Legal & Corporate Services: Strategic Plan - CP6

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Legal & CorporateServices: StrategicPlan - CP619.01.18

Legal & Corporate Services: Strategic PlanContents1.2.3.4.Purpose, role & vision . 31.1.Purpose . 31.2.Role . 31.3.Vision . 3Objectives & Stakeholder priorities . 42.1.Stakeholders & priorities . 42.2.Specific objectives . 4What Legal & Corporate Services is . 63.1.Structure . 63.2.Operating model: present & future . 7Risks, opportunities, constraints & assumptions . 244.1.5.6.Notable assumptions . 26Expenditure & efficiency. 275.1.Cost and volume summary . 275.2.Route Business Scotland details (Will be provided the numbers by Group after submission) . 295.3.Cost drivers, headwinds and efficiency . 305.4.Risk and uncertainty in the CP6 plan . 335.5.Uncertainty ranges for CP6 . 34Sign-off . 39Appendix AN/A . 40Appendix BKey assumptions . 40Appendix CScenario planning. 43Appendix DN/A . 46Appendix EN/A . 46Appendix FGlossary of terms . 46Network Rail2

Legal & Corporate Services: Strategic Plan1. Purpose, role & vision1.1.Purposequality, value, timeliness and risk management.Legal & Corporate Services (LCS) works as an integral part of thebusiness to help achieve Network Rail’s strategy and objectives bymanaging and reducing legal, business, financial and reputationalrisk, being customer and safety focused and providing value formoney.1.2.RoleLCS is a critical business support function. Each team in thefunction offers a variety of professional services and undertakesthe following core roles in their area of specialism:- sets policy and standards;- provides level 2 assurance;- provides governance;- manages risk;- trains and develops capability in the business,supported by appropriate tools;- provides subject matter expertise;- holds accountability for compliance with identifiedpieces of legislation; and- offers professional advisory services.1.3.VisionTo be recognised by customers and stakeholders as providing themost compelling legal and corporate business services in terms ofNetwork Rail3

Legal & Corporate Services: Strategic Plan2. Objectives & Stakeholder priorities2.1.Stakeholders & prioritiesAs a team, LCS operates across the whole business, working withthe Routes, Route Support and Central Support functions. Duringcontrol period 5 (CP5), LCS has increased its focus on andengagement with its internal customers. Each team within LCSowns its own customer relationships and has engaged with thosecustomers in the development of the team’s plans.2.2.Specific objectivesThe LCS team works with all areas of the business and is a criticalsupport function. LCS contributes to delivery of the overallcorporate objectives and those of its customers.The function also works closely with external stakeholders,particularly the Department for Transport, the Office of Rail andRoad, train and freight operating companies, other railwayinfrastructure managers, the Information Commissioner’s Officeand the National Audit Office.A number of themes have emerged from discussions with LCS’scustomers and stakeholders, which have helped us to prioritise:effective, efficient and right first time delivery;timely advice and support, which will help promotefurther business accountability;proactive engagement to understand andanticipate customer requirements;management of risk (including consistency acrossa devolved business);delivering value for money; andappropriate governance and assuranceGetting this right will allow LCS to move towards its vision.Network Rail4

Legal & Corporate Services: Strategic PlanAs a result of customer and stakeholder feedback and thepriorities identified in paragraph 2.1, LCS has developed theprimary objectives for control period 6 (CP6) set out in the figureabove.These are taken forward in section 3.3 below, which sets out thedetail on how the team will deliver for its customers. Consistentwith the objectives, strong themes from that include continuedcustomer focus, provision of the right advice at the right time,managing risk, delivering value for money and being better everyday.This strategic plan also sets out further detail on how theseobjectives will be monitored and delivered with the resourcesavailable.Figure: LCS’s objectivesNetwork Rail5

Legal & Corporate Services: Strategic Plan3. What Legal & Corporate Services is3.1.StructureAt the start of CP6, LCS will consist of 59 people, organisedacross 4 functional teams:- Legal Services;- Company Secretariat (Co Sec);- Transparency, Ethics, Data Protection and Freedom ofInformation (TED & FOI); and- LCS Policy & Assurance.Figure: LCS high level structure chart and headcountThe Group General Counsel and Company Secretary isresponsible for LCS, reporting to the Chief Financial Officer andattending Board and Board Committees as required.Unless there are significant changes to Network Rail’s overalloperating model or to the level of demand for support from theteam, substantial changes to the size or structure of thepermanent team are not anticipated during CP6.Network Rail6

