RMG.L Regulatory News (RMG)

Royal Mail plc

7 November 2018

Board and management changes

The Board of Royal Mail plc (RMG.L 'the Company') announces that Keith Williams, Chair of the Audit & Risk Committee, is also being appointed Deputy Chairman with immediate effect. Keith is increasing his commitment to Royal Mail. He is in the process of reviewing his external commitments, and any changes will be announced as required. As Executive Chairman of British Airways until 2016, Keith has a very strong track record in operational transformation, digital strategy and industrial relations, including pensions.

The Group is also revising its executive structure, with changes in the organisational structure of Post and Parcels UK. After 12 years' service, Sue Whalley, CEO, Post and Parcels UK, and the Board have agreed that she will leave Royal Mail. She will step down from the Board with immediate effect and transition her responsibilities by the end of March 2019. Rico Back, Group CEO, will assume commercial responsibilities for Post and Parcels - domestic letters and parcels - alongside his existing Group role and overall UK strategic responsibility. Operational responsibilities for Post and Parcels will be taken on by Stuart Simpson, CFO, and previously Deputy Chief Operating Officer. Sue will work alongside Stuart Simpson on our Christmas operational programme and assist the Company with ongoing regulatory, legal and other matters, as appropriate. Stuart will continue to report to Rico Back and be supported by a senior operations executive, whose appointment will be announced in due course.

Sue Whalley was formerly the Company's Regulation and Government Affairs Director and played a major part in the privatisation process. She was appointed Chief Operating Officer in 2014 and, subsequently, CEO, Post and Parcels, Royal Mail UK. Prior to Royal Mail, Sue was a McKinsey & Company Partner in its London office.

Les Owen, Chairman, commented: "We are very pleased that Keith Williams has agreed to increase his commitment to Royal Mail. Keith is a seasoned business leader, with a range of experience in regulated, customer-focused industries that we can leverage at Royal Mail.

"The Board would like to thank Sue Whalley for the significant contribution she has made to Royal Mail across a whole range of issues over the last twelve years. She has a strong track record of driving operational and cultural change, supporting letters, and implementing digital transformations to support the growth of the parcels business. We wish her well in the future."

Rico Back, Group Chief Executive Officer, said: "Since Keith Williams joined us in January 2018, his broad experience has been very helpful indeed. I am delighted that we will be working even more closely with him in the future.

"Sue Whalley has worked tirelessly for the company and I have worked closely with her for a number of years. My executive colleagues and I very much appreciate the work that she has done for Royal Mail and the positive change she has brought to many areas in the business. Sue has all our best wishes for the future."

Sue Whalley said: "Following all we have done to move the organisation forward in recent years and to implement change to position Royal Mail as a leader in e-commerce, now is the time to move on. I would like to thank the many colleagues - frontline and management - who have helped me in my time at Royal Mail."

This announcement is made in accordance with Listing Rule 9.6.11 and contains inside information for the purpose of the Market Abuse Regulation (EU) No 596/2014. In accordance with Section 430(2B) of the Companies Act 2006, the relevant disclosures will be made in the Annual Report & Accounts 2018-19.

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Notes to Editors:

i) Keith Williams

Biography: Keith Williams was appointed to the Board of Royal Mail on 1 January 2018. He is a highly regarded business leader with extensive operational and customer service experience. Keith was Executive Chairman of British Airways, having been appointed in January 2014 following three years as Chief Executive Officer. Over a five year period, Keith helped transform British Airways into a customer focused organisation and was responsible for rebuilding the company as part of the International Airlines Group. Prior to joining British Airways, Keith worked for companies including Reckitt and Colman, Apple Computer Inc., and Boots. He was also an Executive Board member and Chair of the Audit Committee at Transport for London until 2016. Keith is a chartered accountant.

Remuneration: As Deputy Chairman, Keith's current fee as a Non-Executive Director will remain unchanged at £69,000 per annum. Keith will also continue as the Chair of the Audit and Risk Committee. He will not participate in any variable remuneration or benefits arrangements. 

ii) Sue Whalley

Biography: Sue Whalley has been a senior executive at Royal Mail for 12 years. Sue was formerly the Company's Regulation and Government Affairs Director and played a major part in the privatisation process. She was appointed Chief Operating Officer in 2014 and, subsequently, CEO, Post and Parcels, Royal Mail UK. Prior to Royal Mail, Sue was a McKinsey & Company Partner in its London office.

Remuneration: Sue Whalley's compensation arrangements are in line with the Company's approved Remuneration Policy.

Salary and Benefits: Sue Whalley will continue to receive full pay and benefits until 31 March 2019; and payments in lieu of approximately seven months' basic salary, in monthly instalments over the remainder of what would have been her contractual 12 month notice period. The Company also has an explicit policy on mitigation for payment in lieu of notice. There will be a requirement for Sue Whalley to immediately disclose any payment received from alternative employment. Her phased payments in lieu of notice will be reduced by any earnings from alternative employment.

Bonus and share awards: Sue Whalley will remain eligible to receive deferred annual bonus awards that have already been granted and where no subsequent performance conditions apply. These will continue to vest according to the normal schedule. It has been agreed that Sue Whalley will not be eligible for any annual bonus for 2018-19, were the relevant performance conditions to be met. All outstanding LTIP awards will lapse with immediate effect. The table below sets out the relevant number of shares previously awarded to Sue Whalley under the Company's share plans and the treatment described above. 

Other: Sue will receive a capped contribution of £7,000 (excluding VAT) towards legal fees incurred in connection with her departure; and a capped contribution of £50,000 (excluding VAT) towards outplacement support following her departure.

Further information: The relevant remuneration details relating to Sue Whalley, including information on the vesting of any outstanding awards detailed above and the dividend equivalents payable on them, will be included in the relevant Directors' Remuneration Report in the Annual Report and Accounts.

For more information, please contact:

Media Relations

Shane O'Riordain

Phone: 07770 544 585

Email: shane.oriordain@royalmail.com

Beth Longcroft

Phone: 07435 768 549

Email: beth.longcroft@royalmail.com

Investor Relations

Catherine Nash

Phone: 020 7449 8183

Email: investorrelations@royalmail.com

Company Secretary

Kulbinder Dosanjh

Phone: 020 7449 8133

Email: cosec@royalmail.com

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About Royal Mail plc

Royal Mail plc is the parent company of Royal Mail Group Limited, the leading provider of postal and delivery services in the UK and the UK's designated universal postal service provider. UK Parcels, International & Letters (UKPIL) comprises the company's UK and international parcels and letters delivery businesses operating under the "Royal Mail" and "Parcelforce Worldwide" brands. Through the Royal Mail Core Network, the company delivers a range of parcels and letters products, including the one-price-goes-anywhere Universal Service products. Royal Mail has the capability to deliver to more than 30 million addresses in the UK, six days a week (excluding UK public holidays). Parcelforce Worldwide operates a separate UK network which collects and delivers express parcels. Royal Mail also owns General Logistics Systems (GLS) which covers 41 countries and nation states in Europe and eight states in the Western U.S. and in Canada. GLS operates one of the largest ground-based, deferred parcel delivery networks in Europe.