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Annual Report & Accounts 2016 - Governance
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42 GVC Holdings PLC Annual Report 2016 How does the Board oversee financial reporting, risk management and internal controls? The Board is required to present a fair, balanced and understandable assessment of the Company's position and prospects. This responsibility to present a fair, balanced and understandable assessment extends to interim and other price-sensitive public reports and reports to regulators, as well as to information required to be presented by statutory requirements. The Board is also responsible for determining the nature and extent of the significant risks it is willing to take in achieving its strategic objectives and, as a consequence, it has to maintain sound risk management and internal control systems. The Board has appointed a committee of independent Directors, the Audit Committee, to monitor these areas and report and make recommendations to the Board. Please see the Report of the Audit Committee on pages 46 to 50. How does the Board decide what Directors and employees should be paid? The Board is responsible for setting the levels of remuneration for the Executive Directors and the senior executive team. It is required to set remuneration at levels sufficient to attract, retain and motivate directors of the quality required to run the Company successfully, but should avoid paying more than is necessary for this purpose. The Board has delegated these remuneration matters to a committee of Non-executive Directors, the Remuneration Committee. The Directors' Remuneration Report prepared by the Remuneration Committee is set out on pages 51 to 63. The fees paid to the Non-executive Directors are a matter for the Board on a recommendation from the Executive Directors. How does the Board engage with shareholders? The Company keeps shareholders informed of business developments via its Annual Report, half-year statement and trading update announcements. In addition, other price sensitive information is publicly disclosed via a regulatory news service. All these items of information are available on the Company's corporate website, www.gvc-plc.com. The website also contains other information about the Group and its business. Throughout the year the Chairman, CEO, CFO and Head of Investor Relations meet with shareholders on request or via organised investor roadshows supported by GVC's brokers, as well as by attending and presenting at industry and investor conferences. During 2016, there were many such meetings, hosted in the UK, mainland Europe and the US. The Senior Independent Director is also available to shareholders if they have concerns which contact through the Chairman, CEO or CFO fails to resolve or if contact is inappropriate. Major shareholders also have the opportunity to meet newly appointed Non-executive Directors should they wish, but in practice our shareholders have not to date taken up this offer. Who are GVC's major shareholders? As at 20 March 2016, GVC's major shareholders were: Shareholder Number of Shares % of Issued Share Capital/ Total Voting Rights Standard Life Investment Holdings Limited 33,238,094 11.30 The Capital Group of Companies, Inc. 14,652,094 4.98 Janus Capital Management, LLC 11,522,047 3.92 Majedie Asset Management 10,504,658 3.57 As at 20 March 2017, the Company had 294,199,190 shares in issue. Each share carries the right to one vote. The above shareholding information is based on the last notification made by the shareholder under the Disclosure & Transparency Rule requirements. When is the Annual General Meeting ("AGM")? Tuesday 20 June A separate notice convening the AGM in Gibraltar will be dispatched to shareholders more than 20 working days before the AGM. The AGM notice will list each item of business, which will be dealt with by its own separate resolution. All the Directors will each stand for re-appointment and there will be separate resolution proposed for each re-appointment. All Directors will be present at the AGM to answer questions from those shareholders that attend. In accordance with best practice, the Chairman will exercise his discretion under the articles and call for all resolutions to be decided on by a poll vote rather than a show of hands. The voting results will be announced via a regulatory news service and published on GVC's corporate website shortly after the AGM closes. Does the Company comply with the UK Corporate Governance Code? Prior to listing on the Main Market, the Company chose not to comply with the Code, because it was not required to as an AIM listed business. After the Company obtained a Standard Listing in February 2016 and in preparation for applying to step up to a Premium Listing, GVC worked to align its policies, procedures and practices to comply with the Code's recommendations. Since GVC obtained a Premium Listing on the London Stock Exchange on 1 August 2016 the Company has complied with the Code's recommendations except in two respects: • Until 23 March 2017 the Board had not appointed a Senior Independent Director. Following the appointment today of Will Whitehorn the Company now complies with this recommendation. • As previously disclosed to shareholders and as set out in the Directors' Remuneration Report on page 58, in certain termination scenarios the Chairman and the CEO are entitled to two years' notice in respect of remuneration and bonus payments. These contractual obligations were entered into prior to the Company obtaining a Premium Listing and the Code being applicable to the Company. Has the Company allotted or acquired any of its shares during 2016? During the year, the Company issued a total of 231,991,749 new ordinary shares in respect of the acquisition of bwin.party, the satisfaction of various bwin.party share incentive plans and the Company's share incentive plans. Governance continued EFFECTIVENESS: GOVERNANCE CONTINUED