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2.1 Minutes from 5 July 2023
POST OFFICE LIMITED BOARD MEETING
Strictly Confidential
MINUTES OF AN ADDITIONAL MEETING OF THE BOARD OF DIRECTORS OF POST OFFICE LIMITED HELD ON
WEDNESDAY 5 JULY 2023 AT 100 WOOD STREET, LONDON, EC2V 7ER AT 11:45 AM’
Present: Henry Staunton Chairman (Chairman)
Lorna Gratton Non-Executive Director (LG)
Elliot Jacobs Non-Executive Director (EJ)
Saf Ismail Non-Executive Director (SI)
Ben Tidswell Senior Independent Director (BT)
Brian Gaunt Non-Executive Director (BG)
Simon Jeffreys Non-Executive Director (SJ)
Amanda Burton Non-Executive Director (AB)
Andrew Darfoor Non-Executive Director (AD)
Nick Read Group Chief Executive Officer (NR)
In attendance: Rachel Scarrabelotti Company Secretary (RS)
Ben Foat Group General Counsel (BF)
John Bartlett Head of Central Investigations Unit (JB)
Apologies: Alisdair Cameron Group Chief Finance Officer
Action
1 Welcome and Conflicts of Interest, Inquiry Undertakings
Welcome and Conflicts of Interest
A quorum being present, the Chairman opened the meeting and thanked Board members
for being available to join the meeting at short notice. The Chairman called for the
Directors to disclose any conflicts of interest. NR noted his conflict of interest in the
matters to be considered at the meeting and that he would not participate in any voting in
respect of any decisions taken. The Directors otherwise declared that they had no
conflicts of interest in the matters to be considered at the meeting in accordance with the
requirements of section 177 of the Companies Act 2006 and the Company’s Articles of
Association.
Inquiry Undertakings
The Board noted that all attendees had a confidentiality undertaking to the Inquiry in
place.
2. Speak-Up
TABLED and NOTED were the following confidential and legally privileged materials:
(i) “Email from John Bartlett dated 30° June 2023’; and
(ii) “Email from Ben Foat dated 30" June 2023’.
Key discussion points were as follows:
The Chairman spoke to the above materials, noting the advice provided by BF and
JB and advised that he had replied to the whistle-blower. The Chairman shared his
view that some of the allegations raised did not appear to be strictly
whistleblowing issues and that it may be in order for the Board to consider a
different approach to address allegations of this nature;
1 This meeting is an addition to the scheduled meetings so standard items such as minutes and matters arising
have been carried over to the meeting on 11 July 2023.
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NR advised that he was of a similar view and set out his perspective on the
allegations and proposed steps to address these:
February 2023 was the first-time management became aware that R2 was
going to be delayed beyond its planned delivery for March 2023;
The Board had been advised of the establishment of the RTP in March 2023
with K Secretan leading this. Whilst the RTP had been purposefully established
as a separate programme to NBIT, this did mean that there was a degree of
challenge and combativeness due to this structure;
As March 2023 progressed it became apparent that the revised release date
for R2 of June 2023 was going to be July 2023. NR advised that he became
uncomfortable at this point as to the progress that was being made on NBIT;
NR advised the Board in June that he was planning to commission an
independent review into the status of the NBIT project. After considering 4
different options and in consultation with Chair, NR had asked KPMG and
Accenture to do a review of the programme. The scope of the review would
include reviewing the delay and articulating the reasons for this and also to
definitively understand the status in relation to bugs, errors and defects in the
system. KPMG and Accenture would be engaged under separate contracts
however carry out the review as 2 integrated pieces of work;
There was the need to engage a Chief Transformation Officer (‘CTO’) to join
the Executive to bring together NBIT, RTP and path clearing. NR hada
preferred candidate who was available to commence 1 August 2023. The
candidate was very experienced, and NR would propose that the individual on
arrival take over the review exercise. NR advised that he had a second
preferred candidate and outlined this candidate’s experience and the potential
applicability of this to the NBIT programme;
The external review was estimated to take 8 — 12 weeks, although KPMG and
Accenture had indicated that this could be reduced to 6 weeks. Whilst the
external review was being conducted the programme would pause however
no regret activity would continue;
Additional issues to be included in the scope for the external review included
the tech build or buy question, the optimal location for conducting the
programme, governance, the capabilities required to deliver the programme
and fundamentally whether delivery of the NBIT programme would ultimately
meet the needs of our business. NR would request K Secretan, Z Mladenov
and G Clark to step back from the review exercise;
NR proposed to ask O Woodley to step up as Deputy CEO to manage the
review of the NBIT programme and the NBIT programme itself, with the
expectation that the CTO would have day to day responsibility for these
programmes;
Whilst NR thought that Z Mladenov had done a good job with BAU aspects of
the business, overseeing NBIT as well had proved too stretching and
