A FTSE100 Group Company Secretary writes...
A number of companies will have policies for the management/governance of their subsidiary entities. The policy would normally set out guidance on who can authorise the incorporation, minimum standards around governance of the entity, and who can authorise the appointment of directors to the entity.
Does anyone have a Subsidiary Governance Policy that they are willing to share?
(NB: I am happy to act as ‘post-box’ for anonymised documents. Send copies to me at: DM@equitycomms.com David Mensley)
All of our subsidiaries (we don’t have many) have adopted the Matters Reserved for the Board, which makes the governance for them simple, we do not have a formal executive committee below Board level, just a Senior Leadership Team. There are certain financial delegated authorities which it is agreed may be decided at subsidiary level.
Being a small listed company, with a limited number of subsidiary entities, we keep it simple, and the “policy” is that no entity can be established, nor any director appointed/removed without the prior written approval of the Group CEO. As regards governance of the entity, all subsidiaries follow the same format – the management of the subsidiary is vested in the subsidiary operational board, which meets monthly and the Group CEO, Group FD and Group Counsel are members of that board, plus the subsidiary MD, FD and other senior management. All done by “custom and practice” rather than formal written policies.