Chairman’s Corporate Governance Statement


As Chairman, it is my responsibility, working with my fellow Board colleagues, to ensure that good standards of corporate governance are embraced throughout the Group. As a Board, we set clear expectations concerning the Group’s culture, values and behaviours.

The Directors acknowledge the importance of high standards of corporate governance and, given the Group’s size and the constitution of the Board, have decided to apply the principles set out in the Corporate Governance Code for small and mid-sized companies published by the QCA in April 2018(‘‘QCA Code’’).

The Board comprises five Directors; an independent Non-Executive Chairman, two full time Executive Directors and two Non-Executive Directors (both being independent), reflecting a blend of different experiences and backgrounds. The function of the Chairman is to supervise and manage the Board and to ensure its effective control of the business. The Board believes that the composition of the Board brings a desirable range of skills and experience in light of the Group’s challenges and opportunities as a public company, while at the same time ensuring that no individual (or a small group of individuals) can dominate the Board’s decision-making.

The Board meet regularly to review, formulate and approve the Group’s strategy, budgets, corporate actions and oversee the Group’s progress towards its goals. The Board has established the following committees to fulfil specific functions – Audit, Risk & Disclosure committee (the ‘‘Audit Committee’’) and a Remuneration committee (the ‘‘Remuneration Committee’’) with formally delegated duties and responsibilities. Each of these committees meet on a regular basis and at least two times a year. The Board has elected not to constitute a dedicated nomination committee, instead retaining such decision-making with the Board as a whole. This approach is considered appropriate to enable all Board members to take an active involvement in the consideration of Board candidates and to support the Chair in matters of nomination and succession.

From time to time, separate committees may also be set up by the Board to consider specific issues when the need arises.

Iain Ross
Chairman
27 September 2018

The 2017 Annual report of Redx Pharma Plc can be found here.

QCA Corporate governance guidelines – Index


Principle Disclosure Location (page references are to the 2017 Annual Report unless otherwise stated).
1. Establish a strategy and business model which promote long-term value for shareholders Explain the company’s business model and strategy, including key challenges in their execution (and how those will be addressed). Chairman’s statement on page 5 of the 2017 Annual report.

Strategic report on page 8 of the 2017 Annual report.

2. Seek to understand and meet shareholder needs and expectations Explain the ways in which the company seeks to engage with shareholders and how successful this has been. This should include information on those responsible for shareholder liaison or specification of the point of contact for such matters. Relations with shareholders, page 24 of the 2017 Annual report.

Investors section of the Group’s website (redxpharma.com)

3. Take into account wider stakeholder and social responsibilities and their implications for long-term success Explain how the business model identifies the key resources and relationships on which the business relies.

Explain how the company obtains feedback from stakeholders and the actions that have been generated as a result of this feedback (e.g. changes to inputs or improvements in products).

Corporate social responsibility and Employment page 23 of the 2017 Annual report.

Details of Expert advisors can be found in the “about” section of the Group’s website.

4. Embed effective risk management, considering both opportunities and threats, throughout the organisation Describe how the board has embedded effective risk management in order to execute and deliver strategy. This should include a description of what the board does to identify, assess and manage risk and how it gets assurance that the risk management and related control systems in place are effective. Risk Management and internal control – page 23 of the 2017 Annual report.

Principal risks and uncertainties – page 11 of the 2017 Annual report.

5. Maintain the board as a well-functioning, balanced team led by the chair Identify those directors who are considered to be independent; where there are grounds to question the independence of a director, through length of service or otherwise, this must be explained.

Describe the time commitment required from directors (including non-executive directors as well as part-time executive directors).

Include the number of meetings of the board (and any committees) during the year, together with the attendance record of each director.

Details of the Board can be found within the “About” section of the Group’s website, and detailed information about it’s functioning can be found within the Corporate governance report on pages 21 to 24 of the 2017 Annual report.

Details about the number of, and attendance at board meetings can be found on page 23 of the 2017 Annual report.

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

Describe the relevant experience, skills and personal qualities and capabilities that each director brings to the board (a simple list of current and past roles is insufficient); the statement should demonstrate how the board as a whole contains (or will contain) the necessary mix of experience, skills, personal qualities (including gender balance) and capabilities to deliver the strategy of the company for the benefit of the shareholders over the medium to long-term.

