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Question 3a

Introduction

Rail Co is a public sector rail company responsible for delivering passenger rail services within Beeland.

Rail Co is governed by a supreme governing committee known as the Rail Co Trust Board. This board is responsible to theMinistry of Transport for ensuring that the Rail Co board of directors make the best use of public money and maintaineffective and efficient services to the public. Figure 1 below shows the governance structure of Rail Co.

Figure 1

The National Audit Authority (NAA) of Beeland is a national government audit authority with responsibility for evaluatingand reporting to the government of Beeland on public spending, suggesting improvements to and benchmarking againstthe performance of a wide range of publicly funded organisations. The NAA also has a responsibility to advise on the valuefor money (VFM) obtained from publicly owned enterprises and on the performance of the boards of such organisations,including the senior executives of these boards.

Rail Co has in the recent past received negative publicity in the media and from a variety of other sources relating to itspoor services and performance. This has prompted the Minister for Transport of Beeland, to commission the NAA toundertake an urgent investigation of the issues facing Rail Co.

The following exhibits (1–6) provide information relevant to Rail Co.
– Exhibit 1: Website page for Rail Co leadership and governance.
– Exhibit 2: Transport report published in the Beeland Herald newspaper.
– Exhibit 3: Passenger survey results and performance analysis spreadsheet for Rail Co and its competitors (three years data).
– Exhibit 4: Rail Co board meeting minutes.
– Exhibit 5: Outline person specification and summary CVs for two candidates for the new chief executive position
– Exhibit 6: Ticket sales, passenger usage data and fraud analysis at stations in towns within Region 1 – Beeland network – prepared by the financial controller of Rail Co.

Question 3a:

It is now two months after the letter was sent by the NAA to the chairperson of the Trust Board (Task 2b).

You are the non-executive chairperson of an ad hoc sub-committee constituted by the NCG of the Rail Co board.

As a consequence of the NAA review and the recommendations of the Rail Co Trust Board, the Minister of Transport recommended that the chief executive of Rail Co should be removed from his position.

Following the termination of the chief executive’s contract, the position has now been advertised both nationally and internationally and a person specification has been uploaded to the Rail Co website.

In the last two weeks, two candidates have been shortlisted for final interview and a summary of their CVs is being reviewed by the nominations and corporate governance (NCG) committee of Rail Co (Exhibit 5).

Required:
Following a review of the suitability of the shortlisted candidates against the outline person specification, you have been asked by the chair of the NCG to do the following:

(a) Write a report to the chair of the NCG which evaluates the suitability of the shortlisted candidates for the position of chief executive of Rail Co and recommend with justification, which candidate you consider to be the most suitable for the position. (8 marks)

Professional skills marks are available for demonstrating commercial acumen skills in using your judgement to evaluate the relative merits of the two candidates. (2 marks)

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