REG - Rightmove Plc - Final Results <Origin Href="QuoteRef">RMV.L</Origin> - Part 2
23/02/2018 07:05
- Part 2: For the preceding part double click ID:nRSW7131Fa
lead to a reduction in advertisers' marketing budgets which could most significant and effective exposure for customers' brands and
confidence which impacts on property transaction levels. reduce the demand for the Group's property advertising products. properties, be the largest source of high quality leads and offer value-adding
products and packages and help drive operational efficiencies for our
customers, thereby embedding the value of our membership
Specific considerations resulting from the UK's decision to leave the European · Communicating the effectiveness of digital media versus
Union have been outlined on page 25. alternative mediums such as print
· Maintaining a flexible cost base that can respond to changing
conditions
2 Competitive environment This may impact on Rightmove's ability to grow revenue due to the potential · Communication of the value of Rightmove membership to advertisers Risk un-changed
loss of:
The Group operates in a competitive marketplace with attractive margins and
· Continued investment in our account management teams to ensure we
low barriers to entry. This may result in increased competition from existing · Audience stay close to our customers and local markets and help our customers run their
competitors or new entrants targeting the Group's primary revenue markets.
businesses more efficiently
· Advertisers
· Sustained marketing investment in the Rightmove brand
· Demand for additional advertising products
· Sustained investment and innovation in serving both home hunters and
our customers
3 New or disruptive technologies and changing consumer behaviours Under-performance and impact on Rightmove's ability to grow revenue due to the · Continual improvements to our platforms including ongoing Risk un-changed
potential loss of: investment in mobile and tablet platforms
Rightmove operates in a fast-moving online marketplace. Failure to innovate or
adopt new technologies or failure to adapt to changing customer business · Audience engagement · Developing our product proposition to meet our customers' needs and
models and evolving consumer behaviour may impact the Group's ability to offer
evolving business models
the best products and services to its advertisers and the best consumer · Advertisers
experience.
· Large in-house technology team with culture of innovation
· Demand for additional advertising products
· Innovation lab to develop emerging models and technologies
· Ongoing monitoring of consumer behaviour and annual 'Hackathons'
which allow employees to spend time during work hours to develop their own
online property related ideas
· Regular contact with the start-up and prop-tech communities to
stay abreast of innovations in the marketplace
4 Cyber security and IT systems Potential reputational damage and financial losses arising from penalties and · Disaster Recovery and Business Continuity Plans in place, subject to Risk un-changed
fines due to loss of consumer and customer confidence in the Rightmove brand regular review and testing
The Group has a high dependency on technology and internal IT systems. and platforms.
· Use of three data centres to load balance and ensure optimal
performance and business continuity capability
In today's digital world there are increased risks associated with external · Regular backups of key data
cyber attacks which could result in unavailability of our platforms.
· Regular testing of the security of the IT systems and platforms
including penetration testing and distributed denial of service attack
procedures
A security breach such as corruption or loss of key data may disrupt the
efficiency and functioning of the Group's day to day operations. · Ongoing investment in security systems
· Ongoing monitoring of external threats through updates from external
specialists and collaboration with other online organisations
· Regular internal security training and 'spearphishing' tests to
minimise risk of social engineering attacks
5 Securing and retaining the right talent The inability to recruit and retain talented people could impact our ability · Ongoing succession planning and development of future leaders Risk un-changed
to maintain our financial performance and deliver growth.
Our continued success is dependent on our ability to attract, recruit, retain
· Payment of competitive reward, including a blend of short and
and motivate our highly skilled workforce. long-term incentives for senior management and the ability for all employees
to participate in the success of the Group through the SIP
When key staff leave or retire, there is a risk that knowledge or competitive
advantage is lost. · Regular staff communication and engagement
· Maintaining the culture of the Group, which generates significant
staff loyalty
· Introduced a number of initiatives to improve the gender balance
across various Rightmove teams as set out in our Gender Pay Gap Report
Increased risk Decreased risk Risk unchanged
STRATEGIC REPORT - The EU referendum
The result of the UK's EU referendum in 2016 increased the level of
macroeconomic uncertainty and could increase the likelihood of the housing
market macroeconomic risks set out on page 22.
During 2017 the Board has continued to assess the impact of the EU referendum
result on the Group and its potential implications and has concluded that
there has been no material change to the severity of this risk. In particular,
the directors considered the following:
· The Rightmove business is largely subscription based and is therefore
less susceptible to short-term shocks or variations in the property market or
wider economy;
· Around two-thirds of our estate agency customers also provide
lettings services which may mitigate the impact of any downturn in the
property market on their business; and
· A reduction in housing market activity increases the propensity for
advertisers to evaluate their marketing spend both offline and on other
portals and we remain confident in the strength of the Rightmove value
proposition.
The directors believe that our strong market position and relationships with
our customers, and the value embedded in our membership continue to position
us well providing that housing transaction volumes do not take a sharp
downward turn.
STRATEGIC REPORT - Viability statement
In accordance with provision C.2.2. of the Code, the directors have assessed
the viability of the Group over a three-year period, taking into account the
Group's current position and the potential impact of the principal risks and
uncertainties set out on pages 21 to 24. Based upon the robust assessment of
the principal risks facing the Group, including those that would threaten its
business model, future performance, solvency or liquidity, the directors have
a reasonable expectation that the Group and the Company will be able to
continue in operation and meet its liabilities as they fall due over the
three-year period to 31 December 2020.
The directors have determined that a three-year period to 31 December 2020
constitutes an appropriate period over which to provide its viability
statement, as the Group operates within the online digital marketplace, and
projections looking out further than three years become significantly less
meaningful in the context of the fast moving nature of the market. Three years
is also the period considered under the Group's current three-year strategic
plan. The three-year plan is reviewed by the directors and is developed on a
segment by segment basis using a bottom up model. The three-year plan makes
certain assumptions about Agency and New Homes customer numbers, Average
Revenue Per Advertiser (ARPA) growth and other breadth revenue streams and
considers the Group's profitability, cash flows and dividend cover over the
period.
The plan is subject to robust downside sensitivity analysis which involves
flexing a number of the main assumptions underlying the plan. Where
appropriate, analysis is carried out to evaluate the potential financial
impact over the period of the Group's principal risks actually occurring.
Specific scenarios that have been modelled include downside scenarios in
relation to the key drivers of revenue being customer numbers and ARPA
together with the impact of a plausible combination of these scenarios.
Furthermore, our business model is structured so that the Group is not overly
reliant on a small customer base with no single customer constituting more
than 3% of Group sales.
Also given our significant free cash flow and our ability to adjust our
discretionary share buyback programme provides long-term comfort around
viability in the face of adverse economic or competitive conditions.
Whilst this review does not consider all the risks that the Group may face,
the directors consider that this stress-testing based assessment of the
Group's prospects is reasonable in the circumstances of the inherent
uncertainty involved.
STRATEGIC REPORT - Corporate responsibility
Our people We believe that our people are the key to Rightmove's success and
our most valued asset. We have always strived to make Rightmove a great place
to work and embedded this into our strategic management objectives. We are
proud of the energy, talent and experience our people bring to the business.
Our culture is open and supportive, with an encouraging and restless yet
focussed approach which fosters innovation and dedication to excellent
customer service.
Recruitment
Recruiting the right people with capability and experience to drive growth is
vital to our business plan. The highly competitive market for technology and
customer centric skills means that we are strongly focussed on maintaining a
happy, collegiate working environment and the top benefits to attract and
retain the best people.
Referrals from existing employees are a valuable source of new recruits,
typically ensuring a higher quality candidate with a better cultural fit. All
new vacancies are advertised internally first to give our colleagues an
opportunity to apply or recommend someone. In 2017, 8% of new employees were
introduced to Rightmove by an existing employee.
We also believe that long-term commitment from Rightmove employees is key to
our culture and success. For a relatively young company we are proud to have
67 people who have celebrated ten or more years' service, which represents
over 14% of our employees and contributes to our strong people survey results.
We continue to support Milton Keynes College in preparing students for their
future careers. During the year we welcomed six students completing their
Level 3 Higher National Diplomas in our design studio and offered two students
internships. In addition, our designers have offered support and mentoring to
students on campus. We have continued to expand our intern programme across
Rightmove. Our technology teams took on four computer and data science interns
from University College London.
People development and training
Every new employee attends two office based 'How Rightmove fits together' days
to introduce them to the business and our customers. They also attend an
off-site residential induction course to introduce them to Rightmove's culture
and values.
