How we govern the group

Board

The Board is responsible for the overall governance of the company. Its responsibilities include setting the strategic direction of the company, providing leadership to put the strategy into action and to supervise the management of the business.

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Matters Reserved for the Board

 

 

Audit Committee

The Audit Committee is chaired by Vijay Thakrar. Its other members are; Jon Pither and Stephen Beechey. The Committee is responsible for monitoring and reviewing the integrity of the financial reporting process, including the appropriateness of any judgements and estimates taken in preparing the financial statements; internal and external audit functions; and internal financial controls.

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Audit Committee Terms of Reference

Alumasc Audit Committee Report 2020

Principal Risks and Uncertainties

Remuneration Committee

The Remuneration Committee is chaired by Jon Pither. Its other members are; Vijay Thakrar and Stephen Beechey. The Committee is responsible for determining the remuneration policy and the application of the policy in relation to the Chairman’s and Executive Directors’ remuneration. The remuneration of the Non-executive Directors is determined by the Chairman and the Executive Directors.

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Remuneration Committee Terms of Reference

Alumasc Directors’ Remuneration Report 2020

Proposed Directors’ Remuneration Policy (2020)

 

Nomination Committee

The Nomination Committee is chaired by John McCall. Its other members are; Jon Pither, Vijay Thakrar and Stephen Beechey. The Committee is responsible for reviewing the size, structure and composition of the Board, including the consideration of skills, knowledge and experience of the Board members. It also manages succession planning and selects potential new Board candidates when appropriate.

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Nomination Committee Terms of Reference

Compliance with QCA Code

There is a commitment to high standards of corporate governance throughout the group. As an AIM quoted company Alumasc has adopted the Quoted Companies Alliance (“QCA”) Code as the basis for its governance framework.

Within certain parameters set by the Board, the Executive Committee, led by the Chief Executive Officer, the Executive Directors and Executive Committee members, are responsible for recommending to the Board the strategy of the Group. The strategic focus of the Group also reflects and takes into account views of the Group’s key stakeholders; its shareholders, employees, members of its pension schemes, customers, suppliers and bankers. The Board reviews and discusses the recommendations and ideas of management and must approve the strategy before it can be implemented. The Executive Committee and the management teams of the Group’s divisions are then responsible for the implementation of the strategic plans and the management of the business on an operational and day-to-day basis.

Further details of the Company’s business model and strategy are can be found in the 2020 Annual Report on pages 2 to 3.

Alumasc has regular dialogue with existing and potential investors. Meetings are organised at least twice a year providing management with a forum to explain the business and our opportunities to investors. It is also useful to receive feedback from investors and analysts on our business as a way to gather information and ideas to help drive the business forward.

Dialogue with Shareholders

There is regular dialogue with individual institutional shareholders, in addition to general presentations after the announcement of results. The Board receives regular updates on all the meetings and communications with major shareholders, who have the opportunity to meet with the Non-executive Directors from time to time. During the year a factory site visit to Timloc was arranged for investors, this was well attended. It provided an opportunity for investors to see how we manufacture our products and our use of recycled plastics. A second visit to Timloc has been postponed due to the COVID-19 pandemic.

Shareholders and potential investors have direct access to the Group via its website and can review corporate data on the site. Additionally, the Group responds to individual enquiries from shareholders on a wide range of issues.

Use of General Meetings

The Annual General Meeting (AGM) also provides an opportunity for shareholders to ask questions.  Comments or questions from proxy voting services are considered and reviewed. At our AGM there is an opportunity for shareholders to attend or to appoint a proxy on their behalf (subject to any COVID-19 measures). Our General Meeting was held on 23 April 2020 whilst the Stay at Home Measures were in force; however, there was an opportunity to submit questions in advance of the meeting via our website, and for shareholders to ask questions in advance or on the day using the conference call facility. We will also use a dial-in facility at the 2020 AGM in light of Government guidelines.

Alumasc is aware of its corporate and social responsibilities and the need to build strong relationships across a range of stakeholder groups.  The business seeks to protect its employees and takes its Health & Safety responsibilities very seriously.

Further information about our approach to Health & Safety and our approach to COVID-19 can be found in our Annual Report & Accounts 2020.

Health & Safety

Alumasc places the highest priority on Health & Safety matters.  There is a Group policy to this effect, and it remains the first agenda item for all subsidiary and plc Board meetings. It is considered that embedding a Health & Safety culture is the responsibility of both management and all employees.

