Corporate Governance

Corporate Governance

Following the recent consultation by the London Stock Exchange, new AIM Rules were published in March 2018. One of the key amendments is in respect of AIM Rule 26 (as set out in AIM Notice 50), which now requires AIM companies to state on their website which recognised corporate governance code they apply and how they have applied that code.

The Board of Directors of the Company is committed to developing and applying high standards of corporate governance.  The Board of Directors seeks to apply the QCA Code, revised in April 2018 as devised by the Quoted Companies Alliance.

The Quoted Companies Alliance is the independent membership organisation that champions the interests of small to mid-size quoted companies.   The QCA Code takes key elements of good governance and applies them in a manner which is workable for the different needs of growing companies.

A revised version of the QCA Code (the “Revised Code”) was published in April 2018, based on the ‘comply or explain’ principle. The QCA Code is constructed around ten broad principles (accompanied by an explanation of what these principles entail, under ‘application’) and a set of disclosures. The Code states what is considered to be appropriate arrangements for growing companies, and asks companies to provide an explanation about how they are meeting the principles through the prescribed disclosures.

The table below sets out the principles, the application recommended by the QCA code.  It then sets out how the Company complies with these requirements and departures from code, and provides links to appropriate disclosures. These are based upon the recommended disclosures provided in the QCA code.

These arrangements are also disclosed in the Corporate Governance section of our Annual Report and Accounts which can be viewed in the Annual Reports section on the website (https://valirx.wpengine.com/investor-relations/annual-reports/).

These disclosures were last reviewed on the 28 September 2018.

The following paragraphs set out ValiRx’s compliance with the ten principles of the QCA Code.

 

QCA Principle

1. Establish a strategy and business model which promote long-term value for shareholders

Application

The board must be able to express a shared view of the company’s purpose, business model and strategy. It should go beyond the simple description of products and corporate structures and set out how the company intends to deliver shareholder value in the medium to long-term. It should demonstrate that the delivery of long-term growth is underpinned by a clear set of values aimed at protecting the company from unnecessary risk and securing its long-term future.

How Company complies

ValiRx is a biopharmaceutical company focused on developing personalised, otherwise called precision medicines to bring more advanced therapeutic options for the treatment of cancer.

For many years the Company has progressively exploited its proprietary epigenomic technology, which has led to the discovery of promising therapeutics that may prove in clinical trials to treat, among other conditions, cancer safely and more effectively than currently used chemotherapeutics, which act indiscriminately, attacking the whole body and causing irreparable damage to normal cellular processes.

ValiRx has four lead drug candidates at varying stages of development for multiple indications. The Company’s business model focuses on out-licensing therapeutic candidates early in the development process. By aiming for early-stage value creation, the company reduces costs considerably while increasing the potential for realising value. The Group is already in licensing discussions with major players in the oncology field. ValiRx operates through the following divisional companies:

ValiPharma: a biopharmaceutical company focused on developing personalised medicines to bring more advanced therapeutic options for the treatment of cancer. Currently, ValiPharma is primarily focused on three drug candidates in clinical and late stage pre-clinical development for four indications – androgen independent prostate cancer (VAL201), hormone refractory prostate cancer (VAL201), endometriosis (VAL301), and pancreatic cancer (VAL101);

ValiSeek: a joint venture company with Tangent Reprofiling Limited (a SEEK group company), which was formed in 2014 and has progressed product VAL401 through pre-clinical development and into a Phase II clinical trial for the treatment of non-small cell lung cancer; and

ValiRx (Finland): ValiFinn’s specialist competency lies in epigenomics, a rapidly advancing field that enables pairing a prognostic and/or predictive biomarker with a targeted drug. This is a key part of personalised medicine, particularly in cancer patients.

ValiRx’s therapeutics have each shown potential for meeting hitherto unmet clinical needs by existing treatments, have worldwide patent filings and agreed commercial rights. They originate or derive from Word class institutions, such as Cancer Research UK and Imperial College.

Departure and Reason

None

QCA Principle

2. Seek to understand and meet shareholder needs and expectations

Application

Directors must develop a good understanding of the needs and expectations of all elements of the company’s shareholder base. The board must manage shareholders’ expectations and should seek to understand the motivations behind shareholder voting decisions.

