Corporate Governance
QCA PRINCIPLES
Deliver Growth
Establish a strategy and business model, which promotes long term value for shareholders
The Group’s core purpose is to improve neonatal outcomes by pioneering first breaths of life support to infants. The Group has a market leading position in the UK and a worldwide international sales network. The Group’s strategy is set out in its annual report and our model is clearly set out on this website. The key to the strategy is simple focus.
Seek to understand and meet shareholder needs and expectations
The Group has faced a number of significant challenges recently and has sought to engage at every stage with its stakeholders through dialogue, reporting, investor relations presentations. There are regular presentations to institutional investors and analysts. Regular communication with the Group’s shareholders is achieved through the Group’s annual report and interim results announcements, aimed at ensuring stakeholders are kept up to date with the Company’s progress. These publications are all presented and retained on this website.
Feedback from the Group’s Nominated Adviser (NOMAD) is provided to all Directors in Board papers pertaining to any recent presentations. The Directors maintain a dialogue with the NOMAD to ensure they meet their obligations, and publicity in respect of key events is provided in a timely manner.
The Board recognises the importance of the Annual General Meeting as a further opportunity to engage with shareholders.
Take into account wider stakeholder and social responsibilities and their implications for long-term success
The Board recognises the importance of maintaining strong relationships with its stakeholders in order to create sustainable long-term value, and it encourages active dialogue and transparency with all stakeholder groups.
The Group remains proud of its record on employee engagement. We remain a living wage employer with a strong record in ensuring equality of opportunity for all. Health and Safety remains a key tenet of our culture ensuring employees receive the training and support they need so they work in a safe environment. Employee engagement is under continuous review within the Group and is monitored by the People function.
Our customers rely on our market leading product support, both through clinical research and at conferences where we demonstrate best practice. Our work with key opinion leaders in the healthcare system ensures our products remain relevant and deliver to the industry’s exacting standards.
We continuously monitor our suppliers and work with them to safeguard our supply chain, keeping it as efficient as possible whilst ensuring compliance with modern slavery and anti-corruption laws, to maintain the quality of our end product
Embed effective risk management, considering both opportunities and threats, throughout the organisation
The Board has overall responsibility for the Group’s systems of internal control and risk management. These systems are reviewed regularly as part of the Board packs delivered prior to every formal Board meeting. Concerns raised by Directors are dealt with through actions which are reviewed for completion at the beginning of every Board meeting. Risk is about managing risk rather than eliminating it in its entirety, to ensure the business achieves its objectives as set out in its strategy.
The Board uses internal frameworks within the Group to identify, evaluate and manage significant risks faced by the Group. The Board ensures that major risks faced by the Group are assessed, reviewed and have appropriate controls in place by which to manage them. They are continually reviewed as well as the systems in place to mitigate risk and ensure appropriate management thereof. More detail of the principal risks faced by the business is set out in the Principal Risks section of the annual report.
The Board considers that the internal controls in place within the Group to be appropriate for the size, complexity and risks faced by the Group.
Maintain a dynamic management framework
Maintain the Board as a well-functioning, balanced team led by the Chair
The Board currently comprises of two Executive Directors and three Non-executive Directors (of which all are independent). Whilst there was a period when the Chair acted in an Executive capacity due to a unique set of circumstances which has been communicated to stakeholders, the Board remains of the view that this temporary role has not impacted the Chair’s position as independent.
The Board is collectively responsible for the success of the Group and provides entrepreneurial leadership which enables risk to be assessed and managed to effect delivery. It sets out the Group’s values and standards and ensures that its obligations to shareholders and other stakeholders are understood and met.
The Board receives detailed papers prior to all meetings as well as monthly updates during months in which a meeting is not held. This ensures the Directors have enough information to be properly briefed. Where issues are raised in Board meetings the Chair is responsible for ensuring that all Directors remain briefed and, where necessary, are consulted for approval.
The Board meets formally 6 times in the year and on an ad hoc basis as and when required. The Audit Committee meets at least three times in the year as does the Remuneration Committee, although in practice more meetings are called to ensure the smooth and efficient running of the Group as and when required. The Nominations Committee meets on an ad hoc basis.
Ensure that between them the Directors have the necessary up-to-date experience, skills and capabilities.
The Director’s biographies are set out on the this website. Each Director brings a blend of different experience which together provides the necessary knowledge to both support and challenge where the need arises. All Non-executive Directors, were considered to be independent prior to appointment in line with the guidelines set out in the QCA Code. The Board has access to the Company Secretary who is also independent, as well as independent legal advice should that be required. The Remuneration Committee seeks independent advice on remuneration matters.
