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Corporate Governance

The London Stock Exchange requires all AIM-quoted companies to adopt a recognised corporate governance code, explain how the company complies with that code’s requirements, and identify and explain areas of non-compliance. The Company has elected to adopt the Quoted Companies Alliance Corporate Governance Code (“QCA Code” or the “Code”).

The Directors recognise the importance of sound corporate governance. Set out below is a description of how the Company complies with the QCA Code and explains the areas of non-compliance.

The Directors remain committed to evolving the Company’s corporate governance arrangements following the acquisition of the Company’s platform asset.

Principle 1: Establish a strategy and business model which promote long term value for shareholders

Safe Harbour aims to become a global leader in B2B distribution and/or business services, through a well-executed buy-and-build strategy. The management team intend to draw upon their extensive managerial and operational experience in consolidation and integration to drive business transformation and thus achieve attractive, long-term compounding returns for shareholders.

Safe Harbour intends to initially acquire a controlling stake in a platform asset of scale which operates in a sector demonstrating a large addressable market opportunity, a steady growth outlook, and a high level of fragmentation, thereby allowing the deployment of a meaningful buy-and-build strategy to capitalise on economies of scale. The intention is for the platform asset to be headquartered in the UK, Europe, or North America with an enterprise value in the region of £250 million to £1.5 billion.

The Company is led by a highly experienced, knowledgeable and reputable Board, who are central to the Company achieving its strategic objectives. The biographies of the Board are detailed here.

The Company’s 31 December 2018 financial statements provide further detail on the key challenges faced by the Company in achieving its strategy.

Principle 2: Seek to understand and meet shareholder needs and expectations

The Company is committed to maintaining an open dialogue and engaging in constructive conversations with both current and potential shareholders. All shareholders have the opportunity, and are encouraged, to attend and vote at the annual general meeting of the Company during which the Board will be available to discuss issues affecting the Company. The Board stays informed of shareholders’ views via regular meetings and other communications, and of institutional shareholders’ views via its Nominated Adviser.

Principle 3: Take into account wider stakeholder and social responsibilities and their implications for long term success

The Directors are aware of the importance of taking into account the Company’s social responsibilities for the long term success of the business.

The Company has not yet acquired a platform asset and therefore does not run an operating business and, until it does, has a very limited number of stakeholders. The Company currently has no customers and its suppliers are primarily professional advisers. Following the acquisition of a platform asset, the Directors will further consider the Company’s wider stakeholders and its social responsibilities.

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

In preparation for the Company’s IPO, the Directors, in consultation with the Company’s advisers, identified a comprehensive list of risks to which the business is exposed, both in its current form and, potentially, following the acquisition of the Company’s platform asset. The risks are detailed in Part II of the Company’s Admission Document which is available here.

The Directors have subsequently reviewed this list of risks and assessed those which they believe have the greatest potential impact on the business in its current form, including those which may jeopardise the successful acquisition of the Company’s platform asset and the ongoing liquidity and solvency of the Group. These risks are described in more detail in both the Corporate Governance Report and the Audit & Risk Committee Report included in the Company’s financial statements for the year ended 31 December 2018 which are available here. In response to these risks, the Directors have considered appropriate mitigating controls.

The Board has reviewed the Company’s risk management and internal control systems and believes that the controls and risk management approach are satisfactory given the current nature and size of the Company and Group. At or around the time an operating business is acquired, the Board will further review the risks to which the new enlarged group is exposed and an appropriate risk management process will be put in place.

Principle 5: Maintain the Board as a well-functioning, balanced team led by the chair

The QCA Code requires a balance between executive and non-executive directors and at least two independent non-executive directors be in place. The Company deviates from the QCA Code in this respect as the Board comprises of only one independent non-executive director, Chris Cole.

The Board considers Chris Cole to be independent in character and judgement and strongly believes that he has no relationships or circumstances which are likely to affect, or could appear to affect, his judgement as an independent Non-Executive Director.

Further information on how a well-functioning and balanced Board is achieved is detailed in the Corporate Governance Report included in the Company’s financial statements for the year ended 31 December 2018 which are available here.

Principle 6: Ensure that between them the Directors have the necessary up-to-date experience, skills and capabilities

The Board has a wealth of knowledge and experience, as is illustrated by the Directors’ Biographies. The Board believes that it has the appropriate mix of experience, expertise, personal qualities and skills to support the business of the Group in its current form.

