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Shareholder
Executive
HM Government Commercial — In Confidence
Minutes of Shareholder Executive Board
Meeting held on Wednesday 16 January 2013 at 15.00
Members Patrick O'Sullivan (Chair) (PO’S) Attendees: Roger Lowe (Item 2-4) (RL)
present: Claudia Arney (CA)
Jeremy Pocklington (JP)
Tony Watson (TW) Secretary: Peter Batten
Lord Carter (LC)
Stephen Lovegrove (SL)
Anthony Odgers (AO) Apologies: Gerry Grimstone (GG)
Mark Russell (MR)
1. Stephen’s move to DECC
1.1.POS and SL held an unminuted session with the attending NEDs to discuss
SL's recently announced promotion to DECC.
2. Apologies for absence, Chair’s welcome and introduction, minutes
from last meeting, declarations of interest
2.1.POS formally opened the meeting. Board noted GG’s amendment to
paragraph 2.1 of the November minutes, which will be updated.
3. Actions
3.1.SL provided an update to the Minister's query about perceived barriers to
ShEx in Whitehall — noting that the Civil Service reform programme was
helpful. TW suggested an alternative question could have been what are the
areas where ShEx can assist, where it currently doesn’t? The Board
discussed various scenarios such as:
= OGDs outsourcing their corporate finance function to ShEx;
= ShEx acting as an advisor to OGDs; and
= Adopting a hub and spoke approach.
3.2.MR noted the need to avoid expansion to the detriment of ShEx's agility and
ability, and suggested that specialist pockets of corporate finance talent
across Whitehall could be more desirable than a single centralised resource.
3.3. SL noted that he is due to speak to Francis Maude on the topic. JP noted
that HMT were conducting a review on Departments’ capability and capacity.
It was also noted that Lord Browne is undertaking a review of resource
allocation. SL noted that it was imperative that ShEx is involved. [action
SL to speak to Paul Deighton regarding HMT review of Departmental
capacity
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4. Chief Executive’s Report
4.1. Introducing his report, SL provided an update on Royal Mail, noting the
company has appointed an industrial relations adviser, and appointed further
advisers on the transaction strategy. SL noted that the Royal Mail Board has
been strengthened by the recent appointment of John Allen as NED.
4.2.SL explained that following the Board’s concerns expressed in the November
meeting, ShEx had looked again at its advisers, and — aware of the likelihood
of scrutiny — is considering the need to appoint further advisers.
4.3. TW asked whether the number of advisers involved risked causing confusion
among potential investors. RL explained that ShEx is pushing the company
to get a firm grip on their planned spend on advisers.
4.4. [action] The Board requested an update on employee shares strategy. SL
noted that the Minister is aware of the importance of employee shares to the
workforce. JP explained that HMT recognises the practical benefits of
employee shares. [action] TW requested a note setting out Senior
Executive share options.
4.5.POS noted the potential risk to the transaction strategy of the forthcoming
year end figures, which are expected to show strong performance.
— RL left the meeting —
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5. Busi
5.2.
5.3
5.4
5.5.
5.6.
“IRRELEVANT
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6.2!
6.3)
6.4!
7. Board effectiveness
" IRRELEVANT
ShEx Board Secretary
8. Actions
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Completed actions
13/06
Action I Action point Action Due Status
ref. officer date
13/01 L V eed
T3102 I An update on the Royal Mail IRL ‘(1 March I See attached
employee shares strategy 2013 I paper 13(05)
13/03 I An update on Royal Mail RL March I RL to provide oral
senior executive share 2013 I update to Board
options
ik) as
= IRRELEVANT