Legal & Corporate Services: Strategic Plan3.2.Operating model: present & future(a) Legal ServicesThe Legal Services team will be 32 at the start of CP6.Historically, Legal Services was organised by legal specialism.That changed in 2013 (with a further evolutionary change in 2016)to create a team that is structured to align more closely withNetwork Rail’s customer-focussed operating model. The team’sstructure is supported by positive feedback from its customers,particularly through the Efficiency and Effectiveness Programmeand pulse surveys since.The team is well placed to continue to support devolution, allowingit to be more focussed on its customers and the delivery ofbusiness objectives.The team exists to provide a compelling service to its customers inthe provision of legal advice, managing legal risk and managingthe legal supply chain. By doing this well, the team will movetowards its vision.Legal Services is made up of 4 teams, each serving differentcustomers with a dedicated legal resource. This is summarised inthe figure right.Figure: Legal Services’ team structure and customers enteringCP6Although Legal Services has distinct, customer-focussed teams,there is the flexibility across the function to allow resource,knowledge and experience to be deployed most effectively andprovide a full service to the whole business.Routes teamThe Routes team was set up to service the legal requirements ofthe Routes and IP regions.To deliver the best and most sustainable and resilient service to itscustomers with the resource available, the team is currently splitinto 3 clusters servicing Scotland, North (LNE/LNW and Freight &National Passenger Operators) and South (Anglia, South East,Wessex and Western). Wales’ legal support is currently providedon a trial basis by one of our external law firms, EvershedsNetwork Rail7

Legal & Corporate Services: Strategic PlanSutherland, who act as the in-house legal team for Wales,replicating the legal service provided to the other routes. This willbe altered slightly in year 5 of CP5 (see below), a permanentchange continuing through CP6.across the legal function and to develop guidance andprocesses, including the delivery of the function’sapproach to Legal Risk Management, intended to facilitatecontinuous improvement.The Route teams provide a dedicated and cross-discipline legalservice aligned to the strategic aims of their routes and IPcustomers. . The model enables the in-house teams to createcloser working relationships with their customers and to betterunderstand the routes and IP businesses, their aims, strategiesand objectives and help to prioritise the support for each route’slegal requirements.Advice is focussed on operationalrequirements, enabling better risk-based decision making. Thestructure establishes relationships with route leadership teams,resulting in earlier dialogue and better risk management. TheRoutes team has bases in London (London Bridge and Stratford),Milton Keynes, York and Glasgow.The team is located so that it is best placed to serve its keycustomers, predominantly working between Milton Keynes andLondon.To further develop the relationships with route leadership teamsand improve the overall service delivery to its customers, it isproposed that the current Southern cluster is split in to East andWest teams. The East team would provide legal support to SouthEast and Anglia and the West team would advise Western andWessex. For the proposed delivery model to be effective, resilientand sustainable, there will be an additional role created in eachcluster.The proposed implementation of the change in theRoute’s team structure would be October 2017, with recruitmentinto the teams completed early in 2018.The team is alsodiscussing an additional lawyer for Scotland to be paid for by theRoute.National Policy & Strategy team (NP&S)The role of the NP&S team is threefold: to provide strategic advice to the company at nationallevel; to lead on the provision of legal support to the centralfunctions comprising Route Services, STE, HR and partsof Finance; and to set legal policy so as to ensure consistency of approachNetwork RailGroup teamThe Group team was formed to support certain Corporate Corefunctions, Digital Railway, corporate projects, group companies,major projects and areas of IP.It also supports elements ofSystem Operator, Technical Authority and property functions.It is a small and experienced cross-discipline team, focussed onbuilding and maintaining the right relationships with its customers.The team recognises that key external stakeholders such as theDepartment for Transport, the Office of Rail and Road, HighSpeed 2, Crossrail and others are critical to business success andactively engages with these stakeholders to maintain excellentworking relationships.In late summer 2017, the Group team took on responsibility forleading Network Rail’s representation in Europe, including workingto influence European policy and legislative agendas. The teamnow includes a dedicated European specialist.The team works flexibly between Milton Keynes and London tomeet business needs.PropertyAs one of the biggest landowners in Great Britain, Network Railhas a specialist and cohesive team of property lawyers. This groupis well positioned to effectively and efficiently provide a full rangeof support to Network Rail in terms of real estate transactions anddisputes, together with regulatory legal support concerningproperty matters.8

