Investor Relations

Responsibilities of the Board

The Board is responsible to the shareholders for:

• setting the Group’s strategy;
• maintaining the policy and decision-making process around which the strategy is implemented;
• ensuring that necessary financial and human resources are in place to meet strategic aims;
• monitoring performance against key financial and nonfinancial indicators;
• providing leadership whilst maintaining the controls for managing risk;
• overseeing the system of risk management; and
• setting values and standards in corporate governance matters.

There is a list of matters reserved for the Board which may be updated by the Board and approved by the Board only.

The Chairman is responsible for leading the Board, facilitating the effective contribution of all members and ensuring that it operates effectively in the interests of the shareholders. The Chief Executive Officer is responsible for the leadership of the business and implementation of the strategy. The Company Secretary is responsible, on behalf of the Chairman, for ensuring that all Board and Committee meetings are conducted properly, that the Directors receive the appropriate information prior to the meeting, for ensuring that governance requirements are considered and implemented, and for accurately recording each meeting. The Directors may have access to independent professional advice, where needed, at the Group’s expense.

Management Committee

The Board delegates management of the business to the Management Committee headed by the Chief Executive Officer, John Dawson. The committee comprises the executive Directors and other senior managers and meets monthly.

Reporting Structure

Committees
The Board has established an Audit Committee and a Remuneration Committee, each with written terms of reference. The terms of reference are available here: Remuneration Committee - Terms of Reference and Audit Committee - Terms of Reference.

Meetings
The Board meets regularly on dates pre-determined each year and has strategy meetings consisting of the Board and the full Management Committee each year, the purpose of which is to discuss progress on the strategy, to review the long-term strategy and develop the strategic framework for the achievement of the Group’s targets.

Non-Executive Directors

The role of the non-executive Directors is to:

• review management performance and the monitoring and reporting of such performance;
• challenge constructively and help develop proposals on strategy;
• satisfy themselves as to the financial integrity of the financial information and the quality of the controls; and
• ensure that the systems of risk management are robust and defensible.

They have a role in determining the pay and benefits of the executive Directors, to play a key role in the appointment and, if necessary, removal of executive Directors and Board succession.

Risk Management

The Board is ultimately responsible for the Group’s system of internal control and for reviewing its effectiveness. This includes having an ongoing process in place for identifying, evaluating and managing significant risks.

The Group’s established internal procedures include the following:

• The management group meetings cover in detail most, if not all, of the significant risks to which the Group is exposed, these deliberations are reported to the Board and further discussion considered.
• A table of significant risks has been prepared by the Board, splitting the categories by:
  • Trading - Significantly between Sales and Supply Chain.
  • Developments - Those currently in progress for Posidorm® and Isprelor®.
  • Financial - In particular the integrity with which the Group is viewed as a plc and exposure to interest and exchange rates.
  • General - Namely the ability to recruit quality staff and the workload pressures existing on the current team.
• The Group’s senior management team meets twice a year for a strategic review at which both executive and nonexecutive directors attend.
• The Group prepares an annual budget, developed through a comprehensive strategic and operational process prior to commencement of the financial year. A revised quarterly budget is also prepared and is reviewed by the Board and Management Committee.
• The Board and Management Committee monitor the actual monthly performance of the Group against budget and revised budgets, with any significant variances highlighted and explained.

Relations with Shareholders

At each meeting, the Board is updated on the meetings and communications with the shareholders and an analysis of the shareholder base is presented. Research notes by the broker and commissioned independent research are circulated to all Board members. Throughout the year the Chief Executive Officer and Finance Director undertook several scheduled meetings and conference calls with the large, institutional shareholders who hold the majority of the shares. Regular feedback is given to the Group following meetings with the shareholders from the financial PR company, and from the shareholders via the brokers.

The Group recognises that whilst the majority of the shareholders are large institutions, attention should be paid to the private shareholders and the Investor Relations section of the Group website is regularly updated and amended with the aim being to provide better information to all shareholders, particularly private investors. The website provides a facility to receive email alert notifications of Group news and stock exchange announcements. In addition the Chief Executive Officer and Finance Director presented at several conferences attended by many potential and current private shareholders and to Private Client Brokers representing the interests of private investors following which feedback was given to the Group.

At the Annual General Meeting the Chairman issues a statement and the Chief Executive reviews the activities throughout the year. All Directors are available following the meeting to answer questions and for informal discussions. The results of the proxy votes are announced at the meeting, including the abstentions and these will be published on the website following the meeting.