Corporate Governance

Corporate Governance Statement

The Company’s corporate governance is founded on the Board having good quality people in place with relevant skills and experience, working as a team, to achieve the Company’s strategy and deliver value for shareholders. The Board currently comprises an Independent Non-Executive Chairman, the Chief Executive Officer, two other Executive Directors and three other Non-Executive Directors and demonstrate a range of experience and sufficient calibre to bring independent judgement on issues of strategy, performance, resources and standards of conduct that are vital to the success of the Group. The Board has overall responsibility for the Group and there is a formal schedule of matters specifically reserved for decision by the Board. The Board have established a Nomination, Audit and Remuneration committee.

 

The Board, recognising the importance of sound corporate governance, has decided to adopt the QCA’s new Corporate Governance Code (published in April 2018) (the “QCA Code”) as the basis for the Company’s corporate governance. In applying the QCA Code companies must show how it has applied the ten principles of the QCA Code (the “Principles”) to its governance.

The Board has reviewed the Company’s corporate governance in the light of the Principles and how it complies with the Principles is explained in this Corporate Governance Statement together with the disclosures required by the Code.

 

The Company’s application of the QCA Code and its Principles are as follows:

 

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

The Board has for a number of years pursued a particular stated strategy which it reviews on a regular basis. Our business strategy is developed on two complimentary platforms:

  • The first, ‘Creating for Tomorrow’ identifies the strategic pillars that we believe will help us create a stronger business in the mid and long term.
  • The second, ‘Delivering for Today’ identifies some key operational focus areas that we need to drive in order to deliver our more immediate (i.e. current fiscal) performance.

 

2. Seek to understand and meet shareholder needs and expectations.

Regular dialogues are held with shareholders, including holding briefings with analysts and other investors and staff shareholders. The company also uses the Annual General Meeting as an opportunity to communicate with its shareholders. All directors are expected to attend the Annual General Meeting with the Chairmen of the Audit and Remuneration Committees being available to answer shareholders’ questions. The Chairman of the Board is the primary point of contact for all shareholders.

The Company produces year end and interim announcements as well as a Full Annual Report all of which are available on the Investors’ section of the Company’s website and hard copies of the annual report are distributed to those shareholders who have requested to continue to receive them. The Board seeks to present a fair and balanced assessment of the Company’s financial position and prospects in its financial reports. Comments from Shareholders on the quality and content of the reports and areas for improvement are always welcomed.

The Company’s website (www.swallowfield.com) contains information on the Group, matters reserved for the Board, the Company’s articles of association, the Committee terms of references, copies of all documents sent to shareholders and all market and regulatory announcements.

There is a separate section on the website named ‘Shareholder Information’ within this section are documents such as notices of Annual General Meetings, Board Changes, Holding(s) in Company which are sent to shareholders and any other information sent to shareholders during the period.

The Directors actively seek to build a relationship with institutional shareholders. The Executive Directors make presentations to institutional shareholders and analysts each year immediately following the release of the full-year and half-year results. In addition, in 2018 the Chairman and Non-Executive Directors visited the substantial shareholders to listen to their feedback and have a direct conversation on any areas of concern.

As well as the Board being available at the AGM to meet with private shareholders, the Company encourages interaction with private shareholders where- ever possible. Private shareholder events are held by the Executive Directors. To request a meeting please contact: samantha.bazeley@swallowfield.com

The Board is kept informed of the views and concerns of major shareholders by briefings from the Executive Directors. Any significant investment reports from analysts are also circulated to the Board. The Chairman and Non-Executive Directors are available to meet with major shareholders if required to discuss issues of importance to them.

 

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

The Group’s stakeholders include shareholders, members of staff, customers, suppliers, regulators, partners, industry bodies and creditors. The principal ways in which their feedback on the group is gathered is via meetings, conversations and feedback processes.

Our People – Our Values
The success of our business is dependent upon the quality, commitment and behaviour of our employees. With clear policies and direction we strive for the highest standards of behaviour, this is implemented through our ‘Build a better Swallowfield’ discipline. The foundation of this discipline is our values.

Making it happen’ – means being action oriented and being accountable for what we have agreed and committed to do with colleagues, customers and suppliers. If something needs doing, let’s get it done.

Making it better’ – means a mind-set of continuous improvement in everything we do and a challenge to not only identify things that are not working so well, but also to do something about it.

