The Group’s Directors recognize the importance of sound corporate governance and the guidelines set out in the UK Corporate Governance Code. Whilst private companies are not obliged to comply with the UK Corporate Governance Code, the Group nevertheless complies as far as is appropriate having regard to the size and nature of the business.
1.1 BUSINESS DESCRIPTION, INCORPORATION AND OPERATION
The Group’s sole business activity is the development of the Hinda Phosphate Project in the Republic of Congo. The Hinda Project lies in the Hinda and Kola-Tchikanou exploration permits covering 2,069 km2 of the coastal plain. Since its establishment in 2007, the Group has been active in the Republic of Congo.
The Company has focused its activities on the rapid development of the Hinda Phosphate Project, with the intention of creating a world-class lowest quartile cost phosphate mine to create sustainable, long term value for its shareholders. The Board is responsible for the achievement of this objective and relies on management to deliver the approved strategies to deliver this goal.
1.2 THE BOARD
The Board has a breadth of experience relevant to the Company, and the Directors believe that any changes to the Board’s composition can be managed without undue disruption. With any new appointment of a Director to the Board, consideration will be given as to whether a formal induction process is appropriate. The Board believes the current mix of skills, experience, ages and length of service are appropriate to the requirements of the Company.
The biographical profiles of the Directors, can be found here .
1.3 ATTENDANCE OF BOARD MEETINGS
The Company holds at least four Board Meetings per year, at which the Directors review the development progress of the Project and all other important issues to ensure control is maintained over the Company’s affairs. In addition, between these formal meetings there is regular contact with the Company’s consultants, management and advisors. The Directors are kept fully informed of the financial and operational matters that are relevant to the business of the Company and that should be brought to the attention of the Directors, including monthly management accounts. All Directors have access to the Company Secretary and, where necessary in the furtherance of their duties, to independent professional advice at the expense of the Company.
The Board considers agenda items laid out in the notice and agenda, which are formally circulated to the Board in advance of a meeting as part of the Board papers, and therefore, Directors may request any agenda items to be added that they consider appropriate for Board discussion. Additionally, each Director is required to inform the Board of any potential or actual conflict of interest prior to Board discussion.
The quorum for a Board meeting is two but attendance by all Directors at each meeting is strongly advised. Apart from the regular Board meetings, additional meetings are arranged when necessary to review strategy, planning, operational, financial performance, risk, capital expenditure, human resource and environmental management.
1.4 BOARD COMMITTEES
The Directors have established an audit committee, a remuneration committee and a Health, Safety, Social & Environmental Committee with formally delegated duties and responsibilities. At this stage of the Company’s development, the Directors consider it is appropriate for the Board to retain responsibility for nominations to the Board. The Board is also responsible for monitoring the activities of management.
1.4.1 Audit & risk committee
The audit committee was established in 2012 and operates within the written terms of reference clearly setting out its authority and duties. The role of the Audit & Risk Committee is to assist the Board in its oversight responsibilities for all matters related to financial management and reporting, external audit, internal audit and risk management of the Company ensuring proper monitoring and reporting. The audit committee will, at least once a year, review its own performance, constitution and terms of reference to ensure it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board for approval.
1.4.2 Remuneration & nomination committee
The Remuneration Committee meets at least twice a year and reviews the performance of senior management, sets their remuneration, and considers and determines the Company’s bonus and option schemes and payments or grants thereunder.
The Remuneration Committee’s key objectives are to:
- Ensure that members of the management of the Company are provided with appropriate incentives to encourage enhanced performance and are, in a fair and responsible manner, rewarded for their individual contributions to the success of the Company
- Revewiew the ongoing appropriateness and relevance of the remunerations policy; and
- Approve the design of, and determine targets for, any performance related pay schemes operated by the Company and approve the total annual payments made under such a scheme
The Remuneration Committee’s main responsibilities are to:
- Determine and agree with the Board the framework for broad policy for:
- The remuneration of the Company’s Chief Executive, 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 shall be a matter for the Chairman of the Board and the executive members of the Board. No Director or manager shall be involved in any decisions as to their own remuneration;
- Review the ongoing appropriateness and relevance of the remuneration policy;
- Approve the design of, and determine targets for, any performance related pay schemes operated by the Company and approve the total annual payments made under such schemes;
- Review the design of all share incentive plans for approval by the Board and shareholders. For any such plans, determine each year whether awards will be made, and if so, the overall amount of such awards, the individual awards to Executive Directors and other senior executives and the performance targets used.
The Board as a whole, establishes the remuneration policy. The Remuneration Committee assists the Board in carrying out its responsibilities in relation to remuneration.
1.4.3 Health, safety social and environmental committee
In 2012, the Directors established a Health, Safety, Social and Environmental Committee, (“HSSE Committee”), with formally delegated duties and responsibilities.
All project HSSE reports will be presented to the Board by X and if any material concerns are raised at Board level the HSSE Committee may be requested to convene.
1.4.4 Cominco web site
The Company maintains a web site at http://www.comincoresources.com in order to keep governments, the public and other interest groups appraised of the Company’s activities. An online registration facility is provided to join the mailing list for updates.
1.5 CODES OF CONDUCT
Cominco actively promotes ethical and responsible decision making through the development of Codes of Conduct. There are separate Codes of Conduct tailored separately for the Directors and the employees to suit their particular needs. Executives are aware that they are required to ensure that employees and contractors under their control are aware of the code.
New employees are required to read and acknowledge the requirements of the code in writing before they commence with the company.
Though this Code, Cominco seeks to encourage and develop a culture of professionalism, honesty and responsibility in order to maintain and enhance our reputation as a valued employer, business operator and corporate citizen.
