Nomination Committee Terms of Reference

1. Constitution

1.1 The committee is established as a committee of the Board and will act in a way which the committee considers to be most likely to promote the success of the company for the benefits of its members as a whole.

2. Membership

2.1 Members of the committee shall be appointed by the Board.

2.2 The committee shall consist of all Non-Executive Directors and the Group Chief Executive. A majority of the members of the committee shall be independent Non-Executive Directors.

2.3 Only members of the committee have the right to attend the committee meetings. However, other individuals such as the People and Customer Experience Director and external advisers may be invited to attend for all or part of any meeting, as and when appropriate.

2.4 The Board shall appoint the committee chairman who should be either the Chairman of the Board or an independent Non-Executive Director. In the absence of the committee chairman and/or an appointed deputy, the remaining members present shall elect one of their number to chair the meeting. The Chairman of the Board shall not chair the committee when it is considering the succession of the chairmanship or in any other circumstance where he believes he may have a conflict of interest. In relation to such matters the committee shall be chaired by an independent Non-Executive Director.

3. Secretary

3.1 The Group Company Secretary or his or her nominee shall act as the secretary of the committee. The secretary shall ascertain at the beginning of each meeting of the committee, the existence of any conflicts and minute them accordingly.

4. Quorum

4.1 The quorum necessary for the transaction of business shall be two, both of whom must be independent Non-Executive Directors. A duly convened meeting of the committee at which a quorum is present shall be competent to exercise all or any of the authorities, powers and discretions vested in or exercisable by the committee.

5. Meetings

5.1 The committee shall meet at least twice a year and at such other times as the chairman of the committee shall require. Meetings may be held in person or by telephone or videoconference.

6. Notice of Meetings

6.1 Meetings of the committee shall be convened by the secretary of the committee at the request of the chairman of the committee.

6.2 Unless otherwise agreed with the chairman of the committee, notice of each meeting confirming the venue, time and date, together with an agenda of items to be discussed and supporting papers, shall be forwarded to each member of the committee, (and where appropriate, to any other person required to attend), no later than five working days before the date of the meeting.

7. Minutes of Meetings

7.1 The secretary shall minute the proceedings and resolutions of all committee meetings, including the names of those present and in attendance.

7.2 Draft minutes of committee meetings shall be circulated promptly to all members of the committee, and once approved, minutes should be circulated to all other members of the Board unless it would be inappropriate to do so.

8. Annual General Meeting

8.1 The chairman of the committee shall attend the Annual General Meeting prepared to respond to any shareholder questions on the committee’s activities.

9. Duties

The committee shall:

9.1 regularly review the structure, size and composition, including the balance of skills, knowledge, experience, independence and diversity (including gender) required of the Board and make recommendations to the Board with regard to any changes;

9.2 give full consideration to succession planning for Directors and other senior management in the course of its work, taking into account the challenges and opportunities facing the company, and the skills and expertise needed on the Board in the future;

9.3 be responsible for identifying and nominating for the approval of the Board, candidates to fill Board vacancies as and when they arise;

9.4 prepare a description of the role and capabilities required for any new appointments to the Board;

9.5 in identifying suitable candidates, (i) use open advertising or the services of external advisers to facilitate the search; (ii) consider candidates from a wide range of backgrounds; and (iii) consider candidates on merit and against objective criteria and with due regard for the benefits of diversity on the Board, including gender, taking care to ensure that appointees have enough time available to devote to the position and do not have unresolvable conflicts of interest;

9.6 for the appointment of a chairman, prepare a job specification, including the time commitment expected, recognising the need for availability in a crisis. As part of any recommendation to the Board a proposed chairman’s other significant commitments should be disclosed before appointment and any changes to the chairman’s commitments should be reported as they arise;

9.7 prior to the appointment of a Director, obtain details of and review any other business interests of the candidate which conflict with or may conflict with the interests of the Company and recommend to the Board any terms and conditions on which any authorisation of a conflict of interest of a proposed candidate should be given;

9.8 annually review any conflicts of interest disclosed by Directors and the terms and conditions, if any, on which such conflicts of interest were authorised by the Board, together with any new conflicts of interest which may have arisen. Following such review the committee shall make recommendations to the Board in respect of authorisation of any new conflicts of interest and any changes required to previous authorisations including, where appropriate, revocation of authorisation;

9.9 ensure that on appointment to the Board, Non-Executive Directors receive a formal letter of appointment setting out clearly what is expected of them in terms of time commitment, committee service and involvement outside Board meetings;

9.10 review the results of the Board performance evaluation process that relate to the composition of the Board; and

9.11 review annually the time required from Non-Executive Directors and where necessary use performance evaluation to assess whether the Non-Executive Directors are spending enough time to fulfil their duties.

The committee (after taking informal soundings from all Board members, where it is appropriate to do so) shall also make recommendations to the Board concerning:

9.12 suitable candidates for the role of senior independent director;

9.13 membership of the audit and remuneration committees, and any other Board committees as appropriate, in consultation with the chairmen of those committees;

9.14 re-appointment of any Non-Executive Director at the conclusion of their specified term of office, or if need be earlier, having given due regard to their performance and ability to continue to contribute to the Board based on the knowledge, skills, experience and diversity required and the need for progressive refreshing of the Board (particularly in respect of directors being appointed for a term beyond six-years); and

9.15 any matters relating to the continuation in office of any director at any time including the suspension or termination of service of an executive director as an employee of the company subject to the provisions of the law and their service contract.

10. Reporting Responsibilities

The committee shall:

10.1 report formally to the Board on its proceedings after each meeting on all matters within its duties and responsibilities;

10.2 make whatever recommendations to the Board (having provided informal updates to the non-members, where it is appropriate to do so, via the Chairman) it deems appropriate on any area within its remit where action or improvement is required; and

10.3 produce a report to be included in the company’s annual report about its activities, the process used to make appointments and explain if external advice or open advertising has not been used.

11. Other matters

The committee shall:

11.1 Have access to sufficient resources in order to carry out its duties, including access to the company secretariat for assistance as required;

11.2 be provided with appropriate and timely training, both in the form of an induction programme for new members and on an ongoing basis;

11.3 give due consideration to laws and regulations, the provisions of the Code and the requirements of the UK Listing Authority’s Listing, Prospectus and Disclosure and Transparency Rules and any other applicable Rules, as appropriate; and

11.4 arrange for periodic reviews of its own performance and, at least once a year, review its constitution, agenda and terms of reference to ensure it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board for approval.

12. Authority

12.1 The committee is authorised by the Board to obtain, at the company’s expense, outside legal or other professional advice on any matters within its terms of reference.

Approved 29 July 2011

Code refers to the UK Corporate Governance Code - June 2010