To ensure our colleagues can work to the best of their ability, we continue to
invest in extensive training and leadership programmes, designed to equip them
with all the necessary skills to provide exceptional service to our customers
and consumers. We have also developed a suite of internal development
courses for our employees covering both technical and non-technical skills to
improve their performance through continual professional and personal
development.
Employee Benefits
Whilst we believe that being a great place to work helps us attract the best
talent we also reward our employees with a range of additional and competitive
benefits.
Rightmove contributes towards a group stakeholder pension plan. Opt out rates
are low and currently 95% of employees are members of the pension plan. We
also offer private healthcare complemented by a cash plan scheme for all our
employees' medical needs.
It is important that our people can directly benefit from their contribution
to the success of Rightmove and we offer two all-employee share plans. Every
employee can join the Group's Save As You Earn Scheme (Sharesave), which
allows employees to save money from their salary with the option to purchase
shares at a discount after three years. In November 2017, the Group's ninth
Sharesave contract matured allowing employees to benefit from the Group's
success and strong share price growth over the last three years. 67% of our
employees currently participate in Sharesave.
The Rightmove Share Incentive Plan was launched in 2015 with an award of 100
free shares for all employees. Those shares were available to sell from
January 2018, with those employees benefiting from the Rightmove share price
more than doubling over that period. Further awards of 50 free shares have
been made annually in subsequent years to all qualifying employees.
We offer flexible working arrangements, fully support part time working and
reduced hours to allow our employees to balance their work and family
commitments. In 2017, we also introduced a flexible holiday scheme to operate
from 2018, allowing employees to buy or sell up to five days (or the part-time
equivalent) of holiday each year to suit their personal circumstances.
Engagement
We encourage employee involvement and keep colleagues informed of the Group's
activities through 'townhalls', business performance updates with senior
management and quarterly sales conferences.
We have an employee recognition scheme, based on the 'Rightmove behaviours'
which allow us to focus on how we work not just on what we achieve. It is an
opportunity to nominate colleagues who have demonstrated the best behaviours
in action and it continues to prove popular with awards presented every two
months at our 'townhalls'.
We conduct an annual 'Have your Say' people survey to gauge what our employees
think and how they feel about working for Rightmove. The survey results are
followed up by every manager and we are never complacent about the importance
of acting on colleagues' feedback. We are proud of another set of strong
results from the survey with highlights including:
· 90% of respondents think Rightmove is a great place to work;
· 90% are proud to tell people they work for Rightmove; and
· 92% enjoy working in their teams.
An employee engagement score will again form part of the senior management
bonus criteria in 2018, demonstrating the importance of employee engagement to
the continuing success of Rightmove.
The management team continues to work hard to improve the employee experience
at Rightmove. In 2017, we took on additional space and refurbished our
London office, taking employee preferences into account; the result being a
creative and welcoming space.
Equality and diversity
Rightmove has a firm commitment to equality of opportunity in all our
employment policies and practices. Our recruitment and selection processes
focus on selecting the best candidate for a role, regardless of their age,
gender, sexuality, full or part-time status, disability and marital status.
We recognise that a diverse workforce reflects Rightmove's broad consumer base
and our many customers. Our people have a wide range of experience and
perspectives that we believe promote innovation, constructive challenge and
success. Drawing on a wide variety of personal attributes drives value in the
way we do business and helps us anticipate and provide what our customers need
from us and what home hunters want from Rightmove.
At 31 December 2017, female representation on the Board was 38% and with the
appointment of Lorna Tilbian in February 2018 that proportion has risen to 44%
of Board members. Following the retirement of Ashley Martin in May 2018, we
are delighted that female representation on the Board will rise to 50%.
The Board continues to focus on succession planning and developing potential
within the senior management team to enable us to promote internal candidates
to the Board. The Group succession plan also identifies individuals with
potential to join the senior management team in the wider organisation. As
at 31 December 2017, 26% (2016: 21%) of our leadership team((1)), were female.
The Board is keen to strengthen female representation in senior roles and has
been a contributor to the Hampton-Alexander Review, a Government sponsored
initiative which aims to increase female leadership within the FTSE350. In
line with the Hampton-Alexander Review, Rightmove has set a target for 33%
female leadership by 2020.
((1)) Being the Executive Committee and their direct reports as per the
Hampton-Alexander definition.
A breakdown by gender of the number of persons as at 31 December 2017 by
various classifications as required by the Companies Act, is set out below:
http://www.rns-pdf.londonstockexchange.com/rns/7131F_1-2018-2-22.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/7131F_1-2018-2-22.pdf)
(1) The Hampton-Alexander cohort comprises members of the Executive
Committee and their direct reports.
(2) The Senior Management Team comprises the Hampton-Alexander cohort,
excluding the executive directors.
Gender Pay
Rightmove has reported its gender pay gap for 2017 and full details can be
found on the Company's website at plc.rightmove.co.uk
We are confident that all Rightmove employees are paid equally for working in
the same jobs and we are pleased to report that men and women are almost
equally represented in our wider workforce. The main contributor to
Rightmove's gender pay gap is the mix in Rightmove communities comprising the
highest and lowest quartile salaries. Women are underrepresented in the higher
paid senior management and technology teams and men are underrepresented in
the customer experience team.
Technology is a sector blighted by a lack of gender diversity, but accepting
the status quo is not in our DNA. Below is our gender pay gap as at April
2017, together with a description of some of the initiatives that we have
underway for improving our gender balance going forward.
Difference between male and female pay
Mean Median
Difference in hourly rate of pay((1)) 30.6% 37.0%
Difference in bonus pay((2)) 70.4% 36.5%
(1) Calculated using Rightmove Group Limited pay data from April 2017.
(2) Calculated using 12 months of Rightmove Group Limited bonus pay data
to 5 April 2017.
We work hard to create an environment where men and women have the opportunity
to build careers throughout the business and believe that our open,
collaborative culture is key to that objective. We are committed to a number
of actions to balance our teams in a fair and transparent way, including:
Balance for all Addressing imbalance
· We have developed maternity and paternity workshops to support · We are developing a mentoring programme to support career
Rightmovers through the changing dynamic of family and work responsibilities development and aim to exceed the Hampton-Alexander review target of 33% of
and their return to work after a career break the leadership team being female by 2020
· We recognise that balancing work and life commitments can make · We are creating an internal talent pipeline to promote the next
people shy away from taking the next step in their career. New flexible generation of leaders
working arrangements have been rolled out for all employees
· We have launched a graduate programme in technology to attract
the best new talent to help create balance in our technology teams over the
longer term
· We have reviewed all job specifications and updated the format of
our recruitment days to guarantee universal appeal and attract the best talent
Human rights
Rightmove does not have a specific human rights policy, we have a framework of
policies and statements covering equal opportunities, dignity at work,
disability, anti-slavery and anti-bribery that adhere to internationally
recognised human rights principles.
Charitable activity
We continue to encourage our employees to raise funds for their chosen
charities. In 2017 we match funded £24,000 (2016: £18,000), supporting
charities including The Stroke Association, The Carers Trust, Scope and many
more. From breakfast mornings to running marathons we are delighted that so
many of our colleagues devote their time and energy to such good causes. For
the second year running we have supported food banks at Christmas; this year
we delivered a car packed full of food to the Milton Keynes Food Bank.
In 2017, we contributed £56,000 (2016: £49,000) via Agents Giving to support
our customers' charitable initiatives, which ranged from a Mount Everest trek
to Tough Mudders, triathlons and fun runs. We contribute to the costs of
setting up the fundraising activity, which allows more of the money raised by
our customers to go directly to charities through a charitable sponsorship
fund we set up with Agents Giving. We are very proud that the fund has
raised over £1 million since 2014 for charitable causes supported by our
customers.
Looking ahead to 2018 we are pleased to be partnering with the Milton Keynes
marathon as headline sponsor in 2018 (the home of Rightmove) in aid of
Meningitis Now and Winter Night Shelter. These two causes are very important
to our employees and fund raising efforts are well underway as part of our 'On
The Move' campaign, with over £1,200 raised in the last 4 weeks of 2017. We
have set our employees a target of raising £26,000, to be split equally
between both charities and Rightmove will make a significant additional
contribution. Over 50 employees will be volunteering their time, training
and being creative with their fundraising efforts to support these charities.
We will be sponsoring the Milton Keynes College Football Academy again in
2018. We have worked closely with the college over the last few years,
enabling the academy to create more opportunities for their students to study
for off-pitch roles in sport.
