All members of the Board believe strongly in the value and importance of good corporate governance and in our accountability to Block Energy Plc’s stakeholders, including shareholders, staff, contractors, clients, suppliers, and the communities amongst which we operate.
In the statement below, we explain our approach to governance, and how the Board and its committees operate.
Changes to AIM rules on 30 March 2018 require AIM companies to apply a recognised Corporate Governance Code from 28 September 2018. Block Energy Plc (‘the Company’) has chosen to adhere to the Quoted Company Alliance’s (‘QCA’) Corporate Governance Code for Small and Mid-Size Quoted Companies (revised in April 2018) to meet the new requirements of AIM Rule 26.
The QCA Code is constructed around 10 broad principles and a set of disclosures. The QCA has stated what it considers to be appropriate arrangements for growing companies, and asks companies to explain how they are meeting the principles through the prescribed disclosures. This statement explains how Block will follow the 10 principles of the QCA Code as specified in the AIM Rules for Companies (PDF) published by the London Stock Exchange.
Principle 1. Establish a strategy and business model which promote long-term value for shareholders
Block’s aim is to become the largest independent oil and gas producer in Georgia by realising the potential of previously discovered fields suited for the deployment of selected Western well technology and completion techniques. Georgia is a stable, business friendly nation with proven but underdeveloped reserves, and is of increasing interest to major producers.
Block has working interests in three licences: Norio (100%), Satskhenisi (90%) and West Rustavi (100%). All lie adjacent to a strategic position taken by Schlumberger, and within the region’s prolific Kura basin, which at its peak produced approximately 70,000 bopd and in the course of its history has produced over 200 MMbbl.
We have designed a robust business model to implement our strategy:
- In May 2019 the Company raised £12m to fund a multi-well drilling programme to accelerate exploration and production at West Rustavi. Two wells have been horizontally sidetracked, both of which are on production. A 3D seismic survey of the field has been undertaken to identify optimal drilling locations. Storage facilities are being upgraded, and a gas offtake agreement has been secured.
- Successful execution of Block’s plan requires a management and technical team with extensive knowledge of Georgia’s oil and gas sector and its legal and regulatory environment. Block is led by a management team with deep and wide experience, with networks both in Georgia and across the international oil and gas industry. One of our major stakeholders, Georgia Oil & Gas (GOG), is a well-established operator and asset owner within the region. The Company has also assembled a team of geologists and geophysicists with first-hand experience of working on major Georgian oil fields.
- Block’s principal technical challenges are to identify technologies suitable for the near-wellbore damage believed to exist in the wells drilled within our licences during the Soviet era, and to successfully deploy sidetracking and suitable completion techniques to optimise production from the fractured and compartmentalised reservoirs present. In meeting these challenges Block is bringing the best and most cost-efficient technology the international oil and gas industry has to offer to Georgia. A state-of-the-art 3D seismic survey of West Rustavi has been completed, the results of which are being analysed by an experienced technical team. We have recruited a highly skilled and experienced technical team, drawing on specialist consultants as required, to design and implement horizontal sidetracking operations at West Rustavi. And we have selected an enhanced perforation technology that our research indicates will be ideal for overcoming legacy wellbore damage, able to bore multiple small holes from the wellbores and circumvent historic issues.
- All our operations are conducted within a developing robust Health, Safety and Environment (HSE) framework. The Board has set a number of short-term objectives to bring the legacy facilities up to industry standards and has recruited a professional petroleum engineer with decades of experience overseeing HSE in Georgia for multinational oil and gas companies as a full time HSE manager. He will work onsite to further develop and enforce our policies.
- The Board recognises the critical importance of developing effective communications channels with current and prospective investors. We regularly update the market as appropriate with RNS announcements, which are posted automatically to our website as soon as they appear on the London Stock Exchange’s Regulatory News Service. Our directors are frequently interviewed on investor news channels. We also distribute our RNS announcements and other Block news through social media and a mailing list subscription service, and continue to make the Company’s business case at investor meetups and other events around the UK. All of our communications are available on our website and social media channels. We intend to meet our major institutional investors on a regular basis and, beyond the Annual General Meeting of shareholders, to hold investor days periodically.
