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Augean is committed to high standards of corporate governance in all its activities. While the Company is not required under AIM rules to comply with the Corporate Governance Code of June 2010 (the Code) or the updated 2012 Code, the Board recognises the value of the Code and has regard to its requirements as far as is practicable and appropriate for a public company of its size and nature. The Board regularly reviews guidance from the FRC and other regulatory bodies and responds as appropriate.
The board of directors
The Board currently comprises a Non-executive Chairman, three further Independent Non-executive Directors, an Executive Director and an Interim Chief Executive Officer/Group Finance Director. A Senior Independent Director has not been appointed as, given the size and nature of the Company, the Directors do not believe that such an appointment is necessary. The Chairman has primary responsibility for running the Board and its effectiveness and the Interim Chief Executive/ Group Finance Director is responsible for developing strategic plans and initiatives for consideration by the Board and for their operational delivery. The Non-executive Directors bring a variety of different experience to the Board, are considered to be independent of management and ensure that rigour is applied to Board decisions.
The composition of the Board is reviewed regularly. Appropriate training, briefings and inductions are available to all Directors on appointment and subsequently as necessary, taking into account existing qualifications and experience. All Directors have access to the advice and services of the Group’s company secretarial partner, Addleshaw Goddard LLP, and any Director may take independent professional advice, if necessary, at the Company’s expense. The Board meets formally at least eight times a year but additional meetings are held to review and approve special matters if necessary.
Each Director is provided with sufficient timely information to enable full consideration of matters in advance of meetings and proper discharge of duties. There is a formal schedule of matters reserved for the Board which includes published financial statements, strategy, acquisitions, significant capital projects, budgets and borrowing facilities. Under the Company’s Articles of Association one third of all Directors are required to retire from office at each Annual General Meeting (AGM) and may stand for reappointment by shareholders each year. Additionally, each Director is required to retire in the third calendar year following his last appointment and may stand for re-election. Any Director appointed to the Board during the year is subject to election by shareholders at the following AGM.
With effect from 1 October 2008, the Companies Act 2006 introduced a statutory duty on Directors to avoid conflicts of interest. Shareholders approved new Articles of Association at the 2008 AGM giving Directors authority to approve situations involving any such conflicts and to allow conflicts of interest to be dealt with by the Board. All Directors are required to notify the Company on an ongoing basis of their other commitments and these are formally recorded in the minutes of Board meetings. The Company has established procedures for ensuring that the Board’s powers for authorising Directors’ conflicts of interest are operated effectively. Board committeesThe company has established a number of committees, details of which are set out below: Audit committee
The Audit Committee comprises the Non-executive Directors, is chaired by Rory Macnamara and meets at least three times a year. The external auditor and the Executive Directors are regularly invited to attend the meetings but the committee also has access to the external auditor’s advice without the presence of the Executive Directors. The Audit Committee considers the adequacy and effectiveness of the risk management and control systems of the Group. It reviews the scope and results of the external audit, its cost effectiveness and the objectivity and independence of the external auditor. It also reviews, prior to publication, the Interim Report, the results announcement, the annual financial statements and other information included in the Annual Report. Remuneration committeeThe Remuneration Committee comprises the Non-executive Directors and is chaired by Roger McDowell. It meets at least twice a year and reviews and advises upon the remuneration and benefits packages of the Executive Directors and other senior management of the Group, including the Long Term Incentive Plan (LTIP). The remuneration of the Chairman and Non-executive Directors is agreed upon by the full Board. Activities during 2012 included a review of remuneration for a new Chief Executive and a review of a new LTIP for the Group.
Nomination committeeThe Nominations Committee comprises the Non-executive Directors and is chaired by Andrew Bryce. It meets as required in order to review the structure, size and composition of the Board. It is responsible for the selection and recommendation of suitable candidates for appointment to the Board. Activities during 2012 focused on recruitment of a new Chief Executive.Internal controlsThe Board has overall responsibility for the Group’s system of internal control and for reviewing its effectiveness, while the role of management is to implement Board policies on risk management and control. The system is designed to provide reasonable but not absolute assurance against material misstatement or loss.The Group operates a series of controls to meet its needs. Key features of the control system include the following:
The Audit Committee receives reports from executive management and the auditor concerning the system of internal control and any control weaknesses.
The Board does not believe it is currently appropriate to establish a separate, independent internal audit function given the size of the Group but this position is kept under review.Annual general meetingThe AGM takes place in June each year in London. All shareholders are invited to attend and vote at the meeting. The meeting notice and voting forms are sent to shareholders in advance.