Board - Terms of Reference

1.    Role of the Board

1.1.         These Terms of Reference set out the role and responsibilities of the Board (“the Board”) of The Royal Mint Limited (“RML” or the “Company”), including the principal activities and matters reserved to it, the interests to be considered, and how the Board is constituted and conducts its business.

1.2.         RML’s strategic aim, as set by HM Treasury (“HMT” or the “Shareholder”), is to secure the supply and integrity of UK coins, whilst sustaining and growing the long-term value of its shareholding interest.

1.3.         The Board’s role is to provide entrepreneurial leadership of The Royal Mint Group[1] (“RML Group”) within a framework of prudent and effective internal controls that enables risk to be assessed and managed.

1.4.         In discharging its responsibilities, the Board acts in accordance with the Companies Act 2006, including the general duties of directors set out in sections 171–177, the Memorandum and Articles of Association of The Royal Mint Limited (the “Articles”), the RMTF Framework Document (the “Framework Document”)[2], and any other ad hoc written instructions from the Shareholder.

1.5.         The Articles set out the basis of the Company’s constitution and the rules by which it is run. They are a key element of corporate governance. Amendments to the Articles may only be made by resolution of the Shareholder.[3]

1.6.         The Board is committed to high standards of corporate governance and RML should comply with the principles and provisions of the of the Financial Reporting Council’s UK Corporate Governance Code (as amended and updated from time to time) to the extent appropriate to RML or specify and explain any non-compliance in its annual report.2

2.    Board Composition

2.1.         The Board comprises: Non-Executive Chair, Chief Executive, Chief Financial Officer, Non-Executive Directors (including the Shareholder Representative Director)2 and such other Executive Directors as may be appointed from time to time.

2.2.         The number of Non-Executive Directors appointed (excluding the Chair) should ordinarily not be fewer than the number of Executive Directors appointed. [4]

2.3.         In accordance with the Code, the Board shall appoint one of the independent Non-Executive Directors to be the ‘Senior Independent Director’ to fulfil the role described in the Code.⁵

2.4.         The Chair and the other Non‑Executive Directors shall be appointed normally for terms of up to three years, which may be renewed subject to satisfactory performance and continued independence (where applicable). All Director appointments, re‑appointments and term extensions shall be made on merit, in accordance with an open and transparent process.⁵

3.    Quorum

3.1. In accordance with the Articles, the quorum for Board meetings shall be not less than two Directors,³ provided that at least one Director present is a Non-Executive Director.

4.    Roles and Responsibilities of the Board

4.1.         The roles and responsibilities of the Board are to:

4.1.1.         review, as appropriate, the strategic objectives and agree them with the Shareholder;

4.1.2.         ensure a strategic multi-year plan is in place to realise the strategic objectives;

4.1.3.         ensure that the necessary management structure, financial and human resources are in place in order to achieve the agreed plan;

4.1.4.         determine the risk appetite of the organisation in furtherance of achieving the strategic objectives and ensure there is a robust, ongoing process to identify and appropriately manage strategic and significant operational risks;

4.1.5.         agree the annual plan and budget and regularly review objectives and management performance against the annual plan and associated business Key Performance Indicators; 2

4.1.6.         ensure the RML Group operates with appropriate values and standards and that, in all Board decision‑making, the interests of the Shareholder, employees, customers and wider stakeholders are appropriately considered and balanced; and the RML Group’s obligations to these stakeholders are understood and met; [5]

4.1.7.         review, approve or propose strategic investment in line with investment authority limits as agreed with the Shareholder; 2

4.1.8.         ensure that RML has and maintains appropriate systems, controls and procedures to comply with applicable laws and regulations including health & safety, fraud & anti-bribery and corruption legislation; 2

4.1.9.         ensure that the Board fulfils its duties set out in the Articles and any frameworks that may be agreed with the Shareholder; ³

4.1.10.      ensure that communication between the RML Board and its Shareholder and other key stakeholders is conducted through the Chair², ensuring transparency and clarity about how their interests are taken into account in Board decision‑making;

