## Governance 

## Contents 

## Page 

38 Corporate Governance Report 

38 Chairman’s Introduction 

40 Listings and Corporate Governance Codes 

40 Board of Directors 

40 – Responsibilities 

40 – Roles of Chairman and Chief Executive 

40 – Membership 

41 – Succession and diversity 

41 – Independence 

41 – Chairman 

41 – Senior Independent Director 

41 – Company Secretary 

41 – Terms of appointment of non-executive Directors 

41 – Induction, training and development 

41 – Performance appraisal and Board evaluation 

42 – External Board evaluation 

42 – Directors’ retirement and re-election 

43 – Board meetings 

43 – Securities dealing policies and codes 

44 Audit Committee 

48 Nomination and Corporate Governance Committee 

50 Remuneration Committee 

50 Acquisitions Committee 

50 Finance Committee 

50 Risk Management and Internal Control 

51 Compliance and Ethics 

51 Attendance at Board/Committee meetings 

52 Sustainability and Corporate Social Responsibility 

52 Substantial Holdings 

52 Communications with Shareholders 

52 General Meetings 

53 Memorandum and Articles of Association 

53 Going Concern 

53 Compliance Statement 

53 Documents and presentations available on CRH website 

54 Report on Directors’ Remuneration 

68 Directors’ Report 

CRH plc has a secondary listing on The Irish Stock Exchange. For this reason, CRH plc is not subject to the same ongoing listing requirements as those which would apply to an Irish company with a primary listing on the Irish Stock Exchange including the requirement that certain transactions require the approval of shareholders. For further information, shareholders should consult their own financial adviser. Further details on the Group’s listing arrangements, including its primary listing on the London Stock Exchange, are set out on page 40. 

Nicky Hartery Chairman 

## Chairman’s Introduction 

The CRH Board is responsible for the leadership, oversight, control, development and long-term success of the Group. We are also responsible for instilling the appropriate culture, values and behaviour throughout the organisation and are committed to maintaining very high standards of corporate governance and ethical business conduct. The Corporate Governance Report sets out in detail CRH’s key corporate governance principles and practices, details the way in which the Board operates and outlines how the 2010 UK Corporate Governance Code, which applies to the Company, is implemented. I have highlighted below some of the more important elements of our governance structures and those areas for which I have specific responsibility as Chairman. 

## Board effectiveness and evaluation 

As a non-executive Director since 2004, and Senior Independent Director from May 2008 to May 2012, I have found the CRH Board to be highly effective, composed of knowledgeable individuals with a wide range of business experience, who enjoy working together towards common goals, in an environment where no aspect of the Group and its operations is off-limits for debate and which is characterised by positive interaction between executive and non-executive Directors. One of the many attributes of my predecessor as Chairman, Kieran McGowan, was his ability to foster and support this environment, particularly against the fast-evolving, uncertain economic and financial backdrop of recent times. 

When I became Chairman following the Annual General Meeting in May 2012, one of my primary goals was to ensure that the effectiveness of the Board was maintained and, where possible, enhanced and that the Board remains resolutely focussed on fulfilling its responsibilities. I was, therefore, very interested in the feedback from the external Board evaluation exercise carried out in 2012. The outcome, which was very positive, together with the relatively small number of recommendations (outlined on page 42), supported my view that the Board operates very effectively. The outcome was also in line with the results of annual internal Board evaluation exercises. Each Board member participated fully in the external evaluation process and felt that the resulting report and recommendations were helpful and practical. All of the recommendations have been implemented or will, for timing reasons, be implemented during 2013. From my perspective, having an external “sense-check” on the 