- The Company contracts an experienced financial communications company to assist with the preparation of our RNS announcements, presentations and the management of our social media channels.
- The Board has engaged an established auditor with extensive experience of the natural resources sector to monitor and audit our financial and administrative system.
- Our directors continually investigate and evaluate new exploration and production opportunities in Georgia and beyond. We are an ambitious, flexible and open-minded operator, alert to fresh opportunities for applying the latest production and exploration technologies and processes to take advantage of discoveries.
Principle 2. Seek to understand and meet shareholder needs and expectations
The Board supplies shareholders clear and transparent information on the Company’s activities, strategy and financial position. Details of all shareholder communications are provided on the Company website, as required by the AIM Rules for Companies. RNS updates appear in the feed in the Announcements section; reports and circulars are posted to the Investors section; and videos, podcasts, presentations and photos from our field operations are available in the Media section.
Primary responsibility for investor relations rests with the Chief Executive Officer, supported by the other directors. Since Block began trading on AIM on 11 June 2018 the Company has used multiple channels to understand the needs and expectations of its shareholder base. The table below summarises the communications the Company has undertaken with current and potential investors in addition to regular RNS announcements:
|12 Nov 19||TD records series of short operations videos for social media||TD|
|31 Oct 19||CEO and TD presentations given at AGM||CEO, TD|
|25 Sep 19||CEO and TD give video presentation on operations at well WR-16aZ||CEO, TD|
|3 Sep 19||Well 38Z operations video published to social media||CEO, TD|
|13 Aug 19||NED Chris Brown interviewed by Proactive Investors||NED|
|12 Aug 19||CH interviewed by Proactive Investors||CH|
|7 Aug 19||CEO interviewed by Vox Markets and Proactive Investors||CEO|
|15 Jul 19||CEO interviewed by IG TV and Proactive Investors||CEO|
|11 Jul 19||CEO presents at LSE Investor Briefing||CEO|
|10 Jul 19||CEO interviewed by ValueTheMarkets||CEO|
|8 Jul 19||CEO interviewed by Total Market Solutions||CEO|
|2 Jul 19||CEO interviewed by Proactive Investors||CEO|
|27 Jun 19||CEO presents at Amati Investor Afternoon||CEO|
|29 May 19||CEO interview with Total Market Solutions||CEO|
|24 May 19||CEO interview with IG TV||CEO|
|22 May 19||CEO interview with Vox Markets||CEO|
|21 May 19||CEO interview with Proactive Investors and Vox Markets||CEO|
|25 Apr 19||Chief Executive Officer interviewed by IG TV on positive production test at West Rustavi well 16aZ||CEO|
|23 Mar 19||Chief Executive Officer video Q&A with Vox Markets||CEO|
|12 Mar 19||Chief Executive Officer interviewed by Proactive Investors on agreement to take 100% Working Interest in West Rustavi field||CEO|
|29 Jan 19||Chief Executive Officer interviewed by Proactive Investors about West Rustavi horizontal sidetrack||CEO|
|13 Dec 18||Chief Executive Officer interviewed by Vox Markets about the employment of a new perforation tool||CEO|
|12 Dec 18||Chief Executive Officer interviewed by Proactive Investors about the employment of a new perforation tool||CEO|
|22 Nov 18||Marketing meeting in Tbilisi||CH, CEO, TD, London and Tbilisi staff|
|15 Oct 18||Chief Executive Officer interviewed by Proactive Investors about the start of Block’s workover programme||CEO|
|5 Oct 18||Chief Executive Officer interviewed by Proactive Investors about gas offtake agreement for West Rustavi field||CEO|
|4 Sep 18||Chief Executive Officer, Non-Executive Chair and Executive Director presented Block’s latest corporate presentation at the Oil Capital Conference, London||CH, CEO, ED|
|31 Aug 18||Chief Executive Officer interviewed by Proactive Investors about Georgian government clearance for our West Rustavi operations||CEO|
|Aug 18||Investors mailing list subscription service introduced|
|Aug 18||Chief Executive Officer, Executive Director, Financial Director and Technical Director interviewed for ‘Meet the Directors’ videos published Block’s Vox Markets channel||CEO, ED, FD, TD|
|Jul 18||Technical Director presented a series of videos onsite in Georgia introducing Block’s field operations||TD|
|Jun 18||Chief Executive Officer gave series of interviews with Proactive Investors and Vox Markets following Block’s admission to AIM||CEO|
Key: CH (Chair), CEO (Chief Executive Officer), TC (Technical Director), FD (Financial Director), ED (Executive Director)
We are committed to frequent and open communications with our shareholders to ensure our strategy and performance are clearly understood. We communicate with shareholders through our Annual Report and Accounts, the Annual General Meeting (AGM), regular RNS updates, video interviews published on our Proactive Investors and Vox Markets channels, our Vimeo and Twitter accounts, and our mailing list. We regularly meet current and prospective shareholders face-to-face. Extensive corporate information (including all Company Regulatory and Reach announcements) is available to shareholders, investors and the public on our website.
