Ark supports high standards of corporate governance and believes that the Company is in compliance with the Combined Code. The Combined Code currently recommends that the board of directors of a UK public company should include a balance of executive and non-executive directors, (and in particular independent non-executive directors) such that no individual or small group of individuals can dominate the board's decision taking. The Combined Code recommends that non-executives should comprise at least half of the board. The Combined Code further recommends that a majority of non-executive directors should be independent and that there should be a senior independent director. The Combined Code also provides that the remuneration committees of UK public companies should consist exclusively of non-executive directors who are independent. The Company complies with the Combined Code in these respects and has put in place the required procedures to comply where practicable with the internal control aspects of the Combined Code.
Currently, the Board is composed of eight members of whom six are Non-Executive Directors. No individual or small group will be in a position to dominate the Board's decision taking. The Combined Code now includes more guidance on whether a director can be viewed as independent. In particular, the Combined Code provides that the board should determine whether the director is independent in character and judgment and whether there are any relationships or circumstances which are likely to affect, or could appear to affect, the directors' judgment. In compliance with the Combined Code, the Board has determined that Sir Mark Richmond, Dr Wolfgang Plischke, David Prince, Andrew Christie and Peter Keen are independent. The senior independent director is Sir Mark Richmond.
The Company no longer grants share options to its Non-Executive Directors. Historically, in order to assist in securing the recruitment and retention of high calibre Non-Executive Directors with the appropriate experience in the context of Ark's then current stage of international development, the Company granted Non-Executive Directors options to acquire shares in the Company, in addition to fees. Options which have been granted to Non-Executive Directors are not subject to any performance conditions and the number of shares which may be acquired on the exercise of an option is solely dependent on the Non-Executive Director's period of service with the Company. The Board considers that the terms of the options will not in any way affect the independent judgment of Sir Mark Richmond, Dr Wolfgang Plischke, David Prince and Peter Keen.
Each Director has one vote. Resolutions are adopted by majority vote of those present and, if the votes are equal, the chairman of the meeting has a second, or deciding, vote. In accordance with the Company's articles of association, no Director shall vote or count in the quorum in relation to a resolution or a meeting of the Directors in respect of any contract or arrangement or other proposal whatsoever in which he has an interest which (together with any interest of a connected person) to his knowledge is a material interest.
The Board has established an Audit Committee, a Remuneration Committee and a Nomination Committee whose make-up complies with the requirements of the Combined Code. Ark expects that the Board will meet at least four times per year and may meet at other times at the request of any Director.
The Combined Code recommends that the Board should establish an Audit Committee of at least three independent Non-Executive Directors, one of whom has recent and relevant financial experience and Ark complies with these requirements. David Prince is Chairman of the Committee, whose other members are Peter Keen and Dr Wolfgang Plischke. The Audit Committee normally meets not less than three times a year and will meet the internal and external auditors at least twice a year without the executive Directors present.
The Audit Committee is responsible for making recommendations to the Board on the appointment of the external auditors and their remuneration. The Audit Committee considers the nature, scope and results of the auditors' work and will review (and reserves the right to approve) any non-audit services that are to be provided by the external auditors. It receives and reviews reports from management and the Group's auditors relating to the Group's annual report and accounts. The Audit Committee focuses particularly on compliance with legal requirements, accounting standards and the Listing Rules and ensuring that an effective system of internal financial and non-financial controls is maintained. The ultimate responsibility for reviewing and approving the annual report and accounts remains with the Board. Audit Committee Terms of Reference.
The Combined Code requires that the Remuneration Committee consist of at least two independent Non-Executive Directors, in the case of a smaller company such as Ark. Peter Keen chairs the Remuneration Committee, and its other members are Sir Mark Richmond and Andrew Christie. In compliance with the Combined Code, only independent Non-Executive Directors of Ark serve on the Remuneration Committee. The Remuneration Committee, which normally meets at least twice a year, has responsibility for making recommendations to the Board on Ark's policy on the remuneration of senior executives, for reviewing the performance of Executive Directors and senior management of Ark and for determining, within agreed terms of reference, specific remuneration packages for each of the Directors and members of senior management, including pension rights, any compensation payments and the implementation of executive incentive schemes. Remuneration Committee Terms of Reference.
Sir Mark Richmond chairs the Nomination Committee, and its other members are Andrew Christie, David Prince and Peter Keen. In compliance with the Combined Code, the majority of the members of the Nomination Committee are Non-Executive Directors and the Chairman of the Nomination Committee is the senior independent Non-Executive Director. The Nomination Committee, which normally meets not less than once a year, has responsibility for considering the size, structure and composition of the Board, retirements and appointments of additional and replacement Directors and making appropriate recommendations to the Board. Nomination Committee Terms of Reference.
In accordance with the requirements of the Combined Code, the identity of each chairman and the membership of the Committees referred to above, and of the Board of Ark itself, will be reviewed on an annual basis.
Company Policies
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