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Corporate Governance

The Quoted Company Alliance (QCA) Code

The Directors recognize the importance of good corporate governance and have chosen to apply the Quoted Companies Alliance Corporate Governance Code (the ”QCA Code”). The QCA Code was developed by the QCA in consultation with a number of significant institutional small company investors, as an alternative corporate governance code applicable to AIM companies. The underlying principle of the QCA Code is that “the purpose of good corporate governance is to ensure that the company is managed in an efficient, effective and entrepreneurial manner for the benefit of all shareholders over the longer term”. The Directors anticipate that whilst the Company will continue to comply with the QCA Code, given the Company’s size and plans for the future, it will also endeavour to have regard to the provisions of the UK Corporate Governance Code as best practice guidance to the extent appropriate for a company of its size and nature. To see how the Company addresses the key governance principles defined in the QCA Code please refer to the below table.Further information on compliance with the QCA Code will be provided in our next annual report.

Jim Mellon, Non-executive Chairman
This disclosure was last reviewed and updated on 28th February 2020.

The principles of the quoted company alliance (QCA) code

Deliver growth

1: Establish a strategy and business model which promote long-term value for shareholders

The strategy and business operations of the Company are set out in the Chairman’s Statement included in the latest audited Financial

Statements at:

The Company’s strategy and business model and amendments thereto, are developed by the non-executive Chairman and approved by the Board.

The Company’s overarching strategy is to create value for Shareholders through investing in companies that have the potential to generate substantial revenues through the development of biopharmaceutical drugs. To achieve this, the Company invests in the life science sector and will establish a portfolio of investments specialising in alternative food technology.

The Company realises this strategy by investing in equity and equity related products in both quoted companies, which offer the benefits of liquidity, and in unquoted companies which offer the attraction of additional capital gains upon completion of a successful IPO.

The Company may also invest in shares of collective investment schemes with exposure to the life science sector and in long-term equity anticipation securities the underlying securities of which will be based on alternative food technology securities and/or indices relating to the life science sector. The Company may also invest in life science sector debt. These investments in life science sector debt shall not exceed 15 per cent. of the Net Asset Value of the Company.

Furthermore, the Company is ungeared and is a passive investor.

The Company aims to deliver capital growth by realising capital gains when it considers that the valuation of individual investments looks to be excessive or, as is often the case in this sector, as a result of trade sales.

Assets and investments are held by the Company directly or through the individual share custodians of the brokers used by the Company to acquire the shares.

The Company invests in inherently high-risk stocks and a predominantly unregulated sector and this is reflected in the principal risks and uncertainties.

In executing the Company’s strategy and operational plans, the Board will typically confront a range of day-to-day challenges associated with these key risks and uncertainties, and will seek to deploy the identified mitigation steps to manage these risks as they manifest themselves.

2. Seek to understand and meet shareholder needs and expectations

The Company via the Board 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, the Board will meet with investors and analysts to provide them with updates on the Company’s business and to obtain feedback regarding the market’s expectations of the Company.

The Company’s investor relations activities encompass dialogue with both institutional and private investors. From time to time, the Company attends private investor events, providing an opportunity for those investors to meet with representatives from the Company in a more informal setting.

3. Take into account wider stakeholder and social responsibilities and their implications 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. These include the Company’s shareholders, partners and suppliers. The Company’s operations and working methodologies take account of the need to balance the needs of all of these stakeholder groups while maintaining focus on the Board’s primary responsibility to promote the success of the Company for the benefit of its members as a whole. The Company endeavours to take account of feedback received from stakeholders, making amendments to working arrangements and operational plans where appropriate and where such amendments are consistent with the Company’s longer-term strategy.

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. Through the activities of the Audit, Risk and Compliance Committee, the effectiveness of these internal controls is reviewed annually.

A comprehensive budgeting process is completed once a year and is reviewed and approved by the Board. The Company’s results, compared with the budget, are reported to the Board on a monthly basis.

The Company maintains appropriate insurance cover in respect of actions taken against the Directors because of their roles, as well as against material loss or claims against the Company. The insured values and type of cover are comprehensively reviewed on a periodic basis.

The Board team meets at least quarterly to consider new risks and opportunities presented to the Company, making recommendations to the Board and/or Audit, Risk and Compliance Committee as appropriate.

Maintain a dynamic management framework

5. Maintain the board as a well- functioning, balanced team led by the chair

The Company’s Board currently comprises three Non-executive Directors.

All of the Directors are subject to election by shareholders at the first Annual General Meeting after their appointment to the Board and will continue to seek re-election at least once every three years.

Directors’ biographies are set out here:

The Board is responsible to the shareholders for the proper management of the Company and meets at least four times a year to set the overall direction and strategy of the Company, to review operational and financial performance. All key operational decisions are subject to Board approval.

