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Investor Relations - Corporate Governance

The Directors recognise the importance of sound corporate governance commensurate with the size and nature of the Company and the interests of its Shareholders. The Company intends to comply as far as possible with the Corporate Governance Guidelines for smaller quoted companies published by the Quoted Companies Alliance, and, as the Company develops, the Board intends to comply as far as practicable with the Corporate Governance Code.

The Company has already established Audit and Remuneration Committees, with formally delegated duties and responsibilities. Set out below is a description of the Company's corporate governance practices.

Meetings of the Board

The Board is required to meet regularly and at least on a quarterly basis and is responsible for strategy, assessment of performance, approval of any major capital expenditure and the framework of internal controls. The Board will establish a formal schedule of matters specifically reserved to it for decision, including matters relating to management structure and appointments, strategic and policy considerations, corporate and significant transactions and finance. To enable the Board to discharge its duties, all members of the Board will receive timely information. The Articles provide that at each annual general meeting, any members of the Board appointed since the previous annual general meeting and any members of the Board who were not appointed or reappointed at either of the previous two annual general meetings must retire from office and may offer themselves for reappointment.

Audit and Remuneration Committees

The Audit Committee, which comprises Roy Pitchford, Brian Moritz and Russell Lamming, and which is chaired by Roy Pitchford, is responsible for ensuring the financial performance, position and prospects of the Group are properly monitored and reported on and for meeting the auditors and reviewing their reports relating to accounts and internal controls. Meetings of the Audit Committee are required to be held at least twice a year, at appropriate times in the reporting and audit cycle. The Audit Committee is required to report formally to the Board on its proceedings after each meeting on all matters for which it has responsibility and is required to compile a report to shareholders to be included in the annual report and accounts of the Group. The members of the Audit Committee are re-elected annually by the Board.

The Remuneration Committee, which comprises Russell Lamming, Brian Moritz and Roy Pitchford and which is chaired by Russell Lamming reviews the performance of the executive directors and sets their remuneration, determines the payment of bonuses to executive directors and considers the future allocation of share options and other equity incentives pursuant to any share option scheme or equity incentive scheme in operation from time to time to directors and employees. Meetings of the Remuneration Committee are required to be held at least twice a year. The Remuneration Committee is required to report formally to the Board on its proceedings after each meeting on all matters for which it has responsibility. The members of the Remuneration Committee are re-elected annually by the Board.

Internal financial controls

The Board will be responsible for establishing and maintaining the Group's system of internal financial controls and importance is placed on maintaining a strong control environment. The key procedures which the Board intends to establish, with a view to providing effective internal financial control, include the following:

  • the Company will institute a monthly management reporting process to enable the Board to monitor the performance of the Group;
  • the Board will adopt and review a comprehensive annual budget for the Group. Monthly results will be examined against the budget and deviations will be closely monitored by the Board;
  • the Board will be responsible for maintaining and identifying major business risks faced by the Group and for determining the appropriate courses of action to manage those risks; and
  • fully consolidated management information will be prepared on a regular basis, at least half yearly.

The Board recognises, however, that such a system of internal financial control can only provide reasonable, not absolute, assurance against material misstatement or loss. The effectiveness of the system of internal financial control operated by the Group will therefore be subject to regular review by the Board in light of the future growth and development of the Group and adjusted accordingly.

Share dealing code

The Company has adopted a code for dealings in Ordinary Shares which is appropriate for an AIM company, including compliance with Rule 21 of the AIM Rules for Companies relating to directors' and applicable employees' dealings in Ordinary Shares.