The AGM is our principal forum for dialogue with private shareholders, and we encourage all shareholders to attend and participate. The Notice of Meeting is sent to shareholders at least 21 days before the meeting. The chairs of the Board and all committees, together with all other directors whenever possible, attend the AGM and are available to answer questions raised by shareholders. Shareholders vote on each resolution by way of a poll. We intend to announce the number of votes withheld, received for and against each resolution and publish them on our website.
The Company maintains a dedicated firstname.lastname@example.org email address which investors can use to contact the Company. This is displayed prominently on our Contact page, together with an online enquiries form and our address and phone number. All enquiries are reviewed by our Communications Officer, Justin Reynolds, and distributed to our directors as appropriate. We also contract a financial communications agency to assist with the preparation and maintenance of our investor announcements, presentations and social media channels.
The directors continually review our channels with private shareholders. As well as the AGM, we intend to hold investor days which shareholders will be encouraged to attend either in person or by teleconference.
The directors also take every opportunity to communicate our objectives to institutional shareholders. They make presentations to institutional shareholders and analysts immediately following the release of the Company’s full-year results. We keep-in-touch with institutional investors through a combination of formal meetings, participation at investor conferences, roadshows and informal briefings with management. The majority of meetings with shareholders and potential investors are arranged by the Company’s brokers or direct with the Company. After meetings the broker provides anonymised feedback to the Board from all of the fund managers we meet with, to gather and monitor sentiments, expectations and intentions. In addition, we review analyst notes to achieve a wide understanding of investor views and develop our investor relations strategy.
Principle 3. Take into account wider stakeholder and social responsibilities and their implications for long-term success
We understand that our long-term success depends on our relationships with our stakeholders. The following table summarises how we identify and seek to meet their needs, interests and expectations.
|Stakeholder||Reason for engagement||How we engage|
|Staff. Our capacity to design and execute our strategy depends on the health, development and retention of our dedicated and skilled staff.||Transparent and regular communications with staff is essential for ensuring understanding of commitment to the Company’s objectives. And as an oil and gas production company we have particular health, safety and environmental obligations (see ‘Communities and environment’ below).||Our London staff have daily team meetings. Our international team join a weekly dial-in meeting. The directors make regular trips to Georgia to work with our operations staff onsite. The CEO has regular one-on-one meetings with every staff member.|
|Shareholders. We provide transparent, accessible and balanced information to investors to ensure support and confidence.||Understanding shareholder sentiments regarding the business, its prospects and the performance of management and, incidentally, meeting regulatory requirements.||RNS announcements published on our website and across our online channels. Interviews with our directors published as videos and podcasts. Investor mailing list subscription service. Regular updates to our corporate presentation. Attendance at investor relations events. Annual report and AGM.|
|Industry bodies, local and national governments. Our services must meet certain legal and regulatory requirements.||We work hard to meet our regulatory obligations to retain our good standing with regulators, the Georgian government, and the wider oil and gas sector.||Adherence to Georgian state regulations. Commitment to fulfilling our AIM obligations. Annual audit of Company processes and financial risks. We have developed comprehensive Market Abuse Regulations (MARS) and Anti-Bribery policies.|
|Communities and environment. Our operations are embedded within a complex local economic and ecosystem.||We ensure that all our staff, particularly those involved in operations, work in safe conditions and that they protect the safety of others. We also ensure that our exploration and production activities are conducted with due care for the environment and neighbouring communities.||We have appointed an experienced professional to develop, enforce and oversee our HSE policy. HSE is the first item discussed during the operations section of our monthly board meeting. Our Technical Director also provides an HSE update during our weekly team meeting. Our London office operates a recycling policy for paper and packaging. We intend to extend this policy to our Georgian offices.|
