Last updated: 20th December 2023
In accordance with the London Stock Exchange amended AIM Rules for Companies (‘AIM Rules’), the Board has chosen to apply the Quoted Companies Alliance’s (‘QCA’) Corporate Governance Code 2018 (the ‘QCA Code 2018’). The Board chose to apply this code as it believes that it is more suitable for small and mid-size companies.
The QCA Code 2018 includes ten governance principles and a set of disclosures. The Board has considered how we apply each principle to the extent appropriate. Below we provide an explanation of the approach taken in relation to each and also any areas where we do not comply with the QCA Code 2018.
The purpose of the Netcall Group (‘Netcall’ or the ‘Group’) is to help organisations transform their customer engagement activities and enable digital transformation faster and more efficiently, empowering them to get a return by driving improved customer experiences and operational efficiencies.
We achieve this by developing powerful and intuitive software that addresses the core elements of best-in-class customer experience. Our industry leading Liberty platform is a tightly integrated suite of automation, Customer Engagement and contact centre solutions.
This is underpinned by our business model, which is to license our proprietary software and software-as-a-service marketed within a flexible and viable commercial framework.
Our key strategies are to:
The objective is that this strategic framework will result in a growing, profitable and highly valued business that will benefit all stakeholders.
The key challenges, being addressed within the strategic framework, include:
The CEO and CFO are the key shareholder liaison contacts. Shareholders can approach the Chairman or Non-Executive Directors should they have any questions about Executive Directors.
The Company has open communications with its shareholders about its strategy and performance. We communicate with shareholders through: the Annual Report and Accounts; full year and half-year results announcements; trading updates; the Annual General Meeting (‘AGM’); and meetings. A range of information is also available to shareholders and the public on our website.
The AGM is the principal forum for dialogue with private shareholders. We encourage all shareholders to attend and take part subject to any conditions imposed by HM Government and otherwise to ensure the health and safety of our employees and shareholders. The Notice of AGM is sent to Shareholders at least 21 clear days before the meeting. All directors, whenever possible, attend the AGM and answer questions raised by investors. Shareholders vote on each resolution, by way of a poll. For each resolution, we announce the number of votes received for, against and withheld and publish them on our website.
The Directors seek to build a mutual understanding of objectives with institutional shareholders. Our CEO and CFO give results presentations to analysts and institutional investors. We communicate with institutional investors via meetings, investor conferences, roadshows and informal briefings with management. The Group’s Nominated Adviser arranges the majority of these meetings, following which they provide anonymised feedback from the fund managers met. This, together with direct feedback, allows us to understand investor motivations and expectations.
The long-term success of the Group relies upon good relations with a range of different stakeholders, including out staff, customers , suppliers and shareholders. We engage with these stakeholders to obtain feedback as follows:
The Directors are responsible for risk assessment and the systems of internal control. Although no system of internal control can provide absolute assurance against material misstatement or loss, the Group’s systems are designed to provide the Directors with reasonable assurance that problems are identified on a timely basis and dealt with appropriately.
The members of the Board have a collective responsibility and legal obligation to promote the interests of the Group. They are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the Chair of the Board.
The Board consists of five directors, of which two are Executives and three are Non-Executives. The Executive Directors work full-time for Netcall. The Chairman and Non-Executive Directors are expected to commit one to two days per month. The relevant experience and skills that each Director brings to the Board are set out below.
The QCA Code 2018 notes that it is usually expected that at least half of the directors on a board are independent nonexecutive directors. The Company does not comply with the QCA Code 2018 as two Non-Executives are not deemed to be independent as:
The Board has three committees: Audit, Remuneration and Nomination. The Board does not comply with the QCA Code 2018’s recommendation that the Chairman of the Board should not sit on any of the Board’s committees. The Chairman’s participation is necessary due to the limited number of Non-Executive Directors.
Notwithstanding the above, the Non-Executive Directors have sufficient industrial and public markets experience in order to constructively challenge the Executive team and help drive value for all stakeholders. Moreover, the Board considers that the length of service of Michael Jackson and Michael Neville to be a valuable asset to constructive Board discussion. There are currently no female directors. The Board remains confident both that the opportunities in the Company are not excluded or limited by any diversity issues (including gender) and that the Board nevertheless contains the necessary mix of experience, skills and other personal qualities and capabilities necessary to deliver its strategy. The QCA Code 2018 recognises that certain of its recommendations may not be suitable for growing companies and your Board considers that its present directors provide a wide range of expertise that benefits the Group and its stakeholders.
