This site uses cookies to bring you the best experience. Find out more
Skip to main content

Corporate Governance Framework

The Corporate Governance report forms part of the Directors’ report from the annual report for the year end 31 December 2017.

Introduction

This report explains key features of the Company’s governance structure to provide a greater understanding of how the main
principles of the UK Corporate Governance Code, published in 2016 by the Financial Reporting Council (the Code), have
been applied, and to highlight areas of focus during the year. The report also includes items required by the Disclosure and
Transparency Rules. A copy of the Code can be obtained at www.frc.org.uk.

 

Compliance with the UK Corporate Governance Code

The Company has complied with the provisions of the Code in this financial year.

 

Governance Overview

The Board is collectively responsible to the shareholders for the long-term success of the Company. The Board has delegated
certain responsibilities to Board Committees to assist it with discharging its duties. The Board Committees play an essential
role in supporting the Board to implement its vision and strategy, and to provide focused oversight of key aspects of the
business. The full terms of reference for each Committee are available on the Committees page.

 

How the Board works

The Board

The Company is led and controlled by the Board. The names, responsibilities and details of the current Directors appointed to the Board are set out on the Management page. The Board agrees the strategic direction and governance structure that will help achieve the long-term success of the Company and deliver shareholder value. The Board takes the lead in areas such as strategy, financial policy and ensuring the Company maintains a sound system of internal control. The Board’s full responsibilities are set out in the ‘Matters Reserved for the Board’.

Role of the Chairman

The Board is chaired by David Maloney, a NED who met the independence criteria in the Code on his appointment. It is the Chairman’s duty to lead the Board and to ensure Directors have sufficient resources available to them to fulfil their statutory duties. The Chairman is responsible for setting the Board’s agenda, ensuring adequate time is available for discussion of all agenda items and ensuring a particular focus on strategic issues.

The Chairman promotes a culture of openness and debate by facilitating the effective contribution of NEDs in particular, and by encouraging constructive relations between Executive Directors and NEDs.

Role of the Chief Executive Officer (CEO)

Mirek Stachowicz is the CEO. Through delegation from the Board, he is responsible for executive management of the Group, including the implementation of the Group’s strategic objectives. In fulfilling his duties, the CEO is supported by the Senior Management Team, whom he also leads (biographies for the Senior Management Team can be found on the Board and Management page).

Interaction between the Chairman and the CEO

The roles of the Chairman and the CEO are separate, with a distinct division of responsibilities.

The partnership between David Maloney and Mirek Stachowicz is based on mutual trust and is facilitated by regular contact between the two. The separation of authority enhances independent oversight of the executive management by the Board and helps to ensure that no one individual on the Board has unfettered authority.

Role of the Senior Independent Director (SID)

John Nicolson is the SID and is available to shareholders if they have concerns that the normal channels of Chairman, CEO
or other Executive Directors have failed to resolve, or for which such channels of communication are inappropriate. The
SID also acts as an internal sounding board for the Chairman, and serves as intermediary for the other Directors, with the
Chairman, when necessary. During the year Mr Nicolson consulted with major shareholders to discuss the proposed changes
to the Directors’ Remuneration Policy both prior to and following the AGM. The role of the SID is considered to be an
important check and balance in the Group’s governance structure. In accordance with the Code, neither the Chairman nor
the SID are employed as executives of the Group.

Non-Executive Director (NED) independence

The Board considers and reviews each NED’s independence on an annual basis, as part of the Directors’ performance evaluation. In carrying out the review, consideration is given to factors such as their character, judgement, commitment and performance on the Board and relevant committees, and their ability to provide objective challenge to management. The Board has considered the findings from the internal Board evaluation exercise and reviewed the independence of each NED. The Board is of the view that all were and continue to be, independent in accordance with the provisions of the Code, with the exception of Randy Pankevicz, who is considered non-independent. His status does not preclude him from making a full contribution to the Board. He has participated in all Board and Board Committee meetings.

