Corporate Governance Statement

The Directors acknowledge the importance of good corporate governance and believe that good corporate governance creates shareholder value by improving performance, whilst reducing or mitigating the risks that a company faces as it seeks to create sustainable growth over the medium to long-term. The Company adopted the QCA Code of Corporate Governance (the “Corporate Governance Code”) in June 2019 in advance of IPO which has become a widely recognised benchmark for corporate governance of small and mid-sized companies, particularly companies admitted to trading on AIM and Euronext Growth. The Corporate Governance Code provides the Company with the framework to help ensure that a strong level of governance is maintained, enabling the Company to embed the governance culture that exists within the Group as part of building a successful and sustainable business for all of its stakeholders. It is the Board’s intention to continue to enhance its corporate governance framework and to transition to compliance with the UK Code.

The Board comprises 11 Directors, 3 of whom are Executive Directors and 8 of whom, including the Chairman, are Non-Executive Directors, reflecting a blend of different experience and backgrounds.

The Board meets at least six times a year to review, formulate and approve the Group’s strategy, budgets and corporate actions and oversee the Group’s progress towards its goals.

A formal Schedule of Matters Reserved for the Board is in place and is reviewed annually. Specific responsibilities reserved for the Board include:

  • responsibility for the overall leadership of the Group and setting the Group’s values and standards;
  • approval of the Group’s purpose, strategic aims and objectives;
  • promoting the long-term sustainable success of the Group, generating value for shareholders and contributing to wider society;
  • embodying and promoting a corporate culture that is based on sound ethical values and behaviours and using it as an asset and a source of competitive advantage;
  • undertaking an assessment of the prospects of the Group, over a defined period and determining why it considers that period to be appropriate;
  • ensuring maintenance of an effective system of internal control and risk management;
  • approving changes to the structure, size and composition of the Board, following recommendations by the Nomination and Governance Committee;
  • undertaking a formal and rigorous review of its own performance, that of its Committees and individual Directors, and the division of responsibilities;
  • considering the balance of interests between shareholders, employees, customers and the community.

During 2020 and early 2021 the Board made significant progress in achieving its target of UK Code compliance. The appointment of Jeff Berkowitz, Jim Gaul and Liz Hoctor saw a further increase in Independence on the Board bringing the total number of Independent Non-Executive Directors to five. The resignation of John Holly, Mark Moran and Marie McConn, each of whom were deemed not to be Independent by the Board, also increased the proportion of Independent representation on the Board.

The Corporate Governance Code requires the Company to apply ten principles of good corporate governance and publish certain disclosures in its annual report and also on its website. The Company has committed to applying these principles within its business and the following describes in detail, how the Company is applying these principles.

Principle One – Establish a strategy and business model which promote long-term value for shareholders

The Company’s vision is to improve patient access to pharmaco-medical products and treatments by enhancing connectivity between manufacturers and healthcare stakeholders.

The Group’s strategy is to double Group EBITDA over the 5-year period 2019 – 2023 by expanding its European commercial offering and developing its global Product Access capabilities to meet the increasing needs of speciality products and innovative medical technologies.

In Commercial & Clinical the Group is building a pan-European service offering from the present footprint in Ireland, the UK the Benelux and the Nordics. The Group’s focus in the short to medium term is to become a strategic partner for manufacturers seeking to address the European market in the most efficient way. With a growing geographic footprint and its network of strategic alliances and third-party logistics providers, the Group has positioned itself with the objective of acquiring further manufacturer clients with a regional mandate in Europe.

In Product Access the Group has an ambition to become a global leader and the Board is excited about the opportunity for the Group to become a leading player in the provision of On-Demand and Exclusive Access services on a global basis following the integration of Durbin. Furthermore, the Company believes that its increased ability to offer Product Access services with a global reach will significantly strengthen the Group’s European Commercial & Clinical solutions with both emerging and established pharmaco-medical clients. Many of these clients have expressed an interest in procuring a strategic partner with the ability to take a product from market access through to full commercialisation. The Board believe that its ability to manage speciality products across their lifecycle will differentiate the Group compared to competitors.