Environment We are conscious of playing our part in tackling climate change
and always encourage the efficient use of resources that contribute to
environmental damage.
Rightmove has changed the way people search for property, reducing the
reliance on printed media and the environmental impact that goes with it. Our
platforms are designed to optimise the information available to home hunters,
giving our customers the ability to advertise high quality photographs, floor
plans and property particulars and reducing the need for paper copies of
property particulars.
The quality of property information available on Rightmove also reduces the
amount of time home hunters waste in visiting inappropriate properties,
usually by car. We have worked hard to improve the functionality of our
platforms with better photographs and property floor plans to comprehensive
map searches and aerial photographs, which helps to identify the specific
location of a property. We continue to add information to help home hunters
customise their property search on Rightmove including School Checker and
broadband speeds. All these innovations have helped to reduce the carbon
footprint generated by prospective buyers and renters making unnecessary
journeys to visit unsuitable properties.
The Rightmove platforms enable our customers to display Energy Performance
Certificates which allow prospective buyers to evaluate the energy efficiency
of a property before buying and to identify opportunities to improve the
energy efficiency once they have purchased the property.
As an internet-based business with most staff employed in two office
locations, our environmental footprint is small. We continue to encourage our
employees to minimise their use of resources and recycle materials wherever
possible. There are no individual waste bins in our London and Milton Keynes
offices to encourage and increase the amount of recycling.
As an operator of an online property portal, our main environmental impact is
from the power usage of our data centres. Our procurement policy is to
purchase hardware with the best computational performance which uses the least
electrical power.
We encourage our employees to use public transport rather than driving between
our two office locations in London and Milton Keynes. We encourage
participation in our Cycle to Work scheme and have many keen cyclists. We
have also introduced the option for staff entitled to a company car to select
hybrid electric cars as an alternative to petrol or diesel engines. In 2017,
our fuel card provider Allstar, again partnered with Forest Carbon to capture
the CO(2) emissions from our fleet of company cars and turn them into new UK
woodlands.
As an online business, we tend towards a paperless environment. However, we
recognise that our responsibilities do not stop with how we operate internally
and we encourage all our customers, business partners and suppliers to use
online records and reduce printing, especially emails. Wherever possible we
have replaced paper-based services and communications with online
alternatives, including e-communications for shareholders, online customer
membership forms, management information and marketing reports and product
documentation.
Greenhouse gas reporting
The Companies Act 2006 (Strategic Report and Directors' Report) Regulations
2013 requires all UK quoted companies to report on their greenhouse gas (GHG)
emissions, which are classified as either direct or indirect and which are
divided further into Scope 1, Scope 2 and Scope 3 emissions.
Direct GHG emissions are emissions from sources that are owned or controlled
by Rightmove. Indirect GHG emissions are emissions that are a consequence of
the activities of the Group but that occur at sources owned or controlled by
other entities.
Scope 1 emissions: Direct emissions controlled by the Group arising from
Company cars. Whilst the cars are leased, we are responsible for the emissions
and therefore we report these under Scope 1.
Scope 2 emissions: Indirect emissions attributable to the Group due to its
consumption of purchased electricity.
Scope 3 emissions: Other indirect emissions associated with activities that
support or supply the Group's operations, we include emissions arising from
our third party run data centres.
The Group is required to report Scope 1 and 2 emissions for its reporting year
to 31 December 2017. Scope 3 is not mandatory, however the Group has again
chosen to report Scope 3 emissions as it relates to electricity used in data
centres, in which the Group rents space to house and operate various servers,
which host our platforms.
Rightmove emissions by scope:
Scope Source Tonnes CO(2)e((1)) Tonnes CO(2)e((1))
2017 2016
Scope 1 Company cars 495 486
Scope 2 Electricity 255 303
Scope 3 Outsourced - data centres 257 298
Total 1,007 1,087
(1) UK emissions factors have been used for all data. All emission factors
have been selected from the emissions conversion factors published annually by
Defra.
www.gov.uk/measuring-and-reporting-environmental-impacts-guidance-for-businesses
(http://www.gov.uk/measuring-and-reporting-environmental-impacts-guidance-for-businesses)
.
Higher fuel consumption was due to increased business mileage by employees
entitled to Company cars. The reduction in electricity use is partly due to
closing one floor of our London office for refurbishment during 2017 and lower
electricity consumption on the two new floors. We expect Scope 2 emissions
to return to historic levels in 2018.
Emissions have also been calculated using an 'intensity metric', which will
enable the Group to monitor how well we are controlling emissions on an annual
basis, independent of fluctuations in the levels of their activity. As
Rightmove is a 'people' business, the most suitable metric is 'Emissions per
Employee', based on the average number of employees during the year. The
Group's emissions per employee are shown in the table below.
Emissions per Employee:
Scope Source Tonnes CO(2)e Tonnes CO(2)e
per employee((1)) per employee((1))
2017 2016
Scope 1 Company cars 1.0 1.0
Scope 2 Electricity 0.5 0.7
Scope 3 Outsourced - data centres 0.5 0.7
Total 2.0 2.4
(1) Based on 479 (2016: 466) employees taken as the average number of
employees in the Group throughout the year.
Scope 2 and 3 emissions per employee have declined year on year due in part to
an increase in average headcount which has not had a proportionate impact on
emissions from running our offices or the outsourced data centres. We will
continue to monitor and look for ways to improve energy efficiency.
Methodology
We have reported on all of the emission sources required under the Companies
Act 2006 (Strategic Report and Directors' Report) Regulations 2013. We have
used the GHG's Protocol's Operational Control consolidation method. We do not
have responsibility for any emission sources that are not included in the
above information.
Health and safety The Group's policy on health and safety is to provide
adequate control of the health and safety risks arising from work activities.
This is delivered through consultation with, and training of, employees, the
provision and maintenance of plant and equipment, safe handling and use of all
substances and the prevention of accidents and causes of ill health. At
Rightmove, our approach to the effective management of health and safety is to
treat it as an integral part of business management. During the year, we
continued our fire safety, first aid and work place safety training.
GOVERNANCE - Directors and officers
Scott Forbes Chairman
Appointment to the Board
13 July 2005
Committee membership
Nomination (Chairman)
Current external commitments
Chairman of Ascential plc
Non-executive director of Travelport Worldwide Limited Chairman of Innasol
Group Limited
Chairman of Cars.com Inc
Previous roles and relevant experience
Chairman of Orbitz Worldwide until September 2015. Director of NetJets
Management Ltd, a subsidiary of Berkshire Hathaway until October 2009. Scott
has over 35 years' experience in operations, finance and mergers and
acquisitions including 15 years at Cendant Corporation which was formerly the
largest worldwide provider of residential property services. Scott established
Cendant's international headquarters in London in 1999 and led this division
as Group Managing Director until he joined Rightmove.
Peter Brooks-Johnson Chief Executive Officer
Appointment to the Board
10 January 2011
Current external commitments
None
Previous roles and relevant experience
Peter joined Rightmove in 2006 and became Chief Operating Officer in April
2013 having been Managing Director of rightmove.co.uk since 2011 and head of
the Agency business since 2008. He was promoted to Chief Executive Officer in
May 2017. Prior to joining Rightmove, Peter was a management consultant with
Accenture and the Berkeley Partnership.
Robyn Perriss Finance Director
Appointment to the Board 30 April 2013
Current external commitments
None
Previous roles and relevant experience
Robyn joined Rightmove in 2007 as Financial Controller with responsibility for
day to day financial operations and was promoted to the Board as Finance
Director in April 2013. She was also Company Secretary from April 2012 to July
2014 and from June to October 2016. Robyn qualified as a chartered
accountant in South Africa with KPMG and worked in both audit and transaction
services. Prior to joining Rightmove, Robyn was Group Financial Controller at
the online media business, Auto Trader.
Peter Williams
Senior Independent Non-Executive Director
Appointment to the Board
3 February 2014
Committee membership
Remuneration (Chairman), Audit, Nomination
Current external commitments
Chairman of DP Eurasia NV Chairman of boohoo.com plc Chairman of Mister Spex
GmbH Chairman of U and I plc
Previous roles and relevant experience
Peter was previously senior independent director of ASOS plc and Sportech plc,
Chairman of Jaeger, held non-executive director roles in Cineworld Group plc,
the EMI group, Blacks Leisure Group plc, JJB Sports plc, GCap Media plc and
Capital Radio Group plc. In his executive career, Peter was Chief Executive at
Alpha Group plc and prior to that, Chief Executive of Selfridges plc where he
also acted as Chief Financial Officer for over ten years.
