Corporate Governance

Tracsis seeks to follow best practice in corporate governance as appropriate for a Group of its size. As a public company listed on AIM, the Board recognises the importance of an effectively operating corporate governance framework.

The Board has adopted the principles of the 2018 Quoted Companies Alliance Corporate Governance Code – (“the QCA Code”) to support the Group’s governance framework. The Directors acknowledge the importance of the ten principles set out in the QCA Code and this statement briefly sets out how Tracsis currently complies with the provisions of the QCA Code and the reasons for any departures from it.

Principle Disclosure Comply or Explain
Establish a strategy and business model which promote long-term value for shareholders Annual report and accounts AND Website Comply

The vision for Tracsis is to become a leading provider of high value, niche technology solutions and services for the global traffic and transportations markets. The business model remains focussed on specialist offerings that have high barriers to entry, are sold on a recurring basis under contract, and to a retained customer base that is largely blue chip in nature. The vision is being achieved via the delivery of a three pronged strategy.

1. Manageable, industry-led organic growth through continual innovation of products and services and an excellent close working relationship with the Group’s customers

2. International expansion into select overseas markets that share problems with the industries the Group currently serves

3. Reinvesting profits to fund further accretive acquisitions that meet with the Group’s disciplined investment criteria

Tracsis has delivered significant shareholder value since its IPO in 2007.
Seek to understand and meet shareholder needs and expectations Website Comply

The Group maintains effective regular contact with its main shareholders, prospective shareholders, and also welcomes communications from its private investors.

The directors meet with institutional shareholders on a regular basis to understand their expectations and elicit feedback. An AGM is held, which provides all shareholders with an opportunity to ask questions and engage with management. Investors are encouraged to attend the AGM.
Take into account wider stakeholder and social responsibilities and their implications for long-term success Website Comply

Through ongoing dialogue with, and presentations by divisional management and the Executive Directors, the Board is kept updated on matters relevant to key stakeholders and incorporates information and feedback into future decision making. The Group’s key stakeholders include employees, customers, suppliers, bankers, shareholders.
Embed effective risk management, considering both opportunities and threats, throughout the organisation Annual report and accounts Comply

The Board carefully considers the risks facing the Group and endeavours to minimise the impact of those risks. These are detailed in the Annual report and accounts, alongside mitigations (where applicable), and changes to these risks in the year.

The effectiveness of the Group’s system of internal financial controls, for the year ended 31 July 2017 and for the period to the date of approval of the financial statements, has been reviewed by the Directors. Whilst they are aware that although no system can provide for absolute assurance against material misstatement or loss, they are satisfied that effective controls are in place.
Maintain the board as a well-functioning, balanced team led by the chair Annual report and accounts AND website Comply

The board comprises two Executive Directors and four independent Non-executive Directors including an independent Chairman.

Audit and Remuneration Committees are also held as appropriate.

Detailed biographies of the Board members can be found on the website and in the Annual Report.

Throughout the year, there have been 10 Board meetings, with Directors in attendance as disclosed in the Annual report and accounts.

The Board comprises four males and two females.
Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities Annual report and accounts Comply

Detailed biographies of the Board members can be found on the website and in the Annual Report, including their relevant experiences, skills and capabilities.

All Directors receive detailed induction training upon joining the Board, covering compliance issues, Board processes and corporate governance considerations.
Evaluate board performance based on clear and relevant objectives, seeking continuous improvement Annual report and accounts AND website Comply /Partial Comply

During a previous year, the Board completed a formal evaluation process which resulted in changes to the Board composition. Such a review considered the skills, experience, independence and knowledge for all Directors.

The Board informally reviews the performance of the Directors on a periodic basis but has not completed a formal evaluation this financial year. The performance of the CEO and CFO is reviewed informally periodically, and also succession planning is also discussed.
Promote a corporate culture that is based on ethical values and behaviours Website Comply
Tracsis maintains up to date policies covering a wide range of areas such as Corporate Social Responsibility, Anti Bribery & Corruption, and Equality & Diversity, plus Modern Slavery.
Maintain governance structures and processes that are fit for purpose and support good decision-making by the board Annual report and accounts AND website Comply

The Board comprises the independent Chairman, two Executive Directors and three independent Non-executive Directors.

