The Directors recognise the importance of sound corporate governance and intend that the Company will comply with the main provisions of the UK Combined Code on Corporate Governance (the "Code") commensurate with the Company's size and stage of development.
The Board
The Board is chaired by Mike Love as non executive Chairman. The Board currently consists of the non Executive Chairman, four Executive Directors and one Independent Non-Executive Director. The Board meets at least eight times each year.
Division of responsibilities
There is a clear division of responsibilities between the Chairman and the Chief Executive which is set out in writing and has been approved by the Board. The Chairman is responsible for leadership of the Board, setting its agenda and monitoring its effectiveness. He ensures effective communication with shareholders and that the Board is aware of the views of major shareholders. He ensures that the Chief Executive Officer develops a strategy which is supported by the Board as a whole. The Chief Executive Officer is responsible for executing the strategy once agreed by the Board.
Independence/Non-Executive Directors
The non Executive Chairman does not strictly satisfy the independence criteria of the Code having previously been CEO until 2003 but both the non Executive Chairman and Independent Non-Executive Director are considered to be independent of management and free from any business or other relationship which could materially interfere with the exercise of their independent judgement . The Non Executive Independent Director is considered to be independent according to the principles of the Code.
The Non-Executive Chairman and Independent Non-Executive Director bring wide and varied commercial experience to the Board and Committee deliberations. They are appointed for an initial three-year term, subject to election by shareholders at the first AGM after their appointment, after which their appointment may be extended subject to mutual agreement and shareholder approval.
The Independent Non-Executive Director is David Jones. SciSys remains committed to a Board which has a balanced representation of executives and non-executives.
The Board's role
The Board supports the executive management team in delivering sustainable added value for shareholders. It considers strategic issues, key projects and major investments and regularly monitors performance against delivery of the key targets of the Business Review. The Board delegates certain functions to its three principal committees. Through the Audit Committee, the Directors ensure the integrity of financial information, the effectiveness of the financial controls and the internal control and risk management systems. The Remuneration Committee sets the remuneration policy for Executive Directors and determines their individual remuneration arrangements. The Nomination Committee recommends the appointment of Board Directors and has responsibility for succession planning at Board level. These and other key responsibilities are formally reserved powers of the Board.
The Audit Committee
The Audit Committee is chaired by Mike Love, and comprises himself and David Jones and meets three times a year. The Chief Executive Officer, Financial Director and external auditors attend by invitation. The Audit Committee advises the Board on the appointment, independence and objectivity of the external auditors, as well as on their remuneration, both on audit and non-audit work. It also discusses the nature, scope and results of the audit with the external auditors.
The Audit Committee reviews external audit activities, monitors compliance with statutory requirements for financial reporting and reviews the half-year and annual accounts, before they are presented to the Board for approval. It is also required to review the effectiveness of the Company's internal control systems, to review the Company's statement on internal control systems prior to endorsement by the Board and to consider, from time to time, the need for a 'risk sub-committee' to assist in monitoring the Company's internal control systems. In accordance with best practice, the Audit Committee reviews the need for an internal audit function once a year.
Remuneration Committee
The Remuneration Committee, chaired by David Jones, comprises himself and Mike Love and, by invitation, the CEO. It is responsible for recommending to the Board the contract terms, remuneration and other benefits of the company's CEO, Chairman, the executive directors, the company secretary and such other members of the executive management as it is designated to consider. The remuneration of non-executive directors is a matter for the Chairman and the executive members of the Board. No director or manager shall be involved in any decisions as to their own remuneration.
Nomination Committee
The Nomination Committee, chaired by Mike Love, comprises himself and David Jones. Meetings are arranged as necessary. The Committee is responsible for nominating candidates (both Executive and Non-Executive) for the approval of the Board, to fill vacancies or appoint additional persons to the Board.
All Directors are required to seek election by shareholders at the first opportunity after their appointment and must stand for re-election to the Board every three years under the Company's Articles of Association.
Investor Relations
The Company is committed to maintaining good communications with investors. Normal shareholder contact is the responsibility of the non Executive Chairman, together with the Chief Executive and Financial Director.
There is regular dialogue with institutional investors who, along with analysts, are invited to presentations by the Company immediately after the announcement of the Company's interim and full year results.
Shareholders have the opportunity to meet and question the Board at the AGM. The Independent Director and Chairmen of the Audit, Remuneration and Nomination Committees will be available to answer questions. A detailed explanation of each item of special business to be considered at the AGM is included with the Notice of Meeting which is usually sent to shareholders at least 20 working days before the meeting. All resolutions proposed at the AGM are taken on a poll vote. This follows best practice guidelines and enables the Company to count all votes, not just those of shareholders who attend the meeting.
Whistleblowing Policy
SciSys is committed to the highest standards of quality, honesty, openness and accountability. The company has therefore introduced a whistleblowing policy and procedure to cover the reporting of any genuine concerns that employees may have about suspected wrongdoing within the organisation.
SciSys encourages members of staff who have serious concerns about any part of their work or wrongdoing within the Company to express those concerns to the designated Whistleblowing Officer, who is the Company Secretary. If the concern relates to the Company's directors, or the individual does not believe it is correct to raise it with anyone in the Company's senior management team, including the Whistleblowing Officer, he/she should contact the Independent Non-Executive Director.
For more information, read the Whistleblowing Policy (
) in full. To view the PDF document () you will need Adobe Acrobat Reader - available from www.adobe.com.
The Future
The issue of corporate governance plays an important role within the running of the company. The Board therefore reviews the Company's level of compliance with the Code on an annual basis.
