Corporate Governance

Chairman’s Statement

The Board has adopted the Quoted Companies Alliance (QCA) Corporate Governance Code in line with the London Stock Exchange’s recent changes to the AIM Rules.

Robinson plc (“Company” or “Group”) has a strategy which sets out how we intend to achieve growth in shareholder value.

Our responsibilities include:

• having a board of directors, senior management team and workforce with the necessary mix of skills and experience to execute and evolve the strategy and business model;

• having all individuals in the business working together effectively, within a clear organisational structure; and

• maximising the chances for successful execution of the strategy by putting in place tailored processes.

We understand good corporate governance is not complete without it being communicated effectively, thus promoting trust among shareholders and other stakeholders.

Below are the 10 principles of the QCA code and details of how these are applied by the Company, together with other information required by the Code.

Alan Raleigh (Chairman) – September 2018

 

PrincipleRobinson
Establish a strategy and business model which promote long-term value for shareholdersRobinson specialises in partnering Brand Owners in the Food, Personal Care and Household markets across Europe to deliver innovative rigid plastic packaging that facilitates Brand differentiation, product protection and ease of use for consumers.

Our overall goal is to deliver profitable sales growth by doing more, better with our current customers and targeted new customers who lead the markets in which we operate.

We use the latest design systems and injection, blow and stretch blow moulding manufacturing technologies to lightweight our products and to minimise costs whilst reducing the environmental impact of the packaging we produce.

We formally update our Strategy on an annual basis and use this to create a rolling 3-year business plan. Progress against this plan is reviewed at least once per quarter.

The key elements of our current strategy are:

Develop a Best in Industry Customer Relationship Management Plan:
As a Board, we believe that it is essential to collaborate brilliantly with our customers. We will ensure that we have the organisation, talent and processes to understand our customer’s markets, their forward plans for the product formats we support and their unmet needs that we can service. We will translate these customer requirements into capabilities to deliver the packaging formats and services that support their ambitions.

Ensure we are competitive on costs:
The markets in which we operate have leading FMCG players and strong, international packaging industry competitors. It is essential that Robinson continually evaluates its cost competitiveness, so we will undertake regular benchmarking of our costs in the areas of resin procurement, Supply Chain efficiency and overheads.

Responsiveness:
Our customers require outstanding responsiveness, so we place great emphasis on building capabilities to collaborate quickly, efficiently and reliably as a trusted partner across three customer models:

1. Full Service Design, Build and Production of new Innovations, typically for customers in niche markets.

2. Partnering to industrialise a customer’s product design

3. Transferring an existing pack into the Robinson Supply Chain

Packaging in the Environment:
Society rightly expects industry to play its part in addressing the challenges of sustainability.

Our approach is to work in close collaboration with our brand owner customers who share our commitment to the circular economy and leverage this experience across our business. We recognise that we can make an important contribution through reducing the amount of plastic we incorporate in our products, using recycled material where technically and economically feasible and designing supply chains that allow reuse of materials.

Through excellent execution of our strategy, we expect sales growth slightly ahead of the market which, together with internally driven operational efficiencies, will leverage our cost base to drive competitive profitability improvements thus delivering sustained shareholder value.
Seek to understand and meet shareholder needs and expectationsRobinson will maintain a regular dialogue with existing and potential investors both directly and through its brokers to communicate its strategy and understand shareholder expectations.

This will be done by the Board at the Annual General Meeting and through periodic Investor Roadshows that showcase evolutions in our business and offer the opportunity to meet and engage with the Board and senior business leaders.

Communications should be addressed to the Company Secretary, Guy Robinson.
Take into account wider stakeholder and social responsibilities and their implications for long-term successRobinson is aware of its corporate social responsibilities and the need to maintain balanced relationships with its shareholders, employees, customers, suppliers, the environment and other stakeholders.

Based on stakeholder feedback we plan to assess our plans on Safety, Diversity and Sustainability and, if appropriate, intervene to drive further progress.
Embed effective risk management, considering both opportunities and threats, throughout the organisationThe directors have set in place a thorough risk management process that identifies the key risks faced by the Group and ensures that processes are adopted to monitor and mitigate such risks. The principal risks affecting the business and the Group’s responses to these risks are:

Customer relationships:
A significant proportion of the Group’s turnover is derived from its key customers. The loss of any of these key customers, or a significant worsening in commercial terms, could adversely affect the Group’s results. This risk will be mitigated through the creation of sector leading Customer Relationship management plans.

Fluctuations in input prices:
Input prices such as plastic resin prices and electricity costs can fluctuate significantly. The Group seeks to structure contracts with customers to recover its costs and monitors the effect of such fluctuations closely, whilst building expertise to mitigate the impact.

Foreign currency risk:
Significant fluctuations between the Polish Zloty and the Euro could impact revenues and profitability as we produce in Poland and purchase materials in dollars, pounds and euros. Although we do not typically hedge currencies, we regularly monitor these exchange rate movements as a Board.
The uncertainty associated with Brexit will require particularly close attention in 2019.