|Suppliers. We engage contractors and purchase from a wide range of suppliers.||We must honour our obligations to the staff of the companies that we contract, and ensure they are aware of the HSE and regulatory framework within which we operate.||We integrate our MARS and HSE policies into all agreements entered into by our contractors. We have a robust financial process for settling our invoices for contractors and all other service providers. We take care to ensure we source products and services from ethical suppliers.|
Take into account wider stakeholder and social responsibilities and their implications for long-term success
Principle 4. Embed effective risk management, considering both opportunities and threats, throughout the organisation
The Board is responsible for putting in place and communicating a sound system to manage risk and implement internal control. We recognise that the management of risk is an essential business practice: we work to balance risk and return, threat and opportunity.
The Board has established an Audit Committee to meet as necessary to consider the scope of the annual audit and the interim financial statements and to assess the effectiveness of the Company’s system of internal controls. It reviews the results of the external audit, its cost effectiveness and the objectives of the auditor. Given the present size of the Company the Audit Committee considers an internal audit function is not currently justified. The Audit Committee comprises Philip Dimmock (Chair) and Chris Brown.
The Remuneration Committee reviews the performance of the executive directors and makes recommendations to the Board on matters relating to their remuneration and terms of employment. The Remuneration Committee also makes recommendations to the Board on proposals for the granting of share options and other equity incentives pursuant to any share option scheme or equity incentive scheme in operation from time to time. The remuneration and terms and conditions of appointment of the non-executive directors of the Group is set by the Board. The executive directors are invited to attend for agenda items that require their contributions although they do not take part in any discussion on their own benefits and remuneration. The Remuneration Committee comprises Chris Brown (Chair) and Philip Dimmock.
The Nominations Committee will meet as and when necessary to consider appointments to the Board and senior management positions. The Nominations Committee comprises Philip Dimmock (Chair), Chris Brown and Paul Haywood.
The Disclosure Committee has the primary responsibility and authority to make decisions on disclosure delay for the purposes of Market Abuse Regulations (MAR). The Disclosure Committee comprises Philip Dimmock (Chair) and William McAvock.
Health, safety and environment
All of our operations are conducted within a robust Health, Safety and Environment (HSE) framework. We have employed a full time HSE manager to work onsite to design and enforce our policy, a professional petroleum engineer with decades of experience overseeing HSE in Georgia for multinational oil and gas companies.
The Board is yet to establish an HSE Committee. It has therefore taken on the responsibility of formulating the HSE Policy and establishing an HSE Management Plan for the remainder of 2018 and the whole of 2019. It monitors performance against the Plan every month, assisted by regular reports from the HSE Manager in Georgia. Any serious incident or high potential near miss will immediately be brought to the attention of the Board which will then oversee the appropriate remedial action.
Principle 5. Maintain the Board as a well-functioning, balanced team led by the Chair
The members of the Board have a collective responsibility and legal obligation to promote the interests of the Company, and are jointly responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the Chair.
The Board comprises six directors, four of whom are executive and two independent non-executives (including the Chair). The Board has established a set of committees to support its work (see Principle 9 below).
A Board meeting is held every month. All directors, executive and non-executive, are required to attend, and to make every effort to attend in person. They are also required to be available at other times as necessary for face-to-face and dial-in and videoconferencing meetings with staff and investors.