The Board is kept informed on an ongoing basis by the Company Secretary about their duties and any update in relation to legal and governance requirements for the Group. Training is provided to the Directors each year regarding their duties by the Group’s NOMAD, with ongoing training provided by the Company Secretary on legal and governance matters pertinent to the Group.
All Directors stand for re-election by the shareholders every year at the AGM.
Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement
The Company Secretary leads an annual evaluation of the Board. The most recent evaluation confirmed that the Board continued to operate effectively. The evaluation was structured around a series of critical questions relating to particular aspects of the functioning of the Board. The Board reviews the output and looks to implement any recommendations.
The Nominations Committee is responsible for succession planning, to ensure that the Board is comprised of appropriately skilled and capable individuals.
Promote a corporate culture that is based on ethical values and behaviours
The Board is guided by the Group’s core values of being patient focussed, outcome changing, pioneering and research driven. The Group is proud of its inclusive culture and diverse colleague base. The Group has ongoing engagement surveys by which to monitor colleague engagement and the Board is appraised of the results.
All formal Board meetings take place at the Group’s research and technology centre and this affords the Directors the opportunity to meet colleagues in both formal and informal situations to build trust and ensure effective working practices throughout the organisation. This gives colleagues the opportunity to discuss issues directly with the Directors should they wish.
Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board
The Board has a formal schedule of matters reserved for its decision, including the approval of strategic plans and annual operating budgets. All Directors take decisions objectively in the interests of the Group. The Group continues to review how best to improve its corporate governance and is constantly looking at ways to strengthen itself, while ensuring that the business is led by people with the right experience, passion and enthusiasm. Richard Jones an independent Non-executive Director chairs the Audit Committee.
The current structure of the Board enables the retention of key skill sets within the Group whilst facilitating the right level of challenge and support to the Executive Directors appropriate for a Group of this size, in line with the Code’s key principles.
All terms of reference for the Board and its sub-committees are published on this website and the Board’s ability to remain flexible in terms of meeting and decision making has been crucial in the last year.
BUILD TRUST
Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders
The AGM is an important opportunity for communication with both institutional and private shareholders and involves a short statement on the Group’s latest trading position. Shareholders may ask questions of the full Board including the chairs of the sub-Committees. The result of the proxy votes submitted by shareholders in respect of each resolution is made be available on the Company’s website or on request to the Company Secretary. As outlined above, the Group maintains an active dialogue with its shareholders through a programme of investor relations presentations.
Audit Committee
Richard Jones, and independent non-Executive Director chairs the Audit Committee, which has primary responsibility for monitoring the quality of internal controls, ensuring that the financial performance of the Group is properly measured and reported on and reviewing reports from the Group’s auditors relating to accounting and internal controls, in all cases having due regard to the interests of shareholders. The Audit Committee meets at least twice a year.
Matters considered at these meetings include:
• reviewing and approving the annual report and financial statements for the year and half year-end;
• discussion with the external auditors to confirm their independence and scope for audit work;
• considering the reports from the external auditors identifying any accounting or judgemental issues requiring the Board’s attention and the auditor’s assessment of internal controls;
• reviewing and approving the Group’s tax strategy; and
• considering the adequacy of the whistle-blowing procedures, the anti-bribery training and monitoring and data protection policy and procedures.
The Audit Committee chair maintains dialogue with the auditors outside of the scheduled meetings and meets with the auditors without the presence of Executive Directors and members of the finance team. The Audit Committee reports to the Board on the effectiveness, value and independence of the auditors on an annual basis.. The terms of reference for the Audit Committee can be found here.
Remuneration Committee
The Chair of the Remuneration Committee is Richard Jones. This Committee reviews the performance of the Executive Directors and determines their terms and conditions of service, including their remuneration and the grant of share awards, having due regard to the interests of shareholders. The Remuneration committee meets at least twice a year, although in reality meets more frequently than this for informal updates and reviews. Marlou Janssen-Counotte is the other member of the Committee. The responsibilities and activities of the Remuneration Committee are set out in more detail in the Directors Remuneration report. The terms of reference for the Remuneration Committee can be found here.
Nominations Committee
Roy Davis is the Chair of the Nomination Committee, which identifies and nominates, for the approval of the Board, candidates to fill vacancies as and when they arise. The Committee also considers matters of succession planning. The Nomination Committee meets at least once a year and otherwise as required. Marlou Janssen-Counotte and Richard Jones are the other members of the Nomination Committee. The terms of reference for the Nominations Committee can be found here.