All AIM companies are now required to apply a “recognised corporate governance code” and to explain how they apply that code.

The Directors of WHIreland have chosen to apply the Corporate Governance Code produced by the Quoted Companies Alliance (“QCA”) (the “QCA Code”).

The QCA Code is constructed around ten broad principles and a set of disclosures which notes appropriate arrangements for growing companies, and requires companies who have adopted the QCA Code to provide an explanation about how they are meeting those principles through the prescribed disclosures.

Below is a table stating those ten principles and which sets out how WHIreland addresses them. This was last updated on 21 September 2018.

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

How it should be applied

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.

What WHIreland does

Page 8 of WHI’s annual report for the period ended 31 March 2018 sets out its principal strategy, which is to focus on continuing to grow the WHI business across the two business divisions of Wealth Management and Corporate and Institutional Broking, with the ultimate objective of becoming the corporate broker of choice in the small and mid-cap company segment and a leading advice-driven wealth management service provider to retail clients.

The risks that attach to this strategy and how such risks are mitigated are set out at pages 12 to 13 of WHI’s annual report for the period ended 31 March 2018.

2. Seek to understand and meet shareholder needs and expectations

How it should be applied

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

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

What WHIreland does

The board is committed to regular shareholder dialogue with both its institutional and retail shareholders.

The principal opportunity for the board to meet shareholders is at the Company’s AGM, to which shareholders are encouraged to attend.

The Company also has a dedicated email address which investors can use to contact the company. The CEO (elect) is responsible for reviewing all communications received from members and determining the most appropriate response.

To date, all responses from shareholders as to the procedures in place for dialogue have been positive.

 

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

How it should be applied

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.

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.

Feedback is an essential part of all control mechanisms. Systems need to be in place to solicit, consider and act on feedback from all stakeholder groups.

What WHIreland does

The Company’s assessment of its key resources and relationships is set out on page 13 of WHI’s annual report for the period ended 31 March 2018.

The Directors believe that, in addition to its members, the main stakeholders of the Company are its clients, its employees, the communities in which it operates and its three regulatory bodies (the London Stock Exchange, the FSA (IoM) and the FCA).

The Company dedicates significant time to understanding and acting on the needs and requirements of each of these group by way of meetings dedicated to obtained feedback. The Company is also a member of certain organisations, such as the Quoted Companies Alliance, which encourages and facilitates active dialogue with some of the Company’s key stakeholders.

Linked to this, the Company strives to have a strong relationship with those local communities in which it operates and some of those initiatives it invests in are set out on pages 34 to 35 of WHI’s annual report for the period ended 31 March 2018.

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

How it should be applied

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.

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).

What WHIreland does

Pages 12 to 13 of WHI’s annual report for the period ended 31 March 2018 set out the risks to the Company’s business and outlook, and how such risks are minimised.

Given the areas in which the Company operates, risk management is a particular focus for the Company.

The Company employs a Head of Risk, which is a full time position within the Group and who is tasked with assessing, ranking and addressing all risk in and threats to, the business. These risks are recorded within the Company’s risk register and cover all categories including personnel, clients, competition, finance, technical and legal. Each risk is ranked on impact and likelihood and mitigating strategies are identified to understand the quantum of any residual risk to the Company.

In addition, the Executive Risk Committee which is formed of the executive directors, the Chief Operating Officer, the Head of Risk, the Head of Compliance and Internal Audit team meet monthly to assess and test these risks; and discuss any new risks arising in the day to day business.

The risk register and minutes from the Executive Risk Committee are reviewed at board meetings on a bi-monthly basis. The directors receive progress reports from the Head of Risk directly, to enable them to assess the effectiveness of the systems in place. These risks and systems are also tested by the Company’s external auditors on an annual basis.

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

How it should be applied

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 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.

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

Directors must commit the time necessary to fulfill their roles.

What WHIreland does

The board is responsible for running the Company, maintaining all internal control systems and considering all major business and financial risks.  All strategic decisions are decided by the board acting collectively.

The board consists of four non-executive directors and two executive directors. It is considered that Victoria Raffé, Jonathan Carey and Tim Steel are independent non-executive directors.

It is acknowledged that Richard Lee has been a director for more than 15 years and therefore he is no longer deemed to be an independent director for reason of length of service. However, the Company recognises the value that Richard Lee adds to the board from his depth of experience and believes this is appropriately balanced by the three other NEDs who have been appointed within the last few years.

All Executive Directors are full time directors of the Company and the Non-Executive Directors are expected to commit sufficient time to the Company in addition to their attendance at board meetings.

The Board meets formally six times a year and on an ad-hoc basis when necessary.