Executive and non-executive director attendance at Board, committee and other significant meetings since the Company began trading on AIM on 11 June 2018 is summarised below:
|22 Nov 19||Board Meeting||6||All directors present|
|22 Nov 19||Remunerations Committee||3||All directors present|
|31 Oct 19||Board Meeting||6||All directors present|
|24 Oct 19||Technical Committee||6||All directors present|
|14 Oct 19||Board Meeting||5||Apologies from one director|
|8 Oct 19||Board Meeting||6||All directors present|
|8 Oct 19||Remunerations Committee||3||All directors present|
|27 Sep 19||Board Meeting||6||All directors present|
|9 Sep 19||Board Meeting||5||All directors present|
|29 Aug 19||Remunerations Committee||3||All directors presents|
|23 Aug 19||Remunerations Committee||3||All directors present|
|13 Aug 19||Remunerations Committee||3||All directors present|
|1 Aug 19||Audit Committee||3||All directors present|
|23 Jul 19||Remunerations Committee||3||All directors present|
|30 Jul 19||Board Meeting||5||All directors present|
|27 Jun 19||Technical Committee||5||All directors present|
|27 Jun 19||Remunerations Committee||3||All directors present|
|26 Jun 19||Board Meeting||4||Apologies from one director|
|10 Jun 19||Technical Committee||5||All directors present|
|4 Jun 19||Board Meeting||5||All directors present|
|16 May 19||Board Meeting||5||All directors present|
|15 May 19||Board Meeting||5||All directors present|
|7 May 19||Board Meeting||5||All directors present|
|3 May 19||Remunerations Committee||3||All directors present|
|9 Apr 19||Board Meeting||5||All directors present|
|1 Mar 19||Board Meeting||5||All directors present|
|22 Feb 19||Board Meeting||5||Apologies from one director|
|22 Jan 19||Board Meeting||5||Apologies from one director|
|22 Jan 19||Audit Committee||3||All directors present|
|22 Jan 19||Remunerations Committee||3||All directors present|
|20 Dec 18||Board Meeting||6||All directors present|
|30 Nov 18||Nominations Committee||3||All directors present|
|30 Nov 18||Remunerations Committee||3||All directors present|
|21 Nov 18||Board Meeting||5||Apologies from one director|
|24 Oct 18||Board Meeting||6||All directors present|
|24 Oct 18||Remumerations Committee||3||All directors present|
|12 Oct 18||Board Meeting||5||Apologies from one director|
|5 Oct 18||Board Meeting||6||All directors present|
|24 Sep 18||Nominations Committee||3||All directors present|
|21 Sep 18||Board Meeting||5||Apologies from one director|
|6 Sep 18||Nominations Committee||3||All directors present|
|28 Aug 18||Board Meeting||5||Apologies from one director|
|14 Aug 18||Technical Meeting||6||All directors present|
|31 Jul 18||Board Meeting||6||All directors present|
|31 Jul 18||Audit Committee||3||All directors present|
|3 Jul 18||Board Meeting||6||All directors present|
The Board follows a schedule of regular business, financial and operational matters, and each committee has compiled a schedule of work to ensure that all areas for which the Board has responsibility are addressed and reviewed during the course of the year. The Chair is responsible for ensuring that, to inform decision-making, directors receive accurate, sufficient and timely information. The Company’s Communications Officer minutes the meetings and compiles the papers circulated to directors prior to meetings. Directors are aware of the right to have any concerns minuted and to seek independent advice at the Company’s expense where appropriate. Minutes are passed to the Company Secretary for archiving.
The Board has a formal meeting once a month. Prior to each meeting papers covering the full range of subjects of interest to the Board are issued by the executive. The directors give these papers careful consideration before meetings. The directors also dedicate time to Committee meetings. The Committees meet three or four times a year. The directors will attend the AGM and will review the Annual Report and Statement of Accounts in preparation. The directors also intend to visit Georgia twice a year in order to perform safety inspections and meet staff and stakeholders. In addition to these formal events the directors frequently discuss day-to-day Company issues in person and by phone. The number of days committed to the Company is difficult to quantify because directors make themselves available as required on a daily basis: the total is in the range of 36 days per year.
