The Directors share the view that sound governance is fundamental to the successful growth of the business. The Company is required to declare which recognised corporate governance code it has adopted and state how that code has been applied. We continue to apply the principles of the Quoted Companies Alliance Corporate Governance Code for small and mid-sized companies, an updated version of which was published in April 2018 (the "QCA Code"), and our Chair's Governance Statement issued in compliance with AIM Rule 26 explaining our application of the QCA Code can be viewed here.
The Directors are responsible for the determination of the Group’s investment policy and setting the strategic aims and objectives of the Group, and have overall responsibility for the Group’s activities including the review of investment activity and performance. The Board will meet at least four times per annum (and on an ad-hoc basis when necessary between the scheduled meetings), the Audit, Risk and Valuations Committee will meet at least three times per annum, and the Remuneration and Nomination Committee will meet at least two times per annum.
On the 4 November 2019, the Group announced the expansion of the management team. Martin Davis was appointed as Chief Executive Officer.
The Directors are as follows:
Karen Slatford (Non-Executive Chair)
Karen is non-executive Chair of Draper Esprit plc. She is also a non-executive director of AIM-quoted Accesso Technology Group plc and Softcat plc, a FTSE 250 IT infrastructure provider, and senior independent non-executive director of LSE and NYSE listed Micro Focus. Karen began her career at ICL before spending 20 years at Hewlett-Packard Company, where in 2000 she became Vice President and General Manager Worldwide Sales & Marketing for the Business Customer Organisation, responsible for sales of all Hewlett Packard products, services and software to business customers globally. Karen holds a BA Honours degree in European Studies from Bath University and a Diploma in Marketing.
Martin Michael Arthur Davis (Chief Executive Officer)
Martin was appointed as CEO of Draper Esprit in November 2019. He has more than 20 years of experience in financial services and joined Draper Esprit from Aegon Asset Management where he was the Head of Europe, Aegon Asset Management & CEO Kames Capital. Prior to Aegon Asset Management, Martin served as CEO at Cofunds, spent 8 years at Zurich Insurance Group, and was also CEO of Zurich’s joint venture, Openwork, the largest network of financial advice firms in the UK. Prior to this, Martin held senior management roles at Misys, Corillian, and Reuters. Martin also served for 11 years in the British Army. Martin has an MBA from London City Business School (CASS) and Diplomas from the Institute of Marketing and the Market Research Society.
Stuart Malcolm Chapman (Chief Portfolio Officer)
Prior to establishing the Group with co-founder Simon Cook in 2006, Stuart was a Director of 3i Ventures in London. Having joined 3i in 1992, he has over 25 years’ venture capital experience in Europe and the US. He was a founding partner of 3i US, based in Menlo Park, CA from 1999 until 2003. Stuart was responsible for Esprit’s investments in Lagan Technology (sold to Verint), Redkite (sold to Nice) and Kiadis (IPO). Stuart serves as a director with Netronome, DisplayData, Resolver, Realeyes, Crate and Conversocial; and as observer with Graphcore. Prior to 3i, Stuart was involved in software and systems implementations for Midland Bank. He is a graduate of Loughborough University and currently serves on the Strategic Advisory Board for the Loughborough School of Business and Economics.
Benjamin David Wilkinson (Chief Financial Officer)
Ben was appointed to the Board on 4 June 2019, having joined the Group as CFO in 2016. In addition to his responsibilities for the Group’s finance and investor relations functions, Ben serves as a member of the Investment Committee. Ben has led on recent equity and debt raises totalling over £350.0 million. Ben is an experienced leader of public company finance teams having previously served for 5 years as CFO of AIM-listed President Energy PLC where he was responsible for all financial aspects of the group. During his time at President, Ben was a key part of the Board that undertook investments into Argentina and Paraguay and raised US$175 million across several equity issuances with shareholders such as IFC/World Bank and significant UK institutional investors. Ben is a Chartered Accountant, FCA, with a background in M&A investment banking from ABN Amro/RBS where he was involved with multiple cross border transactions and corporate financings, both debt and equity. Ben is a graduate of Royal Holloway, University of London with a BSc in Economics.
Grahame David Cook (Non-Executive Director)
Grahame Cook is an experienced FTSE and AIM non-executive director, with extensive experience as an audit committee chairman. Grahame’s background is in banking, where he specialised in healthcare. He has over 20 years’ experience of M&A, equity capital markets, and investor relations. Grahame started his career at Arthur Andersen, where he qualified as a chartered accountant. He was a Director of Corporate Finance at BZW, and then joined UBS as a member of the global investment banking management committee and global head of equity advisory. He then became joint chief executive officer at WestLB Panmure where he built a pan European Tech team and ran a €100m technology fund. Grahame now sits on a number of boards, including Horizon Discovery Plc, a genomics company and Attraqt plc, an AI SaaS company. Grahame holds a Double First Class Honours degree from the University of Oxford.
