Directors’ Responsibilities
The Directors are responsible for managing the business affairs of the Company in accordance with the Articles and have overall responsibility for the Company’s activities, including the review of investment activity and performance. The Directors are also subject to certain statutory duties under the Companies (Guernsey) Law 2008, as amended, in addition to their fiduciary duties and their duty to exercising reasonable care, skill and diligence, which are expected of a director of any company.
The names and roles of each of the Directors is set out below
Quentin Spicer
Quentin is an Independent Non-Executive Director.
Chris Le Page
Chris is an Independent Non-Executive Director.
Zohar Levy
Zohar is the Managing Director of the Company.
Itay Barlev
Itay is the Finance Director of the Company.
Corporate Governance
Summit Properties Limited (the "
Company") is committed to maintaining the highest standards of
corporate governance throughout its operations and to ensuring that all of its practices are
conducted transparently, ethically and efficiently. The Company believes that scrutinising all aspects
of its business and reflecting, analysing and improving its procedures will result in the continued
success of the Company and improve shareholder value. Therefore, and in compliance with the
updated AIM Rules for Companies, the Company has chosen to formalise its governance policies by
complying with the UK's Quoted Companies Alliance Corporate Governance Guidelines for Small and
Mid-Size Quoted Companies (the "
QCA Code").
Accordingly, the Company has established specific committees and implemented certain policies, to
ensure that:
- it is led by an effective board which is collectively responsible for the long-term success of the Company;
- the board and the committees have the appropriate balance of skills, experience, independence, and knowledge of the Company to enable them to discharge their respective duties and responsibilities effectively;
- the board establish a formal and transparent arrangement for considering how it applies the corporate reporting, risk management, and internal control principles and for maintaining an appropriate relationship with the Company's auditors; and
- there is a dialogue with shareholders based on the mutual understanding of objectives.
In addition, the Company has adopted policies in relation to:
- anti-corruption and bribery;
- whistleblowing; and
- IT, communications and systems.
so that all aspects of the Company are run in a robust and responsible way.
The Board of Directors
The board of directors is responsible for the proper management of the Company by formulating,
reviewing and approving the Company's strategy, budgets, and corporate actions. In order to
achieve its objectives, the board adopts the ten principles of the QCA Code. Through successfully
implementing these principles, the Company is able to deliver long-term growth for shareholders
and maintain a flexible, efficient and effective management framework within an entrepreneurial
environment.
It is important that the board itself contains the right mix of skills and experience in order to deliver
the strategy of the Company. As such, the board is comprised of:
- an independent non-executive chairman, whose primary responsibility is the delivery of the Company's corporate governance model. The chairman has a clear separation from the day-to-day business of the Company which allows him to make independent decisions;
- two executive directors; and
- a further two independent non-executive directors.
The
biographies of the directors are set out on the Company’s website.
Additionally, the Company has appointed a professional company secretary in Guernsey who assists
the chairman in preparing for and running effective board meetings, including the timely
dissemination of appropriate information. The company secretary provides advice and guidance to
the extent required by the board on the legal and regulatory environment.
Each director serves on the board until the annual general meeting following his or her election or
appointment, and the board meets regularly at least four times a year and also hold regular ad-hoc
meetings as and when necessary (as at 31 December 2017 the board and its committees held twenty
meetings). The attendance at meetings of the board and its committees in the 2017 financial year is
contained in the Company’s Annual Report and Accounts 2017 (page 25).
Committees
In compliance with UK best practice, the board has established corporate governance committees.
Audit and Risk Committee
The purpose of the Audit and Risk Committee is to monitor the integrity of the financial statements
of the Company.
Some of the Audit and Risk Committee's duties include:
- reviewing the Company's accounting policies and reports produced by internal and external audit functions;
- considering whether the Company has followed appropriate accounting standards and made appropriate estimates and judgments, taking into account the views of the external auditor;
- reporting its views to the board of directors if it is not satisfied with any aspect of the proposed financial reporting by the Company;
- reviewing the adequacy and effectiveness of the Company’s internal financial controls and internal control and risk management systems;
- reviewing the adequacy and effectiveness of the Company's anti-money laundering systems and controls for the prevention of bribery and receive reports on non-compliance; and
- overseeing the appointment of and the relationship with the external auditor.