The Board meets regularly throughout the year and has matters reserved for its approval.

Audit, Remuneration and Nominations Committees are in place and have specific terms of reference.
Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders Annual report and accounts AND website Comply

The Group communicates with shareholders through the Annual Report and accounts, full-year and interim results announcements and the Annual General Meeting (AGM), plus periodic trading updates where appropriate.

A range of corporate information (including all announcements) is also available to shareholders, investors and the public on the corporate website.

The Group maintains regular contact with its main shareholders and also welcomes communications from its private investors.

Information summary

Ten Board meetings are held a year. The Board receives a report ahead of each Board meeting containing relevant information such as general business updates, trading updates & management accounts, forecasts and budgets, updates on acquisition opportunities, PLC matters and similar. Additional reports for the Audit, Remuneration and Nominations Committees are prepared as appropriate containing relevant information.

Summary of strategy

The vision for Tracsis is to become a leading provider of high value, niche technology solutions and services for the global traffic and transportations markets. The business model remains focussed on specialist offerings that have high barriers to entry, are sold on a recurring basis under contract, and to a retained customer base that is largely blue chip in nature. The vision is being achieved via the delivery of a three pronged strategy.

1. Manageable, industry-led organic growth through continual innovation of products and services and an excellent close working relationship with the Group’s customers
2. International expansion into select overseas markets that share problems with the industries the Group currently serves
3. Reinvesting company profits to fund further accretive acquisitions that meet with the Group’s disciplined investment criteria

Description of roles

The role of the Chairman is to oversee Board meetings and field all concerns regarding the executive management of the Group and the performance of the Executive Directors.

The role of the Chief Executive Officer is to formulate, manage and deliver the Group’s strategy and operations in conjunction with the rest of the senior management team.

The division of responsibilities between the Chairman and the Chief Executive Officer is clearly defined. The Chairman's primary responsibility is ensuring the effectiveness of the Board and setting its agenda. The Chairman has no involvement in the day-to-day business of the Group. The Chief Executive Officer has direct charge of the Group on a day-to-day basis and is accountable to the Board for the financial and operational performance of the Group.

Non-Executive Appointment Terms

Non-Executive Directors are appointed on standard commercial terms including a fee which takes into account their responsibilities for chairing committees, a three month notice period and other standard provisions relating to their role. None of the letters of appointment provide for any termination payments.

Terms of reference: Audit Committee

The Audit Committee is chaired by Liz Richards and has the primary responsibility of monitoring the quality of internal controls and ensuring that the financial performance of the Group is properly measured and reported on. It receives and reviews reports from the Group’s management and external auditors relating to the interim and annual accounts and the accounting and internal control systems in use throughout the Group. The Audit Committee meets not less than twice in each financial year and has unrestricted access to the Group’s external auditors. The Audit Committee comprises Liz Richards, Chris Cole, Mac Andrade and Lisa Charles-Jones.

Terms of reference: Remuneration Committee

The Remuneration Committee is chaired Lisa Charles-Jones and reviews the performance of the executive directors and makes recommendations to the Board on matters relating to their remuneration and terms of service. The Remuneration Committee also makes recommendations to the Board on proposals for the granting of share options and other equity incentives pursuant to any employee share option scheme, or bonus scheme in operation from time to time. The Remuneration Committee meets as and when necessary. The Remuneration Committee comprises Lisa Charles-Jones, Chris Cole, Liz Richards, and Mac Andrade.

Terms of reference: Nominations Committee

The committee's primary responsibilities are to make recommendations to the Directors on all new appointments of Directors and senior management, interviewing nominees, to take up references and to consider related matters. The Nominations Committee comprises Chris Cole, Mac Andrade, Lisa Charles-Jones and Liz Richards.

Role of External and Internal Advisors

The group’s external advisors are as follows:

Financial Advisor: Rothschild
Nominated Advisor and Broker: finnCap Limited
Auditor: KPMG LLP
Solicitors: Rosenblatt

The Group does not engage any advisors in respect of remuneration.

There are no internal advisors.

The Company Secretary is Max Cawthra, who also fulfils the role of Chief Financial Officer.

Published material

Annual and interim reports can be located here;
Financial reports

Results of shareholder voting

All resolutions were duly approved at all previous AGMs