1.6 RISK MANAGEMENT & INTERNAL CONTROL
The Directors have overall responsibility for establishing and maintaining the Company’s system of internal control and risk management systems. Internal control systems are designed to meet the particular needs of the Company and the risks to which it is exposed, and, by their very nature, provide reasonable, but not absolute, assurance against material misstatement or loss.
The key procedures which have been established to provide effective internal controls are as follows:
- The Directors of the Company clearly define the duties and responsibilities of their agents and advisors in the terms of their contracts
- The Board reviews financial information produced by the administrator on a regular basis
- The Board monitors the performance of the Company’s service providers and their obligations under their agreements with the Company.
The Company does not have an internal audit department. Due to the size and nature of the Company, it is not felt that there is at this stage a need for the Company to have an internal audit facility. The Audit Committee will continue to keep this under ongoing review.
The Directors do not currently conduct a formal review of the internal controls. However, the Board feels that the procedures employed by the service providers adequately mitigate the risks to which the Company is exposed.
1.7 RELATIONSHIP WITH SHAREHOLDERS
The Code encourages dialogue with shareholders based on the mutual understanding of objectives. The Directors are always available to enter into dialogue with shareholders. The Board stays abreast of shareholders’ views via regular dialogue and meetings with shareholders.
1.8 ANTI BRIBERY POLICY
Cominco Group is dedicated to ensuring full compliance with all anti-bribery and corruption laws and regulations, including the UK Bribery Act 2010. Its Anti-Bribery Policy extends to all the Company’s business dealings and transactions; in all countries in which it or its subsidiaries and associates operate. An associate includes subcontractors; joint venture partners and agents.
Cominco Group expects its employees to demonstrate honesty; integrity and fairness in all aspects of their business dealings and exercise appropriate standards of professionalism and ethical conduct in all their activities. No employee; associate or agent shall pay bribes or offer improper inducements to anyone for any purpose, nor do we or will we, accept bribes or improper inducements.
To use a third party as a conduit to channel bribes to others is a criminal offence. We do not; and will not, engage indirectly in or otherwise encourage bribery.
Cominco Group takes bribery and corruption very seriously; and will not tolerate bribery or corruption in any form and has a ‘zero tolerance’ approach to any breach of this policy. All directors and employees of Cominco Group are required to comply with the policy.
Cominco Group encourages its employees to report any suspicious activity that may violate this policy. There is a confidential and discrete way to report any violations or suspicious activity that is described below.
Bribery is the offering; promising, giving, accepting or soliciting of an advantage as an inducement for an action which is illegal or a breach of trust. It is unacceptable to:
- Give, promise to give, or offer a payment, gift or hospitality with the expectation or hope that a business advantage will be received, or to reward a business advantage already given
- Give, promise to give, or offer a payment, gift or hospitality to a government official, agent or representative to “facilitate” or expedite a routine procedure;
- Accept payment from a third party that you know or suspect is offered with the expectation that it will obtain a business advantage for them;
- Accept a gift or hospitality from a third party if you know or suspect that it is offered or provided with an expectation that a business advantage will be provided by us in return
- Retaliate against or threaten a person who has refused to commit a bribery offence or who has raised concerns under this policy
- Engage in activity in breach of this policy
Objective of this Policy
This policy provides a coherent and consistent framework to enable Cominco Group employees to understand and implement arrangements; enabling compliance. In conjunction with related policies and key documents; it will also enable employees to identify and effectively report a potential breach.
We require that all staff, including those permanently employed; temporary agency staff and contractors to:
- Act honestly and with integrity at all times and to safeguard the organisation’s resources for which they are responsible
- Comply with the spirit; as well as the letter, of the laws and regulations of all jurisdictions in which Cominco Group operates, in respect of the lawful and responsible conduct of activities.
Cominco Group commits to:
- Setting out a clear anti-bribery policy and keeping it up to date.
- Ensure a systematic approach to risk assessment of the nature and extent of bribery risk associated within the construction industry and global market;
- Making all employees aware of their responsibilities to adhere strictly to this policy at all times.
- Training all employees so that they can recognise and avoid the use of bribery by themselves and others.
- Encouraging its employees to be vigilant and to report any suspicion’s of bribery; providing them with suitable channels of communication and ensuring sensitive information is treated appropriately in a confidential manner to a designated senior manager;
- Ensure that our suppliers; agents, intermediaries and fellow participants in joint ventures are fully aware of their responsibility for and are committed to complying with our anti-bribery policy;
- Taking firm and vigorous action against any individual(s) involved in bribery.
- Provide information to all employees; to report breaches and suspected breaches of this policy.
- Include appropriate clauses in contracts to prevent bribery.
Facilitation payments are commonly small payments made to secure or speed up routine actions; usually by public officials, such as issuing permits, immigration controls, providing services or releasing goods held in customs. It is also our policy that we work to ensure that our agents and other intermediaries; joint ventures and consortia, contractors and suppliers do not make facilitation payments on our behalf. If you have doubts about a payment and suspect that it might be considered a facilitation payment; only make the payment if the official or third party can provide a formal receipt or written confirmation of its legality. If practicable, obtain senior management/legal approval for the payment or consult the Company Secretary. If the demand is accompanied by immediate threat of physical harm then put safety first; make the payment and report immediately to senior management/legal department, the circumstances and amount of the payment made ‘under duress’.
Cominco Group prohibit the offer or receipt of gifts; hospitality or expenses whenever they could affect or be perceived to affect the outcome of business transactions and are not reasonable, proportionate and bona fide. Whether any corporate hospitality is improper is judged by reference to what a reasonable person in the UK would expect. The UK 2010 Bribery Act and this policy do not prevent corporate hospitality, but require a sensible approach to hospitality to ensure that promotional business expenditure that seeks to improve the image, or establishes cordial relations is reasonable and proportionate, and that receipts are provided for all proper expenditures.