The Board meets regularly during the year. More meetings are arranged as necessary for specific purposes. It has a schedule of regular business, financial and operational matters. Each Board committee has a schedule of work to ensure that it addresses all areas for which it has responsibility during the year. To inform decision making the Chairman is responsible for ensuring that Directors receive accurate, sufficient and timely information. The Company Secretary provides minutes of each meeting. Every Director is aware of the right to seek independent advice at the Group’s expense where appropriate.
Meetings held during the period under review and the attendance of Directors is set out below:
| Board Meetings | Audit Committee | Remuneration Committee | Nomination Committee | |||||
| Possible | Attended | Possible | Attended | Possible | Attended | Possible | ||
| Executive Directors | ||||||||
| Henrik Bang | 11 | 11 | – | 3⁽¹⁾ | – | – | – | – |
| James Ormondroyd | 11 | 11 | – | 3⁽¹⁾ | – | – | – | – |
| Non-Executive Directors | ||||||||
| Michael Jackson | 11 | 11 | 3 | 3 | 5 | 5 | – | – |
| Michael Neville | 11 | 10 | 3 | 2 | 5 | 5 | – | – |
| Tamer Ozmen | 11 | 11 | – | 1⁽¹⁾ | – | – | – | – |
All five members of the Board bring relevant sector experience in technology, four members have at least nine years of public markets experience, and two members are chartered accountants. The Board believes that its blend of relevant experience, skills and personal qualities and capabilities is sufficient to enable it to successfully execute its strategy. Directors attend seminars, courses and other regulatory and trade events to ensure that their knowledge remains current.
Michael Jackson, Non-Executive Director
Term of office: Appointed as Chairman on 23 March 2009; Chairman of the Nomination Committee and member of the Audit and Remuneration Committees.
Background and suitability for the role: Michael Jackson studied law at Cambridge University, and qualified as a chartered accountant with Coopers & Lybrand before spending five years in marketing for various US multinational technology companies. He founded Elderstreet Investments Limited in 1990 and is its executive chairman where, for the past 30 years, he has specialised in raising finance and investing in the smaller companies quoted and unquoted sector. From 1983 until 1987 he was a director and from 1987 until 2006 was chairman of FTSE100 company The Sage Group plc. He was also chairman of PartyGaming plc, another FTSE100 company.
Michael Neville, Non-Executive Director
Term of office: Joined as Non-Executive Director on 30 July 2010; Chair of the Audit and Remuneration Committees and member of the Nomination Committee.
Background and suitability for the role: Michael Neville was appointed to the Netcall Board on 30 July 2010 following the acquisition of Telephonetics plc, where he served as a Non-Executive Chairman from July 2005. He has extensive experience in capital markets, corporate restructuring and strategic development, and serves as a Non-Executive Director for a number of companies across a wide spectrum of industry sectors. His background is in the telecommunications, technology and media arenas
Tamer Ozmen, Non-Executive Director
Term of office: Joined as a Non-Executive Director on 21 November 2019.
Background and suitability for the role: Tamer Ozmen is an experienced technology professional with a background in the implementation of digital transformation projects. He has over 20 years’ experience in senior management positions including CEO of Microsoft Turkey and most recently as head of Microsoft Consultancy Services in the UK. Tamer has also been Group Vice President of Online and Multichannel at Orange S.A. and is a non-executive director of Charles Taylor.
Henrik Bang, CEO
Term of office: Appointed CEO on 13 February 2004.
Background and suitability for the role: Henrik was previously Vice President in GN Netcom 1999–2004, part of the Danish OMX listed GN Great Nordic Group. Before that, he held a number of international management positions in IBM and AP Moller-Maersk Line.
James Ormondroyd, Group Finance Director
Term of office: Joined as Group Finance Director on 30 July 2010.
Background and suitability for the role: James studied physics at University of Manchester, and qualified as a chartered accountant with PwC. He was appointed to the Netcall Board on the acquisition of Telephonetics plc, a speech recognition and voice automation software provider, on 30 July 2010, where he served as the Finance Director and Company Secretary for five years. Prior to that, he was the Finance Director and Company Secretary at World Television Group Plc, a multi-national media and technology business.
Directors are initially appointed until the following Annual General Meeting when, under the Company’s Articles of Association, it is required that they be elected by Shareholders. The Company’s Articles require that one third of the current Directors must retire as Directors by rotation. The QCA Code 2018 recommends that independent directors who have served for more than nine years should be re-elected on an annual basis. The Company does not follow this recommendation due to the current size of the Board and considers the experience of the Company’s current Non-Executive Directors to be more than sufficient for the Company’s needs. Michael Neville was proposed for re-election and re-appointed in 2019 and Michael Jackson and Tamer Ozmen in 2020. James Ormondroyd is proposed for re-election at the Company’s Annual General Meeting on 8 December 2022.
