267694 EdinburghIT AR 2024 WEB - Flipbook - Page 40
38 / GOVERNANCE / THE EDINBURGH INVESTMENT TRUST PLC
DIRECTORS’ REPORT / CONTINUED
The prescribed format includes provisions relating to the role
of the chief executive officer (CEO), chief financial officer
(CFO) and executive management. The Board considers
these provisions are not relevant to the Company as it is an
externally managed investment company. In particular, all of
the Company’s day-to-day management and administrative
functions are outsourced to third parties. As a result, the
Company has no CEO, CFO or executive management.
The Listing Rules require an explanation of the Company’s
approach to collecting the data used for the purposes
of making the disclosures in LR 9.8.6 R(9) and (10). The
Company Secretary circulated the above tables to each
director to complete individually and collated the responses
for inclusion in the annual financial report.
The Company has met the targets on board diversity as
required by the Listing Rules as at 31 March 2024.
BOARD RESPONSIBILITIES
The Board has overall responsibility for the Company’s
affairs. The Directors are equally responsible under UK law
for promoting the success of the Company and for the proper
conduct of the Company’s affairs taking into consideration:
–
the likely consequences of any decision in the long-term;
–
the need to foster business relationships with its Manager,
other service providers and
advisors;
–
the impact of the Company’s operations on the
community and the environment;
–
the desirability of the Company maintaining a reputation
for high standards of business conduct; and
–
the need to act fairly between shareholders of the
Company.
This is reported in the Section 172 Statement in the Strategic
Report on page 24. The Board is committed to the prevention
of corruption in the conduct of the Company’s affairs and,
taking account of the nature of the Company’s business and
operations, has put in place procedures for and on behalf of
the Company that the Board considers adequate to prevent
persons associated with it from engaging in bribery. It has a
zero tolerance approach towards the criminal facilitation of tax
evasion. In addition, the Directors are responsible for ensuring
that their policies and operations are in the interest of all of
the Company’s shareholders and that the interests of creditors
and suppliers to the Company are properly considered.
The Board has established a schedule of matters reserved
for its consideration, which clearly define the Directors’
responsibilities. The main responsibilities include:
–
setting long-term strategy;
–
setting the Company’s objectives, policies and standards;
–
ensuring that the Company’s obligations to shareholders
and others are understood and met;
–
selecting an appropriate Manager;
–
approving accounting policies and dividend policy;
–
determining dividends payable;
–
managing the capital structure;
–
reviewing investment performance;
–
assessing risk;
–
approving borrowing;
–
and reviewing, and, if agreed, approving recommendations
made by the Board’s committees.
The schedule of matters reserved for the Board will be
available for inspection at the AGM and is otherwise
available at the registered office of the Company and on the
Company’s website.
The Board ensures that shareholders are provided with
sufficient information in order to understand the risk-reward
balance to which they are exposed by holding their shares,
through the portfolio details given in the half-yearly and
annual financial reports, factsheets and daily NAV disclosures.
The Board meets at least five times each year. Additional
meetings are arranged as necessary. Regular contact is
maintained by the Manager with the Board between formal
meetings. Board meetings follow a formal agenda, which
includes a review of the investment portfolio with a report
from the Portfolio Manager on the current investment
position and outlook, strategic direction, performance
against stock market indices and the Company’s peer group,
asset allocation, gearing policy, cash management, revenue
forecasts for the financial year, investment policy guidelines,
marketing and shareholder relations, corporate governance,
regulatory changes and industry and other issues.
To enable the Directors of the Board to fulfil their roles, the
Manager and Company Secretary ensure that all Directors
have timely access to all relevant management, financial
and regulatory information. All directors have access to the
advice of the Company Secretary, who is responsible for
advising the Board on all governance matters.
There is an agreed procedure for the Directors, in the
furtherance of their duties, to take legal advice at the
Company’s expense up to an initial cost of £10,000, having
first consulted with the Chair.
Finally, the Board as a whole undertakes the responsibilities
which would otherwise be assumed by a remuneration
committee, determining the Company’s remuneration
policy. The Board takes into account all factors which are
deemed necessary in order to ensure that members of the
Board are provided with appropriate compensation and
are, in a fair and responsible manner, rewarded for their
individual contributions to the success of the Company.
The remuneration of Directors is reviewed periodically and
reported on in more detail in the Directors’ Remuneration
Report.
