Corporate Governance

The Board is accountable to the Group’s shareholders for attaining a high standard of corporate governance.

Corporate Governance Statement

The Directors recognise the importance of good corporate governance and have chosen to apply the Quoted Companies Alliance Corporate Governance Code (the ‘QCA Code’). The QCA Code was developed by the QCA in consultation with a number of significant institutional small company investors, as an alternative corporate governance code applicable to AIM companies. The underlying principle of the QCA Code is that:

Companies need to deliver growth in long term shareholder value. This requires an efficient, effective and dynamic management framework and should be accompanied by good communication which helps to promote confidence and trust”.

The QCA code identifies 10 principles that well governed businesses should follow. Please refer to The Principles of the Quoted Company Alliance (QCA) Code section below which addresses each in turn and how the Company sets out to apply these. The section refers to the Report and Accounts of the year ended 31 December 2017, which can be found in Reports, Results & Presentations. To see how the Company addresses the key governance principles defined in the QCA Code please refer to the below table.

Further information on compliance with the QCA Code will be provided in our next annual report.

Dr Lynn Drummond, Non-Executive Chair

This disclosure was last reviewed and updated on 27 September 2018

Board Committee

The Board has established an Audit and Risk Committee, a Nomination Committee and a Remuneration Committee with written terms of delegated responsibilities for each.

The Audit and Risk Committee

The Audit and Risk Committee is chaired by Peter Bream. The other members of the Committee are Carl Dempsey and Lynn Drummond. The Committee has responsibility for considering all matters relating to financial controls and reporting, internal and external audits, the scope and results of the audits, the independence and objectivity of the auditor and keeping under review the effectiveness of the Company’s internal controls and risk management. The Audit and Risk Committee is expected to meet at least twice a year.

The Remuneration Committee

The Remuneration Committee is chaired by Carl Dempsey. Lynn Drummond and Carl Dempsey are the other members of the Committee. The Committee has responsibility for making recommendations to the Board on the Company’s policy for remuneration of Senior Executives, for reviewing the performance of Executive Directors and senior management and for determining, within agreed terms of reference, specific remuneration packages for each of the Executive Directors and members of senior management, including pensions rights, any compensation payments and the implementation of executive incentive schemes. The Remuneration Committee meets at least once a year. Further details of Directors’ remuneration are disclosed in the Directors’ Remuneration Report.

The Nomination Committee

The Nomination Committee is chaired by Lynn Drummond with Carl Dempsey and Peter Bream as the other members of the Committee. The Committee has responsibility for considering the size, structure and composition of the Board, and the retirement and appointment of Directors, and will make appropriate recommendations to the Board about these matters. The Nomination Committee is expected to meet at least once a year.

The Principles of the Quoted Company Alliance (QCA) Code

Deliver growth

1. Establish a strategy and business model which promote long-term value for shareholders

Application

The board must be able to express a shared view of the company’s purpose, business model and strategy. It should go beyond the simple description of products and corporate structures and set out how the company intends to deliver shareholder value in the medium to long-term. It should demonstrate that the delivery of long-term growth is underpinned by a clear set of values aimed at protecting the company from unnecessary risk and securing its long-term future.

What we do and why

Venture life Group’s strategy is explained fully within our Strategic Report section on page 10 of our Report and Accounts for the year ended 31 December 2017.

Our strategy is focused around four key areas: revenue growth from existing and new distribution partners, revenue growth product acquisitions, revenue growth from developing innovative products and profit growth through ’increased throughput’.

The key challenges to the business and how these are mitigated is detailed on pages 18 & 19 of our Report and Accounts for the year ended 31 December 2017.

2. Seek to understand and meet shareholder needs and expectations

Application

Directors must develop a good understanding of the needs and expectations of all elements of the company’s shareholder base.
The board must manage shareholders’ expectations and should seek to understand the motivations behind shareholder voting decisions.

What we do and why

The Board is committed to a progressive dividend policy and aims to maintain a sustainable and appropriate level of dividend cover.