Legal & Corporate Services: Strategic PlanThe team works on matters ranging from commercial JVinvestment vehicles to the appropriate exercise of compulsorypurchase powers for railway projects: it provides a full service tothe whole of Network Rail’s property function. Each member ofthe team has accountability for a particular element of the legalreal estate offering based on the different portfolios of NetworkRail land holdings, for example franchise stations and depots,commercial estate, managed stations and retail.The team is aligned to manage a number of boards andcommittees to (i) ensure continuity of support for the customer,facilitating good working relationships with board and committeemembers and (ii) allow the Co Sec team members to develop theirknowledge and understanding of specific business areas.Periodically board and committee management will be rotatedwithin the team to help broaden team members’ companyknowledge and experience and build resilience in the team. Thefigure below sets out the activities carried out by the team.Since January 2016, the Property team has had a pivotal role inthe Asset Divestment Programme. This involvement has resultedin two additional lawyer positions within the team to accommodatethe requirements of the business, both of which are funded by theProgramme.The Property team is located in London, with a property litigationspecialist in Manchester. The team will evolve to meet customerneeds. With this in mind, it is looking at developing a moregeographically dispersed presence.Panel firmsThe in house Legal Services team is supported by a panel ofexternal law firms retained under standard framework agreements.The current arrangements will come to an end in March 2019 andthe team is working on putting a new panel in place to serve thebusiness for CP6 (see below).(b) Company SecretariatThe Co Sec team comprises three qualified chartered secretariesand will (before the start of CP6) have recruited a trainee companysecretary as part of its longer term resource and successionplanning process.The Co Sec team’s vision is to be seen as professional, proactiveand as one team. This fits well with the LCS vision.Network RailFigure: Co Sec team activitiesIn addition to board and committee management, there are anumber of other tasks undertaken by the team, relating primarily tocorporate governance. Again, each of these accountabilities hasan identified ‘lead’ although all team members are able to performthose tasks.Apart from the anticipated introduction of a trainee companysecretary, it is not anticipated that the composition or structure ofthe Co Sec team will change during CP6. The purpose of thetrainee position is (i) to cultivate someone to assist the team with9

