Corporate Governance

Corporate Governance Compliance Statement.

The Board continued its commitment to maintaining high standards of corporate governance, complying with the requirements of the corporate governance guidelines (Guidelines) for smaller quoted companies issued by the Quoted Companies Alliance (the ‘QCA Code’). The QCA Code sets out 10 principles which should be applied. These are listed below together with a short explanation of how the Company applies each of the principles. Where the Company does not fully comply with each principle an explanation as to why has also been provided:

 

Principle One: Strategy and business model

The Board has developed and implemented a strategy which it believes will achieve long term value for shareholders. This strategy is set out in the Strategic Report, in the Annual Report. The Company believes that this strategy is appropriate to protect the Company from unnecessary risk and optimise its long-term growth.

 

Principle Two: Understanding shareholder needs and expectations

The Board is committed to maintaining good communications and seeks to understand and meet shareholder needs and expectations by engaging with them across a range of platforms. All shareholders are encouraged to attend the Company’s Annual General Meetings where they can meet and directly communicate with the Board. After the close of business at the Annual General Meeting, the Chairman opens the floor to questions from shareholders. The Company provides phone numbers on all its updates and RNS announcements where shareholders can contact the appropriate senior Company representatives directly. Shareholders also have access to information through the Company’s website, www.oraclepower.co.uk.

Shareholders are also welcome to contact the Company via its investor relations adviser, St Brides Partners Ltd, at shareholderenquiries@stbridespartners.co.uk with any specific queries.

 

Principle Three: Stakeholder responsibilities

The Board recognises that the long-term success of the Company is reliant upon strong positive relationships with government authorities, project partners, local communities, customers, contractors, suppliers, employees and other stakeholders.  The Company is committed to developing any project under its control to the highest international social and environmental standards.  For more information on the Company’s Corporate & Social Responsibility policies, visit [insert link to CSR section].

The Company engages positively with local communities, regulatory authorities and stakeholders in its project locations and encourages feedback through this engagement. Through this process the Company identifies the key resources and fosters the relationships on which the business relies.

 

Principle Four: Risk management

The Board periodically reviews the risks to which the Group is exposed including on all significant new transactions, and ensures that these risks are minimised as far as possible whilst recognising that its business opportunities carry an inherently high level of risk. The principal risks and uncertainties facing the Group at this stage in its development and in the foreseeable future are detailed in the Annual Report together with risk mitigation strategies employed by the Board.

 

Principle Five: A well-functioning Board of Directors

The Chairman of the Board, Mr Mark Steed, has overall responsibility for the Corporate Governance of the Company. The Board is responsible for formulating, reviewing and approving the Company’s strategy, budget, major transactions and monitoring achievement of its business objectives. An agenda and supporting documentation are circulated to the directors before each Board meeting. Open and timely access to all information is provided to directors to enable them to bring independent judgement on issues affecting the Company and facilitate them in discharging their duties. The Board meets formally periodically during the year for these purposes and holds additional meetings when necessary to transact other business. The Board receives reports for consideration on all significant strategic, operational and financial matters.

The Board currently consists of Mr Mark Steed (Chairman), Ms Naheed Memon (Chief Executive Officer), Mr Andreas Migge (Non-Executive Director) and Mr David Hutchins (Non-Executive Director). 

The Board is supported by the audit, remuneration and the nomination committees, details of which can be found below.

 

Principle Six: Appropriate skills and experience of the Directors

For the current size and stage of development of the Company, the Board considers the current balance of sector, financial and public market skills and experience present on the Board is appropriate to execute the Company’s strategy and business plan and discharge its duties effectively. As the Company evolves, the Board will be reviewed and expanded as necessary to ensure appropriate expertise is always in place to support its business activities. Details of the current Board of Directors’ biographies can be viewed here: Team

All Directors have access to the Company Secretary who is responsible for ensuring that Board procedures and applicable rules and regulations are observed.

 

Principle Seven: Evaluation of Board performance

Due to the Company’s size and available resources, and the status of the Company’s operations, the Company has yet to set in in place a formal evaluation system for its Board, Directors and employees. The appropriateness of performance review will be reassessed as the Company’s corporate governance evolves in line with development of its business. The board shall monitor requirements for succession planning on an ongoing basis.

 

Principle Eight: Corporate culture

The company operates its project in Pakistan and manages central administration and corporate affairs through its office in London.  It is committed to upholding all laws relevant to countering bribery and corruption in all jurisdictions in which it operates and remains bound by the laws of the United Kingdom, including the Bribery Act 2010, in respect of conduct both at home and abroad.

The Company takes a zero-tolerance approach to bribery and corruption and is committed to acting professionally, fairly and with integrity in all its business dealings and relationships wherever we operate, implementing and enforcing effective systems to counter bribery.

The Company gives full and fair consideration to applications for employment received regardless of age, gender, colour, ethnicity, disability, nationality, religious beliefs, transgender status or sexual orientation. The Board takes account of employees’ interests when making decisions, and suggestions from employees aimed at improving the Company’s performance are welcomed.

The Company has adopted a Share Dealing Code for directors’ and employees’ dealings in securities which is appropriate for a company whose securities are traded on AIM and is in accordance with the requirements of the Market Abuse Regulation which came into effect in 2016.

 

Principle Nine: Maintenance of governance structures and processes

Ultimate authority for all aspects of the Company’s activities rests with the Board. The Chairman is responsible for the effectiveness of the Board, ensuring that no individual or group dominates the Board’s decision-making, and that the Non-Executive Director is properly briefed on all operational and financial matters. The Chairman has overall responsibility for corporate governance matters in the Group. The Chairman has the responsibility for implementing the strategy of the Board and managing the day-to-day business activities of the Group. The Company Secretary is responsible for ensuring that Board procedures are followed, and applicable rules and regulations are complied with. Key operational and financial decisions are reserved for the Board through periodic Board meetings.

In accordance with the Companies Act 2006, the Board complies with: a duty to act within their powers; a duty to promote the success of the Company; a duty to exercise independent judgement; a duty to exercise reasonable care, skill and diligence; a duty to avoid conflicts of interest; a duty not to accept benefits from third-parties and a duty to declare any interest in a proposed transaction or arrangement.

 

Principle Ten: Shareholder communication

The Company encourages communication with both private and institutional shareholders. The Company’s website is regularly updated and users, including all stakeholders, can register to be alerted via email when material announcements are made. The Company’s contact details are on the website for investor relations enquiries.

Shareholders are encouraged to attend the Company’s Annual General Meeting. Notices of General Meetings are posted to shareholders and copies for at least the past five years are contained within the Annual Reports, copies of which are available on the website.

The results of voting on all resolutions in future general meetings will be posted to the Company’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 votes.

Board and Committees

The Board consists of one executive director and three non-executive directors. The Board considers that this composition will be satisfactory, considering the size and scale of the Company’s activities and that no one individual or group dominates the decision-making process. The composition of the Board, including the balance between executive and non-executive directors will continue to be reviewed to ensure that the Board continues to have the appropriate structure and skills to meet the needs of the Company as its business develops.

The Board meets regularly through the year, providing effective leadership and overall management of the Company’s affairs through the schedule of matters reserved for its decision. This includes the approval of the Group’s forecast and budget, major capital expenditure, risk management policies and approval of the financial statements. Formal agendas, papers and reports are sent to the Directors in a timely manner prior to Board meetings. The Board delegates certain of its responsibilities to the Board Committees which have clearly defined terms of reference and are listed below.

All directors have access to the advice and services of the Company’s solicitors, Nominated Adviser and the Company Secretary. Any Director may take independent professional advice at the Company’s expense in the furtherance of their duties.

 

Retirement by rotation

One third of directors are required to retire at every Annual General Meeting (AGM) of the Company by rotation and may be re-elected by ordinary resolution.

 

Nomination Committee

The Nomination Committee was established post-admission to AIM to review the structure, size and composition of the Board, including the skills, knowledge and experience required and to make recommendations to the Board with regard to any changes. The Committee also identifies and screens candidates for recommendation to the Board for the Remuneration and Audit Committees. The Nomination Committee also formulates proposals for succession planning of the Board and management. The Committee consists of Mr. Andreas Migge as chairman and Mr. Mark Steed as member.

The Committee also monitors the application of the Company policy on discrimination and encouraging diversity amongst the Company’s workforce.

 

Remuneration Committee

The Committee consists of Mr. Mark Steed as Chairman and Mr. David Hutchins as member. It is responsible for reviewing the remuneration, performance bonuses, incentive schemes and pension provision for Board members and executives of the Company. The Committee responsibility extends to the review of the remuneration of the Company’s appointees to the Boards of Sindh Carbon Energy Limited and Thar Electricity (Private) Ltd.

The Committee engages the services of remuneration consultants h2glenfern Ltd for advice on policies concerning Board and executive remuneration, performance bonuses, incentive schemes and pensions. It is policy that no individual participates in discussions or decisions concerning their own remuneration.

 

Audit Committee

The Committee is chaired by Mr. Steed and consists of Mr. Hutchins as member.  Other Directors and officers are invited to attend where appropriate.

The role of the Audit Committee is to monitor the integrity of the financial statements, and to review any significant financial reporting issues, especially the consistency of, and changes to, accounting policy. The Committee also assesses the effectiveness of the Company’s internal controls and risk management systems. The Committee considers and makes recommendations to the Board, to be put to shareholders for approval at the AGM, in relation to the appointment, re-appointment and replacement of the Company’s external auditor. This extends to monitoring the effectiveness, remuneration and independence of the external auditors.

Whilst the Audit Committee is composed of Directors of Oracle Power PLC it also has a role to advise the Boards of the subsidiary companies, Sindh Carbon Energy Ltd. and Thar Electricity (Private) Ltd.

The auditors of Oracle Power PLC are Price Bailey who have served the Company since it was founded.

A.F. Ferguson & Co., the local affiliates in Karachi of Price Waterhouse Coopers are auditors of Sindh Carbon Energy Limited and of Thar Electricity (Private) Ltd. Price Waterhouse Coopers (London) advise the Group on global tax matters and A. F. Ferguson & Co advise the Group on Pakistani tax matters.

These roles are considered by the Audit Committee to be compatible with their role as auditors of the subsidiary companies.

In the area of internal controls, the Audit Committee monitors the internal control environment of the Group. The Committee also oversees the Group’s adherence to Market Abuse Regulations. The Committee considers that internal controls are sound, both in Oracle Power PLC and in the subsidiary companies. The Committee monitors the Company Internal Control Manual and makes amendments as they are needed.

The risk assessment exercise for the Company is undertaken annually under the supervision of the Audit Committee.

 

Tender Committee

The Tender Committee is chaired by Mr. Migge and consists of Mr. Hutchins as member. The purpose of the Tender Committee is to ensure the fair and objective consideration of bids received for services and goods of both capital and revenue expenditure.

 

Management Meetings

The Senior Management of the Company meets monthly to discuss in detail project progress and all other aspects of the business and where appropriate put tables recommendations to the Board for their consideration and approval.

 

Mark Steed
Chairman

Last reviewed 28 July 2021