Chairman's letter

The past year was a significant and busy year for the Committee. In addition to its key responsibility of ensuring that an effective Board and Committees are in place, the Committee oversaw the process for the appointment of the Group's new Chief Executive Officer, Jill McDonald.

I was delighted when Jill agreed to join the Group and take up the role of CEO and I am certain that she will bring new perspective to the Board, based on her professional and personal experience.

Additional information on the activities of the Committee, including the details of the process leading to the appointment of the new CEO and the services provided by Egon Zehnder, executive search agency, are set out in this report.

There were two meetings held during the year and, after each Committee meeting, I reported to the Board on the key issues discussed during the meeting. A number of informal discussions were also held between Committee members and me.

The Committee's terms of reference are available on the Company's corporate website www.halfordscompany.com.

Committee Composition

Dennis Millard (Chairman)
Jill McDonald (joined 11 May 2015)
David Adams
Claudia Arney
Helen Jones
Matt Davies (resigned 30 April 2015)
Bill Ronald (resigned 31 May 2014)
Keith Harris (resigned 31 May 2014)

The Committee's role is to review the size and structure of the Board, consider succession planning and make recommendations to the Board on potential candidates for the Board. Its key objective is to ensure that the Board comprises individuals with the necessary skill, knowledge and experience to ensure that the Board is effective in discharging its responsibilities.

Principal Activities

The Committee's focus during the year was overseeing the process for the appointment of a new CEO, following Matt Davies' resignation. The Committee set out the types of skills and attributes it envisaged a new CEO would possess, which it captured in its briefing to executive search agency, Egon Zehnder, which identified potential candidates for the role. Committee members interviewed candidates for the role and thereafter recommended the recruitment of Jill McDonald to the Board.

Diversity

The Committee and the Board have sought to ensure that appointments are of the best candidates to promote the success of the Group and are based on merit, with due regard for the benefits of diversity on the Board (while also meeting the requirements of the Equality Act 2013). We previously made a commitment to further strengthen gender diversity amongst the workforce and, further to this commitment, the Board appointed Jill McDonald as the Group's new CEO, bringing the percentage of female Board members to 50%. This exceeds the EU's guideline of 40% female Board representation by 2020.

The Company does not currently publish specific diversity targets but in practice, it has created a more balanced Board and Executive Management Team and continues to work to ensure this is replicated across the entire business, in particular in relation to gender diversity.

Further information regarding diversity Board can be found in the Corporate Governance Report.

Looking ahead

In the year ahead, the Nomination Committee will continue to assess the Board composition and how it may be enhanced. It has also embarked upon the search for a replacement for Andrew Findlay, the Chief Financial Officer, who will leave the Company in October 2015.