Ashley Martin Non-Executive Director
Appointment to the Board 11 June 2009
Committee membership
Audit (Chairman), Nomination
Current external commitments
Non-executive director of Zegona Communications plc
Previous roles and relevant experience
Ashley qualified as a chartered accountant in 1981 and has a career in finance
spanning 35 years. He was previously Global Chief Financial Officer of Engine
Holding LLC and Group Finance Director of Rok plc, the building services
group, and Group Finance Director of the media services company, Tempus plc.
Rakhi Goss-Custard
Non-Executive Director
Appointment to the Board
28 July 2014
Committee membership
Remuneration, Nomination
Current external commitments
Non-executive director of Kingfisher plc Non-executive director of Schroders
plc
Non-executive director of Intu Properties plc
Non-executive director of Be Heard Group plc
Previous roles and relevant experience
Rakhi was previously Director of UK Media at Amazon to June 2014. She held
various other senior positions during her 11-year tenure at Amazon including
Media, Entertainment, General Merchandise and Book divisions as well as
Product Development. Prior to Amazon, Rakhi previously advised Zappos and held
strategy roles at TomTom and Oliver Wyman.
Jacqueline de Rojas CBE
Non-Executive Director
Appointment to the Board 30 December 2016
Committee membership
Remuneration, Nomination
Current external commitments President of techUK
Non-executive director of Costain Group plc
Non-executive director of AO World plc
Previous roles and relevant experience
Jacqueline has been employed throughout her career by global blue-chip
software companies and has held senior positions at Citrix, CA Technologies,
McAfee and Ascential Software. She was a non-executive director of Home
Retail Group from 2012 to 2016. Jacqueline is an advisor to the Digital
Leaders Technology Group and a passionate advocate for diversity and inclusion
in the workplace with a particular focus on getting women and girls into
digital careers and studying STEM subjects. She was awarded a CBE for services
to international trade in the technology industry in the 2018 New Year's
Honours list.
Andrew Findlay
Non-Executive Director
Appointment to the Board 1 June 2017
Committee membership
Audit, Nomination
Current external commitments Director of easyJet plc
Previous roles and relevant experience
Andrew has been the Chief Financial Officer of easyJet plc since 2015. Before
joining easyJet, Andrew was Chief Financial Officer of Halfords plc and prior
to that Director of Finance, Tax and Treasury at Marks and Spencer. He
formerly held senior finance roles at the London Stock Exchange and at Cable
and Wireless, both in the UK and US. Andrew qualified as a chartered
accountant with Coopers & Lybrand.
Lorna Tilbian
Non-Executive Director
Appointment to the Board
1 February 2018
Current external commitments
Non-executive director of Jupiter UK Growth Investment Trust plc
Non-executive director of Proven VCT plc
Non-executive director of Finsbury Growth & Income Trust PLC
Non-executive director of Euromoney Institutional Investor PLC
Non-executive director M&C Saatchi PLC
Previous roles and relevant experience
Lorna was Executive Director and Head of the Media Sector in Corporate Broking
& Advisory at Numis Corporation PLC until September 2017. She was a
founder of Numis when it launched in 2001 having worked at Sheppards, as a
director of SG Warburg and executive director of WestLB Panmure. Lorna sits on
the Advisory Panel of Tech City UK's Future Fifty programme and has served as
a Cabinet Ambassador (for Creative Britain) for the Department of Culture,
Media & Sport.
Sandra Odell
Company Secretary
Appointment as officer to the Board
1 November 2016
Current external commitments
None
Previous roles and relevant experience
Sandra is a Fellow of the Institute of Chartered Secretaries and
Administrators. Prior to joining Rightmove, Sandra was Company Secretary of
Quintain, the London property developer, and before that held various senior
company secretarial positions in listed financial services companies.
GOVERNANCE - Corporate governance report
Introduction The following sections explain how the Company applies the main
provisions of the UK Corporate Governance Code (the Code) issued by the
Financial Reporting Council (FRC), as required by the Listing Rules of the
Financial Conduct Authority (FCA) and meets the relevant information
provisions of the Disclosure and Transparency Rules of the FCA.
The statement of corporate governance covers:
· the structure and role of the Board and its committees;
· relations with the Company's shareholders and the Annual General
Meeting (AGM); and
· the reports of the Audit Committee and Nomination Committee including
Board effectiveness and evaluation.
The report of the Remuneration Committee is set out separately in the
Directors' Remuneration Report on pages 61 to 94.
The Group's risk management and internal control framework and the principal
risks and uncertainties are described on pages 20 to 24. The Directors' Report
on pages 56 to 59 also contains information required to be included in this
statement of corporate governance.
Statement of compliance
The Code sets out the principles and provisions relating to good governance of
UK listed companies and can be found on the FRC's website at frc.org.uk
(file://///mkfs02/finance/secure_finance/02%20-%20Statutory%20Accounts%20&%20YE%20&%20Capital%20Restructure%20&%20Float%20stuff/Year%20End%20and%20Half%20Year/Year%20End%202017/Accounts/Governance%20Sections/frc.org.uk)
.
We are pleased to confirm that, for the year under review, the Company has
complied fully with the principles and provisions of the Code.
The Board's role
The Board is collectively responsible to shareholders for the overall
direction and control of the Group and has the powers and duties set out in
the Companies Act and the Company's Articles of Association. The Board
delegates certain matters to the Board committees and delegates the day to day
operational aspects of the business to the executive directors.
The schedule of matters requiring Board approval includes:
· Rightmove's business strategy;
· the annual business plan;
· changes to the Group's capital structure;
· the capital management and dividend policies;
· the annual and half year results and shareholder communications;
· major acquisitions and disposals;
· appointment and removal of officers of the Company; and
· the system of internal control and risk management.
The key responsibilities and actions carried out by the Board during the year
are set out below:
Responsibility Specific actions and information received during the year
Strategy and direction The June Board meeting was devoted to Rightmove's strategy and included a Strategic initiatives identified at the strategy away day were prioritised The Group's 2018 budget and three-year business plan was approved Presentations were received in relation to innovation in the rental market
discussion of the potential influences, threats and opportunities to then monitored, analysed and discussed at every Board meeting
including RentLondon, an experimental app which explores trends in search to
Rightmove's business model arising from economic, regulatory and other market make the process of finding a rental property more efficient and incorporates
changes a messenger bot and RentReady, a tenant passport initiative
Performance monitoring Regular market updates and reports were received on the competitive landscape The Board regularly reviewed updates on business performance in relation to Senior management gave detailed presentations on Agency and Overseas business The Board received an update on Rightmove Discover, the predictive algorithm
including new business models and innovation analyst consensus forecasts and the business plan performance and progress against other business initiatives product launched in 2017 to Agency customers, following the acquisition of The
Outside View in the prior year
Shareholder engagement Investor feedback was received via the executive directors throughout the Monthly reports are received on the shareholder demographic and analysis of Rightmove's corporate broker UBS gave a presentation, updating the Board on The Remuneration Committee initiated investor correspondence relating to the
year, particularly following the results and investor roadshows significant changes to the share register the key market drivers of the Group's valuation application of the Remuneration Policy for 2018
Governance and risk The Board conducts a bi-annual review of the entire risk register with Reports were received from the Audit Committee on Rightmove Assurance reviews, The Group's regulatory results announcements and Annual Report were reviewed Senior management gave briefings and presentations covering a wide range of
particular focus on principal risks affecting the business together with the with particular focus on the Group's readiness for the General Data Protection in detail and approved topics including cyber and information security risks, corporate governance
consideration of new and emerging risks Regulation in May 2018
and the 2017 insurance renewal programme
People and values The Board considered the organisation strengths, capability requirements and The Board received presentations from senior managers throughout the year to Group employee satisfaction scores as part of the 'Have your say' survey were The Board considered the gender pay gap analysis and the proposed actions to
succession for senior managers as well as skills and experience possessed by ensure exposure to the breadth and depth of talent supporting business growth monitored across a range of criteria reduce the gap going forward
its directors relative to those skills and capabilities identified in the
Board Strategy Review that are necessary to help Rightmove achieve its
strategic objectives
There are usually seven scheduled Board meetings each year including one
meeting or away day devoted to consideration of the Group's strategy.
