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Corporate Governance

CORPORATE GOVERNANCE

STATEMENT OF CORPORATE GOVERNANCE

At Braime we recognize that high standards of corporate governance underpin our continuing success.

Chairman's statement on corporate governance

We continually review the framework within which we operate and the processes implemented to ensure that they reflect the complexities of our business and, whilst acknowledging our size, are also capable of adding value as the business grows. The Company seeks guidance from the Quoted Companies Alliance, as set out in their 2018 publication, "The QCA Corporate Governance Code".

The board sets out the overall strategic direction for the group, regularly reviews management performance and ensures that the group has the right level of resources available to support our strategic goals. The board is satisfied that the necessary controls and resources are in place such that these responsibilities can be properly addressed.

Within the group we promote a culture of good governance in dealing with all key stakeholders: our employees, our customers and our shareholders. Pages 10 to 11 and 13 to 18 of the annual report describes our corporate governance structures and processes and how they have been applied throughout the year ended 31st December 2023.

Nicholas Braime
Chairman

 

As an AIM company, Braime Group PLC is not required to comply with the UK Corporate Governance Code (the 'Code') which applies only to fully listed UK companies and adherence to which requires the commitment of significant resources and cost. However high standards of Corporate Governance are a key priority of the board and details of how the Company addresses key governance issues are set out in the Corporate Governance section of this website by reference to the 10 principles of Corporate Governance developed by the Quoted Companies Alliance.

Companies need to deliver growth in long-term shareholder value. This requires an efficient, effective and dynamic management framework and should be accompanied by good communication which helps to promote confidence and trust.

DELIVER GROWTH
1. Establish a strategy and business model which promote long-term value for shareholders.

Application

The board must express a shared view of the company’s purpose, business model and strategy and set out how the company intends to deliver shareholder value in the medium to long term. It should demonstrate that the delivery is underpinned by a clear set of values aimed at protecting the company from unnecessary risk and securing its long-term future.

Disclosure

The main area of our business is focused on handling agricultural commodities and our strategy is to increase our geographical reach in this global market and to develop new products to enhance our offering. The principal risks and uncertainties surrounding execution of our strategy are set out in the Group strategic report of our annual report.

2. Seek to understand and meet shareholder needs and expectations

Application

Directors must develop a good understanding of the needs and expectations of all elements of the company’s shareholder base. The board must manage shareholder’s expectations and should seek to understand the motivations behind shareholder voting decisions.

Disclosure

The Company engages with shareholders through its website and at the annual general meeting. At the AGM, a presentation of the business activity and outlook is presented by the Chairman. The feedback from shareholders attending the most recent AGM has been very positive.  Responsibility for shareholder liaison rests with the Chairman, and in his absence, with the Company Secretary.

 

3. Take into account wider stakeholder and social responsibilities and their implications for long term success

Application

Long-term success relies upon good relations with a range of different stakeholder groups both internal and external. Communities within which the company operates have the potential to affect the company’s ability to deliver shareholder value. Systems need to be in place to solicit, consider, and act on feedback from all stakeholder groups.

Disclosure

The Company recognises the importance of maintaining good relations with key stakeholder groups, in addition to its members, these are its employees, customers, key suppliers and regulatory bodies. The Company dedicates significant time to understanding and acting on the needs and requirements of each of these groups via meetings dedicated to obtaining feedback.  The Group is fortunate to have so many proactive and longstanding employees and staff turnover remains very low. The Group has dedicated quality teams and works very closely with its key suppliers in key product categories such as monitors, chain, belts and steel, to ensure that products continue to meet the appropriate quality standards, and features are regularly enhanced to obtain and maintain competitive edge.

4. Embed effective risk management considering both opportunities and threats

Application

The board needs to ensure that the company's risk management framework identifies and addresses all relevant risks in order to execute and deliver strategy and to consider the supply chain, from key suppliers to end-customer. Setting strategy should include extend of exposure to the identified risks that the company is able and willing to bear.