The Group’s strategy for Supply Chain & Retail is to continue to leverage its high-tech distribution facilities, longstanding manufacturer relationships and scalable digital infrastructure to maintain market leadership in Ireland, reinvesting in the Group’s growth platforms, while supporting increasing service levels and managing continued operational and financial efficiency within this division. With strategic platforms in place in its Commercial & Clinical and Product Access divisions, the Board is confident in the growth prospects for the Group which are underpinned by continued operational and financial efficiency within the Supply Chain & Retail division.

The Group believes that through a combination of organic growth and further strategic acquisitions it will continue to drive long-term value for its shareholders.

The Board recognises that understanding and meeting shareholder needs and expectations is a key business objective. Therefore, the Company has established a framework for stakeholder engagement which identifies the key stakeholders of the Group (including shareholders), sets out mechanisms for engaging and communicating with them and details key responsibilities. 

The Group is committed to engaging with the international financial community and shareholders on a regular basis. A dedicated investor relations function is in place, focused on continuing to increase awareness of Uniphar across the international financial community. During 2020, the Company conducted more than 200 meetings and conference calls across 133 existing and prospective investors. A summary of key conferences is included below (not exhaustive):

Date Activity
 January 2020  Davy Investor Conference, New York & Boston
 March 2020  2019 Preliminary Results & Roadshow (virtual)
 May 2020  AGM
 May 2020  Stifel Roadhsow (virtual)
 May 2020  Hauck & Aufhauser Roadshow (virual)
 September 2020  Interim Results & Roadshow (virtual)
 September 2020  Hauck & Aufhauser “Stock Pickers” conference (virtual)
 October 2020  Berenberg Conference& Fireside Chat (virtual)
 November 2020  Goodbody Conference (virtual)
 November 2020  Jefferies Conference (virtual)

The Group’s focus on investor relations and the growing interest from equity market participants is evidenced via the growing pool of independent equity analysts providing research coverage on the Group. Engaging with the analyst community is a key part of how Uniphar communicates with the capital markets. During the year, Uniphar carried out over 30 calls with analysts providing market updates and ongoing company education while also supporting the initiation of three new equity analysts. Five independent research analysts now provide equity research on the Group.

Additionally, shareholders are kept up to date on matters of a material substance and/or a regulatory nature, including M&A activity where relevant, via announcements made through the regulatory news service. On a day-to-day basis, the Group welcomes ad-hoc queries directly via telephone, post or email and up to date details and a host of shareholder tools are available on the Group’s website.

The investment community is increasingly interested in the Group’s Environmental, Social and Governance (“ESG”) initiatives, a summary of which can be found in the Group’s Sustainability and Governance Report in the Annual Report and here

The Group has an investor relations policy in place to:

  1. outline the Company’s methods of communication to shareholders;
  2. ensure that the Company communicates effectively with all shareholders;
  3. and ensure that the Company discloses information correctly, in a balanced, transparent and timely way and simultaneously to shareholders.

The Board is kept up to date with the views of the shareholders through the investor relations team’s engagement with shareholders. The Board also receives briefings from the Group’s brokers on topics such as market perception, investor feedback, the development of our share register as well as regulatory topics.

The Board views the Annual Report as well as its interim results as key communication channels through which progress in meeting the Group’s objectives and updating its strategic targets can be given to all shareholders.

The Company’s AGM is an opportunity for shareholders to meet with the Chairman and other members of the Board. The meeting is open to all shareholders, giving them the opportunity to ask questions and raise issues during the meeting or more informally following the meeting. The results of the Company’s AGM are announced via the regulatory news service.

The Company has also implemented a “Significant Votes Against a Resolution Procedure” which will ensure that where 20% or more of votes have been cast against the Board’s recommendation for a resolution at a general meeting of shareholders, the Board will engage with shareholders and seek to understand their views in relation to the significant vote against.