challenging for Z Mladenov. It was proposed that Z Mladenov be invited to
remain with the business to manage BAU IT, however if Z Mladenov did not
wish to do this, then the second preferred candidate for the CTO role could be
offered the BAU IT position;
The other critical aspect was establishing better governance across the NBIT
programme. NR was Chair of RTP, AC had been Chair of the NBIT Steering
Committee which had been disbanded earlier in the year, however reinstated
as the NBIT Technical Steering Committee in May 2023. The Chairman had
discussed with A Darfoor, A Darfoor chairing a new Board Committee which
would include in its ambit responsibility for overseeing the NBIT programme;
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- Inrelation to the Executive, the CFO remained absent, and NR was looking to
appoint an interim CPO. Consideration was being given to appointing C
Pispinis as Chief of Staff given the anticipated intensity of activity in the
business over the next 18 months. The Chief of Staff would be charged to
devise the correct operating model to covers the past, present and future as
well as assisting with the optimal governance arrangements required for this;
© AB advised that she thought the proposed changes all sounded very sensible,
however noted the significant amount of activity going on in the business and that
for employees it was not always clear as to what the priorities were. AB queried
who would have responsibility for this. NR advised that whilst historically this had
been T Mcinnes, this would be part of the Chief of Staff’s role, and that the Chief
of Staff would work with the business to undertake a governance and meeting
cadence overview to ensure alignment with accountability and decision-making
processes;
© SJ expressed his support for the proposed changes, however noted that he had
received mixed reviews on the performance of O Woodley. SJ also noted some
confusion as to lines of accountability and queried whether NR was proposing any
changes in this respect. NR replied that it would be part of the Chief of Staff’s role
to put in place a very precise RACI. In relation to O Woodley, NR reiterated the
comments he had made at the Remuneration Committee meeting earlier in the
week in respect of O Woodley’s very positive performance for FY22/23. In
addition, O Woodley was anticipated to retire in March 2024; by having O
Woodley step up into the position of Deputy CEO, this would allow others from
the Commercial team to step up so the Board could evaluate their ability to take
‘on the CIO when O Woodley departed. In his role as Deputy CEO O Woodley
would be asked to focus on culture as well as the NBIT programme. The Chairman
shared his view that O Woodley had displayed a high degree of leadership, was
visible, and that OW had indicated that he may be open to staying in the Deputy
CEO role beyond the period of his proposed retirement;
© EJ noted concerns in respect of O Woodley’s speed of delivery. If O Woodley and
C Pispinis stepped away from the commercial team it would seem that the most
valuable team members were moving at a critical time. EJ queried how these roles
would be back filled and shared his view that O Woodley’s appointment to the role
of Deputy CEO for a 9-month period could be problematic in terms of short
termism. EJ also queried whether management had considered the impact on the
NBIT team when the proposed changes were implemented. NR advised that in his
role as Deputy CEO O Woodley would still retain oversight of the Commercial
function and would be responsible for the delivery of Banking Framework 4 and
the online aggregator. Whilst NR took EJ’s points, he did not think there was a
profound strategic risk at present due to the proposed changes and thought it was
more pressing to allocate talent and resource to serve business needs;
© BG raised issues in respect of O Woodley also, noting the progress in the mails
business however BG was not sure if O Woodley had driven the strategy as
opposed to O Woodley being driven to conclude the strategy. Also, headcount in
the mails team has been at around 50% for a sustained period before additional
resource was recruited. BG queried whether there was an inclination in O
Woodley not to address conflicts and issues and also queried the plans to
incentivise © Woodley given he was due to retire. BG further queried whether
was there an ability to bring in an interim for the new role proposed for O
Woodley. NR advised that in the role proposed, O Woodley would be responsible
for running the NBIT Technical Steering Committee and assisting with the external
NBIT review; someone who knew their way around the business was required for
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these activities. NR had been on a COO search however had not identified a
candidate the Company could afford and who NR thought would be worth making
the changing for. NR noted the proposed changes to the executive already
advised that he was not certain that the business could sustain further change;
AD advised that he was very supportive and not taking action was not an option.
AD asked whether KPMG and Accenture would be providing recommendation as
part of their scope. NR replied that they would and advised that the approach to
the review would be very much on the ground and a ‘drains up’ in order to
understand the state of R2 in reality along with NBIT governance and behaviour.
