Minutes of the General Meeting 26th July 2012 to Reduce the Elected Members

The 2012 Resolution to reduce Elected Members to Nine
Dear Member

Size of Council

The Council has reviewed the size and composition of Council and has concluded that the number of Council members should be reduced from 18 to 15.

The proposed resolution to amend our Articles of Association is set out in the Notice of Meeting overleaf.

Before taking this step, Council looked at recent evidence on the best possible board size for companies and not-for–profit organisations. For most companies the optimum board size is between 7 and 12 members. This is widely considered the right size to ensure a breadth of expertise and diversity of views, and to provide for membership of the required sub-committees, whilst minimising the negative effects on governance of having too many members. Evidence gathered on the size of not-for-profit or charity boards found that most have 12 to 16 members.

With 18 Council members, Consumers’ Association is at the top end in board size among UK charities. We believe that a Council of 15 would bring us closer to the best possible number whilst ensuring there are sufficient Council members to join our sub-committees and to maintain the necessary range of skills and expertise.

We urge you to support this proposal.

We hope to see you at the King’s Fund, 11-13 Cavendish Square, London, W1G 0AN on Thursday 26 July. However, if you are unable to attend the General Meeting on that day, we urge you to complete the enclosed proxy form so that your vote can be cast in your absence. This should be returned to Electoral Reform Services Limited (ERS) in the reply paid envelope provided by 24 July.

Yours sincerely

'''Prof Patrick Barwise Chairman of Council'''

'''Tanya Heasman and Richard Thomas Deputy Chairmen of Council'''

'You may appreciate the irony that the reduction could have been accomplished with less co-opted members. In fact the membership breakdown of Council is not explicitly mentioned - 9 to 6 instead of 12 to 6 is nowhere mentioned. Any sub-committee is required to have a two thirds of it's membership made up of elected members. '

Notice of General Meeting
NOTICE IS HEREBY GIVEN that a General Meeting of Members will be held at the King’s Fund, 11-13 Cavendish Square, London, W1G 0AN on Thursday 26 July 2012 at 11.30am for the following purpose:

To consider and, if thought fit, pass the following resolution as an Ordinary Resolution:

Ordinary Resolution That in accordance with the power set out in Article 11.4 of the Articles of Association of the Company, the number of Elected Council Members be reduced from 12 to 9. By Order of the Council

'''ANDREW READING Company Secretary'''

Notes: 1 An Ordinary Member entitled to attend and vote at the Meeting convened by the above Notice shall be entitled to appoint a proxy (or proxies) to attend, speak and vote in his/her place. A proxy must be an Ordinary Member of the Company and must attend the Meeting to represent you.

2 A form of proxy is enclosed. You can only appoint a proxy using the procedures set out in these notes and the notes to the proxy form. The appointment of a proxy will not prevent an Ordinary Member from subsequently attending and voting at the meeting in person, in which case any votes cast by the proxy will be excluded and your proxy appointment will automatically be terminated. 3 To appoint a proxy, using the proxy form, the form must be: • Completed and signed; • Sent or delivered to Electoral Reform Services Limited, The Election Centre, 33 Clarendon Road, London N8 0NW and • Received by Electoral Reform Services Limited no later than 48 hours before the time for holding the Meeting Any power of attorney or any other authority under which the proxy form is signed (or a duly certified copy of such power or authority) must be included with the proxy form.

Minutes
Minutes of a General Meeting of Consumers' Association

Held on Thursday 26 July 2012 at The King's Fund,

11-13 Cavendish Square,

London, WIG OAN starting at 11.30am

Present

'''Professor Patrick Barwise (Chairman), Tanya Heasman (Deputy Chairman), Richard Thomas (Deputy Chairman). Andrew Reading (Company Secretary) and some 55 Ordinary Members of the Association.'''







'''1. ARTICLE 11.4 OF THE ARTICLES OF ASSOCIATION'''

The Chairman thanked members for attending and said that the Ordinary Resolution before the meeting was to reduce the number of directly elected Council members from twelve to nine in accordance with the power set out in Article 11.4 of the Articles of Association.

Council currently comprised twelve directly elected members and up to six co-opted members - so a maximum of eighteen. The proposal was to reduce the number of directly elected Council members by three and therefore the maximum total number of members to fifteen. The proposal would reduce the total number of people regularly attending Council meetings (including top management, the Chairman of Which? Limited, the Chairman of the Group Audit Committee and the Company Secretary) from 28 to 25.