Packaging in the Environment:
The current attention on
Packaging in the Environment is challenging our industry to create circular economies to minimise the impact of packaging. We will work with our leading FMCG partners and key suppliers to ensure we have a comprehensive approach to support the evolution of a circular economy for packaging within the markets in which we operate.
Maintain the board as a well-functioning, balanced team led by the chairThe Board currently comprises an independent non-executive chairperson, (Alan Raleigh), Chief Executive (Adam Formela), Finance Director (Guy Robinson) and non-executive director (Anthony Glossop – not considered independent as “time served”, but a valued member of the Board due to his experience in property and business matters).

The board members have a collective responsibility and legal obligation to promote the interests of the company, and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the chair of the board.

The Company is currently seeking a second independent non-executive director (as set out in the QCA code) and expects this position to be filled before its next AGM (May 2019).

The Company holds eight Board meetings per year, some of which cover more than a day. Attendance at Board meetings and Board Committees will be documented in our Annual Report.

The Chairman is expected to devote on average 3 to 4 days per month and other non-executive directors 2 to 3 days per month.
Ensure that between them the directors have the necessary up-to-date experience, skills and capabilitiesThe Board considers that it has sufficient experience, skills, personal qualities and capabilities to deliver the strategy of the Company.

These qualities will be further enhanced by the imminent recruitment of a new independent non-executive director.
Directors biographies are included in the annual financial statements and on its website.

The Board regularly review its composition and depth of skills to ensure it can support the ongoing development of the Company.

The directors are kept up to date on key issues and developments pertaining to the Company through the executive directors and external advisers.
Evaluate board performance based on clear and relevant objectives, seeking continuous improvementThe Board evaluates its own performance and that of its directors annually.

It also reviews the effectiveness of each Board meeting.

In the second half of 2019 after the new non-executive Director has been appointed the Board will commission an independent external review process.

There is a succession plan in place for the Board and this is being actively progressed.
Promote a corporate culture that is based on ethical values and behavioursThe Board is responsible for ensuring we achieve the highest standards of business integrity and ethics. We have policies in place across all key areas of the business operations which are formally reviewed by the Board annually, including discrimination and harassment;

We do not tolerate any form of discrimination on grounds of age, race, colour, sex, religion, sexuality or disability.

We do not tolerate any forms of harassment at any level within our organisation or when dealing with people from outside.

An open culture is encouraged within the Company with regular communications to staff regarding progress and staff feedback is regularly sought.

The Group recognises the need to ensure effective communications with employees. During the year, they were provided with financial and other information affecting the Group and its various operations, by means of the house magazine, briefings and newsletters. Consultative committees in the different areas of the Group enabled the views of employees to be heard and considered when making decisions likely to affect their interests.
In 2019, the Board will formally review the effectiveness of our communications to key stakeholders, including employees.
Maintain governance structures and processes that are fit for purpose and support good decision-making by the boardThe Board has overall responsibility for promoting the success of the Company. The executive directors are responsible for day-to-day operational management. The non-executive directors are responsible for bringing independent and objective judgement to Board discussions and decisions.

The roles of Chief Executive and non-executive Chairman are clearly separated. The Chairman is responsible for overseeing the running of the Board, ensuring that no individual or group dominates the Board’s decision-making and ensuring the Non-Executive Directors are properly briefed on matters. The Chairman has overall responsibility for corporate governance matters and chairs the Nomination and Audit Committees. The Chief Executive is responsible for implementing the strategy of the Board and managing the day-to-day business activities. The Finance Director is responsible for ensuring that Board procedures are followed and applicable rules and regulations are complied with.

The principal matters reserved to the Board are as follows:

● Setting long-term objectives and commercial strategy.
● Approving annual operating and capital expenditure budgets.
● Changing the share capital or corporate structure of the group.
● Approving half-year and full-year results and reports.
● Approving dividend policy and the declaration of dividends.
● Approving the company’s major policies including the remuneration policy and annual remuneration for senior employees
● Approving major investments, disposals, capital projects or contracts.
● Approving resolutions to be put to general meetings of shareholders and the associated documents or circulars.
● Approving changes to the board structure and composition.

The Board operates the following committees:

Audit Committee
This meets twice per year and has primary responsibility for monitoring the quality of internal controls, for ensuring that the financial performance of the Company is properly measured and reported on and for reviewing reports from the Company’s auditors relating to the Company’s accounting and internal controls, and is chaired by the Chairman; (Chair – Alan Raleigh, members – Anthony Glossop, Adam Formela, secretary – Guy Robinson).

Remuneration Committee
This meets as required, but typically at least twice per year, to determine the terms and conditions of service of the Directors, including their remuneration and the grant of options under the Company’s Share Option Schemes, and is chaired by Anthony Glossop; (members – Alan Raleigh, Adam Formela, secretary – Guy Robinson)

Nomination Committee
This meets as required, but typically at least once per year, identifying the need for Board appointments, defining personal criteria and qualifications of persons to be appointed and managing the appointment process, and succession planning. It is chaired by the Chairman. (Chair – Alan Raleigh, members – Anthony Glossop, Adam Formela, secretary – Guy Robinson)
Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholdersThe Company recognises that a healthy dialogue should exist between the Board and its stakeholders to better enable interested parties to come to informed decisions.

The annual financial statements (including notices of meetings), results of resolutions, interim reports, trading statements and director dealings can be found on the Company’s website.

UK City Code on Takeovers and Mergers

Robinson is subject to the UK City Code on Takeovers and Mergers.