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

In establishing its framework for stakeholder engagement, the Group has identified the following key stakeholders and methods of engagement:

Stakeholder How we Engage with our Stakeholders
Shareholders As described under Principle 2, the Group believes that understanding and meeting shareholder needs and expectations is a key business objective in and of itself and Principle 2 sets out how the Group seeks to achieve this.
Employees With a workforce of over 2,500, communication is a key priority for the Group. The Group recognises that an essential part of its continued success is the support and involvement of its employees. Given the diverse range of functions throughout the Group, there is no one size fits all approach to employee engagement and communication. The Group uses a combination of direct communication through meetings and reviews, as well as Group wide communication via the intranet, notice boards and regular training. The Group also recognises the Trade Unions of which some of its employees are members and engages with them as necessary. In January 2021, Jim Gaul was appointed to the Board the designated Non-Executive Director for workforce engagement. The Company believes that having a designated workforce engagement role at Board level, coupled with the appointment of Lorraine Kenny, the new Chief People Officer, marks an era of more formal engagement with the workforce and increased representation of the views of the workforce at senior management and Board level.   
Customers/Suppliers Customer and Supplier satisfaction is key to the business of the Group and therefore the group must continually engage with its customers and suppliers to ensure satisfaction and achievement of KPIs. The method of communication depends on the nature of the relationship and the effectiveness of the communication strategy is kept under constant review by the Group.
Advisors The Group has a number of long-standing and trusted advisors in addition to new engagements on an as needed basis. Open communication between the Group and its advisors ensures expectations are managed and optimum service levels are achieved. Where appropriate, the Group encourages communication between its advisors to ensure a cohesive approach.
Regulators The Group takes its obligations to make notifications, filings and returns to various Regulators seriously and seeks to ensure prompt, effective and transparent communication with its Regulators.
Press/Media/Public The Group engages the services of Q4 Public Relations to handle its media and press communication and the Group Director of Corporate Development also plays a key role in communicating with this important stakeholder.

A Sustainability Council was set up in 2020 to drive the sustainability agenda across the Group. It has representatives from senior leadership across all business units and key functional areas. The council reports to the Executive who report in turn to the Board. The Chair of the council is Aisling McCarthy, General Counsel & Company Secretary of the Group. The responsibility of the Council is to define and oversee the implementation of the sustainability policy and strategy of the Group. Key to this is setting company targets at a Group and individual business unit level and engaging internal and external stakeholders with a view to managing, monitoring and reporting on the delivery against those targets to the Executive, and wider stakeholders. The Council also oversees all sustainability reporting, internally and externally and will oversee the appropriate resourcing of sustainability initiatives to ensure their successful delivery.

2020 saw the first Group-wide charity event in the hugely successful Relay for Hope event. This virtual event took place from December 4th–6th, to support cancer charities around the globe and to remember those who have lost their lives to the disease. The event saw Uniphar employees run, walk and cycle to clock-up kilometres for great causes. The event raised a phenomenal €230,000 for cancer charities in every country that Uniphar has a presence with employees clocking up a breath-taking 27,000 kms over the course of the weekend. This event also united the business in a common goal and brought a great spirit of fun and competitiveness across the whole Group.

Further details of the Group’s sustainability initiatives can be found on the Group’s Sustainability page here

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

The Directors have overall responsibility for the Group’s system of internal control and for reviewing its effectiveness. This system is designed to help the Group meet its business objectives by appropriately managing, rather than eliminating, the risks to those objectives. Through the activities of the Audit, Risk and Compliance Committee, the effectiveness of these internal controls is regularly reviewed.

The Group’s Risk Management Policy is designed to provide the framework to identify, assess, monitor and manage the risks associated with the Group’s business. During 2020, the Group conducted an extensive review of the Group’s Risk Register including a bottom-up reporting exercise to ensure that the Group Risk Register accurately reflects all material risks across all areas of the Group’s business. Further details in relation to the Group’s risk management framework are set out in the Annual Report.

The Group’s Head of Internal Audit meets with the Audit, Risk and Compliance Committee on a regular basis to monitor the adequacy of the Group’s internal control systems. The Audit, Risk and Compliance Committee also meets with and receives reports from the external auditors. The Chairman of the Audit, Risk and Compliance Committee reports to the Board on all significant issues considered by the Committee. Further details of the terms of reference of the Audit, Risk and Compliance Committee are available  here.

The Board is responsible for ensuring that risks, and also opportunities, are identified on a timely basis and that the Company’s objectives and activities are aligned with the risks and opportunities identified by the Board. The Company operates a Group-wide risk register which is reviewed and updated on a regular basis and is presented to the Audit, Risk and Compliance Committee where they consider the appropriateness of the risk identified and the mitigating action taken by the executive on a risk by risk basis focusing on those deemed most critical.