Evidence gathered on the size and effectiveness of Boards suggested that the optimum size was significantly less than 18 and that most large nonprofit organisations had between twelve and sixteen Board members. A majority of Council members would still be directly elected but there would be enough slots for co-opted members retained (up to six) to ensure that Council always had the full range of skills to fulfill its duties.

Mr Godliman said it was difficult for Ordinary Members to understand the reasons for the proposed change and that more detail should have been included in the explanatory note. While there didn't appear to be a problem with the proposal, the reasons for the change were not transparent.

Mr Williams felt that the change could have been dealt with at the AGM and that holding a separate general meeting was an unnecessary cost. If the reason was that it needed to be introduced in time to affect the 2012 elections to Council, then that should have been made clear in the explanatory note.

Mr Kitchen said that he had requested, and received, additional information on meetings attended by Council members and noted that attendance was generally good. While CA was a charity, it wasn't a charity in the usually accepted sense of the term. Mr Kitchen did not support the proposal and felt that the status quo should be maintained.

<p style="background: #ffffff; border: none; padding: 0cm">Mr Grant said that a valued feature of Which? was that it was member funded and led. Consequently, how would reducing the proportion of elected Council members retain the credibility of the members worldwide?

<p style="background: #ffffff; border: none; padding: 0cm">Mr Dolan said that he had come down from Scotland as he felt strongly about the issue and that the timing of the meeting, during the school holidays and just prior to the London Olympics was poor. In his view, the members should have been provided with more information and that additional information about the proposal would not have been confusing. It appeared that the decision had already been taken although members should have the final say.

<p style="background: #ffffff; border: none; padding: 0cm">Mr C Thomas said that while he could just about go along with the proposal, he felt that the explanatory note should have been clearer. It was up to members to decide whether or not to read the information provided. Furthermore, it was unclear how the reduction from 12 to 9 would take place as losing three Council members at once would result in a considerable loss of expertise.

<p style="background: #ffffff; border: none; padding: 0cm">Mr Ghosh said that reducing the number of directly elected Council members would affect the balance of power. The process for co-opting Council members might be one of choosing people known to existing Council members and if so, it would be better for the Council, when inviting candidates to stand for Council, to make it clear what skills were needed.

<p style="background: #ffffff; border: none; padding: 0cm">Ms Kimbell said that if a more detailed explanation had been given to members in advance, then it was possible that fewer members would have given the Chairman authority to cast their votes in favour of the resolution. Members trusted the Council and that was why most had given their support.

<p style="background: #ffffff; border: none; padding: 0cm">Mr Prentice said that two of the rights of consumers included choice and information and the Council had decided to deny members sufficient information to make choices. It was  regretful that on such an important issue, so little information had been provided.

<p style="background: #ffffff; border: none; padding: 0cm">Ms Noble said it was unfair that the members who hadn't attended the meeting hadn't got the full picture and background information should be given to all the members and the matter then re-considered.

<p style="background: #ffffff; border: none; padding: 0cm">In response to these questions, the Chairman said that the explanatory note had been kept deliberately brief in order to encourage as many members as possible to read it.

<p style="background: #ffffff; border: none; padding: 0cm">The change to the size of Council was not designed to copy companies; the main comparison was with other large charities. The evidence was that a smaller Council would be better able to hold the Executive to account.

<p style="text-align: justify; background: #ffffff; border: none; padding: 0cm">Which? was not just a membership organisation. It was a charity, a membership organisation and a commercial business - an unusual but successful hybrid.

<p style="background: #ffffff; border: none; padding: 0cm">The main reason for the separate general meeting was that Council wanted to give those who were interested an opportunity to attend a meeting and raise questions but did not want to take up a lot of time at the AGM on a procedural matter. In addition, having considered the proposal over several months. Council wanted to introduce the change quickly in order to start achieving the benefits as soon as possible. A separate meeting would enable the change to be introduced immediately, reducing the size of Council from early 2013. rather than having to wait another year.

<p style="text-align: justify; background: #ffffff; border: none; padding: 0cm">Council members' attendance at meetings was indeed good and the expectation was that this would continue.

<p style="background: #ffffff; border: none; padding: 0cm">The proposal was not being made for reasons of cost savings, rather it was being done for reasons of effectiveness.