The Company Secretary is responsible for ensuring that the Directors regularly receive high quality information including financial and operational reports.

The Board considers and reviews the requirement for continued professional development. The Board undertakes to ensure that their awareness of developments in corporate governance and the regulatory framework is current, as well as remaining knowledgeable of any industry specific updates.

A list of the Group’s key service providers and their roles can be found in the Advisors section of the Company’s Financial Statements. The Company is currently pursuing its investment strategy and as a result it is expected that further advisers and industry experts will be engaged to help facilitate this.

Principle 7: Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement

The Board has not yet undertaken a Board effectiveness review but, in consideration of the time passed since incorporation, the Board believes it will be beneficial to conduct an evaluation of its own performance and is committed to undertaking its first evaluation in the twelve months following publication of the Company’s financial statements for the year ended 31 December 2018.

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

Ethical values and behaviours are embedded in the corporate culture which the Board uphold. The Board has created an effective corporate governance and compliance framework which will be developed to meet the requirements of an enlarged group following the acquisition of a platform asset. Currently, as a result of the Company’s limited headcount, the Board is able to determine that the ethical values and behaviours are recognised and respected through direct discussion with employees.

Principle 9: Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board

The Board is led by Avril Palmer-Baunack as Non-Executive Chairman, and the day-to-day running of the Company and its subsidiaries (the “Group”) is the responsibility of the CEO. All Board members have full access to the Group’s advisers for seeking professional advice at the Company’s expense, and the Company’s culture is to openly discuss any important issues and frequently engage with Board members outside of formal meetings.

The role of the Non-Executive Chairman is to actively and constructively challenge the Board and draw on her extensive experience and knowledge to contribute to Board discussions and decisions. The Chairman is not responsible for executive decisions; instead, the Chairman’s principal responsibility is the effective running of the Board. This includes:

  • ensuring that the Board as a whole plays a full and constructive part in the development and determination of strategy and overall commercial objectives;
  • running the Board and setting its agenda;
  • ensuring that Board members receive accurate, timely and clear information on the Company’s performance, its issues, challenges and opportunities and on other matters which are reserved for the Board;
  • ensuring effective communication with shareholders;
  • ensuring that the performance of the Board is considered at least once a year; and
  • promoting the highest standards of integrity, probity and corporate governance.

Currently the CEO’s primary responsibility is, with the support of the Board, to achieve the Company’s immediate objective of acquiring an asset engaged in B2B distribution/or business services which, via an acquisitive growth strategy, will generate compounding returns for shareholders.

The Board meets formally at least six times a year but also meets additionally on an ad hoc basis where necessary. Meetings are prepared for using a standing agenda which is updated to incorporate all relevant ad hoc business, matters of interest and changes to applicable laws and regulations. The Board is presented with papers from management to support its discussions, including financial information, shareholder analysis and investor relations information, subsidiary management reporting and details of acquisition targets and deal progress.

Matters reserved for the Board can be found here.

The Board has established two committees, an Audit and Risk Committee and Nomination and Remuneration Committee. The terms of reference for the committees are available here:

The Board has established two committees, an Audit and Risk Committee and Nomination and Remuneration Committee. The terms of reference for the committees are available here:

Audit and Risk Committee Terms of Reference

Nomination and Remuneration Committee Terms of Reference

Around the time of the acquisition of a platform asset, the Group’s corporate governance framework, including Board and committee composition, will be reviewed and reconsidered to ensure that it meets the changing needs of the business.

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

The Board is always available for communication with shareholders, and the Directors frequently engage constructively with current and potential shareholders. The Board stays informed of shareholders’ views via regular meetings and through its Nominated Adviser.

All shareholders have the opportunity, and are encouraged, to attend and vote at the annual general meeting of the Company during which the Board will be available to discuss issues affecting the Company.

The Audit and Risk Committee and Nomination and Remuneration Committee were established on 20 November 2018 and as such committee reports have been prepared and included in the Company’s financial statements for the year ended 31 December 2018 which can be found here. Prior to their establishment, the Board performed the roles expected of the Audit and Risk Committee, and Nomination and Remuneration Committee.

Voting results

The Company's final results of the 2019 Annual General Meeting can be found here.

Last updated: 11 July 2019