How the Board operates

Board meetings

The Board holds scheduled meetings regularly during the year and meets on an ad hoc basis as required. The Board has arranged to hold at least one Board meeting each year at one of the overseas offices of the Group. This provides senior managers from across the Group the opportunity to present to the Board and to meet the Board members informally. It also provides the Board with an opportunity to assess senior managers at first hand.

The attendance record of each Director is shown in the table below. During 2008, the Board met formally on 11 occasions, including two formal strategy review meetings held with senior management present. In addition to the formal meetings of the Board, the Chairman and Chief Executive Officer maintain frequent contact with the other Directors to discuss any issues of concern they may have relating to the Group or as regards their area of responsibility and to keep them fully briefed on the Group’s operations.

Attendance at meetings

The attendance of Directors at meetings of the Board and its Committees during 2008 was as follows:

No. of Meetings	Board (11)	Audit (4)	Nominations (3)	Remuneration (6)
Pat Plunkett1	8/11	–	2/3	4/6
Aidan Heavey	11/11	–	3/3	–
David Bamford	11/11	4/4	3/3	6/6
Ann Grant2	7/7	2/2	1/1	2/2
Angus McCoss	11/11	–	–	–
Paul McDade	9/11	–	–	–
Steven McTiernan	11/11	4/4	3/3	6/6
Graham Martin	11/11	–	–	–
Clare Spottiswoode	11/11	4/4	3/3	6/6
Ian Springett3	4/4	–	–	–
David Williams	11/11	4/4	3/3	6/6
Directors leaving the Board in 2008
Tom Hickey4	7/7	–	–	–
Matthew O’Donoghue5	2/2	–	–	–

Information flow

Directors have access to a regular supply of financial, operational, strategic and regulatory information to assist them in the discharge of their duties. Much of this information is provided as part of the normal management reporting process. Board papers are circulated in time to allow Directors to be properly briefed in advance of meetings. In addition, Board meetings generally include a review of the history, performance and future potential of a material individual asset or business unit. This is designed to ensure that all material assets are considered on a cyclical basis and to enable Board members to familiarise themselves with the key assets and operations of the Group.

Independent professional advice

In accordance with Board policy, all Directors and Committees have access to independent professional advice, at the Company’s expense, as and when required.

Insurance cover

The Company maintains Directors’ and Officers’ liability insurance cover, the level of which is reviewed annually.

Matters reserved

A formal schedule of matters reserved for Board approval is in place and is reviewed annually. The matters reserved include (amongst others):

• agreeing the Group’s overall strategy;
• approval of financial statements, material acquisitions and disposals, material contracts, major capital expenditure projects and budgets; and
• a regular review of the Group’s overall corporate governance arrangements.

Certain other matters are delegated by the Board to the Audit, Nominations and Remuneration Committees, each of which is described in more detail in the Committees section.

Subject to these matters, the Board delegates authority for the management of the day-to-day business and operational matters to the Chief Executive Officer and the other Executive Directors who form the Executive Committee. This Committee meets weekly and is responsible for implementing Group policy and monitoring the detailed performance of all aspects of the business. The Executive Committee is assisted by the Senior Management Team (SMT) which was established during 2008. The SMT meets fortnightly and comprises a number of senior financial, operating and other functional heads.

Board performance evaluation

Given the number of changes to the Board in 2008, the Directors agreed that the annual Board performance evaluation, and that of its Committees and individual Directors for 2008, should be conducted by way of an internal review. The review commenced with the Directors noting the matters highlighted in the previous year’s external evaluation report, the consequential objectives set by the Board for itself for 2008 and the level to which such objectives had been achieved. This was followed by a series of discussions of the issues arising and which took the form of one-to-one interviews with the Chairman; a facilitated discussion among the Executives; various separate discussions among the non-executives and a full Board discussion of the issues.

In summary, the Board considered that good progress had been made towards achieving the Board objectives set for 2008. In particular, the Board was rebalanced in favour of the non-executives following the retirement of Matt O’Donoghue and the addition of Ann Grant as an additional non-executive Director, while improvements were made in the areas of Board induction, training and administration. However, the Board also recognised that in certain areas there was room for improvement. For example, the review concluded that given the extraordinary growth and success of the Group and the resultant challenges, more time at Board meetings could have been devoted to strategic planning rather than routine business and that the visibility of all Directors across the Group’s operations should continue to be increased. The view was also taken that while the Nominations Committee had been very successful in its role in the appointments made to the Board in 2008, more focus needed to be given to Board level succession planning issues. Each of the areas which were identified for improvement has now been incorporated in a revised set of objectives for the Board for 2009.

The review concluded that the Board continues to operate effectively and that its functioning had not been adversely affected by the various changes to the Board in 2008. Board meetings continue to be conducted in a manner that encourages open and honest discussion.

The internal review also confirmed that Board Committees continue to function effectively within clear terms of reference although two areas were identified for particular consideration in 2009. Firstly, whether it continues to be appropriate for all non-executive Directors to participate in each Committee, and secondly, to establish a better mechanism for the fuller and timely reporting to the Board of the deliberations of Committee meetings. In that regard, and to facilitate better circulation of Board papers, the Board agreed to investigate the suitability for Tullow of a web-based meeting administration system.

The Chairman has held discussions with each of the Directors on his or her individual performance and separately the non-executive Directors have reviewed the performance of the Chairman with input from the Executive Directors. The Board is of the view that each non-executive Director commits sufficient time to discharge his or her duties effectively.

Induction

All new Directors receive an induction as soon as practicable after appointment. This includes meetings with senior management, functional and business unit heads and where appropriate, visits to the principal offices. The Company Secretary also provides new Directors with an overview of their duties as Directors, corporate governance policies and established Board procedures as part of the induction process.

Continuing professional development

All members of the Board have access to appropriate training in respect of their obligations and duties as Directors, and during the year, a number of the Directors attended external seminars on relevant topics. In addition, specific briefings were also given to the Board to ensure Board members remain up-to-date with current regulations and developments. These included recent developments in company law brought in by the Companies Act 2006.