Disclosure

The executives have undergone a business continuity planning exercise to understand its exposure to the loss of key staff, suppliers, customers and other natural catastrophic events, enabling the generation of a risk register. Principal risks facing the Group are set out in the annual report. Insurance of key risks is an integral part of the Group’s risk management framework and the board actively reviews its cover requirements on an ongoing and at least annual basis.

MAINTAIN A DYNAMIC MANAGEMENT FRAMEWORK
5. Maintain the board as a well functioning balanced team led by the chair

Application

The board members are collectively and legally responsible for promoting the interests of the company and for defining corporate governance arrangements. Ultimately the quality and approach to governance lies with the chair. The board should be provided with timely, quality information to facilitate assessment of matters requiring decision or insight.

The board should have an appropriate balance between executive and non-executive and have at least two non-executive directors.

Disclosure

The board consists of four executive directors, Nicholas Braime, Carl Braime, Alan Braime and Cielo Cartwright, and two non-executive directors, Peter Alcock and Andrew Walker who will step down in June 2023.  Peter Alcock and Andrew Walker are no longer considered as independent directors by virtue of the time they have served on the board.  As announced on 19th April 2023 three new non-executive independent directors, Mark Cooper, Tony Steels and Philip Stockdale will join the Board from 1st May 2023. Board meetings are held monthly. Certain matters are standing agenda items at each board meeting – these include disclosure of directors’ interests, health and safety, reports from the head of the subsidiary businesses, the CFO's report, specific customer issues, IT, major capital expenditure, business development and AIM disclosures.  A formal agenda, board papers including minutes of the last meeting are circulated in advance. The attendance of the directors at board meetings can be found here.

6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities

Application

The board must have an appropriate balance of sector, financial, and public markets skills and experience, as well as an appropriate balance of personal qualities and capabilities.

Disclosure

The board members' experience and areas of expertise can be found in The Board section.  The board is committed to the promotion of gender balance and diversity within its workforce. At the time of writing there are five male board members and one female board member.

The Company organises briefings from its NOMAD for the directors covering regulations that are relevant to their role as directors of an AIM-quoted company.  These are held at a minimum on an annual basis.  The Company has not to date, sought external advice on keeping directors' skills up to date but the directors believe that their blend of formal qualifications, past and ongoing experience provides them with the relevant up-to-date skills needed to act as board members for a company of its size. 

7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement

Application

The board should review the effectiveness of its performance as well as that of its committees and directors.

Disclosure

Performance targets are set as part of the budgeting process.  Evaluation of the performance of the Company's board has historically been implemented in an informal matter and no formal board performance evaluation took place during the year.  On an ongoing basis, board members maintain a watching brief to identify relevant internal and external candidates who may be suitable additions to or backup for current board members.  However the directors consider that the Company is too small to have an internal succession plan and it would not be cost effective to maintain an external candidate list prior to the need arising. Key performance indicators are set out in the annual report. The role of the various governance committees are set out in the annual report further down this section.

8. Promote a culture that is based on ethical values and behaviours

Application

The board should embody and promote a corporate culture that is based on sound ethical values and use it as an asset and source of competitive advantage. The policy and culture should be visible. The corporate culture should be recognisable.

Disclosure

The board believes that the promotion of a corporate culture based on sound ethical values and behaviours is essential to maximise shareholder value.  The companies in the Group maintain handbooks which include clear guidance on what is expected of every employee and officer of the Company and further development of this guidance is being undertaken to continually strive for high standards.  Staff matters are a standing topic at every board meeting and the board discusses examples of behaviours that either aligns with or at odds with the Group's stated values. The directors believe that the Company's culture encourages collaborative, ethical behaviour which benefits employees, clients and stakeholders.  It is committed to conducting business ethically and responsibly, and treating employees, customers, suppliers and shareholders in a fair, open and honest manner. We aim to maintain healthy and safe working conditions on all our sites and measure our ability to keep employees and visitors safe. We encourage our employees to provide feedback on any issues they are concerned about and the directors maintain a culture of accessibility and fair play and travel extensively to keep in touch with all areas of the business.  The directors believe all employees and contractors have worked in line with the Group's values during this financial year.