Legal & Corporate Services: Strategic Planthe important, but lower value tasks that the team must do, thusfreeing up more experienced members of the team to undertakehigher value tasks and further their own skills and experience; and(ii) to provide some junior level cover in the team to help manageplanned and unplanned absence.(c) Transparency, Ethics and Data Protection and Freedom ofInformationmatured, which means the team operates as a business as usualfunction in the majority of areas. For example: 97% of Network Rail staff (both operational and deskbased) are trained in business ethics; the team consistently achieves 98-100% compliance toresponse deadlines for requests made under the FOI Actand the Environmental Information Regulations; and the team maintains over 50 value adding data sets on ourtransparency webpagesThe permanent team on entering CP6 will comprise 17: a head ofteam, two in the ethics team, three in data protection and eleven inthe FOI and transparency team (this includes administrative,analytics and reporting support).But there is more to do, and by the end of CP6, the team aims tobe a centre of excellence for compliance with informationlegislation and to support the varied and devolved organisation inbeing an exemplar of ethical business behaviour.The team exists to enhance the reputation of Network Rail, bymaking it a more open organisation, embedding the higheststandards of business behaviour and complying with informationlegislation so that the whole business can all work openly, ethicallyand safely to be better. Reputation and employer brand – of whichtransparency, ethics, data protection and FOI are key components– is crucial to the business’ success, both now and in the future.To support this, the team will provide relevant, targeted and valueadding subject matter expertise to the business (outlined in moredetail below). This will help Network Rail better manage thecorporate, reputational and financial risk in the areas oftransparency, ethics, freedom of information and data protectionand allow the function to move towards its vision.The team is made up of subject matter experts, with each teammember having specific knowledge and experience relevant to thearea of the business they support. This allows us to meetbusiness need with a lean team.In CP5, the team’s remit was expanded when Network Rail wasreclassified as a public sector organisation; which meant NetworkRail became subject to the Freedom of Information Act (FOI Act)and Environmental Information Regulations (EIR).The team owns and implements of the company’s transparencystrategy, Network Rail’s Code of Business Ethics and supportingpolicies, and is responsible for data protection and freedom ofinformation compliance.The TED & FOI team has embedded and the business hasNetwork RailData ProtectionData protection compliance is demonstrably low across theorganisation and is a Level 1 risk for Network Rail. In 2017, it wasmentioned as an area of focus in the annual Group AssuranceLetter Process (GALP). Improving this is will continue to be apriority in years 4 and 5 of CP5, continuing into early CP6.The team will focus on increasing awareness of both what dataprotection is and accountabilities across the business for handlingpersonal information safely and fairly and will deliver relevanttraining and tools in support. The team will also put in place anaccessible and robust suite of policies and procedures to increaseour compliance with the changing legislation.It is anticipated that the team will achieve a better foundation forcompliance in early CP6, and will maintain a core team of threedata protection subject matter experts.10

Legal & Corporate Services: Strategic Plancustomers and the Network Rail Executive Committee havesupported the retention of a lean central team of subject matterexperts.EthicsThe approach to business ethics has continuous improvement atits core. Current levels of awareness of our Code of BusinessEthics, supporting policies and our whistleblowing service is high.The team will continue to embed best practice across theorganisation in CP6. This will help mitigate greater risks ofunethical behaviour as the organisation devolves.(d) LCS Policy & AssuranceHistorically, the LCS Policy & Assurance team managed theContracts & Procurement Policy and the Network Rail suite ofcontracts.The team is small and will continue to operate a hub and spokemodel, retaining a core central team of two subject matter experts.This helps the team avoid duplication of resource, provides valuefor money and supports devolution whilst providing consistency forwhole business compliance.The team’s remit has recently expanded to include risk, assuranceand governance activities across LCS. Additional accountabilitiesinclude; ownership of the company’s Delegation of Authority policy; delivering assurance frameworks for other policies owned byLCS; ensuring that LCS is compliant with all relevant companypolicies; and providing risk management and governance support to thewider LCS team and supporting ad-hoc projects.Transparency and FOIIn late CP5, a one-team approach to transparency and FOI wasadopted, reducing headcount and creating a leaner teamfocussing on key value-adding objectives. In CP6, compliancewith the FOI Act and EIR will be maintained, and the team willembed continuous improvement in its ways of working, includingsharing lessons learned with the business to improve businesspractices. This will help Network Rail better comply with legislativerequirements, whilst reflecting on the changing requirements of theorganisation.General Counsel2x Snr Policy & Assurance ManagerThe operating model for the team has been reviewed at regularintervals, both since we became subject to the FOI Act and as thebusiness has devolved. The majority of requests made to NetworkRail require a national corporate response, rather than routespecific.The size of the team compares favourably withorganisations which receive a similar level of requests, such asTransport for London and the Ministry of Defence (see section 7).1 x Policy & Assurance ManagerNetwork RailNR Suite of ContractsPolicy Setting & Assurance Devolved FOI teams can create inconsistencies in approach andpoor compliance, which risks regulatory monitoring by theInformation Commissioner. Instead, to deliver value for money,remove the risk of duplication and help maintain excellentcompliance for the business as a whole, the team’s business1x Snr Contract Specialist Ownership of Contracts & Procurement & Delegationof Authority company policiesProviding assurance that all LCS policies areoperating effectively within the organisationProviding assurance that LCS are compliant withrelevant company policiesProviding risk management and governance supportto support LCS initiatives Ensuring that Network Rail Contractsappropriately manage risk and protect companyinterestsDelivering efficiency for the supply chain throughstandardisationProviding specialist contract advice andapproving contract amendmentsProviding relevant training and guidanceFigure: LCS Policy & Assurance structure11

