Corporate Governance
The Board recognises the importance of sound corporate governance and intends to comply in all material respects with the QCA’s Corporate Governance Guidelines for AIM Companies. The Company will establish, with effect from Admission, audit, nomination and remuneration committees, with formally delegated duties and responsibilities. David Banks and Colin Keith will be the initial members of each committee. The committees will be chaired by David Banks.
The Board of the Company will meet regularly and be responsible for strategy, performance, approval of major capital projects and the framework of internal controls. The Board will have a formal schedule of matters specifically reserved to it for decision, including matters relating to management structure and appointments, strategic and policy considerations, transactions and finance. To enable the Board to discharge its duties, all of the directors will receive timely information. The articles of association of the Company, summarised in paragraph 6 of Part 5 of this document, provide that one third of the Board will submit themselves for re-election at each annual general meeting of the Company.
Audit, remuneration and nomination committees
The audit committee will have primary responsibility for monitoring the quality of internal controls and ensuring that the financial performance of the Company is properly measured and reported on. In addition, it will receive and review reports from the Company’s management and auditors. The audit committee will have unrestricted access to the Company’s auditors.
The remuneration committee will, amongst other things, make recommendations to the Board on matters relating to the remuneration of the executive directors. The remuneration committee will also make recommendations to the Board on proposals for the granting of share options and other equity incentives pursuant to any share option scheme or equity incentive scheme in operation from time to time.
The nomination committee will have responsibility for leading the process of new Board appointments and will make recommendations to the Board.
Internal financial controls
The Board will be responsible for establishing and maintaining the Enlarged 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 controls include the following:
- the Company will institute a monthly management reporting process, including fully consolidated management information to enable the Board to monitor the performance of the Enlarged Group; and
- the Board will be responsible for maintaining and identifying major business risks faced by the Enlarged Group and for determining the appropriate courses of action to manage those risks.
The Board recognises, however, that such a system of internal financial controls can only provide reasonable, not absolute, assurance against material misstatement or loss. The effectiveness of the system of internal financial controls operated by the Enlarged Group will therefore be subject to continuing review by the Board.
The Board intends to comply with Rule 21 of the AIM Rules relating to directors’ dealings as applicable to AIM companies and will also take all reasonable steps to ensure compliance with that rule by the Company’s applicable employees. The Company has adopted the Share Dealing Code for this purpose.