Thames Water has appointed Alistair Buchanan, the former chief executive of Ofgem, as an independent non-executive director to help strengthen the company’s governance.
As part of a review of its corporate structure, Thames Water has pledged to have a majority of independent non-executive directors on its board.
The review’s aim is to boost transparency for customers and stakeholders and was launched following the arrival of Ian Marchant, the former chief executive of SSE, as chairman earlier this year.
Marchant told Utility Week Buchanan’s appointment will be followed by more in the coming months as the company looks to introduce a range of “necessary skills” to move the business forward.
He said: “The board is at the heart of what’s going on and we have clarified the decision-making process. We have split the board and I meet shareholders separately, so they know what’s going on.
“The move makes us closer on the spectrum to a public company and we are strengthening the non-executive directors, who will make up the majority in the future.”
Thames Water said it has “simplified and clarified” the role of the board, including both its relationship with shareholders and the business decisions that are reserved to the board.
Shareholders will provide additional oversight of key strategic frameworks such as the five-year business plan and policies on dividends and remuneration.
Thames has also updated the terms of reference of the board committees, re-established the health, safety & environment committee and committed to increased disclosure of its governance arrangements on the company’s website.
Marchant is independent chairman of Thames Water Utilities Limited, the operating company, but not of Kemble Water Holdings Limited, the ultimate parent company.
Thames Water recently agreed to a new licence requirement to meet Ofwat’s principles of board leadership, governance and transparency, alongside continuing support for the principles set out in the UK Corporate Governance Code 2016.
Buchanan stepped down as the chief executive of Ofgem in June 2013 after 10 years with the energy regulator. He joined KPMG as a partner and UK chairman of power & utilities, having returned to the firm where he trained as a chartered accountant.
He was previously a non-executive director for Scottish Water and was a member of the UK Energy Research Partnership.
In a statement, Marchant, said: “Our governance review is delivering important changes and is a vital building block in helping us achieve what we exist to do – serve our customers in the best way possible.
“Rebuilding trust is important as Thames enters a new chapter and I am delighted that Alistair Buchanan will be joining us. He has a deep understanding of the utility sector and the need to provide industry-leading customer service.”