The Audit and Risk Committee has three members, each of whom is independent, non-executive
directors and at least one member has recent and relevant financial experience. The current
members of the committee are Christopher Spencer as the Chairman and Harry Hyman and Quentin
Spicer.
Remuneration and Nomination Committee
The purpose of the Remuneration and Nomination Committee is to determine and agree with the
board the framework or broad policy for the remuneration of the Company’s chairperson and the
executive directors as well as the composition of the board itself.
Some of the Remuneration and Nomination Committee's duties include:
- reviewing the pay and employment conditions across the Company, including the board of directors;
- approving targets and performance related pay schemes operated by the Company and all share incentive plans and pension arrangements;
- regularly reviewing the structure, size, and composition (including the skills, knowledge, experience and diversity) of the board and make recommendations to the board with regard to any changes succession planning and vacancies; and
- identifying suitable candidates from a wide range of backgrounds to be considered for positions on the board.
The Remuneration and Nomination Committee has four members, comprises three independent,
non-executive directors and once executive director. The current members of the committee are
Quentin Spicer as the Chairman and Harry Hyman, Christopher Spencer and Zohar Levy.
Share Dealing Code
The Company has adopted a share dealing code to ensure directors and certain employees do not
abuse, and do not place themselves under suspicion of abusing inside information of which they are
in possession and to comply with its obligations under the Market Abuse Regulation ("MAR") which
applies to the Company by virtue of its shares being traded on AIM. Furthermore, the Company's
share dealing code is compliant with the AIM Rules for Companies published by the London Stock
Exchange (as amended from time to time).
Under the share dealing code, the Company must:
- disclose all inside information to the public as soon as possible by way of market announcement unless certain circumstances exist in which the disclosure of the inside information may be delayed;
- keep a list of each person who is in possession of inside information relating to the Company;
- procure that all persons discharging managerial responsibilities and certain employees are given clearance by the Company before they are allowed to trade in Company securities; and
- procure that all persons discharging managerial responsibilities and persons closely associated to them notify both the Company and the Financial Conduct Authority of all trades in Company securities that they make.
QCA Code
The QCA Code identifies ten principles to be followed in order for companies to deliver growth in
long term shareholder value, encompassing an efficient, effective and dynamic management
framework accompanied by good communication to promote confidence and trust.
The sections below set out the ways in which the Company applies the ten principles of the QCA
Code in support of the Company’s medium to long-term success.
| Principal |
Disclosure |
| 1. Establish a strategy and business model which promote long-term value from shareholders |
The strategy is to acquire relatively high yielding German commercial assets, primarily from distressed vendors and banks.
Focusing on quality buildings in established locations, with:
- Long term stable income
- High positive yield gaps
- Low capital values, below their replacement const.
- Sustainable growing cash flow to deliver attractive dividend yield
- Substantial upside potential for rent and capital value increase through growth of the German property market
We maximise value via:
- Pro-active asset management with strong local on-site management
- Reducing vacancy rates by letting, redevelopments and/or conversion to residential use
The Company’s strategy is achieved by being well positioned to take advantage of various situations in the market. Using strategic contacts, the Company evaluate the potential investments assessing their potential yield and capital growth. The Company look for opportunistic investments which, via intensive asset management, can improve occupancy rates or rezoning which leads to strong cash flow and increasing capital growth for shareholders.
|
| 2. Seek to understand and meet shareholder needs and expectations |
The Company seeks to maintain a regular dialogue with both existing and potential new shareholders in order to communicate the Company’s strategy and progress and to understand the needs and expectations of shareholders.
Beyond the Annual General Meeting, Zohar Levy, Itay Barlev and, where appropriate, other members of the board, meet with investors to provide them with updates on the Company’s business and to obtain feedback regarding the market’s expectations of the Company.
The main point of contact for investor liaison is Zohar Levy.
The role of the independent directors is to provide a sounding board for the Chairman and to be available to shareholders should they have concerns that they have been unable to resolve through normal channels, or when such channels would be inappropriate.
The Company intend to continue and return capital to shareholders both by way of dividend and other methods subject to potential accretion.
|
| 3. Take into account wider stakeholder and social responsibilities for long-term success |
The Company is aware of its corporate social responsibilities and the need to maintain effective working relationships across a range of stakeholder groups.
The Company management and its Board of Directors acknowledge the importance of Company’s impact on society.