Legal & Corporate Services: Strategic PlanThe team consists of 4 people and adds value in two distinctareas:- providing technical expertise and advice in relatedpolicy areas; and- providing assurance that LCS’s policies are beingcomplied with and that LCS’s risks are beingmanaged.This is illustrated in the figure above.Network Rail12

Legal & Corporate Services: Strategic Plan3.3Customers and deliveryTo move towards its vision, LCS focusses closely on itscustomers. This section of the plan sets out how each team in thefunction delivers for its customers, considering the objectives setout in section 2 above. Each of the teams within the function is ata different stage in developing and using scorecards to reflectdefined and measurable objectives and against which performanceis monitored.Set out below is further detail of the areas theteams have explored.(a) Legal ServicesLegal Services engages with most business units in Network Rail.Further detail is included in the figure in section 3.2 above. Thefigure below sets out how the team focusses on delivering for itscustomers.The team engages closely with its customers and stakeholders onthe work it does for them and strives to continue to improve theservice offered.The team regularly receives feedback fromcustomers that they want more of the team’s services and theteam considers carefully how it manages customer needs betweenthe in house team and external firms.Legal Services’ objectives are driven by its customer priorities andthe team seeking to deliver the compelling service that itscustomers receive, thereby moving LCS towards its vision. Thisis looked at through five key areas, which are measured in theteam and by the leadership group through reporting andscorecards.1. Customer focusThe team is committed to focussing on its customers and deliveryof customer objectives, whether that means supporting Routeteams, improving safety, delivering a Digital Railway, bringing thirdparty investment into the railway, closing level crossings, dealingwith asset disposals, delivering powers for new infrastructure orletting important contracts.Scorecards and customer prioritiesAs part of this commitment, Legal Services has been keen todevelop balanced scorecards that allow the teams to better alignmeasurable objectives with those of their customers. To reflectdifferent customer priorities and team challenges, each teamwithin the function has a bespoke approach to this. An exampleof this is in the figure below.Figure: Legal Services’ strategyNetwork Rail13

Legal & Corporate Services: Strategic Planwant.Working ever more closely with customers is a theme that willcontinue through the remainder of CP5 and CP6.StakeholdersIt is also important that the teams focus on key stakeholdersoutside the business, including the Department for Transport, theOffice of Rail and Road and other railway infrastructure managers.The team continues to develop constructive relationships with thelegal teams in those organisations, allowing more efficient projectdelivery for the business.2. Providing the right advice and systematically managing legalriskFigure: Example scorecardIn developing scorecards, each team has worked with itscustomers to understand and reflect their needs and priorities.Where appropriate, each team has also developed customerengagement plans. These tools allow the teams to challengethemselves on how they are supporting their customers. Theyhave been welcomed across the business.In addition, scorecards also allow each team to monitor its ownteam progress: for example they may contain measures to monitorhealth and wellbeing, setting of personal objectives and personaldevelopment plans.RelationshipsThe team has also been actively working on building strongerrelationships with its customers, whether that is attendingcustomer management team meetings, setting up regularrelationship meetings or providing better data on the legalresource working for customers and visibility on how it is beingdeployed – the team is flexible in providing what its customersNetwork RailLegal Services is made up of experienced lawyers, with each teammember having specific knowledge and experience relevant to thearea of the business they support. This means the provision ofright first time advice.Legal Services is active and expert in helping its customersmanage legal risk. The key to this is understanding its customers’businesses and the wider context in they operate, having theexperience and skills to provide the right legal advice first time andbeing equipped with the right tools. The team is uniquely placedto do this.Being one joined up team allows Legal Services to be flexible,sustainable and resilient and facilitates sharing good practice,business intelligence and knowledge transfer: f

the provision of legal advice, managing legal risk and managing the legal supply chain. By doing this well, the team will move towards its vision. Legal Services is made up of 4 teams, each serving different customers with a dedicated legal resource. This is summarised in the figure right. Although Legal Services has customerdistinct, -focussed .

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