Making it together’ – reminds us that whatever we are trying to make happen or to make better, we are highly unlikely to be able to do it on our own. We will always need the involvement and support of colleagues, customers and suppliers to ensure solutions work best for all concerned.

Equal Opportunities Policy
Health and Safety Policy
Conditions of Purchase Policy
Environmental Policy
Ethical Policy
Conflict Mineral Statement
Quality Policy
Gender Pay Gap Report
FSC Policy
Privacy and Cookie Notice

 

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

The Company’s key risks and uncertainties are set out in the Strategic Report and the main risks arising from the Company’s operations and how these are managed by the Board are also set out in the notes to the Financial Statements. The Company’s strategy and business model and the Company’s risks and uncertainties are reviewed annually.

The Board regularly considers potential risks to its strategy and the Company’s business and concluded its annual risks assessment prior to the preparation of this Annual Report & Accounts and the impact of these risks on the interests of its key stakeholders including suppliers and end-customers were also considered. As a result, the assessment of risk by the Board, which has been discussed with the Company’s Auditors, was that the policies for managing these risks should remain unchanged.

 

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

As non-executive Chairman, I am responsible for the running of the Board and Tim Perman, the Chief Executive Officer, has executive responsibility for running the Group’s business and implementing Group strategy.

The Board comprises Non-Executive Chairman, Chief Executive Officer, two Executive Directors and three Non-Executive Directors. The Board considers that all Non- executive Directors bring an independent judgement to bear notwithstanding the varying lengths of service.

The Board as a whole manages the business of the Company on behalf of the Shareholders and in accordance with the Articles of Association. This is achieved through its decision making and where appropriate through the delegation of certain responsibilities to committees.

The Board has a formal schedule of matters reserved to it and is supported by the Audit, Remuneration and Nomination Committee. The Schedule of Matters Reserved and Committee Terms of Reference are available on the Company’s website.

Directors’ conflict of interest

The Company has effective procedures in place to monitor and deal with conflicts of interest. The Board is aware of the other commitments and interests of its Directors, and changes to these commitments and interests are reported to and, where appropriate, agreed with the rest of the Board.

 

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

The Board as a whole is confident that it has a strong team which contains the necessary mix and balance of experience, skills, personal qualities and capabilities to deliver the Company’s strategy for the benefit of the shareholders. The Board will continue to review the collective resources of its directors and whether further resource and skills may be required to deliver on the Company’s strategic objectives.

The composition and experience of the Board is shown on the Company’s website swallowfield/investors/governance

The directors of the Company, as non-executives, are expected to not only play a part in the management of the Company but also to challenge and contribute to the development of strategy and the achievement of the Company’s objectives. They all play their part by being experienced and commercial people who bring a wide range of skills and capabilities to the Board.

 

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

The Board continually considers and evaluates its own performance and effectiveness and that of the individual Directors and Board Committee members. The Company also conducts annual formal performance appraisals for the Chief Executive and Executive Directors and will continue to do so on an on-going basis. As part of a comprehensive governance review undertaken by the Directors in early 2018, it has been agreed that a formal internal evaluation of the performance and effectiveness of the Board and its Committees will be conducted in 2019.

 

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

Environmental Policy
Swallowfield recognises that concern for the environment is an integral and fundamental part of its business strategy. Managers at all levels in Swallowfield are committed to ensuring that environmental issues and impacts are taken into account when reaching business decisions and in managing operations.

Why is sustainability important to us?

  • The market demands it
  • Our values require it
  • The business can’t survive long-term without it

Reduce, reuse, recycle

  • Waste disposal – we are aiming to reduce material waste and the amount of material that we dispose of in landfill sites. The result of this has been a 37% reduction in the waste we send to landfill over a 3 year period.
  • Material reduction – for both primary and secondary packaging we are constantly looking at reducing the amount of glass, metal, plastic and cardboard. We sell packaging for re-use, we re-cycle waste material, plastic and cardboard and where possible we source locally to reduce our input mileage and we have an aerosol recycle scheme.
  • Energy consumption – we have some very familiar approaches to energy consumption such as, variable speed motors and server consolidation and virtualisation and also some very industry specific approaches like the use of cold processing technology and heat recovery and insulation. This has enabled a 25% reduction on energy consumption over the last 5 years.
  • Water consumption – we have employed a variety of approaches to water usage reduction, starting with some changes in our overflow controls on some of our process equipment and proactive changes in our sanitation processes. We have installed a modern reverse osmosis water plant with added controls, all these attributes contribute to the success in reducing water consumption with a noticeable figure of 64% reduction in 5 years.