AD shared his view that concluding the review in 6-8 weeks was not feasible. NR
took the point and advised it would be preferable to sacrifice some speed for
depth in the review;
ACTION SI echoed BG’s comments in respect of O Woodley and advised that if 0
Woodley was promoted to Deputy CEO, then there would need to be some very
clear objectives set for OW. SI asked NR to share these. SI shared his view that
the Commercial team did need some fresh impetus and that this juncture provided
that opportunity. SI queried how the pause of NBIT would be communicated
within the business, and whether the pause could be construed negatively. NR
stressed the importance of not losing momentum or capability during the pause.
In relation to incentivisation, NR shared his view that there was a need to be more
creative and that there needed to be more delivery incentive. NR was not certain
as yet on if/ how the pause would be communicated. Employees knew that R2
had been delayed and that significant funding had been requested from the
government;
LG advised that she was generally very supportive and thought it was sensible to
pause on NBIT with no regret activity continuing. LG shared her view that the
Shareholder would find comfort in the establishment of a Board level Committee
overseeing NBIT. In relation to O Woodley, LG reiterated the need for clear
objectives and for © Woodley to take ownership quickly to provide NR with space.
LG queried whether it was planned to keep K Secretan and G Clark in the business.
NR replied that it was not thought that GC would remain in the business, however
NR would like K Secretan to stay on if we could find an alternate role for K
Secretan within the business;
EJ shared his views on K Secretan’s performance and that K Secretan leaving the
business would be a loss. EJ referenced the allegations and queried whether there
was a culture at the Company of not calling out when people were not performing.
If this was the case, how could the Board make sure that the recruits to the
Executive were all attuned to this and addressed this issue. EJ also noted that
there had not been any discussion in relation to the allegations in respect of M
Roberts. BT contributed that he thought that the Board and Executive needed to
be direct and keep an eye on Executive members who came into the business;
The Chair returned to the allegations in the whistle-blowing letter and shared his
view that a lot of these were criticisms of the calibre of Executive members and
were for the Board to deal with. AB noted that the proposals discussed in the
meeting addressed a lot of these types of allegations in the letter. AB queried how
the Chairman was going to reply substantively to the letter however given that the
proposals discussed had not been announced as yet. AB pointed out that there
were alleged behaviours mentioned in the letter — for example — M Roberts and
his behaviours with female employees — and that the Board needed to determine
how these would be considered. The Chairman agreed with this, if the allegations
in respect of the abilities of the Executive were put to one side, the Board would
be left with the issues that needed to be investigated and the Board could agree
NR
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that these issues were pressed forward for investigation. BT summarised the point
- the whistle-blowing allegations seemed to be divisible into allegations about
conduct versus competence. The whistle-blowing allegations in respect of conduct
where it was alleged that people had behaved in ways that were inconsistent with
the Company’s values were of the utmost concern to the Board and needed to be
fully investigated in a conventional whistle-blowing way by referral to the Central
Investigations Unit. On the competence side, these allegations needed to be
investigated internally and were not of a nature where the Company could sub-
contract to anyone else. The piece in the middle around whether NBIT had
operated properly and followed governance would come out from the KPMG and
Accenture reviews. All Board members agreed with the distinction in the
allegations as set out by BT and the proposed approach;
* BG queried whether the outcome of the investigations would come back to the
Board. The Chair advised that they would;
AD advised that when he had read the whistleblowing letter that his take was that
the allegations around NBIT did not relate to conduct. AD’s impression was that
there were people who were very stressed and that there were behavioural issues
that needed to be remediated and that this would be surfaced in the KPMG and
Accenture reviews. The Chairman advised he was of the same view. BT shared his
view that he thought it was both conduct and competence in relation to the NBIT
allegations, although the conduct piece was very narrow in this it still needed to be
fully investigated. The Chairman needed accepted this;
* ACTION SJ advised that the Board also needed to appoint a whistleblowing
champion. The Chairman invited Board members to express their interest in this
role by way of to the Chairman. SJ emphasised the need for the Board to make
sure an individual with the right profile was appointed for this position.
Board
Members
EJ, SJ, Sl and BG left the meeting around 12:45. BF and JB joined the meeting at 12:48.
