## External auditor and non-audit work 

The Company has a policy in place governing the conduct of non-audit work by the external auditor. Under this policy the auditor is prohibited from performing services where the auditor: 

■ May be required to audit his/her own work; 

■ Would participate in activities that would normally be undertaken by management; or 

■ Is remunerated through a “success fee” structure. 

Other than the above, the Company does not impose an automatic ban on the external auditor undertaking non-audit work. The external auditor is permitted to provide non-audit services that are not, or are not perceived to be, in conflict with auditor independence, provided it has the skill, competence and integrity to carry out the work and is considered by the Audit Committee to be the most appropriate to undertake such work in the best interests of the Company. The engagement of the external auditor in non-audit work must be pre-approved by the Audit Committee or entered into pursuant to pre-approved policies and procedures established by the Audit Committee. 

Details of the amounts paid to the external auditor during the year for audit and other services are set out on page 76. The Audit Committee has adopted a policy that, except in exceptional circumstances with the prior approval of the Audit Committee, non-audit fees paid to the Company’s Auditor should be capped at a maximum of 100% of audit fees in any one year. 

During 2012, the non-audit fees paid to the external auditor represented 80% of the audit fee. Fees paid for non-audit services relate to other services pursuant to legislation, taxation services and corporate finance transactions. 

## The Remuneration and Nomination Committee 

The Board as a whole is responsible for setting the Company’s policy on Directors’ remuneration. 

The Board of Directors has established a Remuneration and Nomination Committee and has delegated authority to this Committee to determine and recommend to the Board: the salaries and incentive compensation of the Company’s officers; and changes to Board structure, size and composition. 

The Committee comprises only independent, non-executive Directors. The members during the year were Russ Shaw (Chair), Chris Burke and Peter Weber. The Committee’s members have no financial interest in the Company other than as shareholders and through the fees paid to them. 

By invitation, other members of the Board may attend the Committee’s meetings. The CEO and the Vice President, Human Resources, may also attend by invitation but take no part in discussions or decisions on matters relating to their own remuneration. The Committee is free to seek its own advice free from management as it deems appropriate. 

During the year the Committee sought and received general advice relating to remuneration from Towers Watson and PwC, both of whom are signatories to the Remuneration Consultants Group Code of Conduct and any advice was provided in accordance with this code. 

During the year the Committee met formally on five occasions, in addition the Committee Chairman held a number of meetings with our advisers. 

## Responsibilities 

The Remuneration and Nomination Committee’s main responsibilities include to: 

■ Determine the salaries and incentive compensation of the Company’s officers and the officers of the Company’s subsidiaries; 

■ Provide recommendations for other employees and consultants as appropriate; 

■ Administer the Company’s compensation, stock and benefits plans; 

■ Review the Board structure, size and composition and make recommendations to the Board; and, 

■ Identify and nominate Board candidates for approval by the Board. 

The key activities of the Committee during the year were: 

■ Review and address 2011 Annual General Meeting outcomes; 

■ Review and approve Executive Management compensation; 

■ Recruit and appoint non-executive Directors and regularly discuss succession planning; 

■ Appoint new independent remuneration adviser to the Committee (Towers Watson); 

■ Discuss and review senior level talent; 

■ Review, plan and approve CEO remuneration. 

Details of 2012 remuneration and Dialog’s remuneration policy are set out in the Director’s remuneration report on pages 46 to 52. 

## Strategic Transaction and Technology Committee 

The Board of Directors has established a Strategic Transaction and Technology Committee and has delegated authority to this Committee to review, evaluate and make recommendations in relation to strategic transactions (such as acquisitions, disposals or licensing arrangements) and the Company’s technology and the technological market in which it operates. 

The Strategic Transaction and Technology Committee comprises only independent, non-executive Directors. The members during the year were Chris Burke (Chair), Aidan Hughes and Peter Weber. 

During the year, the Committee reviewed and determined the criteria and focus of the Company in terms of technology enhancement and potential M&A activity. 

