A FTSE SMALL CAP Group Counsel & Company Secretary writes...
“I would like to conduct a “straw poll” concerning the form of contractual document used for the appointment of non-executive directors of listed companies.
We have always used an “appointment letter” type of document – i.e. a 3-5 page letter to the newly-appointed NED setting out their responsibilities etc. We do not use a lengthy contractual document (such as a “service contract” style document) and the appointment letter that we use is executed (i.e. the letter is signed as accepted by the NED)under hand and not as a deed.
But we may be not up to date with this approach.
It would be helpful to know if listed companies nowadays use either the “appointment letter” or the “service contract” type formats for their NED appointment contractual documents, and does this agreement (in whatever format it takes) take effect as a deed or not?”
And as a supplemental question: If there is a “standard form” NED appointment contract (of whatever format) out there, please could someone point me towards it.”
We use a letter of appointment for our NEDs. ICSA have a template letter – https://www.icsa.org.uk/knowledge/resources/non-executive-directors-appointment-letters
We use a service agreeement based on the Practical Law template. It is executed as an ordinary contract and not as a deed.
Hi, we use a Service Agreement, its not signed as a Deed.
We use a 7page form taken from Practical Law. We update fees in a separate letter each year. Signed by both parties.
We also use a 3.5 page letter of engagement. It is signed by the Company and acknowledged/agreed by the NED.
We use an appointment letter loosely based on the ICSA model. We do not sign as deeds, they have simple signatures behalf of the company and are acknowledgement by the NEDs. We renew every year and ask each NED to sign the same form of letter with the revised fee if it has changed.
We also use letters of appointments for NED contracts, 9 pages long, signed by acknowledging and agreeing to the terms of appointment.
We use letters of appointment based on the ICSA guidance.