4.1.11.      receive reports directly from the Chief Executive and their Executive Management Team on the RML Group’s internal control systems and to consider amongst others: (i) changes in the nature and extent of significant corporate risks to the business; (ii) the RML Group’s risk appetite; and (iii) the key corporate risks and how these are evaluated and managed;

4.1.12.      review annually the RML Group’s corporate risk register and shall undertake at least annually a review of the effectiveness of the organisation’s risk management and internal control framework;

4.1.13.      carry out a review of its own performance and that of its committees and individual directors on an annual basis; and

4.1.14.      approve subsidiary board director appointments and RML representative directors to the boards of associates.

4.2.         The Board will establish and maintain processes and procedures to discharge these responsibilities and shall keep them under regular review. 2

5.    Board committees

5.1.         The Board will constitute Audit and Risk, Nomination and Remuneration committees. 2

5.2.         The membership and terms of reference of each committee shall be determined by the Board and reviewed by the Board, on at least an annual basis. ³

5.3.         Each committee shall report to the Board on the proceedings of its meetings and on how it has discharged its responsibilities, normally at the next scheduled Board meeting following each committee meeting. ⁵

5.4.         The Board may delegate matters to its committees but retains overall responsibility for all such matters. No committee may exercise any powers beyond those expressly delegated to it by the Board, and any material decisions taken under delegated authority shall be reported to the Board. ³

5.5.         The Audit and Risk committee will monitor and review the effectiveness of the internal control systems, accounting policies and practices, financial reporting processes, risk management procedures, as well as the integrity of the financial statements in accordance with its terms of reference. [6]

5.6.         The Nominations Committee will work with UK Government Investments (“UKGI”) on the appointment process for each of the Board members in accordance with its terms of reference. ⁷

5.7.         The Remuneration Committee’s primary role is to determine the remuneration and performance related incentive schemes of the Executive Management Team in accordance with its terms of reference. ⁷

6.    Schedule of matters reserved for Board decision

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7.    Independent Advice

7.1.         All Directors have access to independent professional advice, at RML’s expense, if required. ⁵

8.    Board Effectiveness

8.1.         The Board will review its effectiveness in a number of ways, including commissioning external reviews and conducting internally facilitated reviews in line with good corporate practice. Internal reviews are to be conducted in years when no external review is conducted. External reviews are conducted every three years. ⁵

9.    Conflicts of Interest

9.1.         The Board should establish and maintain processes to manage all potential conflicts of interest involving Directors in accordance with the Articles. Each individual Director is under an obligation to notify³ the Chair and Company Secretary of any potential conflicts as soon as they arise. Any such interests are reported to the Board which decides whether they are likely to represent a real or potential conflict of interest and, if so, whether they wish to authorise such conflict and on what terms. In addition, the Company Secretary, on an annual basis, confirms with each Director their current external business interests.

9.2.         Directors shall not accept any additional external appointments (including directorships or senior advisory roles) which may reasonably be considered to conflict with, or materially impair, their ability to discharge their duties to RML. Any proposed external appointment shall be notified to the Chair, Shareholder Representative Director and Company Secretary in advance.

10.  Secretary and minutes of meetings

10.1.       The Company Secretary or their nominee shall act as the secretary of the Board.

10.2.       The secretary of the Board shall minute the proceedings and resolutions of all meetings of the Board, including recording the names of those present and in attendance. ³

10.3.       Minutes of Board meetings shall be circulated promptly to all members of the Board. ⁵

11.  Frequency of meetings

11.1     The Board shall meet at least 6 times per year to despatch the business effectively.

12.  Notice and conduct of meetings³

12.1     Meetings of the Board in addition to those regularly scheduled as above, may be called by any Director, or by authorising the Company Secretary to give such notice as set out in the Articles.

12.2     Except as outlined above, meetings of the Board shall be conducted in accordance with the provisions of the Articles governing the proceedings of Directors.

12.3     Meetings may be held in person or via electronic means.

13.  Reviews

13.1     These terms of reference shall be reviewed by the Board on at least a triannual basis.