Following the Board Meeting on the 5th July 2019, the directors of the Company considered and deemed each of Anderson Whamond, David Giampaolo and Richard Reed to be independent non-executive directors. The QCA Code suggests that a board should have at least two independent non-executive Directors. The Board considers that the current composition and structure of the Board of Directors have been appropriate to maintain effective oversight of the Company’s activities to date.

The non-executive Director receive their fees in the form of a basic cash emolument. The current remuneration structure for the Board’s non-executive Directors is deemed to be proportionate.

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

The Board considers that all of the non-executive Directors are of sufficient competence and calibre to add strength and objectivity to its activities, and bring considerable experience in the operational and financial development of biopharma investment companies.

Directors’ biographies are set out here:

The Board regularly reviews the composition of the Board to ensure that it has the necessary breadth and depth of skills to support the ongoing development of the Company. The Finance Director on the Board, sanctioned with the overview of the finance function is Denham Eke, aided by a non-Board accountant from the Administrator.

The Chairman ensures that the Directors’ knowledge is kept up to date on key issues and developments pertaining to the Company, its operational environment and to the Directors’ responsibilities as members of the Board. During the course of the year, Directors received updates from the Finance Director and various external advisers on a number of corporate governance matters.

7: Evaluate board performance based on clear and relevant objectives, seeking continuous improvement

Internal evaluation of the Board, the Committees and individual Directors is to be undertaken on an annual basis in the form of peer appraisal and discussions to determine their effectiveness and performance as well as the Directors’ continued independence.

The results and recommendations that come out of the appraisals for the directors shall identify the key corporate and financial targets that are relevant to each Director and their personal targets in terms of career development and training. Progress against previous targets shall also be assessed where relevant.

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

The Board seeks to maintain the highest standards of integrity and probity in the conduct of the Company’s operations. These values are enshrined in the written policies and working practices adopted by all officers of the Company. The Board regularly monitors the Company’s cultural environment and seeks to address any concerns that may arise.

The Company is committed to providing a safe environment for all parties for which the Company has a legal or moral responsibility in this area. The Company’s health and safety policies and procedures are enshrined in the Company’s documented quality systems, which encompass all aspects of the Company’s day-to-day operations.

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

The Board has overall responsibility for promoting the success of the Company. The independent non-executive Director is responsible for bringing independent and objective judgement to Board decisions.

The Chairman is responsible for overseeing the running of the Board, ensuring that no individual or group dominates the Board’s decision-making and ensuring the Non-executive Directors are properly briefed on matters. The Chairman has overall responsibility for corporate governance matters in the Company. The Finance Director is responsible for ensuring that Board procedures are followed and applicable rules and regulations are complied with.

The Board has established an Audit, Risk and Compliance Committee, a Remuneration Committee and a Nomination Committee with formally delegated duties and responsibilities. Anderson Whamond chairs the Audit, Risk and Compliance Committee and the Remuneration Committee. The Nomination Committee comprises of the Board and is chaired by the Chairman of the Board.

The Audit, Risk and Compliance Committee normally meets twice a year and has responsibility for, amongst other things, planning and reviewing the annual report and accounts and interim statements involving, where appropriate, the external auditors. The Committee also approves external auditors’ fees and ensures the auditors’ independence as well as focusing on compliance with regulations, legal requirements, corporate governance guidance and accounting standards. It is also responsible for ensuring that an effective system of internal control is maintained. The ultimate responsibility for reviewing and approving the annual financial statements and interim statements remains with the Board.

A summary of the work of the Audit, Risk and Compliance Committee undertaken for the year will be set out in the next audited Financial Statements which will be posted here:

The Remuneration Committee, which meets as required, but at least once a year, has responsibility for making recommendations to the Board on the compensation of the non-executive Directors.

A summary of the work of the Remuneration Committee undertaken will be set out in the next audited Financial Statements which will be posted here:

The Directors believe that the above disclosures constitute sufficient disclosure to meet the QCA Code’s requirement for a Remuneration

Committee Report. However, a separate Remuneration Committee Report will also be presented in the Company’s next annual audited Financial Statements.

The Nomination Committee, which meets as required, but at least once a year, has responsibility for reviewing the size and composition of the Board, the appointment of replacement or additional Directors and making appropriate recommendations to the Board.

A summary of the work of the Nomination Committee undertaken will be set out in the next audited Financial Statements which will be posted here:

The terms of reference of the above Committees are set out in the Company’s Corporate Governance Memorandum, which is regularly updated and can be found here:

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 financial reports can be found here:

Notices of General Meetings of the Company can be found here:

The results of voting on all resolutions in general meetings are 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.