 

Meetings and attendance

The attendance of Directors at scheduled Board and Committee meetings during the year ended 31 December 2017 were as follows:

Director Board
Maximum 7
Audit Committee
Maximum 5
Remuneration Committee
Maximum 6
Nomination Committee
Maximum 4
David Maloney 7 - - 4
Mirek Stachowicz 7 - - -
Lesley Jackson1 7 - - -
Paul Bal2 2 - - -
John Nicolson3 7 4 6 3
Randy Pankevicz 7 - - -
Mike Butterworth 7 5 6 4
Diego Bevilacqua 7 - 6 4
Tomasz Blawat 7 5 6 -

1Retired as a Director on 7 November 2017
2Appointed as a Director on 7 November 2017
3Mr Nicolson was unable to attend one Audit Committee and one Nomination Committee due to overseas business commitments

During 2017, certain Executive and Non-Executive Directors who are not Committee members attended Committee
meetings by invitation (other than meetings where there would be a conflict). These details have not been included in
the table.

In addition to the scheduled Board meetings, the Board holds regular meetings by telephone, generally to review the financial results.

In the event that a Director is unable to attend a meeting, they will receive the papers scheduled for discussion at the relevant
meeting, giving them the opportunity to raise any issues and give any comments to the Chairman in advance of the meeting.

The Board delegates authority to its Committees to carry out certain tasks on its behalf, so that it can operate efficiently
and give the right level of attention and consideration to relevant matters. The composition and role of each Committee is
summarised in each of the respective Committee reports.

Board composition, qualification and independence

The Board is committed to high standards of corporate governance and as such, its composition, members’ experience,
balance of skills and effectiveness are regularly reviewed to ensure the right mix of people are on the Board and its
Committees. Following the retirement of Lesley Jackson and the appointment of Paul Bal as CFO, both on 7 November
2017, the Board continues to comprise eight Directors: a Chairman (who, for the purposes of the Code, was independent on
appointment); a SID; three Independent NEDs; one Non-Independent NED and two Executive Directors.

The Directors have a wide range of skills and experience including expertise in the food and drinks industry, within Europe and beyond.

 

Appointment and tenure

All NEDs, including the Chairman, serve on the basis of letters of appointment that are available for inspection at the Company’s registered office. The letters of appointment set out the expected time commitment of NEDs who, on appointment, undertake that they will have sufficient time to meet what is expected of them.

The Executive Directors’ service contracts are also available for inspection at the Company’s registered office.

The Company does not place a term limit on a Director’s service, as all continuing Directors will present themselves for annual re-election by shareholders at the Company’s Annual General Meetings (AGMs).

Director induction and training

The Chairman, with the support of the Company Secretary, is responsible for the induction of new Directors and the ongoing training and development of all Directors. New Directors receive a full, formal and tailored induction on joining the Board, designed to provide an understanding of the Group’s business, governance and key stakeholders. The induction process includes site visits, meetings with key individuals, and briefings on key business, legal and regulatory issues facing the Group.

As the internal and external business environment changes, it is important to ensure the Directors’ skills and knowledge are refreshed and updated regularly. Accordingly the Chairman, with the assistance of the Company Secretary, ensures that regular updates on corporate governance, regulatory and technical matters are provided to Directors at Board meetings. During the year, operational site visits for the Board were arranged in Poland, Czech Republic and Italy which included meetings with the local senior management teams. In this way, Directors keep their skills and knowledge relevant so as to enable them to continue to fulfil their duties effectively.

Information and support available to Directors

All Board Directors have access to the Company Secretary, who advises them on Board and governance matters.

The Chairman and the Company Secretary work together to ensure Board papers are clear, accurate, delivered in a timely manner to Directors and of sufficient quality to enable the Board to discharge its duties. As well as the support of the Company Secretary, there is a procedure in place for any Director to take independent professional advice at the Company’s expense in the furtherance of their duties, where considered necessary.

Director re-election

In accordance with the Code and the Directors’ letters of appointment, the Directors will put themselves forward for annual re-election. Following recommendations from the Nomination Committee, the Board considers that all Directors continue to be effective, committed to their roles and to have sufficient time available to perform their duties. Accordingly, all Directors will seek re-election at the Company’s forthcoming AGM.

Directors’ conflicts of interest

Directors have a statutory duty to avoid situations in which they have, or may have, interests that conflict with those of the Company, unless that conflict is first authorised by the Board. This includes potential conflicts that may arise when a Director takes up a position with another company. The Company’s articles allow the Board to authorise such potential conflicts, and there is a procedure in place to deal with any actual or potential conflict of interest. The Board deals with each appointment on its individual merit and takes into consideration all relevant circumstances. All potential conflicts approved by the Board are recorded in an Interests Register, which is reviewed by the Board at least quarterly to ensure the procedure is working effectively.

