The Board of Directors is accountable to the Company’s shareholders for ensuring good corporate governance and the Directors have agreed to report against the UK Quoted Companies Alliance ("QCA") Governance Code (“the Code”).
It has not been possible to incorporate all of the annual report and accounts disclosures required by the QCA code in the Company’s annual report and accounts for the year ended 31 December 2017 but the Company intends to include all of these disclosures in the Company’s annual report and accounts for the financial year ended 31 December 2018.
The Code has ten key principles. We set out below how we apply those principles to our business and more details will be provided in our Annual Reports on an ongoing basis.
Principle 1 Business Model and Strategy
Establish a strategy and business model which promote long-term value for shareholders
Clear Leisure plc is an AIM listed investment company with a portfolio of companies primarily encompassing the leisure and real estate sectors mainly in Italy. The focus of the management is to pursue the monetisation of all of the Company’s existing assets, through selected realisations, court-led recoveries of misappropriated assets and substantial debt-recovery processes. In addition the Company has recently launched a joint venture initiative in the cryptocurrency mining sector.
A more detailed explanation of the Company’s strategy is set out in the preface of the Company’s Annual Reports and business updates released to the market which are available on the Company’s website in the Regulatory News section.
Principle 2 Understanding Shareholder Needs and Expectations
Seek to understand and meet shareholder needs and expectations
The Company endeavours to maintain a dialogue and keep both private and institutional shareholders informed through its public announcements and its corporate website.
Shareholders are sent Annual Reports and all shareholders receive a Notice of the Meeting and are encouraged to attend the Annual General Meeting.
Members of the Board are in attendance at the Annual General Meeting and are available to meet shareholders formally after the meeting to discuss information that is in the public domain. The Company will advise shareholders attending the AGM of the number of proxy votes lodged for and against each resolution after each resolution has been dealt with by a show of hands.
In addition, shareholder communication may also be answered, where possible or appropriate, by the Company’s Financial PR advisor, Leander PR or the Company’s broker, SP Angel Corporate Finance LLP.
Leander PR is responsible for the public relations of the Company, which includes assistance in the preparation of public announcements and liaison with the press.
The Board is responsible for the Company’s public announcements to the market and where appropriate takes advice from the Company’s advisors in respect of their preparation and the Company’s regulatory requirements.
Principle 3 Stakeholder and Social Responsibilities
Take into account wider stakeholder and social responsibilities and their implications for long-term success
The Directors are aware of the impact the business activities have on the communities in which the Group's businesses operate and are very cognisant of the importance of stakeholders, including but not limited to shareholders, employees, advisors, business partners, regulators and the wider society.
The Company holds formal and informal meetings, to identify both internal and external stakeholders’ needs, interests and expectations.
The Board, on a case-by-case basis, will take the decision to act on feedback from stakeholders.
The Company does not have a policy towards charity, given the current size of the Company, but the Board may from time to time decide to make charitable donations.
The Company works closely with its advisors to ensure it meets its listing obligations as well as the social, legal, religious and cultural requirements of the countries in which it operates.
Principle 4 Risk Management
Embed effective risk management, considering both opportunities and threats, throughout the organisation
The Company is exposed to a variety of risks that result from its investing activities. A detailed explanation of the Board’s management of each risk is outlined in the Annual Reports. Internal controls are designed to manage rather than eliminate risk and therefore even the most effective system cannot provide assurance that each and every risk, present and future, has been addressed.
The Board is responsible for the identification, assessment and management of such risks. In assessing the risks, the Board is assisted by the Company’s advisors.
Principle 5 Board Structure
Maintain the Board as a well-functioning, balanced team led by the chair
Clear Leisure plc’s Board of Directors is comprised of Prof Francesco Gardin as Chairman and Chief Executive Officer (“CEO”). Mr Reginald Eccles is the independent Non-executive Director of the Company, while Mr. James Douglas Gordon acts as Company Secretary.
Both Directors allocate sufficient time to the Company to discharge their duties.
Ultimate responsibility for the quality of, and approach to, corporate governance lies with the Chair of the Board.
The Board is aware that the Code advises that save in exceptional circumstances, the Chairman should not also fulfil the role of Executive Director. Given the current size and stage of the Company, alongside Prof Gardin’s knowledge of past and present complex legal matters impacting on the Company, the Board believes that this combined role is currently appropriate. This however, will be kept under review as the Company develops.
The Company notes that the QCA Code also recommends that the Board include at least two Independent non-executive directors. The Board will consider the appointment of additional non-executive directors as the Group’s scale and complexity grows.
The shareholders are aware of these circumstances and have not opposed the re-election of the Board at the Annual General Meetings.