Where necessary, the Board draws on the expertise of appropriate external consultants to assist in dealing with or mitigating risk.

Principle Five – Maintain the Board as a well-functioning, balanced team led by the Chairman

The Board is responsible for ensuring that risks, and also opportunities, are identified on a timely basis and that the Company’s objectives and activities are aligned with the risks and opportunities identified by the Board. The Company operates a Group-wide risk register which is reviewed and updated on a regular basis and is presented to the Audit, Risk and Compliance Committee where they consider the appropriateness of the risk identified and the mitigating action taken by the executive on a risk by risk basis focusing on those deemed most critical.

Where necessary, the Board draws on the expertise of appropriate external consultants to assist in dealing with or mitigating risk.

Biographies for each of the directors are available here.

Each Board member commits sufficient time to fulfil their duties and obligations to the Board and the Company and expectations in terms of time commitment are clearly set out in the terms of appointment of all Non-Executive Directors.

The Board has also established an Audit, Risk and Compliance Committee, a Nominations & Governance Committee and a Remuneration Committee and details of their terms of reference are available here

Principle Six – Ensure that between them the Directors have the necessary up to date experience, skills and capabilities

Full details of the members of the Board and their relevant experience are set out here.

In 2019, the Board engaged external advisers to carry out an independent review of the Board structure and composition. This detailed review focused on the skills and experience of each Board member and identified areas where additional experience and diversity would be appropriate to enhance the collective Board composition. During 2020, the Board continued to build on the succession planning and skills analysis work carried out in 2019 to ensure that new appointments to the Board not only contributed to the independence and diversity of the Board but also continued to enhance the skillset of the Board as a whole.

In addition, the Board engages external experts including legal advisers, accountants, Nominated Adviser and Euronext Growth Adviser and brokers in accordance with normal legal and financial processes associated with being a company admitted to trading on AIM and Euronext Growth.

The Board is kept abreast of key developments regarding corporate governance and AIM and Euronext Growth regulation by its Nominated Adviser and Euronext Growth Adviser, and its legal advisers. The Company’s legal advisers provide updates on relevant legal and governance issues with the Nominated Adviser and Euronext Growth Adviser providing the Board with training on the AIM Rules and Euronext Growth Rules (as applicable) and refresher training as and when required. The Company Secretary also helps keep the Board up to date on corporate governance developments and liaises with the Nominated Adviser and Euronext Growth Adviser on areas of AIM and Euronext Growth Rules requirements.

The Directors have access to the Nominated Adviser and Euronext Growth Adviser, Company Secretary, lawyers and auditors as and when required and are able to obtain advice from other external bodies when necessary. The Company Secretary has frequent communication with the Chairman and is available to other members of the Board if required.

The Board also has a formal Board induction procedure in place. When new Directors join the Board they are provided with extensive briefing materials on the Group and its operations, as well as training where appropriate.

Principle Seven – Evaluate board performance based on clear and relevant objectives, seeking continuous improvement

The Board believes that, in addition to dealing with any matters as they arise, it is appropriate to carry out a formal evaluation of the performance of the Board each year. This is intended to ensure that the Board remains effective, well-informed and able to make high quality and timely decisions for the benefit of all stakeholders of the Group.

The Board has a formal annual performance evaluation procedure in place. As part of the annual evaluation process, the performance of the Board as a whole, Board processes, its Committees, the Chairman, and individual Directors on an individual basis are assessed. The Board conducts a self-evaluation of its performance on an annual basis and, in line with best practice, the Board intend to carry out a separate external evaluation of the Board at least every three years. The Chairman is responsible for overseeing the annual evaluation process.

The annual performance evaluation procedure includes an evaluation of:

  1. the composition and structure of the Board, to include balance of skills, experience and knowledge on the Board;
  2. the Boards’ diversity, to include gender, social and ethnic backgrounds, and cognitive and personal strengths;
  3. independence of the Board and individual Directors;
  4. how the Board works together as a unit to achieve objectives and fulfil responsibilities;
  5. how the Board discharges its roles and responsibilities;
  6. Board processes, to include effectiveness of meetings, agendas, forward planning and reporting;
  7. the Chairman’s leadership style and approach;
  8. performance of Committees; and
  9. individual Directors’ performance and ability to contribute effectively and ongoing commitment to their role as Director and, if relevant, Committee members.