Richard Fowler Pelly (Non-Executive Director)
Richard is a non-executive director and advisor in the area of micro, small and medium-sized businesses. Up until April 2014, Richard was the chief executive of the European Investment Fund (‘‘EIF’’), Europe’s largest investor in venture capital funds. Before joining EIF in April 2008, Richard was managing director of structured asset finance at Lloyds TSB Bank in London from 2005 to 2007. From 1998 to 2005, he worked for GE Capital, first as chairman and CEO of Budapest Bank in Hungary and then as CEO of UK Business Finance within GE Commercial Finance. Prior to his career at GE, Richard worked for Barclays Bank in various functions in the UK and in France from 1977 to 1997. Richard holds an honours degree in Psychology from Durham University and an MBA with distinction from INSEAD Fontainebleau. In 2003, he was awarded an OBE in the Queen’s Honours List for Services to the Community in Hungary
Roles and responsibilities of the chair, chief executive and any other directors who have specific individual responsibilities or remits
Karen Slatford, as Chair, is responsible for leading an effective Board, upholding high standards of corporate governance throughout the Group, particularly at Board level, and ensuring appropriate strategic focus and direction. Karen Slatford is also Chair of the Remuneration & Nomination Committee.
The Chief Executive Officer (Martin Davis) has overall responsibility for proposing the strategic focus to the Board, delivery of the business model and strategy and the day to day management of the Group's business.
Grahame Cook and Richard Pelly are both independent Non-Executive Directors and Grahame is also Chair of the Audit, Risk and Valuations Committee. They are available to engage with shareholders should they have a concern that is not resolved through the normal channels.
Stuart Chapman is the Chief Portfolio Officer and Compliance Officer and ensures that the Board is properly briefed on the operating performance of the business, including in respect of the investment portfolio. Stuart is supported in respect of HR matters, risk and compliance by the HR Manager and Legal Counsel respectively.
Ben Wilkinson is the Chief Financial Officer and is responsible for the Group's finance and investor relations functions.
Matters reserved for the Board
The Schedule of Matters Reserved for the Board of the Company sets down those powers reserved for the full Board of the Company and which are not delegated to the Company's Executive Directors. The list contains some matters which the Board cannot, as a matter of law, delegate. In accordance with the Company’s articles of association the Board may, however, appoint committees as it thinks fit to exercise certain of its powers.
Specific areas of delegation are set out in terms of reference for the Audit, Risk and Valuations Committee and Remuneration & Nomination Committee.
The following list is a summary of matters that require approval of the Board:
- The Group's strategic aims, objectives and investment strategy;
- The approval of any single investment by the Company that is greater than £10.0 million or 10% of market capitalisation;
- The approval of any investment decision where a conflict of interest exists;
- Structure and capital of the Group;
- Financial reporting, financial controls and dividend policy and approving annual budgets;
- Internal control and risk management (including the Group's appetite for risk);
- The approval of significant contracts and expenditure; and
- Appointments to the Board and its Committees.
Please see schedule of matters reserved for the Board of Directors here.
Committees (Audit, Remuneration & Nomination)
The Board has established an Audit, Risk and Valuations Committee and a Remuneration & Nomination Committee, with formally delegated duties and responsibilities as described below.
Audit, Risk and Valuations Committee
The Audit, Risk and Valuations Committee is responsible for ensuring the financial performance of the Group is properly reported on and monitored. Its role includes monitoring the integrity of the Group’s financial statements, reviewing significant financial reporting issues, reviewing the effectiveness of the Company’s internal control and risk management systems, reviewing the valuations process, approving valuations of assets under management, and overseeing the relationship with the external auditors (including advising on their appointment, agreeing the scope of the audit and reviewing the audit findings). The Audit, Risk and Valuations Committee monitors the need for an internal audit function and is also responsible for establishing, monitoring and reviewing procedures and controls for ensuring compliance with the AIM Rules and Euronext Growth Rules.
The Audit, Risk and Valuations Committee is responsible for monitoring the relationship with the external auditor, PwC, in order to ensure that the auditor’s independence and objectivity are maintained. As part of this responsibility, the Audit, Risk and Valuations Committee reviews the provision of non-audit services by the external auditor and the Audit, Risk and Valuations Committee Chair is consulted by management prior to the external auditor being engaged to provide any such non-audit services
The Audit, Risk and Valuations Committee is chaired by Grahame Cook and its members are Karen Slatford and Richard Pelly, all of whom are independent Non-Executive Directors. The Board is satisfied that Grahame Cook, who is a qualified Chartered Accountant and an experienced Non- Executive Director and audit committee chair, has recent and relevant financial experience to discharge his duties.
The Audit, Risk and Valuations Committee meets at least three times a year at appropriate times in the reporting and audit cycle and otherwise as required. The Audit, Risk and Valuations Committee also meets frequently with the Company’s external auditors.
Please see Terms of Reference of the Audit, Risk and Valuations Committee here.