Additional meetings can be arranged at short notice at the request of any
director, if required. In addition to scheduled Board meetings, there is
regular informal dialogue between the directors.
Directors receive Board papers well in advance of meetings to allow sufficient
time for review and consideration. If any director raises a concern or
challenges any aspect of the business conducted at a Board meeting, the
Company Secretary will ensure their comments are appropriately recorded in
the Board minutes. In addition to formal Board papers, directors receive
monthly management and financial reports on the operational and financial
performance of the business, setting out actual and forecast financial
performance against approved budgets and other key performance indicators. The
Board also receives copies of broker reports and market reviews relating to
Rightmove.
Board committees
The Board has established three principal committees, the Audit Committee, the
Remuneration Committee and the Nomination Committee, to assist it in the
execution of its duties. The Chairman of each Committee reports on the
respective Committee's activities at the subsequent Board meeting.
The Committees' terms of reference are available on the Company's corporate
website, plc.rightmove.co.uk or by request from the Company Secretary.
Each of the Committees is authorised, at the Company's expense, to obtain
legal or other professional advice to assist in carrying out its duties. No
person other than a Committee member is entitled to attend the meetings of
these Committees, except by invitation of the Chairman of that Committee.
Current membership of the Committees is shown on page 43. The composition of
these Committees is reviewed regularly, taking into consideration the
recommendations of the Nomination Committee.
Committee Role and terms of reference Membership required under the terms of reference Minimum number of meetings per year Committee report on pages
Audit Reviews and reports to the Board on: At least three members who should be independent non-executive directors Three 45 to 52
· Group financial reporting;
· the system of internal control and risk management;
· independence and effectiveness of the external audit process; and
· the internal audit plan, results and effectiveness of Rightmove
Assurance, the outsourced internal audit function.
Recommends the appointment of the external auditors to the Board for approval
by shareholders.
Remuneration Makes recommendations to the Board on: At least three members who should be independent non-executive directors Two 61 to 94
· the Remuneration Policy and strategy for executive directors and
senior managers;
· long-term incentive arrangements;
· the design and determination of targets under any
performance-related pay scheme; and
· any major changes in employee benefit structures
with the objective of ensuring that directors and employees are incentivised
and fairly rewarded for their individual contributions to the Group's overall
performance. Careful consideration is given to the interests of the
shareholders and to the financial and commercial health of the Group.
Nomination Undertakes an annual review of organisation and succession planning and At least three members, the majority of whom should be independent Two 53 to 55
ensures that the membership and composition of the Board, including the non-executive directors
balance of skills, remains appropriate.
Makes recommendations for the membership of the Board, Audit and Remuneration
Committees.
Board composition
The Board at the date of this report comprises two executive directors and
seven non-executive directors, including the Chairman. The two executive
directors are Peter Brooks-Johnson (Chief Executive Officer) and Robyn
Perriss (Finance Director) and the non-executive directors are Scott Forbes
(Chairman), Peter Williams (Senior Independent Director), Ashley Martin,
Rakhi Goss-Custard, Jacqueline de Rojas, Andrew Findlay and Lorna Tilbian.
Biographical details of all directors at the date of this report appear on
pages 33 to 36 and details of Committee membership appear on page 43.
The Board's size and composition is kept under regular review by the
Nomination Committee.
Board changes
Nick McKittrick, Chief Executive Officer, retired from the Board on 9 May 2017
and Peter Brooks-Johnson, formerly Chief Operating Officer, was appointed as
Chief Executive Officer from that date. Colin Kemp retired from the Board on 9
May 2017, having served nine years as a non-executive director.
Andrew Findlay was appointed as a non-executive director on 1 June 2017 and
Lorna Tilbian was appointed with effect from 1 February 2018. All other
directors served throughout the year.
Division of responsibilities
The posts of Chairman and Chief Executive Officer are separate and there are
clear written guidelines to support their division of responsibilities. The
key responsibilities of the Board members are summarised below:
Chairman Responsible for the leadership and governance of the Board, including:
· ensuring its effectiveness by creating and managing constructive
relationships between the executive and non-executive directors;
· ensuring there is ongoing and effective communication between the
Board and its key stakeholders; and
· with the assistance of the Company Secretary, setting the Board's
agenda and ensuring that adequate time is available for discussion and
effective decision making, and that directors receive sufficient, relevant,
timely and clear information.
Chief Executive Officer Responsible for the day to day management of the Group, including:
· the operational and financial performance of the Group;
· developing the Group's objectives and strategy and following
Board approval, the successful execution of strategy;
· effective and ongoing communication with stakeholders; and
· chairing the Executive Committee.
Non-executive directors The role of the non-executive directors is to:
· constructively challenge the executive directors; and
· monitor the delivery of the strategy within the risk and control
framework set by the Board.
The non-executive directors bring wide and varied commercial experience and
independent judgement to the Board and the Committees' deliberations.
The breadth of management, financial and listed company experience of the
non-executive directors is described in the biographical details on
- More to follow, for following part double click ID:nRSW7131Fc platforms· Developing our product proposition to meet our customers' needs and evolving business
models· Large in-house technology team with culture of innovation · Innovation lab to develop
emerging models and technologies· Ongoing monitoring of consumer behaviour and annual 'Hackathons'
which allow employees to spend time during work hours to develop their own online property related
ideas· Regular contact with the start-up and prop-tech communities to stay abreast of innovations
in the marketplace
4 Cyber security and IT systemsThe Group has a high dependency on technology and internal IT systems. In today's digital world there are increased risks associated with external cyber attacks which could result in unavailability of our platforms. A security breach such as corruption or loss of key data may disrupt the efficiency and functioning of the Group's day to day operations. Potential reputational damage and financial losses arising from penalties and fines due to loss of consumer and customer confidence in the Rightmove brand and platforms. · Disaster Recovery and Business Continuity Plans in place, subject to regular review and testing· Risk un-changed
Use of three data centres to load balance and ensure optimal performance and business continuity
capability· Regular backups of key data· Regular testing of the security of the IT systems and
platforms including penetration testing and distributed denial of service attack procedures·
Ongoing investment in security systems· Ongoing monitoring of external threats through updates from
external specialists and collaboration with other online organisations· Regular internal security
training and 'spearphishing' tests to minimise risk of social engineering attacks
5 Securing and retaining the right talentOur continued success is dependent on our ability to attract, recruit, retain and motivate our highly skilled workforce. The inability to recruit and retain talented people could impact our ability to maintain our financial performance and deliver growth. When key staff leave or retire, there is a risk that knowledge or competitive advantage is lost. · Ongoing succession planning and development of future leaders· Payment of competitive Risk un-changed
reward, including a blend of short and long-term incentives for senior management and the ability for
all employees to participate in the success of the Group through the SIP· Regular staff
communication and engagement· Maintaining the culture of the Group, which generates significant
staff loyalty· Introduced a number of initiatives to improve the gender balance across various
Rightmove teams as set out in our Gender Pay Gap Report
Increased risk Decreased risk Risk unchanged
STRATEGIC REPORT - The EU referendum
The result of the UK's EU referendum in 2016 increased the level of macroeconomic uncertainty and could increase the
likelihood of the housing market macroeconomic risks set out on page 22.
During 2017 the Board has continued to assess the impact of the EU referendum result on the Group and its potential
implications and has concluded that there has been no material change to the severity of this risk. In particular, the
directors considered the following:
· The Rightmove business is largely subscription based and is therefore less susceptible to short-term shocks or
variations in the property market or wider economy;
· Around two-thirds of our estate agency customers also provide lettings services which may mitigate the impact of any
downturn in the property market on their business; and
· A reduction in housing market activity increases the propensity for advertisers to evaluate their marketing spend both
offline and on other portals and we remain confident in the strength of the Rightmove value proposition.
The directors believe that our strong market position and relationships with our customers, and the value embedded in our
membership continue to position us well providing that housing transaction volumes do not take a sharp downward turn.
STRATEGIC REPORT - Viability statement
In accordance with provision C.2.2. of the Code, the directors have assessed the viability of the Group over a three-year
period, taking into account the Group's current position and the potential impact of the principal risks and uncertainties
set out on pages 21 to 24. Based upon the robust assessment of the principal risks facing the Group, including those that
would threaten its business model, future performance, solvency or liquidity, the directors have a reasonable expectation
that the Group and the Company will be able to continue in operation and meet its liabilities as they fall due over the
three-year period to 31 December 2020.
