QCA Code Principle

Application (as set out by QCA)

What we do and why

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

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

The Company’s strategy is explained fully within the Chief Executive’s Report section of our Report and Accounts for the year ended 31 December 2022.

Our strategy is focused on reviewing manufacturing capabilities to optimise the cost of production and ensure a competitively priced product, and developing a “go to market strategy” by advancing partnerships with solutions providers to incorporate our panels and deliver readily saleable solutions.

The key challenges to the business and how these are mitigated are detailed on pages 7 to 9 of our Report and Accounts for the year ended 31 December 2022. 

2.   Seek to understand and meet shareholder needs and expectations

Directors must develop a good understanding of the needs and expectations of all elements of the company’s shareholder base.

Whilst the company is early stage, the Board is committed to returning value to our shareholders through execution of our strategy.

The Board must manage shareholders’ expectations and should seek to understand the motivations behind shareholder voting decisions.

Verditek plc encourages two-way communication with its investors and responds quickly to all queries received.

The Board recognises the AGM as an important opportunity to meet shareholders. The Directors are available to listen to the views of shareholders informally immediately following the AGM.

The people responsible for shareholder liaison are:

The Chief Executive Officer

The Chief Financial Officer

Nomad (W.H. Ireland Limited)

The Chief Executive Officer is responsible for shareholder liaison and he can be contacted using the “contact” link on the Company website.

The Board noted that a resolution at the Annual General Meeting held in 2022 to re-appoint one the Directors was passed with the necessary majority but received less than 80% of votes in favour. The Board have engaged with its shareholders to understand the reasons behind the voting result.

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

Long-term success relies upon good relations with a range of different stakeholder groups both internal (workforce) and external (suppliers, customers, regulators and others). The board needs to identify the company’s stakeholders and understand their needs, interests and expectations.

The executive maintains communications with trade and interest groups working in the markets where its products are sold and applied.

Where matters that relate to the company’s impact on society, the communities within which it operates, or the environment have the potential to affect the company’s ability to deliver shareholder value over the medium to long-term, then those matters must be integrated into the company’s strategy and business model.

The Company is committed to developing green technology, and this forms the backbone to decision making.

Feedback is an essential part of all control mechanisms, and is welcomed from all stakeholder groups.

The Company’s website maintains a channel to receive feedback from all stakeholders.

4.   Embed effective risk management, considering both opportunities and threats, throughout the organisation

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; companies need to consider their extended business, including the company’s supply chain, from key suppliers to end-customer.

Risk Management on pages 7 to 9 of our Report and Accounts for the year ended 31 December 2022 details the risks to the business and how these are mitigated.

Setting strategy includes determining the extent of exposure to the identified risks that the company is able to bear and willing to take (risk tolerance and risk appetite).

The Board considers risks to the business at its monthly meetings and reviews the principal risks to the business and the risk register quarterly.

5.  Maintain the Board as a well-functioning, balanced team led by the chair

The Board members have a collective responsibility and legal obligation to promote the interests of the company and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the chair of the Board.

The Company is controlled by the Board of Directors. The Rt Hon. Lord David Willetts FRS, the Non-executive Chairman, is responsible for the running of the Board and Rob Richards, the Chief Executive, has executive responsibility for running the Group’s business and implementing Group strategy.

The Board (and any committees) should be provided with high quality information in a timely manner to facilitate proper assessment of the matters requiring a decision or insight.  

All Directors receive regular and timely information on the Group’s operation and financial performance. Relevant information is circulated to the Directors in advance of meetings. All Directors have direct access to the advice and services of the Company Secretary and are able to take independent professional advice in the furtherance of the duties, if necessary, at the Company’s expense. 

The Board should have an appropriate balance between executive and non-executive directors and should have at least two independent non- executive directors. Independence is a board judgement. 

The Board comprises one Executive Director and three Non-Executive Directors. The Board considers that all the Non-Executive Directors bring an independent judgement to bear.

The Board should be supported by committees (e.g. audit, remuneration, nomination) that have the necessary skills and knowledge to discharge their duties and responsibilities effectively. 

The Executive Director is full time and the Non-Executive Directors provide such time as is required to fully and diligently perform their duties.

Directors must commit the time necessary to fulfil their roles.

The Board holds Board meetings at least once a month. Details of the attendance record of each Director at Board meetings is included in the Governance report of the Annual Report.

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

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. The board should understand and challenge its own diversity, including gender balance, as part of its composition. 

The Directors have attended professional NED instruction and have proven track-records of serving on boards previously.

The Board should not be dominated by one person or a group of people. Strong personal bonds can be important but can also divide a board.

The Board will work to increase the diversity of the Directors.

As companies evolve, the mix of skills and experience required on the board will change, and board composition will need to evolve to reflect this change.

