Corporate governance is about the structure and relationships which determine the corporate direction and performance. At BBC Worldwide the board of directors is central to our governance as is its relationship to the other key participants, BBC Public Service, BBC Worldwide and staff.
In the Annual Review of 2013/14 we reported that the number of directors of the statutory Board of BBC Worldwide Limited had been reduced in keeping with the policy to streamline boards and committees across the BBC Group.
However, in view of the size and significance of BBC Worldwide, the BBC Executive Board decided that the composition of the BBC Worldwide Board should be strengthened to include two additional Non-executive Directors.
The BBC Executive Board and its board committees have responsibility for the overall assurance and supervision of BBC Worldwide. However, during the coming months it is proposed that the authority to consider and approve the operational matters of the company will be delegated to the BBC Worldwide Board. For further detail on the activities of the BBC Executive Board go to www.bbc.co.uk/aboutthebbc.
As of 31 March 2015, the Board was composed of Tony Hall (BBC Director-General) as Chairman, Tim Davie (Chief Executive and Director, Global), Andrew Bott (Chief Financial Officer), Anne Bulford (Managing Director, Finance & Operations for the BBC) and from 16 February 2015, Dharmash Mistry and Sir Howard Stringer, both of whom are also Non-executive Directors of the BBC Executive Board.
Statutory matters, such as the approval of the company's statutory accounts, the payment of a dividend and the appointment of a director are already reserved to the Board of Directors.
The Worldwide Executive Committee (WEx) has principal responsibility for the day-to-day management of the company. WEx is chaired by Tim Davie. WEx meets weekly to discuss operational matters impacting the business.
During the year matters under review included plans to launch the global genre brands BBC First in Australia and New Zealand on Foxtel and BBC Brit and BBC Earth in Poland; and investments in The Musketeers S3 and Doctor Who S10. Additionally, during the year WEx reviewed people policies and development opportunities across the company.
WEx approves expenditure of up to £5m, beyond which the matter is reviewed by WEx and referred to the BBC Worldwide Board or to the BBC Executive Board as appropriate for approval. This ensures greater scrutiny of performance and highlights the needs of the regional businesses to be addressed. These quarterly performance reviews also serve to strengthen connections between the regions and Content, Brands and other central functions.
Content is central to our strategy and one of our most significant areas of expenditure. The Content Investment Group (CIG), chaired by the Controller of Content Investment, is responsible for approving investments of distribution and certain broadcast rights. CIG also monitors the content pipeline in the context of performance and strategic development in the business, and recommends changes in global content strategy and execution when necessary. CIG approves investments between £500,000 and £2m. For investments greater than £2m, CIG reviews and recommends the investments to WEx for approval.
WEx also delegates authority to the Investment Review Group, which considers and approves non-content financial investments between £1m and £2m.
Privacy and Information Security
Consumers, talent, partners and employees trust us with their personal information and failure to meet these expectations would lead to a serious loss of trust in the BBC brand. Our global privacy and information security programmes govern how we collect, use and manage all forms of personal information across our operating territories; from collecting information in a fair and transparent way to ensuring that this information remains protected and secured at all times. This extends to information that does not directly identify an individual but which may impact on an individual's privacy and there has been a significant amount of work in this area in the last 12 months across the organisation.
We take our legal and regulatory obligations seriously and we have developed clear policies, practices and training and awareness programmes to ensure the protection of personal information. These are regularly reviewed to ensure that we are transparent to individuals and provide clear choice on how we use their data. Our key focus over the next year will be preparing for the incoming EU General Data Protection Regulation which is due to be finalised in the next six months. As part of our compliance programme, our privacy and data protection function will be audited this year.
In terms of broader information security, we strive for continual improvement in the protection of our business information assets, especially in respect of content. Ensuring that these assets are protected at all stages of their lifecycle is vital to the success of our business, and that of our content partners, and to maintaining our reputation as a trusted organisation with high standards of care. This is especially important where we share content with third parties around the world and we have developed robust processes for evaluating these risks and ensuring that these partners have adequate security measures in place. Our progress in this area is routinely scrutinised by the BBC's Internal Audit function to ensure we are managing risk effectively.
Four Commercial Criteria
The BBC's Royal Charter and Agreement requires all of the BBC's commercial activities to comply with the four Commercial Criteria (4CC).
Our activities must:
- fit with the BBC's Public Purposes;
- not jeopardise the good reputation of the BBC or the value of the BBC brand;
- exhibit commercial efficiency; and
- comply with the BBC Trust's Fair Trading Policy, the BBC's Fair Trading Guidelines and, in particular, avoid distorting the market.
The 4CC approvals framework embedded within our governance structure ensures that key projects and investments are subject to rigorous evaluation, ensuring compliance with each of the 4CC prior to launch.
The BBC's Fair Trading arrangements (which include the 4CC approvals arrangements) have been accredited with the ISO 9001:2008 quality standard. BBC's Fair Trading arrangements are subject to scrutiny by independent auditors commissioned by the BBC. Details of this year's independent Fair Trading audit, undertaken by Deloitte, together with the audit opinion, are available in the BBC Annual Report and Accounts for 2014/15.
We are required to comply with the BBC Editorial Guidelines and the Advertising and Sponsorship Guidelines for BBC Commercial Services. We have an editorial framework which sets out clear editorial accountability for each business area and a dedicated Editorial Standards team that offers support and advice to our businesses. During the year we continued to deliver both online and face-to-face training explaining the editorial, commercial and advertising standards that we expect.