STRUCTURE AND CORPORATE GOVERNANCE BOARD COMMITTEES Nominations Committee Audit Committees Corporate Governance Committee Remuneration Committee 24 REED ELSEVIER ANNUAL REPORTS & FINANCIAL STATEMENTS 2003 In accordance with the principles of good corporate governance, the following committees, all of which have written terms of reference, have been established by the respective boards. The terms of reference of these committees are published on the Reed Elsevier website (www.reedelsevier.com). During the course of 2004 the Committee will keep under review the implications of the UK Combined Code and the Dutch Code on the corporate governance structure and practices of Reed Elsevier PLC and Reed Elsevier NV. Reed Elsevier PLC, Reed Elsevier NV and Reed Elsevier Group plc have established Audit Committees. The Committees comprise only non-executive directors, all of whom are independent. The Committees are chaired by Lord Sharman, the other members being John Brock and David Reid – appointed in April 2003. A report of the Audit Committees, setting out the role of the Committees and their main activities during the year, appears on pages 27 and 28. The Committees met four times during the year, and there was full attendance. Reed Elsevier PLC and Reed Elsevier NV have established a joint Corporate Governance Committee, which comprises only non-executive directors, all of whom are independent. The Committee is chaired by Morris Tabaksblat, the other members being Dien de Boer-Kruyt, John Brock, Mark Elliott – appointed in April 2003, Cees van Lede – appointed in April 2003, David Reid – appointed in April 2003, Lord Sharman and Rolf Stomberg. The Committee met twice during the year and, with the exception of Mrs de Boer-Kruyt who was absent through illness, there was full attendance. In addition to reviewing ongoing developments and best practice in corporate governance, the Committee is also responsible for recommending the structure and operation of the various committees of the boards and the qualifications and criteria for membership of each committee, including the independence of members of the boards.  During the period the Committee reviewed ongoing developments and best practice in corporate governance. The Committee also assessed the performance of individual executive directors and the functioning and constitution of the boards and their Committees and the Chairman assessed the individual performance of the non-executive directors, in consultation with the other directors. The Committee, led by the senior independent non-executive director, also assessed the performance of the Chairman. Based on these assessments, the Committee believes that the performance of each director continues to be effective and that they demonstrate commitment to their respective roles in Reed Elsevier. The Committee is responsible for recommending to the board the remuneration in all its forms of executive directors of Reed Elsevier Group plc, and provides advice to the Chief Executive Officer on the remuneration of executives at a senior level below the board. It also makes recommendations to the board of Reed Elsevier PLC and Reed Elsevier Group plc has established a Remuneration Committee which comprises only independent non- executive directors. The Committee is chaired by Rolf Stomberg, the other members being Mark Elliott – appointed in April 2003 and Cees van Lede – appointed in April 2003. The Committee met three times during the year. Mr van Lede was not able to attend one meeting, otherwise there was full attendance. During the period the Committee recommended to the boards of Reed Elsevier PLC, Reed Elsevier NV and Reed Elsevier Group plc the appointment of an additional executive director and three non-executive directors, as set out on pages 31 and 32. In each case the Committee retained the services of external search consultants to produce short lists of potential candidates.  The Committee’s terms of reference include assuring board succession and making recommendations to the boards of Reed Elsevier PLC, Reed Elsevier NV and Reed Elsevier Group plc concerning the appointment or reappointment of directors to, and the retirement of directors from, those boards. In conjunction with the Chairman of the Reed Elsevier Group plc Remuneration Committee and external consultants, the Committee is also responsible for developing proposals for the remuneration and fees for new directors. Reed Elsevier PLC and Reed Elsevier NV have established a joint Nominations Committee, which provides a formal and transparent procedure for the appointment of new directors to the boards. The Committee comprises a majority of independent non-executive directors. The Committee is chaired by Morris Tabaksblat, the other members being Crispin Davis – Chief Executive Officer, Cees van Lede – appointed in April 2003, Lord Sharman – appointed in August 2003 and Rolf Stomberg. The Committee believes that it is appropriate for the Chief Executive Officer to be a member of the Committee since he provides a perspective which assists the Committee in nominating candidates to the board who will be able to work as a team with both the executive and non-executive directors. The Committee met twice during the year, and there was full attendance. 