How Company complies

The Board is accountable to shareholders and other stakeholders and is ultimately responsible for the implementation of sound corporate governance practices throughout the Group. Our Board of Directors is committed to ensuring that the Group adheres to high standards of corporate governance in the conduct of its business.

The Board attaches considerable importance to providing shareholders with clear and transparent information on the Group’s activities, strategy, and financial position. Details of all shareholder communications are provided on the Group’s website.

Private shareholders constitute the main body of investors in ValiRx. As such, the Board regards the annual general meeting as the principal opportunity for shareholders to meet and discuss the Group’s business with the Directors. There is an open question and answer session during which shareholders may ask questions both about the resolutions being proposed and the business in general. The Directors are also available after the meeting for an informal discussion with shareholders. Moreover, the Company’s contact details are provided on the website: info@valirx.com and https://valirx.wpengine.com/contact-us/contact/ should shareholders wish to communicate with the Board.  Announcements on the Group’s half and full-year results presenting all shareholders with an assessment of the Group’s position and prospects are found on https://valirx.wpengine.com/investor-relations/annual-reports/. Shareholders vote on each resolution, by way of a poll. For each resolution we announce the number of votes received for, against and withheld and subsequently publish them on our website.

The directors actively seek to build a mutual understanding of objectives with institutional shareholders. The Chair and CEO make presentations to institutional shareholders and analysts immediately following the release of the full-year and half-year results. We communicate with institutional investors frequently through a combination of formal meetings, roadshows and informal briefings with management.

The majority of meetings with shareholders and potential investors are arranged by the Company’s broker. Following meetings, the broker provides feedback to the board from all fund managers met, from which sentiments, expectations and intentions may be gleaned.

In addition, we review analysts’ notes to achieve a wide understanding of investors’ views.

Departure and Reason

None

QCA Principle

3. Take into account wider stakeholder and social responsibilities and their implications for long-term success

Application

Long-term success relies upon good relations with a range of different stakeholder groups both internal (workforce) and external (suppliers, customers, regulators and others).

The board needs to identify the company’s stakeholders and understand their needs, interests and expectations.

Where matters that relate to the company’s impact on society, the communities within which it operates or the environment have the potential to affect the company’s ability to deliver shareholder value over the medium to long-term, then those matters must be integrated into the company’s strategy and business model. Feedback is an essential part of all control mechanisms. Systems need to be in place to solicit, consider and act on feedback from all stakeholder groups.

How Company complies

The Board recognises its prime responsibility under UK corporate law is to promote the success of the Company for the benefit of its members as a whole. The Board also understands that it has a responsibility towards employees, partners, customers, suppliers, and the patients who ultimately benefit from its research and drug development programmes. Our corporate social responsibility approach continues to meet these expectations. The Board also understands that it has a responsibility to take into account, where practicable, the social, environmental and economic impact of its approach.

Responsibility for the Company’s corporate activities lies with the Senior Management Team (“SMT”) who set the Group’s strategic approach and develop key policies. The Company engages with stakeholders through a number of channels, which include shareholder communications via the Regulatory News service (“RNS”), the Company’s website and its Annual Report & Accounts, results presentations and the Annual General Meeting and via interviews in the broadcast media and attendance at investor shows around the country.

Corporate communication and shareholder engagement through these channels not only gives shareholders a deeper insight into and understanding of the Company’s activities and of its development, but it also invites feedback, either face-to-face at such meetings or via email, on how the Company can improve its communications with stakeholders to better support their needs.  By so doing, such engagement enables the SMT to more effectively work with stakeholders in the future to their mutual advantage. The Board receives formal feedback from the SMT on a quarterly basis on the nature of interaction with the stakeholders they meet during each period.

The SMT is comprised of the Chief Executive Officer, Chief Operating Officer, and the Chief Financial Officer who take leading roles in key strategic areas such as Gender, HR, and Environmental Management. The SMT is also responsible for ensuring global compliance with key internal and external policies including:

  • Anti-human trafficking and slavery policy
  • Diversity policy
  • Anti-corruption and bribery policy
  • Whistleblowing policy
  • UK modern slavery act.

