Key QCA Principles

Establish a strategy and business model which promotes long-term value for shareholders

Ubisense has and continues to develop the Group’s activities as two separate business units. This structure enables each unit to develop and execute distinct sales and marketing strategies designed to increase operational productivity across targeted industries through its digital twin technology. While the Geospatial business unit (comprised of the myWorld software and 3rd party services) is concentrated on the communications and utilities industries, the SmartSpace business unit focuses on discrete manufacturing for automotive (commercial and passenger vehicles) and aerospace.

The Group is focused on the three-point strategy as outlined on page 12 of our Report and Accounts for the year ended 31 December 2017 to achieve the performance goals of the business:

Refocus the business

•             Target key industries and top 200 global companies

•             Develop customer driven product roadmaps

•             Manage out legacy 3rd party software and service business

Improve sales execution

•             Strengthen go-to-market capabilities and geographic coverage

•             Deploy metric-driven CRM and Marketing Automation resources

•             Establish a broader, more consistent business pipeline

Reposition the product portfolio

•             Solve enterprise level business challenges

•             Create a modular architecture addressing known customer pain-points

•             Communicate the long-term value Ubisense products deliver to customers

The key challenges to the business and how these are mitigated is detailed on pages 23 to 25 of our Report and Accounts for the year ended 31 December 2017.

 

Seek to understand and meet shareholder expectations

The company maintains a dedicated contact form which is prominently displayed on its website together with the company’s address and phone number for investors to use.  The company holds an Annual General Meeting (AGM) to which all members are invited. During the AGM, time is set aside specifically to allow questions from attending members to any Board member.  As the company is too small to have a dedicated investor relations department, the CEO is responsible for reviewing all communications received from members and determining the most appropriate response, engaging the executive team and Board as needed. In addition to these passive measures, the CEO typically engages with members through investor roadshows held at least twice each year following the release of results.

 

Take into account wider stakeholder and social responsibilities and their implications for long-term success

In addition to members, the company believes its main stakeholder groups are its employees, suppliers and customers. The company devotes significant time to understanding and acting on the needs and requirements of each of these groups via meetings dedicated to obtaining feedback.

With regards to corporate social responsibility (CSR), Ubisense is engaged in a range of CSR programmes through corporate activities sponsored by its regional offices. In addition, the company encourages employees to participate in local activities by giving each employee an annual charity day to volunteer for an organisation of their choice. Ubisense believes that participation in CSR activities is a fundamental responsibility of the company. It encourages the personal development of employees and greater community integration, which helps contribute to the long-term success of the company by creating a more experienced, passionate and productive workforce.

 

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

Risk management on pages 23 to 25 of our Report and Accounts for the year ended 31 December 2017 details risks to the business, how these are mitigated and the change in identified risk over the last reporting period.

The Board considers risk to the business at every Board meeting and the risk register is updated at each meeting. The Company formally reviews and documents the principal risks to the business at least annually.

Both the Board and senior managers are responsible for reviewing and evaluating risk and the Executive Directors meet at least monthly to review ongoing trading performance, discuss budgets and forecasts and new risks associated with ongoing trading.

 

Maintain the board as a well-functioning, balanced team led by the Chairman

The Company is controlled by the Board of Directors. The Board comprises of the Non-Executive Chairman, four Non-Executive Directors and two Executive Directors. The Non-executive Chairman, is responsible for the running of the Board and Richard Petti, the Chief Executive, has responsibility for running the Group’s business and implementing Group Strategy.

The Non-Executive Directors are required to be available to attend board meetings and to deal with both regular and ad hoc matters and they are expected to commit sufficient time to fully discharge their responsibilities. All Non-Executive Directors have confirmed and demonstrated that they have adequate time available to meet the requirements of the role and they have no conflicts. Executive Directors work full time in the business and have no other significant outside business commitments.

All Directors receive regular and timely information on the Group’s operational and financial performance. Relevant information is circulated to the Director’s in advance of meetings.

The Board comprises two Executive Directors and four 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 is satisfied that it has a suitable balance between independence and knowledge of the business to allow it to discharge its duties and responsibilities effectively.

 

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

The Board of Directors has overall responsibility for the Group. Its aim is to provide the leadership and industry specific insight required to develop a successful business, through utilising the broad range of skills and experience of the Board members.