Our key responsibility is to keep all people we interact with safe from harm. Alumasc and its subsidiaries comply with Health & Safety legislation, and we have active involvement of all staff with continuous improvement.

Further information about Health & Safety can be found on pages 22 and 28 of the 2020 Annual Report.

People

Communication with employees can be through various methods from Company meetings and conferences to other forms of written and electronic communication, this also includes site visits from senior management and Directors.

Alumasc engages with employees via works forums and written updates to understand employee matters and points of view and this in turn helps us to make more informed business decisions. Alumasc takes seriously its corporate and social responsibilities. During COVID-19 we stayed in touch with our staff, some employees in one division were part of a WhatsApp group and employees also made sure they were in contact with those who lived on their own.

Our training programme includes: Health & Safety, technical and compliance skills to reflect softer business skills including Supervisor and Management training. We have online training available and have moved other training onto interactive audio visual platforms, where possible.

Diversity

As a Group, we are committed to promoting diversity and providing equal opportunity to all areas including (but not limited to) recruitment, employment and career progression. The Group is an equal opportunities employer.

The Environment

The majority of our products help to manage scarce resources of energy and water in the built environment. We sell primarily manufactured products made of metal and support materials that can be re-used.

Many of the materials used in our products can be recycled and a high proportion of the plastics used are made from recycled materials.

Culture

All our employees are expected to operate in an honest and ethical manner. We look to have relationships of trust and reliability with our customers and suppliers. Compliance is an important part of our culture, as evidenced by our approach to Health & Safety.

Customers

We also aim to provide outstanding customer service and are very customer focused.  Our aim is to ensure we provide market leading products and services to meet customer  requirements. Alumasc seeks to innovate where possible to provide solutions for customers. We do seek to provide excellent service and good relationships are part of our long-term success.

Suppliers

Alumasc’s suppliers are critical to our success. We have long-term relationships with our suppliers as we need assured timeliness, quality and the reliable delivery of materials and products. As part of our supply chain our suppliers need to have aligned values; for example, to support our statement ensuring that Modern Slavery does not take place and complying with our Anti-Bribery Policy. We work with our suppliers to ensure that we respect the environment, and this year have made significant investments to ensure that the methods of manufacture used reduce particulates and are environmentally friendly.

Communities

We seek to be close to the communities where we operate and to be supportive neighbours. Operating divisions are connected with events for good causes in their communities. For example, we have supported charity fundraising events and local football clubs.

Further information on the support we provide is in the Sustainability Report on pages 22 to 29.

The Board’s policy on risk management encompasses all significant business risks to the Group, including: strategic, commercial, financial, operational and Health & Safety risks, which could undermine the achievement of business objectives. The Board sees the discussion of principal risks as critical for our business and the risk management approach is outlined on pages 20 to 21 and 41 o 43.

Monitoring Risks

Regular monitoring of risk and control processes, across headline risk areas and other business-specific risk areas, provides the basis for regular and exception reporting to management and the Board. We also run regular Health & Safety assessments and reviews. Our risk assessment and reporting criteria are designed to provide the Board with a consistent, Group-wide perspective of the key risks. Regular reports to the Board include an assessment of the likelihood and impact of risks materialising, together with risk mitigation initiatives and their effectiveness. Internal Audit as part of its remit also reports on risks to the Audit Committee.

Role of the Board

The Board has overall responsibility for the Group’s approach to risk management. It has delegated some responsibility in respect of financial controls to the Audit Committee. Any new and material risks identified by management are communicated promptly to the Chairman and the Board.

Controls

The Board is responsible for, and ensures that, the Company’s business activities comply with key standards policies such as the Data Protection, Anti-Bribery, Whistleblowing and Share Dealing Policies. Other policies have key messages delivered by staff training. There is a delegated authorities matrix in place for approval levels across the business. Each trading division is aware of matters and powers that are reserved for Board approval and the relevant financial levels that require approval.

A summary of the principal risks and uncertainties facing Alumasc, together with mitigating actions, are set out on pages 20 to 21.

Board Composition

The Board consists of a Chairman, Chief Executive, two Executive Directors, and four Non-executive Directors, of whom three are independent. The Non-executive Directors who are not considered independent are Mr John McCall and Mr Jon Pither. A director is no longer considered independent after they have served for more than nine years on the Board. The Board has three Executive Directors; Mr Paul Hooper, the Chief Executive, and two additional Executive Directors, Mr Michael Leaf and Mr Gilbert Jackson, who were appointed on 5 September 2019. On 6 February 2020 Mr Andrew Magson, Group Finance Director, resigned from the Board.

There is a clear separation of roles between the Chairman and the Chief Executive Officer. The Chairman takes responsibility for the running of the Board; no individual or group dominates the Board’s decision-making and the Chairman ensures that the Non-executive Directors are properly briefed on matters. The Chairman has overall responsibility for corporate governance matters and also chairs the Nomination Committee.

The Chairman approves the Board agenda; in addition, the Directors are provided with regular, timely information on the financial performance of the divisions within the Group, and on the business as a whole. The Chairman facilitates the meetings and ensures there is time for each Director to contribute and that no one individual dominates a meeting. Directors contribute their independent judgement and experience to challenge and explore all matters, whether strategic or operational. The Board is provided with Health & Safety reports, finance and management reports and other information on a regular basis.

The Chief Executive Officer has responsibility for implementing the strategy of the Board and for managing the day-to-day business activities. The Company Secretary is responsible for ensuring that Board procedures are followed together with all applicable rules and regulations.

All Non-executive Directors have confirmed and demonstrated that they have adequate time available to meet the requirements of the role and they have no conflicts.

Board Committees

The Board has delegated authority to the Audit, Remuneration and Nomination Committees to support the work of the Board in the performance of its duties and terms of reference for each Committee are available on our website www.alumasc.co.uk. The Board believes that the members of those Committees have the appropriate skills and knowledge to carry out their functions.

a) Audit Committee

Information about the composition of the Audit Committee and its activities during the year is given in the Audit Committee Report on pages 40 to 43.

b) Remuneration Committee

The Remuneration Committee Report is on pages 44 to 51.

c) Nominations Committee

Information about the Nomination Committee can be found on page 58.

In accordance with the Articles of Association, any Director appointed during the year is required to retire and seek election by shareholders at the next Annual General Meeting (AGM) following their appointment. Additionally, one-third of the Directors retire by rotation each year and seek re-election at the AGM. The Executive Directors who were appointed during the year, Mr Michael Leaf and Mr Gilbert Jackson, are required to offer themselves for election at the forthcoming AGM. The Directors required to retire are those who have served three years since their previous re-election or were appointed during the year. Accordingly Mr Michael Leaf and Mr Gilbert Jackson are standing for election and Mr Jon Pither and Mr David Armfield are standing for re-election.

The Board meets at least seven times a year and more frequently where business needs require, for example, during the COVID-19 pandemic there were weekly calls and as the businesses began to re-open the calls were held less frequently. The Board has a Schedule of Matters reserved for its decisions, including appointments to the Board, material capital commitments, commencing or settling major litigation, business acquisitions and disposals and monitoring the effectiveness of the Group’s risk management processes. The full Schedule of Matters Reserved for the Board is on the Group’s website www.alumasc.co.uk.

All Directors have access to independent professional advice if required and at the Company’s expense. This is in addition to the access that every Director has to the Company Secretary. The Company Secretary is charged by the Board with ensuring that Board procedures are followed.

Scheduled Board and Committee meeting attendance is found on page 37 of the 2020 Annual Report which can be found on our website.

Profiles of the Board members appear on pages 30 and 31 of this report and on our website (www.alumasc.co.uk/investors/board-directors). These indicate the high level and range of business experience which enables the Group to be managed effectively.

The Chairman, together with the Nomination Committee and the Company Secretary, review the knowledge and experience on the Board to ensure that the Board has the right balance to support Alumasc’s strategy.

When considering appointing new Non-executive Directors to the Board, the Nomination Committee will consider relevant matters including the experience and the skills needed together with the diversity of its composition.  During the year, Alumasc has refreshed its Board with the appointment of two new Executive Directors, and it keeps its membership under review.

The Board considers that the Directors bring a senior and significant level of judgment and experience that are important for the evaluation of the operations, (including key appointments) and standards of conduct.  All Directors are given access to the Group’s operations and personnel as and when required.

The Board ensures that the Directors’ knowledge of Alumasc and its business is kept up-to-date. Site visits are also arranged for Non-executive Directors.

The Directors received briefings from the Nomad and from other advisers as needed to enable them to fulfil their duties (for example, the auditors). The Company Secretary is available to discuss corporate governance matters.

Directors may seek advice from the Company Secretary as required about their duties, or from the Company’s legal advisers if needed.

Role of the Chairman

The main role of the Chairman is to oversee the Board and the Company’s governance structures. He is also responsible for ensuring that the Company maintains an appropriate level of dialogue with its shareholders.

Chief Executive Officer

The role of the Chief Executive Officer is to oversee the day-to-day running of the business and the operational management of the Group’s businesses.

An evaluation of the performance and effectiveness of the Board, its Committees and individual Directors was carried out during the year. The outline for the evaluation complied with the QCA Code. The Company normally conducts an annual performance review of the Board using one-to-one interviews with Board members in line with the QCA Code. The results of the interviews are then discussed with the Board. Due to COVID-19 feedback was provided directly by phone or email.

Overall Board composition is reviewed annually by the Chairman and the Nomination Committee to determine whether or not any changes might be recommended. Two Executive Directors were appointed on 5 September 2019 and one Executive Director (the Group FD) resigned on 6 February 2020.

The areas discussed related to strategy, succession planning, risk assessment, employee management and development.

The Executive Director appointments were made following the 2019 Board evaluation.

Our Chairman and Chief Executive Officer lead on corporate culture and encourage the values of trust, honesty and integrity. The Board understands that employee engagement underpins our business and helps us drive for success. We also seek to ensure we have the best levels of Health & Safety standards in order to protect employees. Employees are required to deal ethically with customers and suppliers. A number of our businesses have employee forums for matters to be raised.

Alumasc Group employees are asked to maintain appropriate behaviours and to comply with Health & Safety regulations. The Group has policies that govern its activities in respect of zero tolerance towards Modern Slavery and other policies such as Anti-Bribery, Whistleblowing and Data Protection. Alumasc has a series of requirements for its suppliers and these are reviewed from time to time by internal procurement professionals.

Any matters of concern can also be raised to the Chairman or to the Chair of our Audit Committee, as appropriate.

The Board has seven scheduled meetings each year. Before each Board meeting an agenda is prepared and circulated to the Directors.

The Board is responsible for the long-term success of the Company; there is a formal Schedule of Matters Reserved for the Board and this includes discussions on strategy. The Board also considers budgets, annual and interim results, dividend policies, contract approval, large capital expenditure requests, acquisitions and senior appointments.

The Chairman and Board of Directors support good corporate governance to ensure that they build a successful and sustainable business that is beneficial and successful for all our stakeholders.

The Chief Executive Officer and Executive Directors have responsibility for the operational day-to-day management of Alumasc’s business and activity. The Non-executive Directors bring outside experience and independent judgment to decision-making at the Board. The Chairman has responsibility for the Board and for corporate governance matters. The Company Secretary is responsible for ensuring that Board procedures are followed together with all applicable rules and regulations.

The Board is responsible for the overall governance of the Company. Its responsibilities include setting the strategic direction of the Company, providing leadership to put the strategy into action and to supervise the management of the business.

The Board is supported by the Audit, Remuneration and Nomination Committees and the reports for these Committees can be found on paged 40 to 51 and page 58, the terms of reference for the Committees can also be found on our website www.alumasc.co.uk.

The business sets a high priority on maintaining good communications with its stakeholders to ensure that the Alumasc Group’s processes and procedures are clear and understood. On our website (www.alumasc.co.uk) the “Investors” section is regularly updated. We communicate with our shareholders through: The Annual Report, the half-year announcements, the AGM and roadshows/meetings with Investors and at analysts’ briefings.

The Board also pays attention to the voting recommendations provided by third party proxy voting services, as well as the voting outcomes of specific resolutions with a view to determining whether or not any further action is required.

The Company maintains a dedicated email address for use by current and/or potential investors (alumasc@camarco.co.uk). After the AGM the Company announces the results of the voting, including details of the proxy votes cast or received. In addition, this information is available on the investor section of our website.

The Board also receives information on the views of shareholders from its brokers and Nomad. Feedback from analysts, other advisers and investors are also reviewed. Discussions, where needed, are held to enable closer alignment between the way in which the Group is led and shareholder views.

Additional information is provided in the s.172 Statement on pages 28 to 29.



Information last updated 25 September 2020