Further information about the Board’s skillset, including each Director’s experience and CV, is set out on the Company website and additional information is shown on page 10 of the Annual Report for the year ended 31 December 2022.

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

The Board should regularly review the effectiveness of its performance as a unit, as well as that of its committees and the individual directors. 

The Company was admitted to trading on AIM in August 2017. Since that time there has been a greater than 50% turnover in Board membership.

It was proposed that a board performance evaluation  be carried out in 2022 to look critically at what we do and to identify areas of improvement but this was not possible given other Board priorities and it will take place in the second half of 2023.

An appraisal is scheduled to be carried out each year with the Executive Director.

The Board performance review may be carried out internally or, ideally, externally facilitated from time to time. The review should identify development or mentoring needs of individual directors or the wider senior management team.

The Company is early stage and as such the Board has been focussed on ensuring that sufficient capital is in place to execute its strategy: first sales; investing in longer term development opportunities and developing the organisation. 

It is against the performance of this strategy that the Board is currently assessed.

It is healthy for membership of the Board to be periodically refreshed. Succession planning is a vital task for boards. No member of the board should become indispensable.

No formal succession plans are currently in place, but the Board will continue to review this position.

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

The Board should embody and promote a corporate culture that is based on sound ethical values and behaviours and use it as an asset and a source of competitive advantage.

The policy set by the board should be visible in the actions and decisions of the chief executive and the rest of the management team. 

The Corporate and Social Responsibility section on page 21 of our Report & Accounts for the year ended 31 December 2022 details the ethical values of the Company. 

Corporate values should guide the objectives and strategy of the company.

The culture should be visible in every aspect of the business, including recruitment, nominations, training and engagement. The performance and reward system should endorse the desired ethical behaviours across all levels of the company.

The corporate culture should be recognisable throughout the disclosures in the annual report, website and any other statements issued by the company.

The Company’s policies and procedures on Data Protection; Disciplinary, Dismissal and Grievance; Ethics; Share Dealing; Social Media; and Speak-Up are reviewed and updated as required and amended policies were approved by the Board during the year.

These policies and procedures are made available to staff and consultants and anti-bribery and anti-corruption training and data protection training is mandatory.

Staff and consultants are encouraged to ask questions and seek clarifications from senior members of the team on these policies and procedures.

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

The Company should maintain governance structures and processes in line with its corporate culture and appropriate to its:

•  size and complexity; and

•  capacity, appetite and tolerance for risk.

The Corporate Governance Report on pages 12 to 17 of our Report & Accounts for the year ended 31 December 2022 details the Company’s governance structures and why they are appropriate and suitable for the Company.

The governance structures should evolve over time in parallel with its objectives, strategy and business model to reflect the development of the company.

The Board has a formal schedule of matters reserved to it and is supported by the Audit and Remuneration Committees. Due to the size of the Company, the Directors have decided that issues concerning the nomination of directors will be dealt with by the Board rather than a committee but will regularly reconsider whether a nominations committee is required.

The Audit Committee and a Remuneration Committee have formally delegated duties and responsibilities and with specific terms of reference and these are available on request.

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

A healthy dialogue should exist between the Board and all of its stakeholders, including shareholders, to enable all interested parties to come to informed decisions about the company. 

The Company encourages two-way communication with its investors and responds quickly to all queries received.

The Board recognises the AGM as an important opportunity to meet private shareholders. The Directors are available to listen to the views of shareholders informally immediately following the AGM. 

Appropriate communication and reporting structure should exist between the Board and all constituent parts of its shareholder base. This will assist:  

• the communication of shareholders’ views to the board; and
• the shareholders’ understanding of the unique circumstances and constraints faced by the company.

The Chairman and the Chief Executive Officer are responsible for ensuring appropriate communication and reporting to shareholders.

A range of corporate information (including all Company announcements, historical annual reports and other governance related material since the company was admitted to AIM in August 2017) is also available to shareholders, investors and the public on the Company’s website. 

It should be clear where these communication practices are described (annual report or website).

The Company will disclose outcomes of all votes at shareholder meetings in a clear and transparent manner by either publishing a market announcement or by reporting it on the Company website. When a considerable proportion of votes (20%) have been cast against a resolution at any meeting of shareholders, the Company will include an explanation of what actions it intends to take to understand the reasons behind that vote result and, where appropriate, any different action it has taken, or will take, as a result of the vote.

Significant Shareholders (over 3%)

number of ordinary Shares

% of total issued shares

Hargreaves Lansdown (Nominees) Limited

112,616,905

25.39%

Vidacos Nominees Limited

65,645,377

14.80%

Pershing Nominees Limited

49,530,053

11.17%

Interactive Investor Services Nominees Limited

28,116,762

6.34%

The Bank Of New York (Nominees) Limited

21,020,495

4.74%

HSDL Nominees Limited

19,490,081

4.39%

Platform Securities Nominees Limited

14,656,941

3.30%