Departure and Reason

None

QCA Principle

4. Embed effective risk management, considering both opportunities and threats, throughout the organisation

Application

The board needs to ensure that the company’s risk management framework identifies and addresses all relevant risks in order to execute and deliver strategy; companies need to consider their extended business, including the company’s supply chain, from key suppliers to end-customer. Setting strategy includes determining the extent of exposure to the identified risks that the company is able to bear and willing to take (risk tolerance and risk appetite).

How Company complies

An important aspect of risk management is to put in place and consistently work according to unambiguous Standard Operating Procedures (SOPs). A SOP is a compulsory instruction to carry out s series of operations correctly and always in the same manner, avoiding deviations or non-conformances to ensure that the integrity of scientific investigations and drug manufacture are consistently maintained.

ValiRx operates an internal Quality Management System (QMS) comprising 14 SOPs to comply with the most stringent quality standards expected of a drug development company. Furthermore, the Company regularly audits its suppliers to ensure the manufacturing process, quality process, and also the drug’s shipment process all conform to the standard required.

SOP Title Description
001 Quality Management SOP describes the QMS, its structure and maintenance at ValiRx.
002 ValiRx Organisation and Training SOP describes the organisation of ValiRx as a company, and the internal training programme.
003 Clinical Project Management SOP describes the general process by which ValiRx manages and coordinates the development programme for an Investigational Medicinal Product (IMP).
004 Document Review and Approval SOP describes the general process by which ValiRx reviews and approves essential documents in support of product development activities.
005 Document Management, Filing and Archiving SOP describes the general process by which ValiRx Plc manages, files and archives essential documents in support of product development activities.
006 Selection and Management of Vendors/Consultants SOP describes the process followed at ValiRx to identify, select and manage external service providers.
007 Contracts SOP describes the process followed at ValiRx to ensure appropriate contracts and agreements are in place with vendors or consultants, and that these are put in place in a timely manner.
008 Investigational Medicinal Product Management SOP describes the general process for ValiRx to establish that a chain of custody is maintained and documented for the supply of Investigational Product for a clinical trial from release from the manufacturer site, shipment, delivery and receipt at an investigational site, accountability, and then for return or destruction of used/unused product.
009 Investigator’s Brochure SOP describes the process for ValiRx to prepare and maintain an Investigator’s Brochure, including review process.
010 Safety Reporting SOP describes the responsibilities for reporting of safety information from clinical trials to Competent Authorities, Ethics Committees, Investigators and other parties as appropriate.
011 Clinical Trial Transparency SOP describes the process for ValiRx to follow when registering clinical trials and posting trial results in order to fulfil requirements.
012 Medical Monitoring of Clinical Trials SOP describes the role of the Medical Monitor (MM) in maintaining and documenting safety oversight and pharmacovigilance during clinical trials.
013 Risk Management, Issue Escalation and Management of Corrective and Preventative Actions (CAPA) SOP describes the processes implemented by ValiRx to manage risk, escalate issues and ensure Corrective and Preventative Actions (CAPA) are in place for all clinical studies where ValiRx is the Sponsor.
014 Management of Non-compliance and Serious breaches SOP describes the procedures for identifying, documenting and reporting non-compliance, misconduct and serious breaches of the trial protocol and associated approved documents, and the principles of Good Clinical Practice (GCP), SOPs and all applicable regulatory requirements.

Departure and Reason

 

QCA Principle

5. Maintain the board as a well-functioning, balanced team led by the chair

Application

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 board (and any committees) should be provided with high quality information in a timely manner to facilitate proper assessment of the matters requiring a decision or insight. The board should have an appropriate balance between executive and non-executive directors and should have at least two independent non-executive directors. Independence is a board judgement. The board should be supported by committees (e.g. audit, remuneration, nomination) that have the necessary skills and knowledge to discharge their duties and responsibilities effectively. Directors must commit the time necessary to fulfil their roles.