 

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

The role of the Board is to ensure delivery of the business strategy and long-term shareholder value. The general obligations of the Board and the roles and responsibilities of the Chairman and the Chief Executive Officer are set out in a formal Board responsibilities statement approved by the Board. The Board fulfils its role by approving the annual strategic plan and monitoring business performance throughout the year. The Board held 10 formal scheduled Board meetings during the financial year to 31 January 2018 and in addition held a number of unscheduled ad-hoc meetings, typically by conference call. There is in place a schedule of matters reserved for Board approval that can be found on the Company’s website (www.swallowfield.com).

The Board have approved an annual Board calendar setting out the dates, location and standing agenda items for each formal scheduled Board and Committee meeting and scheduled Board calls. Board papers are circulated to Directors in advance of scheduled and unscheduled meetings, which are of an appropriate quality to enable the Directors to fulfil their obligations and adequately monitor the performance of the business. Directors who are unable to attend a meeting are expected to provide their comments to the Chairman, the Chief Executive Officer, or the Company Secretary as appropriate. The Board also receives management information on a regular basis that sets out the performance of the business. The Chief Executive Officer and Group Finance Director are invited to attend the Audit and Remuneration Committee meetings, if appropriate.

All Directors receive regular and timely information on the Group’s operational and financial performance. Relevant information is circulated to the Directors in advance of meetings. The business reports monthly on its headline performance against its agreed budget, and the Board reviews the monthly update on performance and any significant variances are reviewed at each meeting. Senior executives below Board level attend Board meetings where appropriate to present business updates.

Board Committees

The Board is supported by the Audit, Remuneration and Nomination Committees. Each Committee has access to such resources, information and advice as it deems necessary, at the cost of the Company, to enable the Committee to discharge its duties. The terms of reference of each Committee are available at www.swallowfield.com.

Insider trading

The board has appropriate policies and procedures in place to guard against insider trading by employees including Directors. Appropriate clearances are required in order that trades can be made and all employees are made aware, via company-wide emails, of relevant close periods prior to financial results being announced.

More information about the Board and Committees can be found on the Company’s website swallowfield/investors/governance

 

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

The Company encourages two-way communication with both its institutional and private investors and responds quickly to all queries received. As the Chairman, I talk regularly with the Group’s major shareholders and ensures that their views are communicated fully to the Board.

In addition, the Company communicates with shareholders through the Annual Report, full-year and half-year announcements, the Annual General Meeting, General Meetings and one-to-one meetings with large existing or potential new shareholders.

 

 

Directors’ and Officers’ Liability Insurance and Third Party Indemnity Insurance
During the year, the Company has maintained insurance cover for its directors and officers under a Directors’ and Officers’ liability insurance policy. The Company has not provided any qualifying third-party indemnity cover for the directors although under the Company’s Articles of Association the Company may indemnify any Director or other officer against any such liability.

 

Conflicts of interest
Under the Companies Act 2006, directors must avoid situations where a direct or indirect conflict of interest may occur. The Company has in place procedures to deal with any situation where a conflict may be perceived.

 


Below are the terms of reference for the Audit, Remuneration and Nomination Committees and our whistle blowing policy (these documents are all in PDF downloadable format):

Terms of Reference – Audit Committee

Members: E J Beale (Chair), B M Hynes, R S McDowell, F P Berrebi


Terms of Reference – Nomination Committee

Members: B M Hynes (Chair), R S McDowell, F P Berrebi


Terms of Reference – Remuneration Committee

Members: R S McDowell (Chair), B M Hynes, F P Berrebi, E J Beale


Swallowfield plc is quoted on AIM and as a result the Company has complied with AIM Rule 31 which requires the following:

  • have in place sufficient procedures, resources and controls to enable its compliance with the AIM Rules;
  • seek advice from its Nominated Advisor (“Nomad”) regarding its compliance with the AIM Rules whenever appropriate and take that advice into account;
  • provide the Company’s Nomad with any information it reasonably requests in order for the Nomad to carry out its responsibilities under the AIM Rules for Nominated Advisors, including any proposed changes to the Board and provision of draft notifications in advance;
  • ensure that each of the Company’s Directors accepts full responsibility, collectively and individually, for compliance with the AIM Rules; and
  • ensure that each Director discloses without delay all information which the Company needs in order to comply with AIM Rule 17 (Disclosure of Miscellaneous Information) insofar as that information is known to the Director or could with reasonable diligence be ascertained by the Director.