Further information is contained in the 2018 Annual Report – Corporate Social Responsibility statement (page 36).
|
| 4. Embed effective risk management, considering both opportunities and threats, throughout the organisation |
The board is responsible for the systems of risk management and internal control and for reviewing their effectiveness. The internal controls are designed to manage rather than eliminate risk and provide reasonable but not absolute assurance against material misstatement or loss.
The Company has established a risk management framework, controlled by its board of directors. The risk register of the Company is reviewed by the board on a regular basis.
See Annual Report and Accounts 2018 for risk management and assurance of effective control systems.
|
| 5. Maintain the board as a well-functioned, balances year led by the chair |
Corporate governance matters are considered by the board on an on-going basis and in particular, at each quarterly board meeting.
The Company's board of directors comprises two executive directors and three independent non-executive directors.
Details of the Directors including their independence are clearly disclosed as are their appointment terms and also in the 2018 Annual Report.
The Board meets at least 4 times a year (during 2018 the Board met 12 times and the committees met 6 times).
|
| 6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities |
During the course of the year, Directors received updates from the Company Secretary and various external advisers on a number of corporate governance matters and other issues.
The training needs of each Director are also regularly reviewed by the Chairman. The Directors are able to receive training or additional information on specific subject pertinent to their role as a Director that they request or require. All Directors have access to independent professional advice at the Company’s expense, if deemed necessary and subject to clearance by the Chairman.
An internal Board evaluation is undertaken on an annual basis where matters are considered.
|
| 7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement |
An evaluation of the board’s performance is conducted each year and includes questions on different aspects of the operation of the Board and its committees and the performance of individual directors.
The Chairman is responsible for ensuring the annual evaluation of the Board’s performance and that of its committees and individuals Directors. This should be done by discussions based on process and questions outlined in the Code concerning Board and Committee performance and meetings.
Succession planning needs of the Company is reviewed and discussed by the directors on an annual basis.
|
| 8. Promote a corporate culture that is based on ethical values and behaviours |
The board seeks to maintain the highest standards of integrity and ethics in the conduct of the Company’s operations. These values are exhibited in the written policies and working practices adopted by all employees in the Company.
An open culture is encouraged within the Company, with regular communications to staff regarding progress and staff feedback regularly sought. Employees are expected to behave and to execute the Company’s strategy and objectives in an ethical, compliant manner as well as to ask questions and raise concerns openly. The board and its committees monitor the Company’s cultural environment and seek to address any concerns that may arise, escalating these to Board level as necessary.
The Board also sets the values and culture of the Group and has a duty to protect the interest of the shareholders.
|
| 9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the board |
The Company's board of directors comprises five directors, three of which are independent non-executive directors.
An Audit and Risk committee and a Remuneration and Nomination committee have been established and their terms of reference defined.
|
| 10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders |
The Company places a high priority on regular communications with its various stakeholder groups and aims to ensure that all communications concerning the Company’s activities are clear, fair and accurate. The Company’s website is regularly updated.
The Company’s financial reports can be found on the Company’s website.
Notices of General Meetings of the Company can also be found on the Company’s website.
The results of voting on all resolutions in future general meetings will be posted to the Company’s website, including any actions to be taken as a result of resolutions for which votes against have been received from at least 20 per cent of independent shareholders.
|
Secretary
C.L. Secretaries Limited
—
1st and 2nd Floors
Elizabeth House
Les Ruettes Brayes
St Peter Port
Guernsey
GY1 1EW
Administrator
Carey Commercial Limited
—
1st and 2nd Floors
Elizabeth House
Les Ruettes Brayes
St Peter Port
Guernsey
GY1 1EW
Solicitors to the Company as to German Property Law
Taylor Wessing
—
Senckenberganlage 20-22
60325 Frankfurt
Germany
Guernsey Advocates to
the Company
Carey Olsen
—
PO Box 98
Carey House
Les Banques
St. Peter Port
Guernsey
GY14BZ
Solicitors to the Nominated Adviser and Broker
Lawrence Graham LLP
—
4 More London Riverside
London
SE1 2AU
Auditors
Deloitte LLP
—
P.O. Box 137
Regency Court
Glategny Esplanade
St. Peter Port
Guernsey GY1 3HW
Registrar
Link Asset Services
—
Mont Crevelt House
Bulwer Avenue
St Sampson
Guernsey
GY2 4LH