Confidential and legally privileged
Key points of the discussion were as follows:
The Chairman provided a summary of the Board’s view into the demarcation
between the allegations in relation of conduct as against competence. It was
proposed that the allegations in relation to competence be investigated internally
and the Board would take decisions based on the findings. The issue the Board
was looking at was in relation to the NBIT allegations, which could come out in the
KPMG and Accenture review. JB advised that any conduct allegations around NBIT
would be judged against the Company’s Ways of Working, policies and
procedures, and that the reliability of information as it flowed out from the NBIT
project would be looked at.
There was discussion as to the depth of the investigations required for the NBIT
allegations, as the external KPMG and Accenture reviews would draw out these
issues. AB noted that the depth of the investigations would partly depend on who
was instructed externally to undertake the conduct investigations. AB suggested
that an internal review be carried out on the conduct allegations to assess whether
and where a deep dive was required. BT agreed that the approach could be a
review of the NBIT allegations to work out which parts were conduct and
warranted further investigation. ACTION [i
BF/JB
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I 2 2er2cc with this also and
advised that he would commence preparing a Terms of Reference;
LG queried how confident JB was of carrying out the conduct allegation
investigations internally. JB advised that he was confident, however specialist
external support would be provided to assist the Central Investigations Un I
The status and approach to the 2 other whistleblowing investigations mentioned
in the emails from BF and JB of 30 June were discussed with JB noting that a
revised approach to investigations 1 and 2 would be taken. AB queried whether
the whistle-blowers were anonymous in respect of the other 2 cases. The
Chairman replied that one whistle-blower was anonymous and the other was not;
the known whistle-blower was providing assistance with the investigation. In
relation to the whistle-blowing allegation in respect of NBIT testing, AB queried
whether this could be covered in KPMG and Accenture’s scope. NR agreed that
this could be added, and AB noted that there may be different skill sets required
for the review and that KMPG and Accenture may bea better route. JB advised
that he was comfortable to supply some of the information to the teams
undertaking the technical review.
Any Other Business
There being no other business the Chairman declared the meeting closed at 13:10.
Date of next scheduled meeting
11 July 9:30 — 15:00 hrs.
Chairman Date
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POST OFFICE LIMITED BOARD MEETING
Strictly Confidential
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS OF POST OFFICE LIMITED HELD ON TUESDAY 11 JULY
2023 AT 100 WOOD STREET, LONDON, EC2V 7ER AT 09:30 AM
Present: Henry Staunton Chairman (Chairman)
Lorna Gratton Non-Executive Director (LG)
Saf Ismail Non-Executive Director (SI)
Elliot Jacobs Non-Executive Director (EJ)
Ben Tidswell Senior Independent Director (BT)
Brian Gaunt Non-Executive Director (BG)
Simon Jeffreys Non-Executive Director (SJ)
Amanda Burton Non-Executive Director (AB)
Andrew Darfoor Non-Executive Director (AD)
Nick Read Group Chief Executive Officer (NR)
In attendance: Rachel Scarrabelotti Company Secretary (RS)
Max Jacobi Finance Director (MJ)
David Bickerton Director General, Business Sectors, DBT (DB)
Charles Donald CEO, UKGI (CD)
Ben Foat Group General Counsel (BF)
Diane Wills Historical Matters Legal Services and Public Inquiry
Director (DW)
Gemma Ludgate Inquiry Operations Director (GL)
Simon Recaldin Historical Matters Director (SR)
Zdravko Mladenov Group Chief Digital and Information Officer (ZM)
Tim McInnes Strategy and Transformation Director (TM)
Liam Carroll Procurement Director (LC)
Apologies: Alisdair Cameron Group Chief Finance Officer (AC)
Action
L Welcome and Conflicts of Interest, Inquiry Undertakings
Welcome and Conflicts of Interest
‘A quorum being present, the Chairman opened the meeting. The Chairman called for the
Directors to disclose any conflicts of interest. EJ reminded the Board of his ongoing
conflict in being a practising Postmaster. The Directors otherwise declared that they had
no conflicts of interest in the matters to be considered at the meeting in accordance with
the requirements of section 177 of the Companies Act 2006 and the Company's Articles of
Association.
Inquiry Confidentiality Undertakings
The Board noted that MJ, LC, CD and DB did not have confidentiality undertakings
accepted by the Inquiry in place, and that these individuals would need to be excused from
the meeting should the need to discuss information confidential to the Inquiry arise.
2. Role of the Shareholder Representative
The Chair welcomed DB and CD. Key points advised by DB were as follows:
© The Shareholder’s priority was to arrive at a situation where the Company could
move on. The view of the Minister for Postal Affairs was that this could only be
achieved once the Inquiry was completed, and compensation schemes fully
administered. Once the Company could move on however, it remained to be
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