The Board believes its blend of experience, skills and personal qualities and capabilities is sufficient to enable it to successfully execute the Company’s strategy. The directors attend seminars and other regulatory and trade events to help ensure their knowledge remains current.
The Board has established a Nominations Committee which meet at least twice a year. As well as making appointments to the Board it maintains a list of candidates for future selection.
Principle 6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities
On the Company’s admission to AIM the founding directors brought new directors onto the Board to ensure that the directors have the collective experience and skills to oversee the activities of the Company and the successful execution of its strategy. Together, the directors have wide and deep experience in the governance of publicly listed companies, HSE management, well and production operations, petroleum reservoir engineering, geoscience, oil and gas field development, contract negotiation, commercial, finance, accounting and government and community relations. Furthermore, three of our directors have experience of applying all of these skills within Georgia.
Profiles of our executive and non-executive directors demonstrating their suitability for the responsibilities with which they have been entrusted are available on the About page of our website.
All of the directors accept personal responsibility for undertaking continuous professional development – through means including seminars, conferences and self-directed study – to understand and take advantage of the most recent developments in the sector whether technical, commercial or related to governance.
The Nominations Committee will continue to assess the suitability the Board’s skills and experience for designing and implementing the Company’s strategy, and, when warranted, will appoint new directors with the required skills.
The Board is kept abreast of developments of governance and AIM regulations. Hill Dickinson, the Company’s lawyers, provide updates on governance issues, and the Company’s NOMAD provides annual Board AIM Rules refresher training as well as the initial training received in the course of a new director’s onboarding.
The directors have access to the Company’s NOMAD, lawyers and auditors as and when required and are able to obtain advice from other external bodies when necessary.
Principle 7. Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement
The performance of each member of the Board (and senior management) is evaluated to assess their contribution to the success of the Company. The Board is collectively responsible for the evaluation of the performance of each member. The executive directors are incentivised to seek continuous improvement and innovation through remuneration schemes linked to share price, and thus, ultimately, Company performance.
It is intended that a questionnaire method of measuring the performance of the Board will be introduced at the end of the first full financial year of listing on AIM.
Principle 8. Promote a corporate culture that is based on ethical values and behaviours
Our long-term growth is underpinned by our core values:
- We continually work to develop and maintain excellent relationships with all of our stakeholders: with staff, shareholders, suppliers and the communities within which our operations work is embedded.
- We are an agile and ambitious company with a team carefully selected for their skills and experience, commitment to our values, and dedication the successful execution of our current and future strategy.
- We are committed to employing the industry’s most cost-effective technology and processes to achieve our objectives and deliver value to our stakeholders.
- We are courteous, honest and straightforward in all our dealings, honouring diversity, individuality and personal differences, and are committed to observing the highest personal, professional and ethical standards in conducting our business.
- We are acutely conscious of our particular responsibilities as an oil and gas producer. Our HSE obligations are the first operations-related agenda item at all of our Board meetings, and we have employed an experienced full time professional onsite in Georgia to develop and manage our HSE processes.
Our values are expressed and communicated regularly to staff through internal communications and forums. They are enshrined in the contract signed by all new employees, and evidence of commitment to them by candidates is considered as part of the selection process.
The Board believes the suffusion of our core values across the Company’s operations also gives Block a critical competitive advantage, improving our internal efficiency and the quality of our stakeholder relationships.
Principle 9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board
The Board is supported by the following governance structure:
The Board provides the Company’s strategic leadership and operates within the scope of a robust corporate governance framework. It ensures the delivery of long-term shareholder value by setting and promoting the culture, values and practices that operate throughout the business, and defining the Company’s strategic goals. The Board delegates certain defined responsibilities to its committees. The chair of each committee (defined below) reports its activities to the Board.
The Chair has overall responsibility for the quality of corporate governance. The Chair:
- leads and chairs the Board;
- ensures that committees are properly structured and operate with appropriate terms of reference;
- ensures that performance of individual directors, the Board and its committees are reviewed on a regular basis;
- leads the development of strategy and setting objectives;
- oversees communication between the Company and its shareholders.