How Company complies

Board Composition

The Board currently consists of three Executive Directors and two Non-Executive Directors, including the Chairman, who collectively scientific, financial, legal, and business experience necessary to advance the Company and apply corporate governance best practices. The Board is satisfied with its composition and the balance between Executive and Non-Executive Directors. These are:

Oliver de Giorgio-Miller (Senior Independent Non-Executive Chairman)

Dr Satu Vainikka (Chief Executive Officer)

Dr George Morris (Chief Operating Officer)

Gerry Desler (Executive Chief Financial Officer)

Kevin Alexander (Independent Non-Executive Director)

ROLE OF THE CHAIRMAN

The core functions of the Chairman include, inter alia:

  • Setting the ethical tone for the ValiRx Board and the Company;
  • Providing overall leadership to the Board;
  • Formulating (with the CEO and Company Secretary) the yearly work plan for the Board against agreed objectives, and playing an active part in setting the agenda for board meetings;
  • Presiding over board meetings and ensuring that time in meetings is used productively;
  • Managing conflicts of interest;
  • Acting as the link between the Board and Management and particularly between the Board and the CEO;
  • Ensuring that complete, timely, relevant, accurate, honest and accessible information is placed before the Board to enable Directors to reach an informed decision;
  • Monitoring how the Board works together and how individual Directors perform and interact at meetings;
  • Ensuring that good relations are maintained with the Company’s major shareholders and its strategic stakeholders, and presiding over shareholders’ meetings;
  • Upholding rigorous standards of preparation for meetings, and
  • Ensuring that decisions by the board are executed.

Further responsibilities of the Chairman are to identify and participate in selecting Board members (via the Nomination and Governance Committee), and overseeing a formal succession plan for the Board, CEO and certain senior management appointments such as the Chief Operating Officer and Chief Financial Officer. The Chairman also ensures that all Directors are appropriately made aware of their responsibilities through a tailored induction programme, and that a formal programme of continuing professional education is adopted at Board level. Also, the Chairman ensures that Directors play a full and constructive role in the affairs of the Company and take a lead role in the process for removing non-performing or unsuitable Directors from the Board.

ROLE OF THE CEO

  • Leads and manages the day-to-day running of the Group’s business in accordance with the business plans and within the budgets approved by the Board;
  • Leads the management to ensure effective working relationships with the Chairman and the Board by meeting or communicating with the Chairman on a regular basis to review key developments, issues, opportunities and concerns;
  • Develops and proposes the Group’s strategies and policies for the Board’s consideration;
  • Implements, with the support of the management team, the strategies and policies as approved by the Board and its committees in pursuit of the Group’s objectives;
  • Maintains regular dialogue with the Chairman on important and strategic issues facing the Group, and ensures bringing these issues to the Board’s attention;
  • Ensures that the management gives appropriate priority to providing reports to the Board which contain relevant, accurate, timely and clear information necessary for the Board to fulfil its duties;
  • Ensures that the Board, especially the Chairman, is alerted to forthcoming complex, contentious or sensitive issues affecting the Group
  • Leads the communication programme with stakeholders including shareholders;
  • Conducts the affairs of the Group in accordance with the practices and procedures adopted by the Board and promotes the highest standards of integrity, probity and corporate governance within the Group

Role of the Non-Executive Directors

As members of the Board, all Non-Executive directors have key accountabilities, which include the following:

  • Provision of entrepreneurial leadership of the Company within a framework of prudent and effective controls, which enable risk to be assessed and managed;
  • Setting the Company’s strategic aims, ensure that the necessary financial and human resources are in place for the Company to meet its objectives, and review management performance;
  • Setting the Company’s values and standards and ensure that its obligations to shareholders are understood and met;
  • Constructively challenge and help develop strategy, participate actively in the decision-making process of the Board, and scrutinise the performance of management in meeting agreed goals and objectives; and

Independence

As recommended in the UK Corporate Governance Code, the Board will identify in the annual report each Non-Executive Director it considers to be independent. The Board will determine whether the Director is independent in character and judgement and whether there are relationships or circumstances which are likely to affect, or could appear to affect, the Director’s judgement. The Board will state its reasons if it determines that a Director is independent notwithstanding the existence of relationships or circumstances which are relevant to its determination, including if the Director:

  • Has been an employee of the Company or group within the last five years;
  • Has, or has had within the last three years, a material business relationship with the Company either directly, or as a Director or senior employee of a body that has such a relationship with the Company;
  • Has received or receives additional remuneration from the Company apart from a Director’s fee;
  • Has close family ties with any of the Company’s advisers, directors or senior employees;
  • Holds cross-directorships or has significant links with other directors through involvement in other companies or bodies; or
  • Has served on the Board for more than nine years form the date of their first election;
  • Has a close family tie with any of the Company’s advisers, Directors or senior employees.

ROLE OF THE BOARD COMMITTEES

The Board has established three committees: remuneration, audit and risk and nomination and governance. All of these committees have terms of reference, which set out clearly their role, stating whether it is to take decisions or make recommendations to the Board of Directors. These are available on the Company’s website (https://valirx.wpengine.com/investor-relations/corporate-governance/).

Departure and Reason

None

QCA Principle

6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities

Application

The board must have an appropriate balance of sector, financial and public markets skills and experience, as well as an appropriate balance of personal qualities and capabilities. The board should understand and challenge its own diversity, including gender balance, as part of its composition. The board should not be dominated by one person or a group of people. Strong personal bonds can be important but can also divide a board. As companies evolve, the mix of skills and experience required on the board will change, and board composition will need to evolve to reflect this change.

How Company complies

Biographical details of the Directors can be found on https://valirx.wpengine.com/about-us/board-directors/

ValiRx seeks to recruit the best candidates at Board level and considers candidates on merit and against objective criteria and with due regard for the benefits of diversity on the Board (including gender), taking care that appointees have the necessary experience and time available to allocate to the position. Each Director appointed by the Board is subject to election by the shareholders at the first AGM after their appointment. Following advice from the Nomination and Governance Committee, the Board has concluded that each Director is qualified for election or re-election.

The current Board members are individuals with extensive industry-specific experience as well as professionals that bring to the Board the skill sets required to meet its strategic, operational and compliance objectives. Their suitability as Directors has therefore been determined largely on the basis of their ability to deliver outcomes in accordance with the company’s short and longer-term objectives and thus add value to shareholders.

Departure and Reason

None

QCA Principle

7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement

Application

The board should regularly review the effectiveness of its performance as a unit, as well as that of its committees and the individual directors. The board performance review may be carried out internally or, ideally, externally facilitated from time to time. The review should identify development or mentoring needs of individual directors or the wider senior management team. It is healthy for membership of the board to be periodically refreshed. Succession planning is a vital task for boards. No member of the board should become indispensable.

How Company complies

ValiRx considers that assessments of the performance of the Board, the Board committees, the Chairman, the Chief Executive, the Company Secretary and each of the individual Non-Executive Directors are pivotal to good corporate governance, bringing significant benefits and performance improvements on three levels: organisational; board and individual member level. Establishing an effective process for board evaluation sends a positive signal to the organisation that board members are committed to acting professionally.

Performance assessments are conducted annually across the board, applying a matrix of key areas of focus to identify collective and individual strengths and weaknesses within the Company for continuous improvement.

Board Composition:

  • Appropriate ratio between Executive and Independent Directors;
  • Awareness of social, professional and legal responsibilities at individual, company and community level; ability to identify independence conflicts; applies sound professional judgement; identifies when external counsel should be sought; upholds Board confidentiality; respectful in every situation.
  • Effective in working within defined corporate communications policies; makes constructive and precise contribution to the Board both verbally and in written form;
  • Negotiation skills to engender stakeholder support for implementing Board decisions; and
  • Experienced with the mechanisms, controls and channels to deliver effective governance and manage risks.