In the last 12 months, at which there have been 6 meetings, the directors attendance has been:

Richard Killingbeck – 6

Dan Cowland – 6

Tim Steel – 6

Jonathan Carey – 6

Victoria Raffé – 6

Richard Lee – 6

Board minutes and related papers are circulated to directors in good time ahead of the relevant board meeting.

The board has established audit, remuneration, risk, nomination and executive committees which meet regularly in accordance with their terms of reference. The details of these committees, including their terms of reference and composition, are set out on page 20 and 21 of WHI’s annual report for the period ended 31 March 2018.

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

How it should be applied

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 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.

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.

What WHIreland does

The Company has five directors being Tim Steel, Dan Cowland, Richard Lee, Jonathan Carey and Victoria Raffé. Details of these directors and their relevant experience, skills and personal qualities are set out at pages 14 to 15 of WHI’s annual report for the period ended 31 March 2018.

The Company periodically holds briefings for the directors covering regulations that are relevant to their role as directors of an AIM-quoted company from our  Nominated Adviser and lawyers.

The Company also has a dedicated Human Resources and Compliance departments and also uses the services of a number of external training providers. The directors therefore have access to a suite of training products including online training, in-house seminars and external training courses to ensure the directors skills are kept up to date.

The board is supported by Katy Mitchell as Company Secretary and Head of Legal. Katy is a qualified corporate lawyer, a member of ICSA and a senior Qualified Executive for AIM within the Corporate Broking department of WHI. The board also engages Travers Smith to advise them, where appropriate and necessary on the legal aspects of any ongoing regulatory queries.

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

How it should be applied

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 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.

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.

What WHIreland does

Evaluation of the performance of the Company’s board has historically been implemented in an informal manner, with the exception of the Executive Directors who are assessed annually on performance by either the Chairman or CEO as appropriate.

In the coming year however, the board will formally review and consider the performance of each director at or around the time of the Company’s annual general meeting using a process which is currently under development. The process and its results and recommendations will be published at a future date.

The Nomination Committee is required to give recommendations to the Directors where there are vacancies or where it is felt that additional directors should be appointed. For new appointments the search for candidates is conducted, and appointments are made, on merit, against objective criteria and with due regard for the benefits of diversity on the Board.

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

How it should be applied

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. 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.

What WHIreland does

Page 19 of WHI’s annual report for the period ended 31 March 2018 sets out WHI’s values relating to corporate culture and page 34 to 35 of WHI’s annual report for the period ended 31 March 2018 sets out WHI’s approach to corporate responsibility, the Group’s people, its social impact and the impact upon the environment in which it operates.

The board seeks to ensure that all of its employees are aware of WHI’s ethical values which embodies 7 core values. These are covered in the mandatory induction process for new employees and each employee is also assessed on their adherence to these values in their annual appraisal which influences promotion and reward.

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

How it should be applied

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

What WHIreland does

The board has established audit, remuneration, risk, nomination and executive  committees which meet regularly in accordance with their terms of reference. The details of these committees, including their terms of reference and composition, are set out on page 20 and 21 of WHI’s annual report for the period ended 31 March 2018. This detail also includes the roles and responsibilities of each of the directors, with all of the Non-Executive directors sitting on each of the sub-committees of the board.

The matters reserved for the board, are set out in the Board Terms of Reference, and can be summarised as follows:

  • Reviewing, approving and guiding corporate strategy, major plans of action, risk appetite and policies, annual budgets and business plans; setting performance objectives; monitoring, implementation and corporate performance; and overseeing major capital expenditures, acquisitions and disposals;
  • Monitoring the effectiveness of the Company’s governance arrangements and practices, making changes as needed to ensure the alignment of the Company’s governance framework with current best practices;
  • Ensuring that appointments to the Board or its Committees are effected in accordance with the appropriate governance process;
  • Monitoring and managing potential conflicts of interest of management, Board members, shareholders, external advisors and other service providers, including misuse of corporate assets and abuse in related party transactions; and
  • Overseeing the process of external disclosure and communications. The Board is also  responsible for all other matters of such importance as to be of significance to the Group as a whole because of their strategic, financial or reputational implications or consequences.

At this stage the board believes that the governance framework is appropriate for a Company of its size but it continues to keep this under review.

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

How it should be applied

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.

In particular, appropriate communication and reporting structures 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.

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

What WHIreland does

The Company is committed to open dialogue with both institutional and retail shareholders.  The CEO liaises with WHI’s principal shareholders and relays their views to the wider board.

On the Company’s website shareholders can find all historical RNS announcements, interim reports and annual reports.  Annual Reports and Annual General Meeting Circulars are posted directly to all registered shareholders or nominees and results of Annual General Meeting votes are also published on the Company’s website. As described earlier, the Company also maintains email and phone contacts which shareholders can use to make enquiries or requests in accordance with the Company’s social media policy.

Following the Company’s GM on 27 September 2018 the results of all votes will be made available in this section.

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