The Chief Executive Officer oversees the coherent leadership and management of the Company. The Chief Executive Officer:
- leads the development of objectives, strategies and performance standards as agreed by the Board;
- monitors, reviews and manages key risks and strategies with the Board;
- ensures that the Company’s assets are maintained and safeguarded;
- leads on investor relations activities to ensure the Company’s standing with shareholders and financial institutions is maintained;
- ensures the Board is aware of the views and opinions of employees on relevant matters.
The Technical, Executive, and Financial Directors are responsible for implementing and delivering the operational decisions agreed by the Board, making operational and financial decisions required in the day-to-day operation of the Company, providing executive leadership to managers, championing the Company’s core values and promoting talent management.
The independent non-executive directors contribute independent thinking and judgement through the application of their external experience and knowledge, scrutinise the performance of management, provide constructive challenge to the executive directors and ensure that the Company is operating within the governance and risk framework approved by the Board.
The Communications Officer is responsible for providing clear and timely information flow to the Board and its committees and the Company Secretary supports the Board on matters of corporate governance and risk.
The matters reserved for the Board are:
- setting long-term objectives and commercial strategy;
- approving annual operating and capital expenditure budgets;
- establishing and monitoring the implementation of the HSE Policy and Management Plan
- changing the share capital or corporate structure of the Company;
- approving results and reports;
- approving dividend policy and the declaration of dividends;
- approving major investments, disposals, capital projects or contracts;
- approving resolutions to be put to general meetings of shareholders and the associated documents or circulars; and
- approving changes to the Board structure.
The Board has approved the adoption of the QCA Code as its governance framework against which this statement has been prepared. The Board will monitor the suitability of this Code on an annual basis and revise its governance framework as appropriate as the Company evolves.
The Board is supported by the work of its committees (please see Principle 4 above for brief descriptions of their respective duties):
- Audit Committee
- Disclosure Committee
- Nominations Commitee
- Remuneration Committee
Principle 10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders
All historical annual reports, notices of general meetings and other corporate governance related material are available on the Investors section of our website. Here are brief summaries of the work of our committees since we joined AIM:
Audit Committee Report
Through July and August 2018 the Audit Committee reviewed the agreement with the Company’s then auditor and interviewed a number of other companies providing audit services to ensure Block is being serviced with the optimal audit services for a company of our kind, and receiving the best value for money for the audit fee. The Committee met to consider and compare each proposal, and decided to change the company’s auditor to BDO, the leading audit firm for AIM-quoted oil and gas companies. The Committee subsequently met in November 2018 to consider the annual audit and report.
Nominations Committee Report
The Nominations Committee has met twice since the Company was listed on AIM in June 2018. It has developed criteria for the selection of non-executive directors and has identified candidates that meet those criteria in order to formulate a succession plan. The Committee has considered the merits of a number of those candidates and has selected one for immediate recruitment to the Board.
Remuneration Committee Report
The Remuneration Committee met immediately before the Company listed on AIM and has met twice subsequently. It awarded stock options to executives as part of an Enterprise Management Incentive Scheme. It was decided that it was too early in the life of the Company for the options to be performance related. The Committee also undertook a preliminary review of the appropriateness of the executives’ remuneration and its alignment to shareholder value. The Committee decided that, in due course, an annual bonus scheme would further improve alignment.
Disclosure Committee Report
There has been no call to convene the Disclosure Committee since the Company was listed on AIM.
General Meeting voting
The Company maintains that, if there is a resolution passed at a General Meeting with 20% or more votes against, the Company will seek to understand the reason for the result and, where appropriate, take suitable action.
The Company’s Corporate Governance Statement has been approved by the Board.
Philip Dimmock, Chairman of the Board
Updated 9 May 2019
- Establish a strategy and business model which promote long-term value for shareholders
- Seek to understand and meet shareholder needs and expectations
- Take into account wider stakeholder and social responsibilities and their implications for long-term success
- Embed effective risk management, considering both opportunities and threats, throughout the organisation
- Maintain the Board as a well-functioning, balanced team led by the Chair
- Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities
- Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement
- Promote a corporate culture that is based on ethical values and behaviours
- Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board
- Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders