Corporate Governance Statement

This statement was last updated on 27 September 2018

As an AIM company, from 28 September 2018, the Company is required to maintain on its website details of a recognised corporate governance code, how the Company complies with this code, and an explanation of any departure from the code.

The information will need to be reviewed annually and the website should include the date on which the information was last reviewed. The Directors intend to undertake this review at the same time as the Annual Report and Consolidated Financial Statements are prepared, and, as with past practice, the Annual Report and Statements will also include a Corporate Governance Report.

The Directors recognise the importance of sound corporate governance, and have, historically applied the UK Corporate Governance Code. However, the Board has decided that it will now apply the Quoted Companies Alliance's Corporate Governance Code (the "QCA Code"). The QCA Code was revised and reissued in May 2018 and the Board believes that this is now the most appropriate corporate governance code for the Company.

Chris Akers, in his capacity as Chairman, has assumed responsibility for leading the Board effectively and ensuring that the Company has appropriate corporate governance standards in place and that these standards are observed and applied within the Company as a whole.

The corporate governance arrangements that the Board has adopted are intended to ensure that the Company delivers medium and long-term value to its shareholders. The Board maintains a regular dialogue with its investors, providing them with such information on the Company's progress as is permitted by the AIM Rules, MAR and the requirements of the relevant legislation.

The Board currently consists of two Independent Non-Executives, Mark Horrocks and Peter Read, and two Executive Directors, Chris Akers and Russell Backhouse. Whilst the Board recognises that an Executive Chairman is not considered best practice, Chris Aker's role is seen to be integral in leading the business forward and the Company does not have a chief executive.

Key Corporate Governance related matters which have occurred during the last year are:

  • the Company's becoming a Rule 15 Cash Shell and being obliged to make an acquisition or acquisitions which constituted a reverse takeover under AIM Rule 14 on 3 October 2017;
  • the suspension of the Company's shares from trading on AIM on 4 April 2018; and
  • announcement on 17 September 2018 that, in accordance with AIM Rule 15, the Company expects that the London Stock Exchange will cancel the admission of the Company's ordinary shares to trading on AIM with effect from 7.00 am on 5 October 2018.

Further information on all of these matters are available on the Company Announcements section of the Company's website.

Chris Akers,
Chairman

 

The QCA Code sets out 10 principles that should be applied. These are listed below with a short explanation of how the Company applies each of the principles.

Principle 1 - Business Model and Strategy

The Company is an investment company whose principal activity is to identify and acquire interests in technology, media and communication companies.

For further information on the market, the future strategy of the Company and the risks the Board consider to be the most significant for potential investors, Shareholders are referred to Strategic Report in the latest Report and Accounts (which is available on our website) as well as the Investor Relations section of the website.

 

Principle 2 - Understanding Shareholders' Needs and Expectations

Communication with shareholders is co-ordinated and led by the Chairman who is the Company's principal spokesperson with investors, fund managers, the press and other interested parties.

The Company is in regular dialogue with, and holds regular meetings with, institutional and other larger shareholders and brokers representing private shareholders providing them with such information on the Company's progress as is permitted within the AIM Rules, MAR and requirements of relevant legislation.

The Company regularly updates its website and releases news flow and operational updates. Communications are also provided through the Company's Annual and Interim Reports.

Shareholders are encouraged to attend the Annual General Meeting, which the Board believes is a good opportunity to communicate directly with shareholders.

The Company discloses contact details on its website and on all announcements released via RNS, should shareholders wish to communicate with the Board.

 

Principle 3 - Consider Wider Stakeholder and Social Responsibilities

The Board believes that its stakeholders (other than shareholders) are its investee businesses and their funders.

The Board recognises that the long-term success of the Company is reliant upon the efforts of the Company, advisers and these stakeholders.

The Board makes every effort to communicate effectively with all stakeholders, to ensure that the Company complies with contractual terms.

 

Principle 4 - Risk Management

The Board has overall responsibility for the determination of the Company's risk management objectives and policies and recognises the need for an effective and well-defined risk management process. The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Company's competitiveness and flexibility. The Board is responsible for the monitoring of financial performance against budget and forecast and the formulation of the Company's risk appetite including the identification, assessment and monitoring of the Company's principal risks.

For further information on the risks the Board considers to be the most significant for potential investors, Shareholders are referred to the Strategic and Directors' Report contained in the latest Report and Accounts which are available on the Company's website.

The Board has delegated certain authorities to committees, each with formal terms of reference, such as the Audit Committee which is chaired by Peter Read. The Terms of Reference for this, and the Remuneration Committee, are set out in the Company's Corporate Governance Statement in the Report and Accounts and in Principle 9 below.

 

Principle 5 - A Well-functioning Board of Directors

The Board is responsible for the management of the business of the Company, setting the strategic direction of the Company and establishing the policies of the Company. It is the Board's responsibility to oversee the financial position of the Company and monitor the business and affairs of the Company on behalf of Shareholders, to whom the Directors are accountable. The primary duty of the Board is to act in the best interests of the Company at all times. The Board also addresses issues relating to internal control and the Company's approach to risk management.

The Board consists of two Executive Directors, comprising the Chairman and Finance Director and two Non-Executive Directors.  

Chris Akers chairs the Board. The Executive Directors have industry and technical knowledge and expertise and financial expertise (Russell Backhouse). The Non-Executive Directors have accounting, fund management, technical and public market experience.

Sean Nicolson, who is a solicitor, is the Company Secretary.

The Board holds board meetings monthly and whenever issues arise which require the urgent attention of the Board. All the Directors are expected to devote as much time to the affairs of the Company as may be necessary to fulfil their roles.

The Board has also established an Audit Committee and a Remuneration Committee. The Company considers that, at this stage of its development, and given the current size of its Board, it is not necessary to establish a formal Nomination Committee and nominations to the Board will be dealt with by the whole Board. This position is reviewed on a regular basis by the Directors.

The two Non-Executive Directors sit on the Audit Committee, which is chaired by Peter Read (who is a chartered accountant) and on the Remuneration Committee, which is also chaired by Peter Read.

The Company will report annually on the number of Board and Committee meetings that have been held and the attendance record of individual Directors.

 

Principle 6 - Appropriate Skills and Experience of the Directors

The Company believes that the current balance of skills within the Board as a whole reflects a broad and appropriate range of commercial, technical and professional skills relevant to an investment company in the sectors in which the Company operates and its status as an AIM quoted company.

Whilst the Board recognises that an Executive Chairman is not considered best practice Chris Aker's role is seen to be integral in leading the business forward. The Company at present does not have a chief executive. Biographical details of each of the Directors and officers are set out below:

Christopher Akers - Executive Chairman

Chris was appointed to the board in December 2012. Mr Akers has already served on several public and private company boards, including several AIM companies and is expected to be of great value to the Company, both on a technical and corporate level.  He began his career in Media, as a research analyst for Saatchi and Saatchi, and moved on to work for both the Canadian Imperial Bank of Commerce, and then for Citicorp. He was Chairman and Chief Executive of Leeds United plc from 1996-98.  In 1999, he founded Sports Internet Group plc, which was admitted to trading on AIM later that year and acquired by British Sky Broadcasting plc in 2000 for £300m

Russell Backhouse - Finance Director

Russell was appointed to the board in May 2013. Russell is an experienced finance director and corporate financier and has served on a number of company boards, both listed and private, with a particular focus on the TMT sector. Russell was finance director at Transcomm Plc (AIM Listed) prior to its disposal to British Telecom, and more recently has been a director of United Wireless Holdings Limited (a privately held technology company) and Swindon Town Football Company Limited.

Mark Horrocks - Non-Executive Director

Mark was appointed to the board in March 2014. Mark began his career in the City in 1983 as a financial analyst at Guardian Royal Exchange Group plc and went on to manage the UK equity portfolios of the main pension and life funds, which had assets of over £2 billion, until leaving in 1997 to pursue his own interests in the small company marketplace. In 1999, he co-founded and launched the small company investment trust Intrinsic Value plc and is currently a Partner in Intrinsic Capital LLP. He has also served on the boards of numerous quoted small companies and is currently a non-executive director of AIM-quoted Immedia Group plc, a company which provides bespoke audio digital networks and music strategies. Mark gained a Bachelor of Arts degree from Manchester Polytechnic in Business Studies.

Peter Read FCA - Non-Executive Director

Peter was appointed to the board in September 2014. Peter began his career with KPMG in 1976, becoming a Partner in 1990 and Head of Transaction Services for the Telecoms, Media, Technology ("TMT") Practice in 1998 and Head of the TMT Practice in 2003.

In 2008, Peter was appointed Chairman of KPMG's TMT Practice and Chairman (EMA) of the global Japanese Practice. He held these positions until retiring from KPMG in 2013. Over this six year period he was also the lead Partner for key TMT clients including WPP, IBM, Informa and DMGT and European sub-groups of Japanese clients, including Sony, Sumitomo, Mazda and Hitachi.

Peter's current non-executive roles include Quayle Munro Holdings, the Professional Cricketers' Association, The Royal Automobile Club where he is also Chairman of the Audit Committee and The Motor Sports Association.

Sean Nicolson, a solicitor, acts as the Company Secretary, and is responsible for ensuring that Board procedures are followed and that the Company complies with all applicable rules, regulations and obligations governing its operation, as well as helping the Chairman maintain good standards of corporate governance.

The Directors have access to the Company's external advisers e.g. NOMAD, lawyers and auditors as and when required and are able to obtain advice from other external advisers when necessary.

All Directors have access to independent legal advice at the Company's expense.

The Board will seek to take into account Board imbalances for future nominations, with areas to take into account including gender balance.

 

Principle 7 - Evaluation of Board Performance

Although the Directors consider the issues of Board performance and succession planning to be integral to the long-term success of the Company, given the size of the Company and the Board, it is not currently considered to be necessary to establish formal processes for Board performance evaluation or succession planning. The performance of the Directors is therefore evaluated on an ongoing basis by the Board as a whole.

 

Principle 8 - Corporate Culture

The Company recognises the importance of promoting an ethical corporate culture, interacting responsibly with all stakeholders and the communities in which the Company operates. The Board considers this to be essential if medium and long term value is to be delivered.

The Directors consider that at present the Company has an open culture facilitating comprehensive dialogue and feedback.

The Company has adopted policies to deal with corruption and bribery and to comply with the UK Bribery Act.

 

Principle 9 - Maintenance of Governance Structures and Processes

The Board provides strategic leadership for the Company and operates within the scope of a robust corporate governance framework. Its purpose is to ensure the delivery of long-term shareholder value, which involves setting the culture, values and practices that operate throughout the business, and defining the strategic goals that the Company implements in its business plans. There are no matters specifically reserved for the Board, the Board has approved terms of reference for its Audit and Remuneration Committees to which certain responsibilities are delegated. The chair of each committee reports to the Board on the activities of that committee.

The Chairman has overall responsibility for corporate governance and in promoting high standards throughout the Company. He leads and chairs the Board, ensuring that committees are properly structured and operate with appropriate terms of reference, ensures that performance of individual Directors, the Board and its committees are reviewed on a regular basis, leads in the development of strategy and setting objectives, and oversees communication between the Company and its shareholders.

The Executive Directors are responsible for implementing and delivering the strategy and operational decisions agreed by the Board, making operational and financial decisions required in the day-to-day operation of the Company, providing executive leadership to managers, championing the Company's core values and promoting talent management.

The Independent Non-Executive Directors contribute independent thinking and judgement through the application of their external experience and knowledge, scrutinise the performance of management, provide constructive challenge to the Executive Directors and ensure that the Company is operating within the governance and risk framework approved by the Board.

The Company Secretary is responsible for providing clear and timely information flow to the Board and its committees and supports the Board on matters of corporate governance and risk.

The Board reviews annually the effectiveness of its corporate governance structures and processes.

Whilst the Board recognises that an Executive Chairman is not considered best practice, the Board currently considers that the balance between Executive and Non-Executive Directors, including the independent Directors, and the roles of the Audit and Remuneration Committees are appropriate for the Company's size.

The primary duty of the Board is to act in the best interests of the Company at all times. The Board also addresses issues relating to internal control and the Company's approach to risk management.

The Board delegates authority to two Committees to assist in meeting its business objectives, and the Committees meet independently of Board meetings.

Audit Committee

The Audit Committee comprises P Read (Chairman of the committee) and M Horrocks. Meetings can also be attended by the external auditors.

The remit of the Committee is to review:

  • the appointment and performance of the external auditors
  • the independence of the auditors
  • remuneration for both audit and non-audit work and nature and scope of the audit with the external auditors
  • the interim or final financial report and accounts
  • the external auditor's management letter and management's responses
  • the systems of risk management and internal controls
  • operating, financial and accounting policies and practices, and to make related recommendations to the Board.

The Audit Committee meets once a year.

Remuneration Committee

The Remuneration Committee comprises P Read (Chairman of the committee) and M Horrocks and is responsible for making recommendations to the Board on the Company's framework of Executive remuneration and its cost. The Committee determines the contract terms, remuneration and other benefits for the Directors.

Given the current size of its Board, the Board deems it is not necessary to establish a formal Nomination Committee and nominations to the Board will be dealt with by the whole Board. This position will be reviewed on a regular basis by the Board.

The Company has also implemented a code for Directors' and employees' dealings in securities which is appropriate for a company whose securities are traded on AIM and is in accordance with the requirements of the Market Abuse Regulation which came into effect in 2016.

 

Principle 10 - Shareholder Communication

The Board is committed to maintaining good communication with its major institutional investors and other professional investors, providing them with such information on the Company's progress as is permitted by the AIM rules, MAR and the requirements of the relevant legislation.

The Board believes that the Company's Annual Report and Accounts, and its Interim Report published after the half year, play an important part in presenting all shareholders with an assessment of the Company's position and prospects.

The Annual General Meeting is the principal opportunity for private shareholders to meet and discuss the Company's business with the Directors. There is an open question and answer session during which shareholders may ask questions both about the resolutions being proposed and the business in general. The Directors are also available after the meeting for an informal discussion with shareholders.

Results of shareholder meetings and details of votes cast will be publicly announced through RNS and displayed on the Company's website with suitable explanations of any actions undertaken as a result of any significant votes against resolutions.

All reports and press releases are published on the Group's website: www.concha.com and the Company will continue to keep its website up to date, participate in investor presentations, attend conferences and release news flow and operational updates as appropriate. The Company will also include a Corporate Governance Report in its Annual Report and Consolidated Financial Statements.

 

UK City Code on Takeovers and Mergers

As an AIM traded UK registered company, Concha PLC is subject to the UK City Code on Takeovers and Mergers legislation.