all matters;

 

5.3       ensuring effective communication with shareholders and that relevant governance and strategy issues are discussed with major shareholders and that their views are communicated to the Board as a whole;

 

5.4       maintaining and enhancing the reputation of the Group; and

 

5.5       supporting the commercial activities of the Group and meeting with internal and external groups as required from time to time.

 

Approved by the Prudential plc Board on 8 December 2011.

 

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