Effectiveness of the Board of Directors in:

  • Monitoring financial performance against agreed financial objectives;
  • Monitoring the implementation of the strategy approved by the Board;
  • Appointing, removing and monitoring the performance of the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer and Company Secretary;
  • Ensuring appropriate succession planning for Board members and senior management via the Nomination and Governance Committee;
  • Approving and monitoring financial and other reporting;
  • Approving and monitoring major capital expenditure, capital management, funding, acquisitions and divestments;
  • Overseeing risk management, control, accountability and compliance systems;
  • Setting standards of behaviour to enhance the reputation of the Company in the market and the community;
  • Ensuring proper organisation and management so as to achieve conformity goals across all aspects of the business;
  • Setting appropriate delegated powers between CEO and Board of Directors;
  • Ensuring quality and continuity of relations with the Group CEO, members of Committees, managers and heads of
    control functions; and
  • Setting clear strategy for the Company reflecting goals short to mid-long term.

Attributes of the Chairman to:

  • Promote and oversee the highest standards of corporate governance within the Board and the Company;
  • Lead the Board and discussions on all proposals put forward by the Executive team;
  • Set an agenda for the Board focused on strategic matters, forward looking and evaluates current business;
  • Maintain a proper process to ensure compliance with Board policy on matters reserved to the Board for consideration;
  • Ensure that Board members receive accurate, timely and clear information to enable them to monitor performance, make sound decisions and give appropriate advice to promote the success of the Company;
  • Manage Board meetings so that sufficient time is allowed for the discussion of complex or contentious issues and that all members’ contributions are encouraged and valued;
  • Chair, serve on or attend Committees of the Board;
  • Maintain an effective and balanced team, initiate change and, supported by the Nomination Committee, plan non-executive director succession;
  • Encourage active engagement by all members of the Board.
  • Create the environment for overall Board and individual director effectiveness including promotion of an appropriate induction programme for new directors, creating the opportunity for maintenance of the relevant skills and knowledge required to fulfil the director role on the Board and its committees and ensuring the Board undertakes an annual evaluation of its own performance, that of its committees and that of individual directors, including the Chairman; and
  • Take the lead in identifying and meeting the development needs of individual directors and to address the development needs of the Board as a whole with a view to enhancing its overall effectiveness as a team.

Effectiveness of Executive Management in:

  • Implementing the strategic objectives set by the Board;
  • Operating within the risk parameters set by the Board;
  • Operational and business management of the Company;
  • Managing the Company’s reputation and operating performance in accordance parameters set by the Board;
  • The day-to-day running of the Company;
  • Providing the Board with accurate, timely and clear information to enable the Board to perform its responsibilities;
  • Interfacing with shareholders and stakeholders, Nomad and Broker; and
  • Approving capital expenditure (except acquisitions) within delegated authority levels.

Structure and competency of Committees to: 

  • Advise the Board on the suitability of external auditors and critical accounting policies for financial reports, in particular YE audited accounts, and the Company’s risk management and internal control systems;
  • Provide independent and transparent pay arrangements linked to achievements over a given period; and
  • Lead the Board appointment and succession planning process considering the requirements of the Company.

Departure and Reason

None

QCA Principle

8. Promote a corporate culture that is based on ethical values and behaviours

Application

The board should embody and promote a corporate culture that is based on sound ethical values and behaviours and use it as an asset and a source of competitive advantage. The policy set by the board should be visible in the actions and decisions of the chief executive and the rest of the management team. Corporate values should guide the objectives and strategy of the company. The culture should be visible in every aspect of the business, including recruitment, nominations, training and engagement. The performance and reward system should endorse the desired ethical behaviours across all levels of the company. The corporate culture should be recognisable throughout the disclosures in the annual report, website and any other statements issued by the company

How Company complies

The Board understands the importance of setting the right culture for a biotechnology oncology-focused company specialising in developing novel treatments for cancer that will provide a breakthrough into human health and wellbeing through the early detection of cancer and its therapeutic intervention. Moreover, it ensures that the Company’s strategies and requirements for excellence and good governance are instilled into the culture of our business. The Executive Directors and the Chairman interface regularly with all personnel within ValiRx. In this way we encourage them to take responsibility for advancing their projects within parameters and controls set by the Board. This approach creates a culture that motivates and enables our personnel to develop and express their talents and skills. Moreover, in the performance of its duties the Board listens to the views of key stakeholders, including scientists, clinicians, regulators and suppliers and is mindful of the potential impacts of decisions it makes.

The Company has established a Scientific Advisory Board (SAB), which includes clinicians with relevant experience in the treatment of cancer. The SAB provides a means of identifying emerging issues for patients and health care providers in the treatment of cancer that can be brought to the attention of the Board. Details of the membership of our SAB are on https://valirx.wpengine.com/about-us/scientific-advisory-board/

Departure and Reason

None

QCA Principle

9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the board

Application

The company should maintain governance structures and processes in line with its corporate culture and appropriate to its:

  • size and complexity; and
  • capacity, appetite and tolerance for risk.

The governance structures should evolve over time in parallel with its objectives, strategy and business model to reflect the development of the company.

How Company complies

The Chairman, with the support of the Executive Management and Committees, is ultimately responsible for establishing and maintaining good standards of governance. This can be achieved by creating conditions that enhance overall Board’s and individual Directors’ effectiveness in order that all key issues are addressed and sound decisions are taken in a timely manner.

Other responsibilities of the Chairman include:

  • Promoting effective relationships and open communication, and creates an environment that allows constructive debates and challenges, both inside and outside the boardroom, between Non-executive Directors and the management;
  • Ensuring that the Board as a whole plays a full and constructive part in the development and determination of the Group’s strategies and policies, and that Board decisions taken are in the Group’s best interests and fairly reflect Board’s consensus;
  • Setting, in consultation with the Chief Executive and Company Secretary, the Board meeting schedule and agenda to take full account of the important issues facing the Group and the concerns of all Directors, and ensures that adequate time is available for thorough discussion of critical and strategic issues;
  • Ensuring that the strategies and policies agreed by the Board are effectively implemented by the Chief Executive and the management; and
  • Ensuring that there is effective communication with shareholders, and that each Director develops and maintains an understanding of the stakeholders’ views.

Departure and Reason

None

QCA Principle

10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders

Application

A healthy dialogue should exist between the board and all of its stakeholders, including shareholders, to enable all interested parties to come to informed decisions about the company. In particular, appropriate communication and reporting structures should exist between the board and all constituent parts of its shareholder base. This will assist:

  • the communication of shareholders’ views to the board; and
  • the shareholders’ understanding of the unique circumstances and constraints faced by the company. It should be clear where these communication practices are described (annual report or website).

How Company complies

The Board recognises the importance of sound corporate governance.

The Board is satisfied with its composition. The Non-Executive Directors bring a wide range of skills and experience to the Company, as well as independent judgment on strategy, risk and performance. The independence of each Non-Executive Director is assessed at least annually, and both are considered to be independent at the date of this report.

Attendance at Board meetings

A minimum of ten (10) Board meetings are held each year at which it is expected that all Directors attend in addition to relevant Committee meetings, General Meetings and the Annual General Meeting.

Where Directors are unable to attend meetings due to conflicts in their schedules, they will receive the papers scheduled for discussion in the relevant meetings, giving them the opportunity to relay any comments to the Chairman in advance of the meeting. Directors are required to leave the meeting where matters relating to them, or which may constitute a conflict of interest to them, are being discussed.

The following table shows the Directors’ attendance at scheduled Board meetings, which they were eligible to attend in the 12 month period to September 2018:

Director Attendance at Board Meetings
Oliver de Giorgio-Miller 11/11
Dr Satu Vainikka 10/11
Dr George Morris 9/11
Gerry Desler 11/11
Kevin Alexander 11/11

Matters reserved for the Board.

  • Approval of the Group vision, values and overall governance framework;
  • Approval of the Company’s Annual Report and Accounts and Half Yearly Financial Statements;
  • Approval of Group financial policy;
  • Approval to enter into discussions with Biotech companies reference potential joint-partnering projects or licensing of Company’s preclinical and clinical assets;
  • Approval of the Company’s long-term finance plan and annual capital budget;
  • Approval of any significant change in Group accounting policies or practices;
  • Approval of all circulars, listing particulars, resolutions and corresponding documentation sent to shareholders;
  • Establishing committees of the Board, approving their terms of reference (including membership and financial authority), reviewing their activities and, where appropriate, ratifying their decisions;
  • Approval of this schedule of Matters Reserved to the Board.