The directors have determined that a three-year period to 31 December 2020 constitutes an appropriate period over which to
provide its viability statement, as the Group operates within the online digital marketplace, and projections looking out
further than three years become significantly less meaningful in the context of the fast moving nature of the market. Three
years is also the period considered under the Group's current three-year strategic plan. The three-year plan is reviewed by
the directors and is developed on a segment by segment basis using a bottom up model. The three-year plan makes certain
assumptions about Agency and New Homes customer numbers, Average Revenue Per Advertiser (ARPA) growth and other breadth
revenue streams and considers the Group's profitability, cash flows and dividend cover over the period.
The plan is subject to robust downside sensitivity analysis which involves flexing a number of the main assumptions
underlying the plan. Where appropriate, analysis is carried out to evaluate the potential financial impact over the period
of the Group's principal risks actually occurring. Specific scenarios that have been modelled include downside scenarios in
relation to the key drivers of revenue being customer numbers and ARPA together with the impact of a plausible combination
of these scenarios. Furthermore, our business model is structured so that the Group is not overly reliant on a small
customer base with no single customer constituting more than 3% of Group sales.
Also given our significant free cash flow and our ability to adjust our discretionary share buyback programme provides
long-term comfort around viability in the face of adverse economic or competitive conditions.
Whilst this review does not consider all the risks that the Group may face, the directors consider that this stress-testing
based assessment of the Group's prospects is reasonable in the circumstances of the inherent uncertainty involved.
STRATEGIC REPORT - Corporate responsibility
Our people
We believe that our people are the key to Rightmove's success and our most valued asset. We have always strived to make
Rightmove a great place to work and embedded this into our strategic management objectives. We are proud of the energy,
talent and experience our people bring to the business. Our culture is open and supportive, with an encouraging and
restless yet focussed approach which fosters innovation and dedication to excellent customer service.
Recruitment
Recruiting the right people with capability and experience to drive growth is vital to our business plan. The highly
competitive market for technology and customer centric skills means that we are strongly focussed on maintaining a happy,
collegiate working environment and the top benefits to attract and retain the best people.
Referrals from existing employees are a valuable source of new recruits, typically ensuring a higher quality candidate with
a better cultural fit. All new vacancies are advertised internally first to give our colleagues an opportunity to apply or
recommend someone. In 2017, 8% of new employees were introduced to Rightmove by an existing employee.
We also believe that long-term commitment from Rightmove employees is key to our culture and success. For a relatively
young company we are proud to have 67 people who have celebrated ten or more years' service, which represents over 14% of
our employees and contributes to our strong people survey results.
We continue to support Milton Keynes College in preparing students for their future careers. During the year we welcomed
six students completing their Level 3 Higher National Diplomas in our design studio and offered two students internships.
In addition, our designers have offered support and mentoring to students on campus. We have continued to expand our intern
programme across Rightmove. Our technology teams took on four computer and data science interns from University College
London.
People development and training
Every new employee attends two office based 'How Rightmove fits together' days to introduce them to the business and our
customers. They also attend an off-site residential induction course to introduce them to Rightmove's culture and values.
To ensure our colleagues can work to the best of their ability, we continue to invest in extensive training and leadership
programmes, designed to equip them with all the necessary skills to provide exceptional service to our customers and
consumers. We have also developed a suite of internal development courses for our employees covering both technical and
non-technical skills to improve their performance through continual professional and personal development.
Employee Benefits
Whilst we believe that being a great place to work helps us attract the best talent we also reward our employees with a
range of additional and competitive benefits.
Rightmove contributes towards a group stakeholder pension plan. Opt out rates are low and currently 95% of employees are
members of the pension plan. We also offer private healthcare complemented by a cash plan scheme for all our employees'
medical needs.
It is important that our people can directly benefit from their contribution to the success of Rightmove and we offer two
all-employee share plans. Every employee can join the Group's Save As You Earn Scheme (Sharesave), which allows employees
to save money from their salary with the option to purchase shares at a discount after three years. In November 2017, the
Group's ninth Sharesave contract matured allowing employees to benefit from the Group's success and strong share price
growth over the last three years. 67% of our employees currently participate in Sharesave.
The Rightmove Share Incentive Plan was launched in 2015 with an award of 100 free shares for all employees. Those shares
were available to sell from January 2018, with those employees benefiting from the Rightmove share price more than doubling
over that period. Further awards of 50 free shares have been made annually in subsequent years to all qualifying
employees.
We offer flexible working arrangements, fully support part time working and reduced hours to allow our employees to balance
their work and family commitments. In 2017, we also introduced a flexible holiday scheme to operate from 2018, allowing
employees to buy or sell up to five days (or the part-time equivalent) of holiday each year to suit their personal
circumstances.
Engagement
We encourage employee involvement and keep colleagues informed of the Group's activities through 'townhalls', business
performance updates with senior management and quarterly sales conferences.
We have an employee recognition scheme, based on the 'Rightmove behaviours' which allow us to focus on how we work not just
on what we achieve. It is an opportunity to nominate colleagues who have demonstrated the best behaviours in action and it
continues to prove popular with awards presented every two months at our 'townhalls'.
We conduct an annual 'Have your Say' people survey to gauge what our employees think and how they feel about working for
Rightmove. The survey results are followed up by every manager and we are never complacent about the importance of acting
on colleagues' feedback. We are proud of another set of strong results from the survey with highlights including:
· 90% of respondents think Rightmove is a great place to work;
· 90% are proud to tell people they work for Rightmove; and
· 92% enjoy working in their teams.
An employee engagement score will again form part of the senior management bonus criteria in 2018, demonstrating the
importance of employee engagement to the continuing success of Rightmove.
The management team continues to work hard to improve the employee experience at Rightmove. In 2017, we took on additional
space and refurbished our London office, taking employee preferences into account; the result being a creative and
welcoming space.
Equality and diversity
Rightmove has a firm commitment to equality of opportunity in all our employment policies and practices. Our recruitment
and selection processes focus on selecting the best candidate for a role, regardless of their age, gender, sexuality, full
or part-time status, disability and marital status.
We recognise that a diverse workforce reflects Rightmove's broad consumer base and our many customers. Our people have a
wide range of experience and perspectives that we believe promote innovation, constructive challenge and success. Drawing
on a wide variety of personal attributes drives value in the way we do business and helps us anticipate and provide what
our customers need from us and what home hunters want from Rightmove.
At 31 December 2017, female representation on the Board was 38% and with the appointment of Lorna Tilbian in February 2018
that proportion has risen to 44% of Board members. Following the retirement of Ashley Martin in May 2018, we are delighted
that female representation on the Board will rise to 50%.
The Board continues to focus on succession planning and developing potential within the senior management team to enable us
to promote internal candidates to the Board. The Group succession plan also identifies individuals with potential to join
the senior management team in the wider organisation. As at 31 December 2017, 26% (2016: 21%) of our leadership team(1),
were female. The Board is keen to strengthen female representation in senior roles and has been a contributor to the
Hampton-Alexander Review, a Government sponsored initiative which aims to increase female leadership within the FTSE350. In
line with the Hampton-Alexander Review, Rightmove has set a target for 33% female leadership by 2020.
(1) Being the Executive Committee and their direct reports as per the Hampton-Alexander definition.
A breakdown by gender of the number of persons as at 31 December 2017 by various classifications as required by the
Companies Act, is set out below:
http://www.rns-pdf.londonstockexchange.com/rns/7131F_1-2018-2-22.pdf
(1) The Hampton-Alexander cohort comprises members of the Executive Committee and their direct reports.
(2) The Senior Management Team comprises the Hampton-Alexander cohort, excluding the executive directors.
Gender Pay
Rightmove has reported its gender pay gap for 2017 and full details can be found on the Company's website at
plc.rightmove.co.uk
We are confident that all Rightmove employees are paid equally for working in the same jobs and we are pleased to report
that men and women are almost equally represented in our wider workforce. The main contributor to Rightmove's gender pay
gap is the mix in Rightmove communities comprising the highest and lowest quartile salaries. Women are underrepresented in
the higher paid senior management and technology teams and men are underrepresented in the customer experience team.
Technology is a sector blighted by a lack of gender diversity, but accepting the status quo is not in our DNA. Below is
our gender pay gap as at April 2017, together with a description of some of the initiatives that we have underway for
improving our gender balance going forward.
Difference between male and female pay
Mean Median
Difference in hourly rate of pay(1) 30.6% 37.0%
Difference in bonus pay(2) 70.4% 36.5%
(1) Calculated using Rightmove Group Limited pay data from April 2017.