Board evaluation and effectiveness

An internal evaluation of the performance of the Board, its Committees and the Chairman was carried out during the year.
The process of evaluating the performance was undertaken by the Company Secretary under the direction of the Chairman.
A tailored, high-level questionnaire was distributed for the Directors to complete. This was structured to provide Directors
with an opportunity to express their views about:

  • The performance of the Board and its Committees, including how the Directors work together as a whole;
  • The balance of skills, experience, independence and knowledge of the Directors; and
  • Individual performance, and whether each Director continues to make an effective contribution.

Following evaluation, it was agreed that all Directors contribute effectively, demonstrate a high level of commitment to their role, and together provide the skills and experience that are relevant and necessary for the leadership and direction of the Company.

The evaluation highlighted that following Mrs Jackson’s departure, the Board is currently lacking in gender diversity, however, it is diverse in terms of ethnicity, culture, nationality and international experience. In line with the Board Diversity Policy, gender diversity will be considered alongside race, merit, skills, background, knowledge and international and industry experience when the next opportunity arises on the Board.

The responses to the evaluation of the Board and its Committees were reviewed with the Chairman and considered by the
Board. The results of the evaluation indicated that the Board is working well and that there were no significant concerns
among the Directors about its effectiveness. It was generally felt that the actions agreed as a result of the previous year’s
external evaluation had been progressed. These actions included succession planning and promoting a stronger culture of
value creation in the Board and throughout the Company. For the year ahead, the actions agreed included a continued focus
on succession planning, continued engagement with the management teams in each market and a focus on improving the
management information provided to the Board.

The results of the evaluation of the Chairman’s performance were considered by the SID and were discussed with the
Chairman at a separate one-to-one meeting. The performance of individual Directors was evaluated by the Chairman,
with input from the Committee Chairmen and other Directors.

For 2018, an internal evaluation of the performance of the Board, its Committees and the Chairman will take place.
The process of evaluation will be undertaken by the Company Secretary under the direction of the Chairman.

 

Annual General Meeting (AGM)

The Company’s AGM will take place at 11.30am on Tuesday, 22 May 2018 at the offices of Numis Securities Limited at The London Stock Exchange Building, 10 Paternoster Square, London, EC4M 7LT. All shareholders have the opportunity to attend and vote, in person or by proxy, at the AGM. The notice of the AGM can be found on the AGM page, and in a booklet that is being issued at the same time as this Report. The Notice of the AGM sets out the business of the meeting and an explanatory note on all resolutions. Separate resolutions are proposed in respect of each substantive issue.

The AGM is the Company’s principal forum for communication with private shareholders. The Chairman of the Board and Directors will be available to answer shareholders’ questions at the AGM.

 

Committees

The Company has established an Audit Committee, a Nomination Committee, a Remuneration Committee and a Disclosure Committee. The Board delegated specific responsibilities to these Committees. The role and responsibilities of each Board Committee are set out in formal Terms of Reference, which are available on the Company’s website. The Board Committees make recommendations to the Board as they see fit, as contemplated by their Terms of Reference.

 

Shareholder Engagement

The Company has regular discussions with and briefings for analysts, investors and institutional shareholders. Primary
responsibility for shareholder relations rests with Mirek Stachowicz, CEO and Paul Bal, CFO. They ensure there is effective
communication with shareholders on matters such as governance and strategy, and are responsible for ensuring the Board
understands the views of major shareholders on such matters.

As part of a comprehensive investor relations programme, formal meetings with investors are scheduled to discuss the
Group’s interim and final results. In the intervening periods, the Company continues its dialogue with the investor community
by meeting key investor representatives and attending investor conferences.

During the year, the CFO, CEO and the Chairman have met with a number of shareholders and potential shareholders. External presentations are posted on the Company’s website in the Investors section.

The Chairman is always available to meet individual shareholders on request. In addition, all Directors are available to meet
shareholders at the Company’s AGM.

 

David Maloney
Chairman

7 March 2018