 

9. Maintain governance structures and processes that are fit for purpose and support good decision making

Application

The company should maintain governance structures in line with its corporate culture and appropriate to its size and complexity and its capacity, appetite and tolerance for risk

Disclosure

The board has a number of informal subcommittees which the directors consider appropriate for the size of the business and are described further below. 

During the year the roles of Chairman and chief executive were fulfilled by Nicholas Braime which was a departure from the recommendations of the QCA code.  However, in 2023 this matter has been addressed by making some changes to the board as explained in the 'Responsibilities of the board' set out in the annual report.

Certain matters are reserved for the board for its consideration. These are set out below in this section.

BUILD TRUST
10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders.

Application

A healthy dialogue should exist between the board and all its stakeholders. In particular, appropriate communication and reporting should exist between the board and all constituent parts of its shareholder base.

Disclosure

The Company's website provides all historical RNS announcements, interim reports and annual reports.  The annual reports and AGM circulars are posted directly to all registered shareholders or nominees.  Communication with shareholder base is primarily conducted at general meetings which include presentations by the Chairman.  Historical annual reports including notices of all general meetings are shown in the investor section.  The Company also maintains email and phone contacts which shareholders can use to make enquiries or requests.  At the last AGM, all resolutions were passed unanimously by the shareholders voting.  At this state the Company does not publish an Audit Committee report or a Remuneration Committee report but it may look to do so in the future.

Directors’ remuneration

Recruitment, appointment and termination of directors

Acquisition of new businesses

Disposal of existing business

Material restructure of operations

Purchase of land and buildings

Significant capital expenditure

Changes of shareholding or share structure

Change of auditors

Change of name of the group

Taking up of debentures and mortgages of existing business

Change of accounting year end

Introduction of bonus schemes

Strategic change - incursion into completely new areas of activity

Entering into, and settling litigation

Approval of the annual report

Approval of dividends to be paid by Braime Group PLC

Major changes to the group’s pension scheme

Changes to the Memorandum and Articles and Association

Consideration of conflicts of interest where permitted by the Articles

Approval of key policies (H&S, environmental, political donations, bribery etc)

Nomination committee
The company uses the whole board to consider matters of nomination and succession. The nomination committee ensures there is a robust process for the appointment of new board directors, and works to identify the skills, experience, personal qualities and capabilities required for the next stage in the company’s development, linking the company’s strategy to future changes. The nomination committee also discusses the appointment and replacement of senior management within the group.

Remuneration committee
The executive directors’ pay is subject to the decision of the whole board and not of a separate committee. Any significant awards to senior management are also discussed by the whole board. The company’s policy on directors’ remuneration is discussed in the director’s remuneration report in the annual report. The directors consider this is adequate for a group of this size.

Audit and Risk committee
The whole board formally receives presentation of audit and risk matters from the group’s independent statutory auditors at least once a year. The consideration of business risks is a standing item on the board’s agenda. The board considers that the size of the group does not justify an internal audit function but continues to assess the requirement for an internal audit function under review.

The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the group, for safeguarding the assets of the company, for taking reasonable steps for the prevention and detection of fraud and other irregularities and for the preparation of a Directors' Report and Directors' Remuneration Report which comply with the requirements of the Companies Act 2006.

The directors are responsible for preparing the annual report and the financial statements in accordance with the Companies Act 2006. The directors are also required to prepare financial statements for the group in accordance with International Financial Reporting Standards as adopted by the European Union (IFRSs) and Article 4 of the IAS Regulation.