(2) Calculated using 12 months of Rightmove Group Limited bonus pay data to 5 April 2017.
We work hard to create an environment where men and women have the opportunity to build careers throughout the business and
believe that our open, collaborative culture is key to that objective. We are committed to a number of actions to balance
our teams in a fair and transparent way, including:
Balance for all Addressing imbalance
· We have developed maternity and paternity workshops to support Rightmovers through the changing dynamic of family and work responsibilities and their return to work after a career break· We recognise that balancing work and life commitments can make people shy away from taking the next step in their career. New flexible working arrangements have been rolled out for all employees · We are developing a mentoring programme to support career development and aim to exceed the Hampton-Alexander review target of 33% of the leadership team being female by 2020 · We are creating an internal talent pipeline to promote the next
generation of leaders· We have launched a graduate programme in technology to attract the best new talent to help create balance in our technology teams over the longer term· We have reviewed all job specifications and updated the format of our
recruitment days to guarantee universal appeal and attract the best talent
Human rights
Rightmove does not have a specific human rights policy, we have a framework of policies and statements covering equal
opportunities, dignity at work, disability, anti-slavery and anti-bribery that adhere to internationally recognised human
rights principles.
Charitable activity
We continue to encourage our employees to raise funds for their chosen charities. In 2017 we match funded £24,000 (2016:
£18,000), supporting charities including The Stroke Association, The Carers Trust, Scope and many more. From breakfast
mornings to running marathons we are delighted that so many of our colleagues devote their time and energy to such good
causes. For the second year running we have supported food banks at Christmas; this year we delivered a car packed full of
food to the Milton Keynes Food Bank.
In 2017, we contributed £56,000 (2016: £49,000) via Agents Giving to support our customers' charitable initiatives, which
ranged from a Mount Everest trek to Tough Mudders, triathlons and fun runs. We contribute to the costs of setting up the
fundraising activity, which allows more of the money raised by our customers to go directly to charities through a
charitable sponsorship fund we set up with Agents Giving. We are very proud that the fund has raised over £1 million since
2014 for charitable causes supported by our customers.
Looking ahead to 2018 we are pleased to be partnering with the Milton Keynes marathon as headline sponsor in 2018 (the home
of Rightmove) in aid of Meningitis Now and Winter Night Shelter. These two causes are very important to our employees and
fund raising efforts are well underway as part of our 'On The Move' campaign, with over £1,200 raised in the last 4 weeks
of 2017. We have set our employees a target of raising £26,000, to be split equally between both charities and Rightmove
will make a significant additional contribution. Over 50 employees will be volunteering their time, training and being
creative with their fundraising efforts to support these charities.
We will be sponsoring the Milton Keynes College Football Academy again in 2018. We have worked closely with the college
over the last few years, enabling the academy to create more opportunities for their students to study for off-pitch roles
in sport.
Environment
We are conscious of playing our part in tackling climate change and always encourage the efficient use of resources that
contribute to environmental damage.
Rightmove has changed the way people search for property, reducing the reliance on printed media and the environmental
impact that goes with it. Our platforms are designed to optimise the information available to home hunters, giving our
customers the ability to advertise high quality photographs, floor plans and property particulars and reducing the need for
paper copies of property particulars.
The quality of property information available on Rightmove also reduces the amount of time home hunters waste in visiting
inappropriate properties, usually by car. We have worked hard to improve the functionality of our platforms with better
photographs and property floor plans to comprehensive map searches and aerial photographs, which helps to identify the
specific location of a property. We continue to add information to help home hunters customise their property search on
Rightmove including School Checker and broadband speeds. All these innovations have helped to reduce the carbon footprint
generated by prospective buyers and renters making unnecessary journeys to visit unsuitable properties.
The Rightmove platforms enable our customers to display Energy Performance Certificates which allow prospective buyers to
evaluate the energy efficiency of a property before buying and to identify opportunities to improve the energy efficiency
once they have purchased the property.
As an internet-based business with most staff employed in two office locations, our environmental footprint is small. We
continue to encourage our employees to minimise their use of resources and recycle materials wherever possible. There are
no individual waste bins in our London and Milton Keynes offices to encourage and increase the amount of recycling.
As an operator of an online property portal, our main environmental impact is from the power usage of our data centres. Our
procurement policy is to purchase hardware with the best computational performance which uses the least electrical power.
We encourage our employees to use public transport rather than driving between our two office locations in London and
Milton Keynes. We encourage participation in our Cycle to Work scheme and have many keen cyclists. We have also
introduced the option for staff entitled to a company car to select hybrid electric cars as an alternative to petrol or
diesel engines. In 2017, our fuel card provider Allstar, again partnered with Forest Carbon to capture the CO2 emissions
from our fleet of company cars and turn them into new UK woodlands.
As an online business, we tend towards a paperless environment. However, we recognise that our responsibilities do not stop
with how we operate internally and we encourage all our customers, business partners and suppliers to use online records
and reduce printing, especially emails. Wherever possible we have replaced paper-based services and communications with
online alternatives, including e-communications for shareholders, online customer membership forms, management information
and marketing reports and product documentation.
Greenhouse gas reporting
The Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 requires all UK quoted companies to report
on their greenhouse gas (GHG) emissions, which are classified as either direct or indirect and which are divided further
into Scope 1, Scope 2 and Scope 3 emissions.
Direct GHG emissions are emissions from sources that are owned or controlled by Rightmove. Indirect GHG emissions are
emissions that are a consequence of the activities of the Group but that occur at sources owned or controlled by other
entities.
Scope 1 emissions: Direct emissions controlled by the Group arising from Company cars. Whilst the cars are leased, we are
responsible for the emissions and therefore we report these under Scope 1.
Scope 2 emissions: Indirect emissions attributable to the Group due to its consumption of purchased electricity.
Scope 3 emissions: Other indirect emissions associated with activities that support or supply the Group's operations, we
include emissions arising from our third party run data centres.
The Group is required to report Scope 1 and 2 emissions for its reporting year to 31 December 2017. Scope 3 is not
mandatory, however the Group has again chosen to report Scope 3 emissions as it relates to electricity used in data
centres, in which the Group rents space to house and operate various servers, which host our platforms.
Rightmove emissions by scope:
Scope Source Tonnes CO2e(1)2017 Tonnes CO2e(1)2016
Scope 1 Company cars 495 486
Scope 2 Electricity 255 303
Scope 3 Outsourced - data centres 257 298
Total 1,007 1,087
(1) UK emissions factors have been used for all data. All emission factors have been selected from the emissions conversion
factors published annually by Defra. www.gov.uk/measuring-and-reporting-environmental-impacts-guidance-for-businesses.
Higher fuel consumption was due to increased business mileage by employees entitled to Company cars. The reduction in
electricity use is partly due to closing one floor of our London office for refurbishment during 2017 and lower electricity
consumption on the two new floors. We expect Scope 2 emissions to return to historic levels in 2018.
Emissions have also been calculated using an 'intensity metric', which will enable the Group to monitor how well we are
controlling emissions on an annual basis, independent of fluctuations in the levels of their activity. As Rightmove is a
'people' business, the most suitable metric is 'Emissions per Employee', based on the average number of employees during
the year. The Group's emissions per employee are shown in the table below.
Emissions per Employee:
Scope Source Tonnes CO2eper employee(1)2017 Tonnes CO2eper employee(1)2016
Scope 1 Company cars 1.0 1.0
Scope 2 Electricity 0.5 0.7
Scope 3 Outsourced - data centres 0.5 0.7
Total 2.0 2.4
(1) Based on 479 (2016: 466) employees taken as the average number of employees in the Group throughout the year.
Scope 2 and 3 emissions per employee have declined year on year due in part to an increase in average headcount which has
not had a proportionate impact on emissions from running our offices or the outsourced data centres. We will continue to
monitor and look for ways to improve energy efficiency.
Methodology
We have reported on all of the emission sources required under the Companies Act 2006 (Strategic Report and Directors'
Report) Regulations 2013. We have used the GHG's Protocol's Operational Control consolidation method. We do not have
responsibility for any emission sources that are not included in the above information.
Health and safety
The Group's policy on health and safety is to provide adequate control of the health and safety risks arising from work
activities. This is delivered through consultation with, and training of, employees, the provision and maintenance of plant
and equipment, safe handling and use of all substances and the prevention of accidents and causes of ill health. At
Rightmove, our approach to the effective management of health and safety is to treat it as an integral part of business
management. During the year, we continued our fire safety, first aid and work place safety training.