In January 2020, six months post-IPO, and following the implementation of new Board Reporting formats, the Board conducted a short-form evaluation of its performance since IPO to ensure that the progress made in the period prior to and since IPO was being monitored. In November 2020, the Board conducted a full Board evaluation in line with the Annual Performance Evaluation Procedure, including individual director self-assessments led by the Chair.

The Non-Executive Directors also meet with the Chair without Executive Directors present to discuss wide range of issues including those considered by the various standing Board Committees. In addition, the Non-Executive Directors, led by Paul Hogan as Senior Independent Director, meet without the Chair present to review the performance of the Chair.

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

The Directors are committed to upholding ethical values and behaviours both at Board level and throughout the Group.

The Schedule of Matters Reserved for the Board includes an obligation on the Board to:

  1. embody and promote a corporate culture that is based on sound ethical values and behaviours and use it as an asset and a source of competitive advantage; and
  2. establish a framework for setting, promoting, monitoring and assessing culture.

The Group is mindful that its corporate culture transcends all three business divisions. The Group is committed to reviewing and further developing and communicating its corporate culture across the enlarged Group and to its stakeholders.

The appointment of Lorraine Kenny, a highly experienced HR professional, to the role of Chief People Officer is a significant step in driving the focus on culture across our continuously growing Group.

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

The Board retains ultimate accountability for good governance and is responsible for monitoring the activities of the executive team. The Board has a collective responsibility and legal obligation to promote the interests of the Group and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the Chairman.

The roles of Chairman and Chief Executive Officer are not combined and there is a clear division of responsibilities between them. The Chairman's responsibility is to lead the Board and this ensures that the Board is effective and efficient. The Chief Executive Officer is accountable to the Board for all authority delegated to the executive team.

The Chairman has overall responsibility for corporate governance and for promoting high standards throughout the Group. He leads and chairs the Board, ensuring that Committees are properly structured and operate with the appropriate terms of reference. He ensures that all Directors contribute effectively in the development and implementation of the Group’s strategy whilst ensuring that the nature and extent of the significant risks the Group is willing to embrace in the implementation of its strategy are determined and challenged. The Chairman is involved in the development of strategy and setting objectives together with the Chief Executive Officer and oversees communication between the Company and its shareholders.

The Chief Executive Officer provides coherent leadership and management of the Group, leads the development of objectives, strategies and performance standards as agreed by the Board. He monitors, reviews and manages key risks and strategies with the Board, and ensures that the assets of the Group are maintained and safeguarded. He also takes a leading role on investor relations activities to ensure communications and the Company’s standing with shareholders and financial institutions is maintained.

The Non-Executive Directors contribute independent thinking and judgement through the application of their external experience and knowledge, scrutinise the performance of management, provide constructive challenge to the Executive Directors and ensure that the Group is operating within the governance and risk framework approved by the Board.

The Company Secretary is responsible for providing clear and timely information flow to the Board and its Committees and supports the Board on matters of corporate governance and risk. All Directors have access to the advice and services of the Company Secretary, who is responsible to the Board for ensuring that Board procedures are complied with. The appointment and removal of the Company Secretary is a matter for the Board.

The Senior Independent Director provides a sounding board for the Chairman and serves as an intermediary for the other Directors when necessary. The Senior Independent Director is also available to shareholders if they have concerns.

The Board is supported in its function by the Audit, Risk and Compliance Committee, the Nominations & Governance Committee and the Remuneration Committee and each committee has clearly defined terms of reference which are available here

 

The Board conducted a review of its relevant stakeholders and those identified, and the methods of communicating with them, are set out under Principle 3 above.

The Group Director of Corporate Development manages investor relations and shareholder communications on behalf of the Group. The Group has also put in place an Investor Relations Policy which ensures that all communications with Shareholders are dealt with in a fair and transparent manner. Details in relation to engagement with shareholders are set out under Principal 2 above.  

In January 2021, Jim Gaul was appointed to the Board the designated Non-Executive Director for workforce engagement. The Company believes that having a designated workforce engagement role at Board level, coupled with the appointment of Lorraine Kenny, the new Chief People Officer, marks an era of more formal engagement with the workforce and increased representation of the views of the workforce at senior management and Board level.