Corporate Governance

It is the Company's policy to comply in full with the provisions of the UK Corporate Governance Code issued by the Financial Reporting Council, as applicable to smaller companies.

The Board

The Company's board of directors ("the Board") meets regularly throughout the year, reflecting the Company's business cycle, to review operational matters. Further meetings are held to consider corporate strategy and financial planning. In addition, arrangements are made for Board members to inspect the Group's properties and discuss specific projects. The Board considers the following:

  • Operational progress, current activities and plans for ongoing investment and asset management. In doing so, the Board will scrutinise the Group's management accounts and cash flow projections, reports on current market conditions and outlook and proposals for the investment programme. All activities and results are monitored against operational plans.
  • Reports and recommendations provided by the Audit, Remuneration and Nominations Committees.
  • Periodic reports and presentations on conditions and prospects for the UK economy and property market.
  • Matters specifically reserved for the attention of the Board include:
  • Approval of financial statements, dividends and significant changes in accounting policy;
  • Monitoring operational and financial progress;
  • Stock Exchange related issues including the approval of communications to the Stock Exchange and communications with shareholders;
  • Group strategy, corporate activity and the investor relations programme;
  • Financial matters including the approval of the budget and financial plans, changes to the Group's capital structure and capital expenditure, investment finance facilities, performance against banking covenants; and
  • Health and safety policy, risk management and regulatory compliance.

In addition to the regular programme of Board meetings, the Chairman meets separately with the non-executive directors.

Board Committees

The Board has established Audit, Remuneration and Nomination Committees in accordance with the recommendations of the Combined Code.

Audit Committee

The Audit Committee meets at least twice a year and is made up exclusively of independent non-executive directors. The Committee is responsible for the functions recommended by the Combined Code including:

  • reviewing audited statements prior to approval, including results announcements focusing on significant financial reporting issues, major judgemental areas, significant audit adjustments, going concern and compliance with accounting standards, Stock Exchange and regulatory requirements;
  • monitoring and, where necessary, challenging the consistency of, and any changes to, accounting policies, the selection of accounting methodology for significant transactions, the application of appropriate accounting standards and the clarity of disclosure in the Group's financial reports including all material supporting information;
  • keeping under review the effectiveness of the Company's internal controls and risk management systems, considering reports from the Auditors and approving statements to be included in the Annual Report concerning internal controls and risk management;
  • reviewing the internal procedures by which members of staff may raise concerns about possible improprieties in matters of financial reporting and other matters, to ensure that arrangements are in place for the investigation of such matters and appropriate follow-up action;
  • monitoring the independence and objectivity of the Auditors and making recommendations to the Board, to be put to members for approval at the AGM, in relation to the appointment, reappointment and removal of the Auditors and their remuneration and overseeing the selection process for new Auditors as necessary;
  • overseeing the relationship with the Auditors including agreeing terms of engagement, meeting with the Auditors at the audit planning stage to consider the scope of the audit and quality assurance processes, considering issues arising from the audit and any matters the Auditors wish to raise;
  • developing and implementing policy on the engagement of the external Auditors to supply non-audit services;
  • reviewing the effectiveness of the audit, including the Auditors' management letter and the response of management to its findings and recommendations; and
  • reviewing the Committee's own performance, constitution and terms of reference, making recommendations to the Board as necessary, to ensure that the Committee continues to operate at maximum effectiveness.

The Audit Committee comprises Stephen East and Nick Vetch and is chaired by Nick Vetch. The Committee invites executive directors and other senior executives to attend all or part of its meetings as necessary to discharge its duties.

Remuneration Committee

The Remuneration Committee comprises exclusively non-executive directors. The Committee meets at least once a year and its remit includes:

  • determining the broad policy for the remuneration of the executive directors and senior executive management;
  • considering the design of performance-related remuneration or share incentive plans for approval by the Board and shareholders, approving performance targets and determining the extent of awards to individual executive directors and senior executives;
  • determining the remuneration package of each executive director and, where appropriate, other senior executives, giving due regard to the provisions and recommendations of the Combined Code and the UKLA Listing Rules; and
  • considering and approving the directors' remuneration report for presentation to shareholders, ensuring that the regulatory requirements for disclosure of remuneration are fulfilled.

The Remuneration Committee comprises Stephen East and Nick Vetch and is chaired by Nick Vetch. The Committee invites executive directors and other senior executives to attend all or part of its meetings as necessary to discharge its duties.

Nomination Committee

Membership of the Nomination Committee is determined by the Board. However, independent non-executive directors are always in the majority. The Nomination Committee is chaired by the senior independent non-executive director, Nick Vetch. The Committee invites other directors and senior executives to attend all or part of its meetings as necessary to discharge its duties. The Committee meets at least once a year and its remit includes:

  • reviewing the structure, size and composition (including the skills, knowledge and experience) of the Board and making recommendations to the Board with regard to any adjustments that are deemed necessary;
  • keeping under review the leadership needs of the Company, both executive and non-executive, with a view to ensuring the ability of the Company to compete effectively in the marketplace;
  • identifying the role and capabilities required for a particular appointment, having evaluated the balance of skills, knowledge and experience on the Board;
  • identifying and nominating for the approval of the Board candidates to fill Board vacancies as and when they arise;
  • reviewing the time needed to fulfil the roles of Chairman of the Company, senior independent director and non-executive director and undertake an annual performance evaluation to ensure that all members of the Board have devoted sufficient time to fulfil their duties;
  • providing a statement in the Annual Report about the Committee's activities and the process used to make appointments; and
  • making recommendations to the Board with regard to:
  • succession planning — that the processes and plans are in place with regard to both Board and senior appointments;
    • the reappointment of any non-executive director at the conclusion of his or her specified term of office, particularly when they have concluded their second three year term; and
    • any matters relating to the continuation in office as a director of any director at any time.

The Board and its committees may call on the services of the Company Secretary as well as external advisors.

Management Committee

The Company also has a management committee, comprising the executives and the asset management and finance teams which meets regularly and monitors the following:

  • asset management activity;
  • progress with investment programmes and specific acquisitions;
  • progress with development and refurbishment projects and potential for additional projects;
  • financial monitoring and ongoing compliance with the REIT regime;
  • health, safety and environmental issues; and
  • human resources.

Risk Assessment

The Board takes proper account of the relevant provisions of the UK Corporate Governance Code in formulating the systems and procedures in operation in the Group. Reporting to the Board, the Audit Committee periodically reviews the risk profile of the business to identify any deficiencies in the controls operating over all aspects of the Group. The Board will require further risk assessments during the year, should the need arise. The risk assessment will incorporate a review of the Company's internal controls, taking into consideration the findings and recommendations of the Auditors.

Published : Friday, October 17, 2014 9:50 AM

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