GOVERNANCE - Directors and officers
Scott Forbes
Chairman
Appointment to the Board
13 July 2005
Committee membership
Nomination (Chairman)
Current external commitments
Chairman of Ascential plc
Non-executive director of Travelport Worldwide Limited
Chairman of Innasol Group Limited
Chairman of Cars.com Inc
Previous roles and relevant experience
Chairman of Orbitz Worldwide until September 2015. Director of NetJets Management Ltd, a subsidiary of Berkshire Hathaway
until October 2009. Scott has over 35 years' experience in operations, finance and mergers and acquisitions including 15
years at Cendant Corporation which was formerly the largest worldwide provider of residential property services. Scott
established Cendant's international headquarters in London in 1999 and led this division as Group Managing Director until
he joined Rightmove.
Peter Brooks-Johnson
Chief Executive Officer
Appointment to the Board
10 January 2011
Current external commitments
None
Previous roles and relevant experience
Peter joined Rightmove in 2006 and became Chief Operating Officer in April 2013 having been Managing Director of
rightmove.co.uk since 2011 and head of the Agency business since 2008. He was promoted to Chief Executive Officer in May
2017. Prior to joining Rightmove, Peter was a management consultant with Accenture and the Berkeley Partnership.
Robyn Perriss
Finance Director
Appointment to the Board
30 April 2013
Current external commitments
None
Previous roles and relevant experience
Robyn joined Rightmove in 2007 as Financial Controller with responsibility for day to day financial operations and was
promoted to the Board as Finance Director in April 2013. She was also Company Secretary from April 2012 to July 2014 and
from June to October 2016. Robyn qualified as a chartered accountant in South Africa with KPMG and worked in both audit
and transaction services. Prior to joining Rightmove, Robyn was Group Financial Controller at the online media business,
Auto Trader.
Peter Williams
Senior Independent Non-Executive Director
Appointment to the Board
3 February 2014
Committee membership
Remuneration (Chairman), Audit, Nomination
Current external commitments
Chairman of DP Eurasia NV
Chairman of boohoo.com plc
Chairman of Mister Spex GmbH
Chairman of U and I plc
Previous roles and relevant experience
Peter was previously senior independent director of ASOS plc and Sportech plc, Chairman of Jaeger, held non-executive
director roles in Cineworld Group plc, the EMI group, Blacks Leisure Group plc, JJB Sports plc, GCap Media plc and Capital
Radio Group plc. In his executive career, Peter was Chief Executive at Alpha Group plc and prior to that, Chief Executive
of Selfridges plc where he also acted as Chief Financial Officer for over ten years.
Ashley Martin
Non-Executive Director
Appointment to the Board
11 June 2009
Committee membership
Audit (Chairman), Nomination
Current external commitments
Non-executive director of Zegona Communications plc
Previous roles and relevant experience
Ashley qualified as a chartered accountant in 1981 and has a career in finance spanning 35 years. He was previously Global
Chief Financial Officer of Engine Holding LLC and Group Finance Director of Rok plc, the building services group, and Group
Finance Director of the media services company, Tempus plc.
Rakhi Goss-Custard
Non-Executive Director
Appointment to the Board
28 July 2014
Committee membership
Remuneration, Nomination
Current external commitments
Non-executive director of Kingfisher plc
Non-executive director of Schroders plc
Non-executive director of Intu Properties plc
Non-executive director of Be Heard Group plc
Previous roles and relevant experience
Rakhi was previously Director of UK Media at Amazon to June 2014. She held various other senior positions during her
11-year tenure at Amazon including Media, Entertainment, General Merchandise and Book divisions as well as Product
Development. Prior to Amazon, Rakhi previously advised Zappos and held strategy roles at TomTom and Oliver Wyman.
Jacqueline de Rojas CBE
Non-Executive Director
Appointment to the Board
30 December 2016
Committee membership
Remuneration, Nomination
Current external commitments
President of techUK
Non-executive director of Costain Group plc
Non-executive director of AO World plc
Previous roles and relevant experience
Jacqueline has been employed throughout her career by global blue-chip software companies and has held senior positions at
Citrix, CA Technologies, McAfee and Ascential Software. She was a non-executive director of Home Retail Group from 2012 to
2016. Jacqueline is an advisor to the Digital Leaders Technology Group and a passionate advocate for diversity and
inclusion in the workplace with a particular focus on getting women and girls into digital careers and studying STEM
subjects. She was awarded a CBE for services to international trade in the technology industry in the 2018 New Year's
Honours list.
Andrew Findlay
Non-Executive Director
Appointment to the Board
1 June 2017
Committee membership
Audit, Nomination
Current external commitments
Director of easyJet plc
Previous roles and relevant experience
Andrew has been the Chief Financial Officer of easyJet plc since 2015. Before joining easyJet, Andrew was Chief Financial
Officer of Halfords plc and prior to that Director of Finance, Tax and Treasury at Marks and Spencer. He formerly held
senior finance roles at the London Stock Exchange and at Cable and Wireless, both in the UK and US. Andrew qualified as a
chartered accountant with Coopers & Lybrand.
Lorna Tilbian
Non-Executive Director
Appointment to the Board
1 February 2018
Current external commitments
Non-executive director of Jupiter UK Growth Investment Trust plc
Non-executive director of Proven VCT plc
Non-executive director of Finsbury Growth & Income Trust PLC
Non-executive director of Euromoney Institutional Investor PLC
Non-executive director M&C Saatchi PLC
Previous roles and relevant experience
Lorna was Executive Director and Head of the Media Sector in Corporate Broking & Advisory at Numis Corporation PLC until
September 2017. She was a founder of Numis when it launched in 2001 having worked at Sheppards, as a director of SG Warburg
and executive director of WestLB Panmure. Lorna sits on the Advisory Panel of Tech City UK's Future Fifty programme and has
served as a Cabinet Ambassador (for Creative Britain) for the Department of Culture, Media & Sport.
Sandra Odell
Company Secretary
Appointment as officer to the Board
1 November 2016
Current external commitments
None
Previous roles and relevant experience
Sandra is a Fellow of the Institute of Chartered Secretaries and Administrators. Prior to joining Rightmove, Sandra was
Company Secretary of Quintain, the London property developer, and before that held various senior company secretarial
positions in listed financial services companies.
GOVERNANCE - Corporate governance report
Introduction
The following sections explain how the Company applies the main provisions of the UK Corporate Governance Code (the Code)
issued by the Financial Reporting Council (FRC), as required by the Listing Rules of the Financial Conduct Authority (FCA)
and meets the relevant information provisions of the Disclosure and Transparency Rules of the FCA.
The statement of corporate governance covers:
· the structure and role of the Board and its committees;
· relations with the Company's shareholders and the Annual General Meeting (AGM); and
· the reports of the Audit Committee and Nomination Committee including Board effectiveness and evaluation.
The report of the Remuneration Committee is set out separately in the Directors' Remuneration Report on pages 61 to 94.
The Group's risk management and internal control framework and the principal risks and uncertainties are described on pages
20 to 24. The Directors' Report on pages 56 to 59 also contains information required to be included in this statement of
corporate governance.
Statement of compliance
The Code sets out the principles and provisions relating to good governance of UK listed companies and can be found on the
FRC's website at frc.org.uk.
We are pleased to confirm that, for the year under review, the Company has complied fully with the principles and
provisions of the Code.
The Board's role
The Board is collectively responsible to shareholders for the overall direction and control of the Group and has the powers
and duties set out in the Companies Act and the Company's Articles of Association. The Board delegates certain matters to
the Board committees and delegates the day to day operational aspects of the business to the executive directors.
The schedule of matters requiring Board approval includes:
· Rightmove's business strategy;
· the annual business plan;
· changes to the Group's capital structure;
· the capital management and dividend policies;
· the annual and half year results and shareholder communications;
· major acquisitions and disposals;
· appointment and removal of officers of the Company; and
· the system of internal control and risk management.
The key responsibilities and actions carried out by the Board during the year are set out below:
Responsibility Specific actions and information received during the year
Strategy and direction The June Board meeting was devoted to Rightmove's strategy and included a discussion of the potential influences, threats and opportunities to Rightmove's business model arising from economic, regulatory and other market changes Strategic initiatives identified at the strategy away day were prioritised then monitored, analysed and discussed at every Board meeting
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