In addition, there is a regular dialogue between the Directors and the Company Secretary to ensure every decision is correctly assessed and properly balanced.
The Board is also supported by a number of committees including the Audit Committee and the Remuneration Committee.
Additionally, as a holding company, Clear Leisure is supported by the Boards and independent Directors of individual operating companies.
Principle 6 Board Composition
Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities
Biographies and expertise of the Directors are available on both the Company’s website (in the Board of Directors section) and the Annual Reports.
In matters related to company law, the Company depends upon the legal expertise of its legal advisers.
Where there are issues that exceed the expertise of the Directors, the Company utilises external advisors.
The Company has engaged several law firms, in Italy and in the UK, to advise in respect of the legal matters related to the claims the Company has pursued since the appointment of the current Board in July 2015.
The Directors’ background and experience guarantee they can maintain their skillset up-to-date. Prof Francesco Gardin has maintained close connections with his former colleagues at Udine, Milan and Siena Universities, where he lectured for 30 years, regularly attends global technology and technology-related conferences and he is part of a network of advisors, CEOs and CFOs, of quoted and unquoted companies around the world, he meets regularly. Mr Reginald Eccles is a long-standing member of the Institute of Directors, through which he has access to outstanding advice and information. He is also a Freeman of a City Livery Company and a Freeman of the City of London, in which roles he continuously meet entrepreneurs and businessmen.
Principle 7 Board Evaluation
Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement
The Board considers the evaluation process is best carried out internally given the Company’s current size, However, the Board will keep this under review and may consider independent external evaluation reviews in due course as the Company grows.
The Independent Non-executive Director chairs the Remuneration Committee and is responsible for assessing and for evaluating the effectiveness of the Executive Director (including determination of any annual bonus) by reference to the performance of the Company. This review takes place every six months.
The Company does not consider it necessary at the current time to have a Nominations Committee and the Board as a whole is responsible for Board and senior management nominations. The merits of constituting a separate Nominations Committee will be kept under review. The Board continues to monitor and evolves the Company’s corporate governance structures and processes, and maintains that these will evolve over time, in line with the Company’s growth and development.
There is currently no focus for the Board on succession planning although this will be kept under review.
Principle 8 Corporate Culture
Promote a corporate culture that is based on ethical values and behaviours
The Board recognises that a corporate culture based on sound ethical values and behaviours is an asset and provides competitive advantages. The Company operates in different sectors and markets and is mindful that respect of individual cultures is critical to corporate success.
The Company endeavours to conduct its business in an ethical, professional and responsible manner, treating its employees, business partners and wider stakeholders with equal courtesy and respect at all times.
Principle 9 Governance Structure
Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board
The Board is responsible for maintaining the corporate governance structure that is appropriate to its corporate culture and business growth. In maintaining the governance structure, the Board works closely with its Nominated Advisor.
The Executive Director is responsible for running the business and implementing the decisions and policies of the Board. The Board is also responsible for ensuring the Company’s communication with shareholders is timely, informative and accurate with due regard to regulatory requirements.
The Non-Executive Director was appointed not only to provide independent oversight and constructive challenge to the Executive Director but also chosen to provide strategic advice and guidance.
The Board is supported by the Audit Committee, and the Remuneration Committee.
The Audit Committee meets twice a year and is responsible for dealing with accounting matters, ensuring the independence of the external auditors, financial reporting and internal controls. The committee comprises the Non-executive Director and the Chairman of the Company and is chaired by the Non-executive Director.
The Remuneration Committee, chaired by the Non-executive Director, is responsible for the approval of the remuneration for the executive Director. The Committee meets twice a year and is comprised of the Non-executive Director and the Chief Executive Officer.
In determining the total remuneration (including bonuses, if any) of the Executive Director, the Non-Executive Director may consult advisors.
The Executive Director also consults the Non-executive Director with respect to overall staff remuneration.
Principle 10 Stakeholder Communication
Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders
The Chairman is responsible for maintaining a dialogue with shareholders and the financial markets, including the financial press. The Company communicates with shareholders through the Annual Report and half-year accounts, announcements to the stock market and at its Annual General Meeting.
The AIM Rule 26 section of the Company’s website provides all required regulatory information, as well as additional information shareholders, may find helpful.
Historical company announcements, annual reports and circulars of Annual General Meeting are available on the Company’s website in the Annual Report and Circulars and Regulatory News section.
Results of shareholder meetings will be publicly announced through the regulatory system and displayed on the Company’s website with suitable explanations of any actions undertaken as a result of any significant votes against resolutions.
Information on the work of the various Board Committees and other relevant information are included in the Company’s Annual Report.
Compliance with the Code was last reviewed on 27 September 2018