2) Remuneration policy for non-executive directors.

Non-executive directors (NEDs) are appointed for a period of three years. Their performance is reviewed annually. NEDs may be reappointed for a further three-year period and subsequently, if considered appropriate, for a final period of three years after which such NEDs shall be subject to annual re-election in accordance with the Company’s Articles of Association and the Combined Code. Appointments may be terminated by either party without notice. Fees for the non-executive directors are determined by the Board, based on a range of external information and advice set within the aggregate limits contained in the Articles of Association.

During 2009, the fees of the NEDs, including the Chairman, were reviewed and no increases were made. For 2010, it has been determined that no change would be made to fees until the new Chairman, John Stewart, has had time to consider the members of the Board committees and whether the roles and responsibilities of the NEDs have broadened in scope and time commitment given the added emphasis being placed on corporate governance and risk oversight. As a result the following fees continue to apply:

NEDs must use at least 50% of their fees, after UK tax, to buy Legal & General shares. Fees paid to non-executive directors are non-pensionable. In addition to their fees, directors are entitled to be reimbursed for expenses properly and reasonably incurred in respect of their office and shown as benefits within the emoluments table. No further remuneration is payable.