Strategic Review
32 Finsbury Food Group Annual Report & Accounts 2018
Report on Corporate Governance
Corporate Governance
Financial Statements
The Board
The Board believes that corporate governance is more than just a set of guidelines; rather it is a framework which underpins the core values for running the business in which we all believe, including a commitment to open and transparent communications with stakeholders. We believe that good corporate governance improves performance while reducing or mitigating risks.
QCA Principles
1. Establish a strategy and business model which promote long-term value for shareholders The Group’s vision is to be the UK’s most innovative speciality bakery group, providing differentiation for our customers. Our business model, and the Finsbury ‘recipe for growth’ operating principles by which we manage our business, are shown on page 11. Our strategy and markets are explained in detail in our Strategic Report on pages 7 to 10.
2. Seek to understand and meet shareholder needs and expectations Relationships with our shareholders are important to us and we seek to provide effective communications through our Interim and Annual Reports along with Regulatory News Service announcements. We also use the Company’s website,
www.finsburyfoods.co.uk for both financial and general news relevant to shareholders. The Executive Directors meet shareholders and other investors/potential investors at regular intervals during the year and host broker and analyst meetings at operating sites from time to time.
The broker and NOMAD, Cenkos, is briefed regularly and updates the Board during the year on shareholder expectations.
The Annual General Meeting (AGM) is regarded as an opportunity to meet, listen and present to shareholders, and their participation is encouraged; all Directors attend the AGM and are available to meet shareholders individually or as a group. All 2017 AGM resolutions were passed comfortably.
3. Take into account wider stakeholder and social responsibilities and their implications for long-term success Our continued success is built entirely on the talented people who work here, and employee engagement forms a major part of our operating principles. Everyone at Finsbury Food Group is a valued member of the team, and our aim is to help every individual achieve their full potential. We offer equal opportunities regardless of race, gender, gender identity or reassignment, age, disability, religion or sexual orientation.
Another key element of our recipe for growth is to work for mutual benefit with our partners, including retail grocery and foodservice customers, all of whom benefit from tailored innovation and service. Joint business plans are agreed, customers visit our sites on a regular basis to be involved in product development and business planning activities.
Our key strategic suppliers are long term in nature and work in partnership with the Group on innovations in both product and service. We believe an ethical supply chain is a sustainable one. Finsbury Food Group is a long-standing member of Sedex, an organisation for promoting improvement in responsible and ethical business practices in supply chains.
4. Embed effective risk management, considering both opportunities and threats, throughout the organisation The Board recognises the need for a robust system of internal controls and risk management. The assessment of risks and the development of strategies for dealing with these risks are achieved on an ongoing basis through the way in which the Group is controlled and managed internally. A formal review of these risks is carried out by the Group on an annual basis.
The review process involves the identification of risks, assessment to determine the relative likelihood of them impacting the business and the potential severity of the impact and determination of what needs to be done to manage them effectively. Risk management is integral to the ability of the Group to deliver on its strategic objectives.
The system of internal control is structured around an assessment of the various risks to the business and is designed to address those risks that the Board considers to be material, to safeguard assets against unauthorised use or disposition and to maintain proper accounting records which produce reliable financial and management information.
The key features of the Group’s system of internal control are as follows:
• An ongoing process of risk assessment to identify, evaluate and manage business risks • Management structure with clearly defined responsibilities and authority limits • A comprehensive system of reporting financial results to the Board • A rolling programme of internal audit activities carried out by group finance reporting to the Audit Committee • Appraisal and authorisation of capital expenditure projects • Dual signatories on all bank accounts
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