<p style="background: #ffffff; border: none; padding: 0cm">In terms of the proportion of elected members, the proposal was for a small adjustment that would see at least 60% directly elected and at most 40% co-opted, i.e. if all six co-opted slots were filled. The directly elected Council members would always be in the majority. Currently, only four of the co-opted slots were filled. Further, there was no issue of the 'balance of power' between elected and co-opted members: members are co-opted only if they fully subscribe to the organisation's values and Council discussions reflect individual members' views on each issue.

<p style="background: #ffffff; border: none; padding: 0cm">There was always a trade-off between giving consumers (in this case members) detailed information and the proportion of them who would then read it. The proposal before the members was procedural and, in Council's view, likely to be seen as fairly minor by most members. The fact that participation had been high and that the overwhelming majority had instructed that their vote be cast in favour, supported this view, although in retrospect, perhaps more information might have been provided as an appendix, in addition to the main letter, which was deliberately limited to one side of A4.

<p style="background: #ffffff; border: none; padding: 0cm">In terms of the transition, the Chairman said that, assuming the Resolution was carried, Council had agreed to implement the entire reduction immediately, so there would only be one vacancy to fill at the 2012 elections to Council. Under the tenure rules agreed by members in 2010, three elected Council members would be required to retire in 2012 and would not be eligible for re-election. It was therefore sensible to introduce the reduction straight away so that no individual would be adversely affected by having to retire earlier than he or she had anticipated.

<p style="background: #ffffff; border: none; padding: 0cm">Council was looking at ways of further formalising the co-option process and might use a recruitment consultant to ensure that the net was spread wider.

<p style="background: #ffffff; border: none; padding: 0cm">Committee membership was under review. The aim was to put proposals to Council in the autumn.

<p style="background: #ffffff; border: none; padding: 0cm">Richard Thomas, Deputy Chairman, said that the proposal to reduce the number of elected Council members had been given a great deal of consideration by Council. Which? was an unusual hybrid organisation and getting the balance right on the Council was crucial. It was also clear that at eighteen, the number of trustees was larger than the trustee boards of most other large charities.

<p style="background: #ffffff; border: none; padding: 0cm">Consumers' Association was a charity and had to make clear how it met the Charity Commission's public benefit test. It also aspired to be the voice of the consumer, and political events made that more acute with the forthcoming abolition of Consumer Focus and the Office of Fair Trading. These changes would bring challenges and opportunities and so the Council had established a small group to review the charitable purpose.

<p style="background: #ffffff; border: none; padding: 0cm">Tanya Heasman, Deputy Chairman, said that she came from a business background and in that environment it was important to look for improvements and increased efficiencies. That doctrine was equally valid for not-for-profit organisations. It was essential to have some Council members with commercial experience in order to hold the Executive to account and this could not be guaranteed through the election process.

<p style="background: #ffffff; border: none; padding: 0cm">Mr Todd asked whether there was any related proposal to reduce the number of people on Council committees. The Chairman replied that this was under review with the aim of putting proposals to Council in the autumn.

<p style="background: #ffffff; border: none; padding: 0cm">Mr Marsden asked how the proceedings of the meeting would be made available and was advised that the minutes of the general meeting would be circulated to Ordinary Members in due course.

<p style="text-align: justify; background: #ffffff; border: none; padding: 0cm">The Chairman then called for a poll under Article 10.27, to be held immediately after the conclusion of the meeting, and said that where he had been authorised to exercise his discretion, he would be casting those votes in favour. The votes cast at the meeting would be added to those cast by proxy.

<p style="background: #ffffff; border: none; padding: 0cm">The Resolution was duly CARRIED, 2875 votes in favour (91.6%), 211 against (6.7%) and 52 abstentions (1.7%)

<p style="background: #ffffff; border: none; padding: 0cm">Votes cast at the meeting - 23 in favour, 13 against and 2 abstentions.

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<p style="background: #ffffff; border: none; padding: 0cm">'''2. ENERGY AND THE BIG SWITCH'''

<p style="background: #ffffff; border: none; padding: 0cm">The Chairman invited Ashleye Gunn to report on the Which? affordable energy campaign.

