The Company is not required to comply with the provisions of the Corporate Governance Code. However, the Board recognises the importance of good corporate governance and has considered the principles and recommendations set out in the Corporate Governance Code.
The Directors intend, so far as possible given the Company's size and the composition of the Board, to voluntarily observe insofar as is appropriate, the requirements of the Corporate Governance Code. However, at Admission the Company will not be fully compliant with the Corporate Governance Code which recommends that at least half of a company's board, excluding the chairman, should be independent in character and judgment.
Furthermore, the Corporate Governance Code states that the roles of the chairman and the CEO should not be exercised by the same person. At Admission, Mr. Jindian Lin will be acting as both the Chairman of the Board and the CEO. The Directors believe that, for the moment, it is appropriate for the Company due to the size of business and Mr. Lin as a founder has substantial experience in both roles. However, the casting vote, which is usually exercised by the board chairman, will be exercised by one of the Non-Executive Directors of the Company designated by a majority of the Directors, in all board meetings. The Board will consider appointing an independent chairman of the board in due course.
The Board has established an audit committee, a remuneration committee and a nomination committee with formally delegated duties and responsibilities and written terms of reference details of which are set out below.
The audit committee’s terms of reference require that it includes two or more independent non-executive Directors, at least one of whom is to have significant, recent and relevant financial experience.
The audit committee currently includes one independent non-executive Directors, Ivor Colin Shrago.
The audit committee’s terms of reference require that the audit committee meet at least three times a year at the appropriate times in the reporting and audit cycle. The audit committee is responsible for, amongst other things:
making recommendations to the Board in relation to the appointment, terms of engagement, remuneration and resignation or dismissal of the Company's external auditor;
reviewing the Company's annual accounts and interim reports prior to submission for approval to the Board focussing particularly on, inter alia, changes to the accounting policies;
overseeing the relationship with the Company's auditor, ensuring the independence and objectivity of the auditor;
reviewing the effectiveness of the Company's internal controls systems;
reviewing the nature and extent of non-audit services supplied by the auditors;
developing and implementing a policy on engagement of external auditor to supply non-audit services; and
reviewing the external auditor's management letter and response.
The remuneration committee’s terms of reference require that it includes two or more independent non-executive Directors.
The remuneration committee currently includes one independent non-executive Directors. It is chaired by Ivor Colin Shrago. The committee is expected to meet not less than twice a year.
The remuneration committee will also be responsible for determining at what point the Company should adopt any form of share option plan, considering the grant of options under any such plan and, in particular, the price per share and the application of the performance standards which may apply to any grant, ensuring in determining such remuneration packages and arrangements, due regard is given to any relevant legal requirements.
The remuneration committee is responsible for, amongst other things:
determining and agreeing, with the Board, the framework or broad policy for the remuneration of the Directors;
determining the remuneration of non-executive Director(s);
determining targets for any performance-related pay schemes operated by the Company and Group;
ensuring that contractual terms on termination and any payments made are fair to the individual, the Company and the Group, that failure is not rewarded and that the duty to mitigate loss is fully recognised;
determining the total individual remuneration package of each executive Director, including bonuses, incentive payments and share options;
being aware of and advising on any major changes in employees’ benefit structures throughout the Company and the Group;
ensuring that provisions regarding disclosure, including pensions, as set out in the Directors Remuneration Report Regulations 2002, are fulfilled; and
being exclusively responsible for establishing the selection criteria, selecting, appointing and setting the terms of reference for any remuneration consultants who advise the remuneration committee.
The nomination committee’s terms of reference require that it includes two or more Directors of whom the majority shall be independent non-executive Directors.
The nomination committee includes Ivor Colin Shrago. The committee is chaired by Ivor Colin Shrago.
The nomination committee is responsible for considering and making recommendations to the Board in respect of appointments to the Board, the Board committees and the chairmanship of the Board committees. It is also responsible for keeping the structure, size and composition of the Board under regular review, and for making recommendations to the Board with regard to any changes necessary.
The nomination committee’s terms of reference deal with such issues as membership and frequency of meetings, together with the requirements for quorum and notice procedure and the right to attend meetings. The responsibilities of the nomination committee covered in its terms of reference include: review of the Board composition; appointing new Directors; reappointment and re-election of existing Directors; succession planning, taking into account the skills and expertise that will be needed on the Board in the future; reviewing time required from non-executive Directors; determining membership of other Board committees; and ensuring external facilitation of the evaluation of the Board. The nomination committee will meet at least twice a year.