Venture Life encourages two-way communication with both its institutional and private investors and responds quickly to all queries received. The CEO, CCO and CFO talk regularly with the Group’s major shareholders and ensures that their views are communicated fully to the Board.

The Board recognises the AGM as an important opportunity to meet private shareholders. The Directors are available to listen to the views of shareholders informally immediately following the AGM.

The Company’s website has details of how shareholders and other parties may contact the Company by email or telephone.

Where voting decisions are not in line with the Board’s expectations the Board will engage with those shareholders to understand and address any issues. The Company Secretary is the main point of contact for such matters.

3. Take into account wider stakeholder and social responsibilities and their implications for long-term success

Application

Long-term success relies upon good relations with a range of different stakeholder groups both internal (workforce) and external (suppliers, customers, regulators and others). The board needs to identify the company’s stakeholders and understand their needs, interests and expectations.

Where matters that relate to the company’s impact on society, the communities within which it operates or the environment have the potential to affect the company’s ability to deliver shareholder value over the medium to long-term, then those matters must be integrated into the company’s strategy and business model.

Feedback is an essential part of all control mechanisms. Systems need to be in place to solicit, consider and act on feedback from all stakeholder groups.

What we do and why

Venture Life is committed to sustainable progress in all aspects of its business – the environment customers, suppliers and the communities we operate in. This is evidenced and underpinned by our vision and values:

  1. Customers – Grow profitable sales
  2. Quality – Operational excellence
  3. Environment – Community
  4. Innovation – Excellent product design
  5. Team Work – Engage our people

Venture Life encourages feedback from all staff and employees and facilitates regular meetings and opportunities for employees to do this.

The Company encourages feedback from customers through alliance and customer service managers, and engagement with individual customers through customer service teams and social media such as Facebook and Twitter.

4. Embed effective risk management, considering both opportunities and threats, throughout the organisation

Application

The board needs to ensure that the company’s risk management framework identifies and addresses all relevant risks in order to execute and deliver strategy; companies need to consider their extended business, including the company’s supply chain, from key suppliers to end-customer.

Setting strategy includes determining the extent of exposure to the identified risks that the company is able to bear and willing to take (risk tolerance and risk appetite).

What we do and why

The Risk Management section on pages 18 & 19 of our Report and Accounts for the year ended 31 December 2017 details risks to the business, how these are mitigated and the change in the identified risk over the last reporting period.

The Board considers risk to the business at every Board meeting (at least 5 meetings are held each year). The Company formally reviews and documents the principal risks to the business at least annually.

Both the Board and senior managers are responsible for reviewing and evaluating risk and the Executive Directors meet at least monthly to review ongoing trading performance, discuss budgets and forecasts and new risks associated with ongoing trading.

Maintain a dynamic management framework

5. Maintain the board as a well- functioning, balanced team led by the chair

Application

The board members have a collective responsibility and legal obligation to promote the interests of the company, and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the chair of the board.

The board (and any committees) should be provided with high quality information in a timely manner to facilitate proper assessment of the matters requiring a decision or insight.

The board should have an appropriate balance between executive and non-executive directors and should have at least two independent non- executive directors. Independence is a board judgement.

The board should be supported by committees (e.g. audit, remuneration, nomination) that have the necessary skills and knowledge to discharge their duties and responsibilities effectively.

Directors must commit the time necessary to fulfill their roles.

What we do and why

Dr. Lynn Drummond, the Non-executive Chairman, is responsible for the running of the Board and Jerry Randall, the Chief Executive, has executive responsibility for running the Group’s business and implementing Group strategy.

All Directors receive regular and timely information on the Group’s operational and financial performance. Relevant information is circulated to the Directors in advance of meetings. All Directors have direct access to the advice and services of the Company Secretary and are able to take independent professional advice in the furtherance of the duties, if necessary, at the company’s expense.

The Board comprises four Executive Directors and three Non-Executive Directors (Dr Lynn Drummond, Peter Bream and Carl Dempsey). The Board considers that all Non-executive Directors are independent.