Directors

Brendan M Hynes MBA, FCMA

Non-Executive Chairman

Brendan joined the Company as Non-Executive Chairman on 1st July 2013. He is also currently the Senior Independent Non-Executive Director and Chairman of the Audit Committee of Churchill China plc, Non-Executive Director of private, online education business “Webexaminer”; and a member of the Criticaleye Advisory Board. He was CEO of Nichols plc from 2007 to 2013 having previously been Group Finance Director. He has plc main board experience across a range of other sectors including TMT, retail, consumer goods, buildings and automotive. Previous roles have included Executive Director at Knowledge Management Software plc and Group Finance Director at William Baird plc a branded clothing business and Director of the Consumer, Retail and Distribution (CRD) practice of PricewaterhouseCoopers advising Times 100 companies. Brendan chairs the Nomination Committee and is a member of the Audit and Remuneration Committees.

Tim Perman

Chief Executive Officer

Tim joined the Company as Chief Executive on 2 July, 2018. He has extensive experience in the consumer products industry, with over 20 years in the beauty and personal care sector, and has held senior General Management and Marketing positions at PZ Cussons, Seven Seas, Campbells Grocery Products and Clairol. In his last role at Cussons, Tim was Group Category & Brand Director and Global Beauty Director, and prior to that he was Area Director, Europe. Tim has previously been Managing Director UK & Ireland at Seven Seas, Managing Director at Campbells and occupied senior roles in the US and EMEA at Clairol.

Jane Fletcher, BSc (Hons)

Group Sales and Marketing Director

Jane joined the Company in 1996 and was promoted to the position of Group Sales and Marketing Director in October 2004. Prior to this she gained valuable experience in product buying at Marks and Spencer. Jane has over 20 years’ experience within the industry, working and developing products with both brands and retailers.

Matthew Gazzard, FCCA

Group Finance Director

Matthew joined the company in January 2018 as Group Finance Director. Matthew has extensive experience in financial, commercial and management roles from across a range of manufacturing businesses in various industrial sectors. Matthew has previously held senior roles in Autologic Holdings plc, Invensys plc, British Ceramic Tile Ltd and Thatchers Cider Company Ltd.

Franklin Berrebi

Non-Executive Director

Franklin joined the Company in July 2010 and brings a wealth of international experience in the consumer goods market having spent 33 years with L’Oréal, latterly as the Managing Director of L’Oréal Consumer Goods Europe. Since retiring from L’Oréal in 2004 Franklin has worked with AXA Private Equity (now Ardian) and Activa Capital, and sits on the Board of a number of companies. Franklin is a member of the Audit, Remuneration and Nomination Committees.

Roger McDowell

Non-Executive Director

Roger was reappointed to the Board in March 2012 having previously served as a Non-Executive Director from July 2011 to January 2012. Roger is an experienced director of over 30 years’ standing: he led the Oliver Ashworth Group through dramatic growth, main market listing and sale to St. Gobain, following which he was appointed to a number of non-executive roles, including chairmanships in both public and private equity backed businesses. He is currently Chairman of Avingtrans plc, and is Senior Non-Executive Director of Servelec Group plc and Tribal Group plc. He is also a Non-Executive Director of D4T4 Solutions plc and Proteome Sciences plc. Roger chairs the Remuneration Committee and is a member of the Audit and Nomination Committees.

Edward Beale

Non-Executive Director

Edward joined the Company as a Non-Executive Director on 1 July 2014. Mr Beale is a Chartered Accountant and is the Finance Director of Marshall Monteagle plc. He is a member, previously chairman, of the Corporate Governance Committee of the Quoted Companies Alliance. He was a member of the Accounting Standards Board of the Financial Reporting Council for six years to 31st August 2013. He is a non-executive director of London Finance & Investment Group P.L.C., Western Selection P.L.C., Heartstone Inns Limited, and some of their subsidiary and associated companies. Edward chairs the Audit Committee and is a member of the Remuneration Committee.