Remuneration & Nomination Committee
The Remuneration & Nomination Committee is responsible for determining and agreeing with the Board the policy for the remuneration of the Chair and Executive Directors and, within the terms of the agreed policy, recommending the total remuneration packages of such persons including, where appropriate, bonuses, incentive payments, share options or awards. The remuneration of Non-Executive Directors is a matter for the Chair and the Executive Directors. No Director is involved in any decision as to his or her own remuneration. The Remuneration & Nomination Committee is also responsible for issuing awards of shares and options to purchase Ordinary Shares under the Company’s share incentive plans.
The Remuneration & Nomination Committee is responsible for identifying and nominating members of the Board, recommending Directors to be appointed to each committee of the Board and the chair of each such committee. The Remuneration & Nomination Committee also arranges the annual formal Board evaluation process.
The Remuneration & Nomination Committee is chaired by Karen Slatford and its members are Richard Pelly and Grahame Cook (all of whom are independent Non-Executive Directors). The Remuneration & Nomination Committee meets at least twice a year and otherwise as required.
Please see Terms of Reference of the Remuneration and Nomination Committee here.
As described on page 64 of our Financial Year 2020 Annual Report, the Board conducted a formal performance evaluation process during the year ended 31 March 2020, building on previous Board evaluation which took place in February 2019. The process was carried out by way of detailed questionnaires completed by each member of the Board and covering topics such as the composition of the Board, the quality and timeliness of information provided, relationships between the Board, shareholders, employees and other stakeholders, and succession planning. The responses were collated by the Company Secretary, who presented a summary of the results to the Board for discussion at its meeting in March 2020.
The Board has agreed a number of specific actions to take forward during 2020 in order to improve its efficiency and effectiveness. These included improvements to the Board process, increasing the oversight of risk (principally through the Audit, Risk and Valuations Committee), and focus on the development and communication of corporate culture (to be led by the CEO).
It is intended that Board performance evaluations continue to take place on an annual basis going forwards.
Committee evaluation was also conducted by way of questionnaires, with the questions asked including the extent to which the Board's Committees are properly constituted and received appropriate information in order to discharge their duties, whether each of the Committees had performed their role and responsibilities, as detailed in their Terms of Reference and the reporting of the Committee activities to the Board.
We intend to carry out regular Committee evaluation processes in future.
City Code on Takeovers and Mergers – Mandatory Bid
The City Code on Takeovers and Mergers (“the Takeover Code”) applies to the Company. Under Rule 9 of the Takeover Code, if a person acquires an interest in Ordinary Shares which, when taken together with Ordinary Shares already held by them or persons acting in concert with them, carry 30 per cent. or more of the voting rights in the Company; or a person who, together with persons acting in concert with them, is interested in not less than 30 per cent. and not more than 50 per cent. of the voting rights in the Company acquires additional interests in Ordinary Shares which increase the percentage of Ordinary Shares carrying voting rights in which that person is interested, the acquirer and, depending on the circumstances, its concert parties, would be required (except with the consent of the Takeover Panel) to make a cash offer for the outstanding Ordinary Shares at a price not less than the highest price paid for any interests in the Ordinary Shares by the acquirer or its concert parties during the previous twelve months.
Relations with shareholders
Regular communication with institutional shareholders is maintained through individual meetings with the Executive Directors, particularly following the publication of interim and full-year results. During the year, the Chair also wrote to the Company’s largest investors, and attended meetings with significant shareholders. The Board also encourages shareholders to attend and vote at the Company’s General Meetings, at which the Board is also in attendance and available for shareholder questions. Investor relations are a standing item on the Board’s agenda, and the executive team routinely updates the Board as to outcomes of their meetings with shareholders and potential investors. These initiatives help us to understand shareholders’ views and to address their concerns.
This website contains general information about the Company, its Group, the management team and the Group's investments. Details of recent announcements and all information required to be maintained under AIM Rule 26 can be found at the following location.
Shareholders also have an opportunity to raise questions with the Board at the Group's Annual General Meeting, noting that due to COVID-19 restrictions prohibiting public gatherings, the Board has determined that the 2020 AGM will be held as a closed meeting, and therefore members will not be permitted to attend in person.
Investor relations - contact us
Relations with stakeholders
Due to the Company’s relatively small employee base, the Directors are able to engage directly with employees, and the Non-Executive Directors have an open invitation to attend the Company’s weekly Investment Committee meetings.
The Company’s other key stakeholders are our investee companies, with which we have regular contact, in particular where we have a seat as a director or Board observer of that company. We host an annual Portfolio day for our investee companies, to which our Directors, shareholders and key advisers are also invited. This forms part of a wider events programme targeted towards our investee companies and early stage companies. For our portfolio companies, we participate in an annual CEO conference in Silicon Valley via the Draper Venture Network to connect them to corporates, partners and investors globally. For the wider community, we regularly hold thematic events across the regions and sectors we focus on. In addition to enabling our investee companies and wider partners to meet each other and gain valuable insight, these events also give us regular opportunities to engage with these communities and thereby strengthen our relationships with them. For more information on our stakeholder considerations please see our section 172 Companies Act 2006 disclosures found on pages 48 to 51 of the Financial Year 2020 Annual Report.