In 2017, following the combination of Andes Energia plc and Trefoil Holdings B.V., the Board decided to follow the principal provisions of the UK Corporate Governance Code 2016 (“the Code”) on a comply or explain basis, commensurate with the standards expected by stakeholders of Premium Listed companies. The Code and associated guidance are available on the Financial Reporting Council website at www.frc.org.uk.
The Board assesses its compliance with the Code on an annual basis and publish the status of its compliance in its annual report and accounts. As at the date of this statement, 2 May 2019, the Company was in compliance with the provisions of the Code with the following exceptions, (relevant Code provisions referenced):
Code Provision B.6.1: The board should state in the annual report how performance evaluation of the board, its committees and its individual directors has been conducted. The performance of the board and of the individual directors has not been formally assessed during the year. Changes to the board composition have been made with the involvement of the nominations committee. These changes were made to address a perceived gap in experience of unconventional oil and gas among the non-executive directors and to bring operational oil and gas finance experience to the board.
Company position: We will continue to assess the performance of individual directors throughout 2019.
The Code was updated in 2018 and a revised version published that is focused on an updated set of principles and an increased focus on stakeholder engagement. This new Code was formally issued in July 2018 and is effective from 1 January 2019. We are undertaking an evaluation of our compliance with the revised principles and may make further changes to our governance procedures as a result. We will report our compliance with the principles of the revised 2018 code in our 2019 annual report.
The Audit and Risk Committee, the Remuneration Committee, the Nomination Committee and the Integration Committee of the Company each have formally delegated rules and responsibilities.
The members of each committee (including non-director members for the Integration Committee) and directors with formal observer rights on each committee is as follows:
|Audit and Risk Committee||David Jackson||Sir Michael Rake
|Remuneration Committee||John Bentley||Sir Michael Rake David Jackson Nicolas Mallo Huergo*|
|Nomination Committee||Sir Michael Rake||Javier Alvarez John Bentley Nicolas Mallo Huergo*|
*Observer rights only
Audit and Risk Committee
The Audit and Risk Committee consists of no less than three members, at least one of whom has recent and relevant financial experience and the quorum for meetings is two members. The majority of the committee is Independent Non-Executive Directors. The Chairman is an Independent Non-Executive Director and shall not be the Chairman of the company. The committee meets at such times as it may be necessary and at least four times a year.
Its responsibilities include: monitoring the integrity of the company’s financial statements and formal announcements; reviewing financial reporting issues and significant accounting policies and disclosures in financial reports; reviewing the effectiveness of the company’s internal audit function and risk management systems; making recommendations to the Board on the appointment or re-appointment of the Group’s external auditors; overseeing the New Board’s relationship with the external auditors (including an external reserves auditor) and, where appropriate, the selection of new external auditors; and ensuring that an effective whistle-blowing procedure is in place.
The Remuneration Committee consists of not less than three members and the quorum for meetings is two members. The majority of the committee is Independent Non-Executive Directors. The chairman is an Independent Non-Executive Director and is not the chairman of the company. The committee meets at such times as may be necessary and at least three times a year.
The Remuneration Committee is responsible for determining, and agreeing with the Board, the remuneration policy for the Chief Executive Officer, Chairman, Chief Financial Officer, Chief Operating Officer/Secretary and Executive Directors, (together, the “Relevant Individuals”) approving the design of, and determining targets for, an incentive plan for the executive directors and senior managers; reviewing the design of share incentive plans for approval by the Board and Phoenix Global Resources Shareholders, approving the remuneration policy applicable to the Relevant Individual (no Relevant Individual being involved in any decisions as to their own remuneration); and within the terms of the agreed policy, determining the remainder of the remuneration packages (including pension) for each executive director and senior executive; reviewing and having regard to pay and employment conditions across the company, especially when determining annual salary increases.
The Nomination Committee consists of not less than three members and the quorum for meetings is two members. The majority of the committee is Independent Non-Executive Directors. The chairman of the committee is the Chairman of the company or an independent non-executive Director. The chairman of the committee does not however chair the committee when it is dealing with the appointment of a successor to the chairmanship. The committee will meet at such times, as may be necessary and at least twice a year.
The Nomination Committee’s responsibilities include reviewing the structure, size and composition of the Board and making recommendations to the Board with regard to any changes required; succession planning for directors and other senior executives; identifying and nominating, for the Board approval, candidates to fill Board vacancies as and when they arise; reviewing annually the time commitment required of Non-Executive Directors and making recommendations to the Board with regard to membership of the Audit and Risk Committee and Remuneration Committee in consultation with the chairman of each of these committees.
Share Dealing Code
The company has adopted a share dealing code for Directors and applicable employees (within the meaning of the AIM Rules for Companies) of the company for the purpose of ensuring compliance by such persons with the provisions of the Market Abuse Regulation relating to dealings in the company’s securities. The Directors consider that this share dealing code is appropriate for a company whose shares are admitted to trading on AIM.