The Board has a formal schedule of matters reserved to it and is supported by the Audit, Remuneration and Nomination Committee. The Schedule of Matters Reserved and Committee Terms of Reference are available on the Company’s website and can be accessed on the Directors & Committees page of this website.

6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities

Application

The board must have an appropriate balance of sector, financial and public markets skills and experience, as well as an appropriate balance of personal qualities and capabilities. The board should understand and challenge its own diversity, including gender balance, as part of its composition.

The board should not be dominated by one person or a group of people. Strong personal bonds can be important but can also divide a board.

As companies evolve, the mix of skills and experience required on the board will change, and board composition will need to evolve to reflect this change.

What we do and why

The Nomination Committee of the Board oversees the process and makes recommendations to the Board on all new Board appointments.  Where new Board appointments are considered the search for candidates is conducted, and appointments are made, on merit, against objective criteria and with due regard for the benefits of diversity on the Board, including gender.  The Nomination Committee also considers succession planning.

Adrian Crockett, the Company Secretary, supports the Chairman in addressing the training and development needs of Directors.

Summary background on the directors can be found at Board of Directors

7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement

Application

The board should regularly review the effectiveness of its performance as a unit, as well as that of its committees and the individual directors.

The board performance review may be carried out internally or, ideally, externally facilitated from time to time. The review should identify development or mentoring needs of individual directors or the wider senior management team.

It is healthy for membership of the board to be periodically refreshed. Succession planning is a vital task for boards. No member of the board should become indispensable.

What we do and why

The Board carries out an evaluation of its performance annually, taking into account the Financial reporting Council’s Guidance on Board Effectiveness.

All Directors undergo a performance evaluation before being proposed for re- election to ensure that their performance is and continues to be effective, that where appropriate they maintain their independence and that they are demonstrating continued commitment to the role.

Appraisals are carried out each year with all Executive Directors.

All continuing Directors stand for re-election on a tri-annual basis.

8. Promote a corporate culture that is based on ethical values and behaviours

Application

The board should embody and promote a corporate culture that is based on sound ethical values and behaviours and use it as an asset and a source of competitive advantage.

The policy set by the board should be visible in the actions and decisions of the chief executive and the rest of the management team.

Corporate values should guide the objectives and strategy of the company.

The culture should be visible in every aspect of the business, including recruitment, nominations, training and engagement. The performance and reward system should endorse the desired ethical behaviours across all levels of the company.

The corporate culture should be recognisable throughout the disclosures in the annual report, website and any other statements issued by the company.

What we do and why

The Corporate Governance Report on pages 26 – 27 of our Report & Accounts for the year ended 31 December 2017 details the ethical values of Venture Life Group including environmental, political and employee relationships – we don’t really talk about culture and ethics in our annual report other than in the governance section.

9. Maintain governance structures and processes that are fit for purpose and support good decision- making by the board

Application

The company should maintain governance structures and processes in line with its corporate culture and appropriate to its:

  • size and complexity; and
  • capacity, appetite and tolerance for risk.

The governance structures should evolve over time in parallel with its objectives, strategy and business model to reflect the development of the company.

What we do and why

Our Corporate Governance Statement on pages 24 – 25 of our Report & Accounts for the year ended 31 December 2017 details the company’s governance structures and why they are appropriate and suitable for the company.

Build trust

10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders.

Application

A healthy dialogue should exist between the board and all of its stakeholders, including shareholders, to enable all interested parties to come to informed decisions about the company.
In particular, appropriate communication and reporting structure should exist between the board and all constituent parts of its shareholder base. This will assist:

  • the communication of shareholders’ views to the board; and
  • the shareholders’ understanding of the unique circumstances and constraints faced by the company.

It should be clear where these communication practices are described (annual report or website).

What we do and why

Venture Life Group encourages two-way communication with both its institutional and private investors and responds quickly to all queries received. The CEO, CCO and CFO talk regularly with the Group’s major shareholders and ensure that their views are communicated fully to the

Board

The Board recognizes the AGM as an important opportunity to meet private shareholders. The Directors are available to listen to the views of shareholders informally immediately following the AGM.

The proxies for and against each resolution are announced at the meetings.