The Board is responsible to the Company’s shareholders with its main objective to increase the value of assets and long-term sustainability of the Company. The Board reviews business opportunities and determines the risks and control framework. It also makes decisions on budgets, Group strategy and major capital expenditure. The day-to day management of the business is delegated to the Executive Directors.

The Board meets monthly with agendas, Committee papers and other appropriate information distributed prior to each meeting to allow the Board to meet its duties. Effective procedures are in place to deal with conflicts of interest. The Board knows other interests and commitments of Directors and any changes to their commitments are reported.

In addition to the Executive Committee, the Board has established a Remuneration Committee, an Audit and Risk Committee, and a Nomination and Governance Committee, which also report into ValiRx’s Board.

The Executive Committee is in charge of the daily management of the Group and is mandated to prepare and plan the overall policies and strategies of the Company for approval by the Board. It may approve intra-group transactions, provided that they are consistent with the consolidated annual budget of the Company, as well as specific transactions with third parties provided that the cost per transaction is within specified spending limits. It informs the Board at its next meeting on each such transaction.
Prior to the beginning of each fiscal year, the Executive Committee submits to the Board those measures that it deems necessary to be taken in order to meet the objectives of the Company and a consolidated budget for approval. This committee comprises:

Dr Satu Vainikka (Chief Executive Officer)

Dr George Morris (Chief Operating Officer)

Gerry Desler (Executive Chief Financial Officer)

The Audit and Risk Committee meets at least twice per annum and is responsible for assisting the Board in carrying out its oversight responsibilities in relation to corporate policies, risk management, internal control, internal and external audit and financial and regulatory reporting practices. The Committee has an oversight function, providing a link between the external auditors and the Board; it also determines the terms of engagement of the Company’s auditors. The current members of the Audit and Risk Committee are:

Oliver de Giorgio-Miller (Chairman)

Dr George Morris (Chief Operating Officer)

Kevin Alexander (Non-Executive Director)

The Remuneration Committee meets at least twice per annum to determine and agree with the Board the framework or broad policy for the remuneration of executive directors of the Company and advises on the overall remuneration policies applied throughout the Company. The objective of this committee is to attract, retain and motivate executives capable of delivering the Company’s objectives. Agreed personal objectives and targets including financial and non-financial metrics are set each year for the executive directors and other personnel and performance measured against these metrics. The committee is made up of: Non-Executive Directors, namely:

Oliver de Giorgio-Miller (Non-Executive Chairman)

Kevin Alexander (Non-Executive Director)

The Chief Executive Officer is consulted on remuneration packages and policy but does not attend discussions regarding her own package. The Board determines the remuneration and terms and conditions of the appointment of Non-Executive Directors.

The Nomination Committee is a sub-committee of the whole Board responsible for the selection and proposal to the Board of suitable candidates for appointment as Executive and Non-Executive Directors The Committee may engage external search consultants to identify candidates for Board vacancies before recommending a preferred candidate to the Board for consideration. The Committee comprises:

Oliver de Giorgio-Miller (Non-Executive Chairman)

Kevin Alexander (Non-Executive Director)

Gerry Desler (Executive Chief Financial Officer)

Departure and Reason

None

General Meeting and Documentation

https://valirx.wpengine.com/investor-relations/general-meetings-documentation/

UK City Code on Takeovers and Mergers

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

The Bribery Act 2010

ValiRx plc prohibits any inducement which may result in a personal gain or advantage to the recipient or any person or body associated with them, and which is intended to influence them to take action which may not be solely in the interests of ValiRx plc or of the person or body employing them or whom they represent.

The information above was last updated on 28 September 2018.

ValiRx pic is listed on AIM of the London Stock Exchange under the ticker code VAL
ValiRx plc is listed on AIM of the London Stock Exchange under the ticker code VAL
ValiRx plc is a member of the Quoted Companies Alliance.
ValiRx plc is a member of the Quoted Companies Alliance, the independent membership organisation that champions the interests of small to mid-size quoted companies.
ValiRx plc is a member of the Quoted Companies Alliance.ValiRx plc is a member of the One Nucleus.
ValiRx plc is a member of One Nucleus, the heart of Europe’s largest life science and healthcare cluster.

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