The Board is satisfied that, between the Directors, it has significant industry, financial, public markets and governance experience, possessing the necessary mix of experience, skills, personal qualities and capabilities to deliver the strategy of the Company for the benefit of the shareholders over the medium to long-term. The role of the Chairman and CEO are split in accordance with best practice. The Chairman has responsibility of ensuring that the Board discharges its responsibilities and is also responsible for facilitating full and constructive contributions from each member of the Board in determination of the Group’s strategy and overall commercial objectives. The CEO leads the business and the executive team ensuring that strategic and commercial objectives are met. He is accountable to the Board for the operational and financial performance of the business.

The Nomination Committee of the Board oversees the process and makes recommendations to the Board on all new Board appointments. Where new Board appointments are considered the search for candidates is conducted, and appointments are made, on merit, against objective criteria and with due regard for the benefits of diversity on the Board, including gender. The Nomination Committee also considers succession planning.

The Board carries out an evaluation of its performance annually, taking into account the Financial reporting Council’s guidance on Board Effectiveness.

Biographical details of all members of the Board are set out on pages 26 and 27 of our Report and Accounts for the year ended 31 December 2017 and also on the website.

 

Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement

Board members are appointed with full consideration of the knowledge and skills that they will contribute to the Board and aligned to the needs of the Company at that time. The Chairman ensures that full consideration of the development of the Board is addressed by reviewing the Board composition annually in consultation with the other Board members. The Board, through its Remuneration Committee, ensures that appropriate annual performance targets are set for Executive Board members. The Chairman routinely reviews the management and performance of the Board committees and will addresses any performance concerns directly with the Chairman of and or participants of that committee.

 

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

The Board believes that the promotion of a corporate culture based on sound ethical values and behaviours is essential to maximise shareholder value.  These values are reinforced with employees by the management team through annual business review sessions and form the cornerstone of the employee performance review process. The ethical standards at Ubisense are a key factor in the evaluation of individual performance and that of the entire company.

 

Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board

The Board of Ubisense Group plc currently comprises two Executive Directors, one Non-Executive Chairman and four Non-Executive Directors. For now the Board considers its composition appropriate given the size of the company, its revenues and profitability.

The key Board roles are as follows:

  • Chairman: The primary responsibility of the Chairman is to lead the Board effectively and to oversee the adoption, delivery and communication of the company’s corporate governance model. The Chairman has sufficient separation from the day-to-day business to be able to make independent decisions. The Chairman is also responsible for making sure that the board agenda concentrates on the key issues, both operational and financial, with regular reviews of the company’s strategy and its overall implementation
  • CEO: Charged with the delivery of the business model within the strategy set by the Board.  Works with the Chairman and Non-Executive Directors in an open and transparent way. Keeps the Chairman and Board up-to-date with operational performance, opportunities, risks and other issues to ensure that the business remains aligned with its key objectives.

The board has three sub-committees as follows:

  • Audit Committee: The Audit Committee’s main functions include, inter alia, reviewing and monitoring internal financial control systems and risk management systems on which the Company is reliant. Considering annual and interim accounts and audit reports, making recommendations to the Board in relation to the appointment and remuneration of the Company’s auditors, monitoring and reviewing annually their independence, objectivity, effectiveness and qualifications. Review of the group's whistleblowing policies and procedures.
  • Remuneration Committee: The Remuneration Committee agree the framework for the Group's remuneration policy for Director's and key management, including determining individual remuneration policies for executive directors. The committee also approve the design and targets for short and long term incentive plans. Determining the policy and scope of pension arrangements. Ensuring contractual terms and payments made on termination are fair to both the individual and the Group. Agreeing the policy for authorising expense claims by the Chairman and Chief Executive.
  • Nomination Committee: The Nominations Committee will consider the selection and re-appointment of Board members. It will identify and nominate candidates to fill Board vacancies and review regularly the structure, size and composition (including the skills, knowledge and experience) of the Board and make recommendations to the Board with regard to any changes. The committee will also ensure non-executive directors are able to make the necessary time commitments to fulfil their role and ensure non-executive directors receive letters of appointment, detailing their responsibilities.

Further details on the composition of these committees can be found on the Corporate Governance page.

Updated 25Sep18

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