<p style="background: #ffffff; border: none; padding: 0cm">Ms Gunn said that energy bills were a major concern for consumers, yet individuals paid far more than they needed to and did not know how to bring their bills down. Furthermore, the message from government was that bills would go up further. For this reason Which? had increased its focus on energy in the last year,

<p style="background: #ffffff; border: none; padding: 0cm">both in terms of lobbying on behalf of consumers and helping people to make the best decisions. All of this had been brought together under the affordable energy campaign.

<p style="background: #ffffff; border: none; padding: 0cm">The UK had signed up to a large carbon reduction programme which would involve among other innovations, the supply of smart meters. However, it was disturbing that under current proposals, consumers would foot the whole bill, no matter how large that was. Energy supplies had to be sustainable and secure but also needed to be affordable for consumers. Consumers had to play a part, but so should industry and government. Prices went up when wholesale prices rose but did not go down when wholesale prices fell. People who switched for a better deal often ended up paying more because tariffs were so complicated. With the new options of solar panels and energy efficient insulation, installers often gave bad advice in order to make a sale.

<p style="background: #ffffff; border: none; padding: 0cm">'''Which? had three aims:'''

<p style="text-align: justify; background: #ffffff; border: none; padding: 0cm">1. Campaigning to improve the energy sector's current practices across everyday issues with bills and tariffs, but also energy efficiency and micro generation.

<p style="background: #ffffff; border: none; padding: 0cm">2. Taking the role of the straight talking voice of sense and helping consumers navigate the world of energy and energy efficiency to help them make good decisions and ultimately pay less.

<p style="background: #ffffff; border: none; padding: 0cm">3. Focusing public policy attention on the need to answer the questions of long term energy security, affordability, and transparency.

<p style="background: #ffffff; border: none; padding: 0cm">That was aiming high and delivering change for consumers would be difficult. It also begged the question why the industry would listen to Which? However, by doing things suppliers couldn't ignore, Which? had made a difference this year. Ms Gunn referred to two investigations. In the first, Which? had called suppliers asking for them to give their cheapest tariff. None did so and media picked up on the matter. As a result, four suppliers had taken action.

<p style="background: #ffffff; border: none; padding: 0cm">The second investigation was into energy tariffs, which had shown that there were 1400 different tariffs. Suppliers had traditionally said that people wanted choice. However, making things so complex that people could not make the choice did not improve competition and only one out of thirty six people, when asked, was able to understand a tariff. Subsequently several suppliers had simplified their tariff structures and reduced their number. The ultimate aim was for people to be able to compare tariffs at a glance.

<p style="background: #ffffff; border: none; padding: 0cm">By 2019 the government wanted a smart meter in every home. These would send usage information direct to suppliers without a need to read meters. Although most of the financial benefit would be to suppliers, consumers would pay the £11bn installation bill. This year Which? had achieved a ban on cross selling during installation, but still had serious concerns about the lack of cost control and accountability, and so the government had been asked to stop early installation and review the plans for the formal rollout.

<p style="background: #ffffff; border: none; padding: 0cm">Suppliers had told Which? that they wanted trust to be rebuilt, and Which? customer surveys showed customer satisfaction was the lowest of any sector. So rather than just measuring satisfaction Which? was working with companies to help them raise their game by sharing survey data and establishing a set of best practice criteria which had led to some suppliers making improvements. So it really did matter to suppliers what Which? thought.

<p style="background: #ffffff; border: none; padding: 0cm">It was hard for consumers to get behind the hype and know what could bring bills down, but Which? was in a unique position to help. We knew how much appliances cost to run and could translate that into a lifetime cost that was highlighted in running cost calculators. Which? could also investigate sale practices. Suppliers, regulators and government were starting to notice and act on our work.

<p style="background: #ffffff; border: none; padding: 0cm">A lot of effort had been put into enhancing written content in Which? magazine and online. The most visible initiative in 2012 had been the Big Switch designed to test out whether people wanted to band together to try and get a better energy deal. 290,000 consumers had signed up and more than half of them had supplied usage information. In total, 37,000 people had switched at an average saving of £220 per person and a collective saving of £8.2m. All three categories had been won by a relatively new player. Co-operative energy.

<p style="background: #ffffff; border: none; padding: 0cm">The Chairman concluded by thanking Ashleye Gunn for her presentation and said that she would be very happy to take questions over lunch.

<p style="background: #ffffff; border: none; padding: 0cm">There being no further business, the meeting ended at 1.30pm.