The performance and effectiveness of the Board, its Committees and individual Directors are reviewed by the Chairman and the Board on an ongoing basis. The performance and effectiveness of the Chairman is reviewed by the other Board members. Training is available should a Director request it, or if the Chairman feels it is necessary. The performance of the Board is measured by the Chairman with reference to the Company’s achievement of its strategic goals. The Board does not undertake a formal evaluation of its performance, as this is constantly under review given its size.
The Board continually assesses the candidacy of Netcall staff with respect to succession planning for Executive management and has in place a short-term plan to be instigated in the event of the loss or incapacity of either CEO or CFO. A number of senior managers are directors of subsidiary company boards and we continue to evaluate their progress.
The Group’s long-term growth is underpinned by a set of value-based operating principles. These have regularly been reviewed and adapted as the Group has developed and centres on customer focus, innovation, integrity, quality and teamwork. The culture of the Group is characterised by these values, and they are communicated widely including within the Group’s competency framework (which sets out how we want our colleagues to work within Netcall) and promoted throughout the organisation by managers in their daily work.
We monitor the culture through the use of employee and customer surveys and have in place comprehensive policies and procedures to support ethical behaviour. The Board is updated on the findings of these and determines what action is required and considers its culture is positive.
The Board believes that a culture based on these core values is consistent with fulfilment of the Group’s mission and execution of its strategy.
The Board sets the Group’s vision, strategy and business model to deliver value to its shareholders. It maintains a governance structure appropriate for the Group’s size, complexity and risk, and ensures this structure evolves over time in line with developments of the Group.
The Board defines a series of matters reserved for its decision. It has terms of reference for its Audit, Remuneration and Nomination Committees, to which it delegates certain responsibilities. The Chair of each Committee reports to the Board on the activities of that Committee.
The Audit Committee monitors the integrity of the financial results. It reviews the need for internal audit and considers the engagement of external auditors including the approval of non-audit services. The Audit Committee comprises Michael Jackson and Michael Neville. It is Chaired by Michael Neville and meets at least twice per year. An Audit Committee Report is set out below. The terms of reference of the Audit Committee are available here.
The Remuneration Committee sets and reviews the compensation of Executive Directors including the targets and performance frameworks for cash- and share-based awards. The Remuneration Committee comprises Michael Jackson and Michael Neville. It is chaired by Michael Neville and meets at least once per year. The terms of reference of the Remuneration Committee are available here.
The Nomination Committee reviews the structure, size and composition of the Board. It considers succession and identifies and nominates Board candidates. It comprises Michael Jackson and Michael Neville. It is chaired by Michael Jackson. The Nomination Committee did not meet formally during the year; however, members of the committee discussed these matters regularly in Board meetings. The terms of reference of the Nomination Committee are available here.
The primary responsibility of the Chairman is to lead the Board and to oversee the Group’s corporate governance. He ensures that:
The CEO provides leadership and management of the Group. He:
The Non-Executive Directors contribute independent thinking and judgement through the application of their external experience and knowledge. They scrutinise the performance of management and provide constructive challenge to the Executive Directors. They ensure that the Group is operating within the governance and risk framework approved by the Board.
The Company Secretary ensures that clear and timely information flows to the Board and its Committees. He supports the Board on matters of corporate governance and risk.
The matters reserved for the Board are:
A copy of the Matters Reserved for the Board is available here.
Audit Committee Report
During the year, the Audit Committee has continued to focus on the effectiveness of the controls throughout the Group. The committee met three times, and the external auditor and the CEO and CFO were invited to attend these meetings. Consideration was given to the auditor’s pre- and post-audit reports and these provide opportunities to review the accounting policies, internal control and the financial information contained in both the Annual and Interim Reports. Matters considered included risk of revenue misstatement, management override of controls, going concern and impairment of intangible assets. The Committee reviewed the independence, taking into account fees for non-audit services, and performance of the external Auditor.
Remuneration Committee Report
During the period under review, the Remuneration Committee met five times and:
This Corporate Governance Report is available on the Netcall website. The Board will review and update it annually. Copies of the Annual Report and Accounts, AGM notices, outcomes of AGM votes and other governance materials are available on the Netcall website.
Michael Jackson
Chairman