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CORPORATE GOVERNANCE


The Group is committed to high standards of corporate governance. The Board is accountable to the Company’s shareholders for good corporate governance. Although the Group is not required to comply with the UK Corporate Governance Code, this statement describes how the principles of corporate governance are applied to the Group.

 

Directors

The Board of Uvenco UK plc comprises one Executive Director and three Non-executive Directors. The Board is chaired by J.J.Hamer, and assisted by the Senior Independent Non-executive Director M.E.W.Jackson, who has the primary responsibility for running the Board.

S.Kornienko has executive responsibilities for the remaining operations, results and strategic development of the Group. M.Maltby is acting Chief Financial Officer and Company Secretary. The Board structure ensures that no individual or group dominates the decision making process and this is further controlled through a Relationship Agreement signed in November 2014, a copy of which is available in the section Rule 9 waiver.

B.Belotserkovskiy is not deemed an independent Director due to his Concert Party controlling 53.9% of the shares currently in issue. S.Kornienko is deemed to be a member of the Belotserkovskiy Concert Party. J.J.Hamer and M.E.W.Jackson are considered to be independent of both the management and the Concert Party and from any business relationship, which could materially interfere with their independent judgment.

The Board meets regularly with no less than ten such meetings held in each calendar year. There is a formal schedule of matters specifically reserved for the Board so that its decisions enable it to manage overall control of the Group’s affairs. All Directors have access to the services of the Company Secretary and may take independent professional advice at the Group’s expense in the furtherance of their duties. Management has an obligation to provide the Board with appropriate and timely information to enable it to discharge its duties. The Chairman ensures that all Directors are properly briefed on issues arising at Board meetings.

At the present time the Group does not have a separate Nominations Committee preferring to deal with any Board appointments at our regular Board meetings. This would include the decision to recommend the appointment, or re-appointment, of a Director.

The Company’s Articles of Association ensure Directors retire at the third Annual General Meeting after the Annual General Meeting at which they were elected and may, if eligible, offer themselves for re-election.

M.E.W.Jackson chairs the Audit Committee and J.J.Hamer chairs the Remuneration Committee. The Non-executive Directors and the Chairman are members of all the above committees.

 

Directors’ remuneration

The responsibilities of the Remuneration Committee, together with an explanation of how it applies the Directors’ remuneration principles of the UK Corporate Governance Code, are set out in the Report of the Directors on Remuneration in the Annual Report.

 

Relations with shareholders

The Board attaches a high importance to maintaining good relationships with shareholders, whether institutional or private ones. The Board encourages all Directors to attend shareholder meetings enabling the Board to develop an understanding of the views of shareholders.

The Company counts all proxy votes and except where a poll is called, it indicates the level of proxies lodged on each resolution and the balance for and against the resolution, after it has been dealt with on a show of hands. 

A separate resolution on each substantially separate issue is proposed at the Annual General Meeting. The Chairman of the Board and each of the Chairmen of the Audit and Remuneration Committees, are available to answer questions at the Annual General Meeting.

 

Accountability and Audit

The respective responsibilities of Directors and Auditors are set out in the Annual Report. The Board has established an Audit Committee. The Audit Committee’s primary responsibilities include monitoring of internal control, approving accounting policies, agreeing the treatment of major accounting issues, appointment and remuneration of the external auditors and reviewing the interim and financial statements before submission to the Board. It meets at least once a year with the external auditors to review their findings. At these meetings the Non-executive Directors have the opportunity to discuss findings with the auditors in the absence of the Executive Directors.

To follow best practice and in accordance with Ethical Standard 1 issued by the Auditing Practice Board, the external auditors have discussions with the audit committee on the subject of auditor independence and have confirmed their independence in writing.

 

Internal control

The Directors acknowledge that they are responsible for ensuring that the Group has in place a system of internal controls, which is both effective and appropriate to the nature and size of the business. 

The Board, through the Audit Committee, has reviewed the operation and effectiveness of the systems of internal control throughout the accounting year and the period to the date of approval of the financial statements, although it should be understood that such systems are designed to provide reasonable but not absolute assurance against material misstatement or loss. The Group’s system of controls include:     

•    A comprehensive budgeting system with annual budgets approved by the Directors;

•    Monthly monitoring of actual results against budget and a review of variances;

•    Close involvement of Directors who approve all significant transactions;

•    Internal management rules which include financial and operating control procedures for all management of the Group;

•    Identification and appraisal by the Board of the major risks affecting the business and the financial controls;

•    Bank facilities and other treasury functions are monitored and policy changes approved by the Board.

The Board has considered the need for an internal audit function and concluded that this would not be appropriate at present due to the size of the Group.