Verizon’s culture, strategies and policies are identified and continually reviewed at group level by the senior executives of Verizon. Verizon and its group of companies (“Verizon Group”), which includes the Company, believes that it must effectively address and balance the interests of all of its stakeholders, including its shareholders, employees, customers, communities, suppliers and others, in order to put itself in the best position to serve its customers, provide critical services to the community and grow profitably over the long term. This belief is reflected in the breadth and aspiration of the Verizon Group’s corporate purpose to “create the networks that move the world forward”. It is also reflected in the Verizon Group’s values underlying all of the Verizon Group’s decisions: integrity, respect, performance excellence, accountability and social responsibility.
As a holding company for certain subsidiaries in the Verizon Group, the Company’s principal activity remains closely aligned with the Verizon Group, and the directors of the Company continue to be guided by the Verizon Group’s culture, policies and strategies. The directors of the Company however recognise that their statutory duties are owed to the Company and believe when taking board decisions during the year ended 31 December 2021 that they have acted in a way that they consider, in good faith, would be most likely to promote the success of the Company, having regard to those matters set out in section 172 of the Companies Act 2006 (“CA 2006”). When making decisions, particularly those of a strategic nature, the directors, with the support of the relevant business functions and the wider Verizon Group’s policies and strategies in place, have regard to the likely long-term consequences of their decisions. As a holding company with no employees, third party suppliers or customers and given the nature of the decisions made during the year, the directors did not consider the factors listed in sections 172(1)(b), interests of employees, 172(1)(c), relationships with suppliers and customers, or 172(1)(d), impact of operations on the community and environment, to have been relevant to the proper discharge of their duties pursuant to section 172 of the CA 2006. As a wholly-owned subsidiary, the directors also did not consider section 172(1)(f), having regard to the need to act fairly as between members, to have been relevant to the proper discharge of their duties.
In their capacity as executives of the Verizon Group, the directors receive a broad range of training, pertaining to their functional roles and more broadly relating to leadership and other personal skills. To better enable the directors to discharge their duties pursuant to the CA 2006, the directors are briefed specifically on their duties as directors of the Company, in particular when reviewing transactions that require careful analysis of their duties such as those related to solvency.
Meetings of board directors were held on a regular basis to enable the directors to consider a range of topics and to receive reports and updates from the business including, but not limited to, those pertaining to financial performance, tax, treasury and statutory audit matters.
During the year, the directors both at board meetings and in the course of their day to day management of the Company continued to be supported by a number of corporate functions, including Legal, Accounting, Treasury and Tax.
Specific examples of how the directors had regard to the matters set out in section 172 when discharging their duties during the year were the directors’ decisions in March 2021 and July 2021 to partially repay the promissory note dated 31 December 2017 (“VII Note”) owed by the Company to Verizon International Inc. (“Partial Note Repayments”) and their subsequent decision in December 2021 to settle the VII Note in full (“Full Note Repayment”). The directors considered a range of factors including how the Partial Note Repayments and the Full Note Repayment would be funded and the financial position of the Company, including its cash flow requirements. Rather than distributing the value of the Full Note Repayment to its shareholders by way of a dividend, the directors considered it to be in the best interests of the Company to make the Full Note Repayment, thereby reducing the amount owed to creditors and improving the Company’s balance sheet position. There were no specific conflicting interests between the Company’s stakeholders that the directors were required to balance.