Explain how each director keeps his/her skillset up-to-date.

Where the board or any committee has sought external advice on a significant matter, this must be described and explained.

Where external advisers to the board or any of its committees have been engaged, explain their role.

Describe any internal advisory responsibilities, such as the roles performed by the company secretary and the senior independent director, in advising and supporting the board.

Details of the Board can be found within the “About” section of the Group’s website, and detailed information about its functioning can be found within the Corporate governance report on pages 21 to 24 of the 2017 Annual report.

The Chief Executive Officer, in conjunction with the executive team, ensures that the Directors’ knowledge is kept up to date on key issues and developments pertaining to scientific, financial and governance matters, its operational environment and to the Directors’ responsibilities as members of the Board. During the course of the year, Directors received updates from the Company Secretary and various external advisers on a number of corporate governance matters.

7Evaluate board performance based on clear and relevant objectives, seeking continuous improvement Include a high-level explanation of the board performance effectiveness process.

Where a board performance evaluation has taken place in the year, provide a brief overview of it, how it was conducted and its results and recommendations. Progress against previous recommendations should also be addressed.

Include a more detailed description of the board performance evaluation process/cycle adopted by the company. This should include a summary of:

The criteria against which board, committee, and individual effectiveness is considered;

How evaluation procedures have evolved from previous years, the results of the evaluation process and action taken or planned as a result; and  How often board evaluations take place.

Explain how the company approaches succession planning and the processes by which it determines board and other senior management appointments, including any links to the board evaluation process.

Performance evaluation – within the Corporate governance report on page 21 of the 2017 Annual report.

In addition a full evaluation of board performance is currently underway, and the results will be included in the 2018 annual report.

8. Promote a corporate culture that is based on ethical values and behaviours Include in the chair’s corporate governance statement how the culture is consistent with the company’s objectives, strategy and business model in the strategic report and with the description of principal risks and uncertainties. The statement should explain what the board does to monitor and promote a healthy corporate culture and how the board assesses the state of the culture at present.

Explain how the board ensures that the company has the means to determine that ethical values and behaviours are recognise d and respected.

Included within the Chair’s corporate governance statement.

The Board takes seriously the role of embedding a corporate culture across the business that is based on ethical values and behaviours. These values are documented in the written policies adopted by all employees in the Group.

The Company has adopted a share dealing code for the Directors and certain employees, which is appropriate for a company whose shares are admitted to trading on AIM (including relating to the restrictions on dealings during close periods in accordance with MAR and with Rule 21 of the AIM Rules for Companies). The Company takes all reasonable steps to ensure compliance with the share dealing code by the Directors and any relevant employees.

9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the board In addition to the high level explanation of the application of the QCA Code set out in the chair’s corporate governance statement:

• Describe the roles and responsibilities of the chair, chief executive and any other directors who have specific individual responsibilities or remits (e.g. for engagement with shareholders or other stakeholder groups).

• Describe the roles of any committees (e.g. audit, remuneration and nomination committees) setting out any terms of reference and matters reserved by the board for its consideration.

• Describe which matters are reserved for the board.

• Describe any plans for evolution of the governance framework in line with the company’s plans for growth.

Covered within the Corporate governance section on pages 21 to 24 of the 2017 Annual report.
10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders • Describe the work of any board committees undertaken during the year.

• Include an audit committee report (or equivalent report if such committee is not in place).

• Include a remuneration committee report (or equivalent report if such committee is not in place).

• If the company has not published one or more of the disclosures set out under Principles 1-9, the omitted disclosures must be identified and the reason for their omission explained.

WEBSITE DISCLOSURE:

• Disclose the outcomes of all votes in a clear and transparent manner.

• Where a significant proportion of votes (e.g. 20% of independent votes) have been cast against a resolution at any general meeting, the company should include, on a timely basis, 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.

• Include historical annual reports and other governance-related material, including notices of all general meetings over the last five years.

Please see the Corporate governance section on pages 21 to 2 of the 2017 Annual report.

Within the investors section of the Group’s website, redxpharma.com

The results of voting on all resolutions in future general meetings will be posted to the Group’s website, including any actions to be taken as a result of resolutions for which votes against have been received from at least 20 per cent of independent shareholders.