Section 172 (1) Statement The revised UK Corporate Governance Code was published in July 2018 and applies to accounting periods beginning on or after January 1, 2019.
The Companies (Miscellaneous Reporting) Regulations 2018 require Directors to explain how they considered the interests key stakeholders and the broader matters set out in the section 172(1) to (F) of the Companies Act 2006 ('172') when performing their duty to promote the success of the Company under S172.
This S172 statement, explains how the Directors: a) have engaged with employees, suppliers, customers and others; and b) have had regard to employee interests, the need to foster the Company's business relationships with suppliers, customers and others, and the effect of that, an the principal decisions taken by the Company during the financial year.
The S172 statement focuses on matters of strategic importance to the Company, and a level of information disclosed is consistent with the size and the complexity of the business.
General confirmation of Directors’ duties
The Board has a framework for determining the matters within its remit and certain financial and strategic thresholds have been determined to identify matters requiring Board consideration and approval. When making decisions, each Director ensures that he/she considers, in good faith and that would most likely promote the Company's success for the benefit of its shareholders, and in doing so have regard (among other matters) to:
S172(1) (A) “The likely consequences of any decision in the long term”
The Company is part of RPM International Inc. ("RPM") group of companies, which is a global group of companies. The ultimate parent of which is listed in the New York Stock Exchange, and all the Company's shares are held internally within the RPM group. The Company continues to adopt the RPM Code of Conduct, The Values and Expectations of 168, which encourages the RPM core principles of integrity, commitment, responsible entrepreneurship and moral courage, as the cornerstone for each decision made in the short or long term. The Directors understand the business and the evolving environment which it operates, including the related risks and challenges.
S172(1) (B) “The interests of the Company’s employees”
The Directors recognise that employees are fundamental and instrumental to the success of the business, which is dependent on attracting, retaining, and motivation a diverse group of talented and qualified employees. With the intent of ensuring that it remains a responsible employer (including with respect to pay, benefits, health and safety and the workplace environment), the Directors factor the implications of decisions on employees where relevant and feasible. Employee engagement, organisational culture and attracting and retaining talent is key to the business, as is compliance with applicable employment legislation.
To engage employees, the business will hold quarterly town hall discussions, providing senior management the opportunity to update colleagues on key performance metrics and strategic priorities. It will also allow colleagues the opportunity to ask relevant questions. A one to one/appraisal program is also part of the Company's culture.
S172(1) (C) “The need to foster the Company’s business relationships with suppliers, customers and others”
Deploying the Company's strategy requires strong and mutually beneficial relationships with suppliers and customers. The company seeks the promotion and application of sound corporate governance principles in such relationships, which are prescribed in standards such as the Company's Code of Conduct, Supplier Code of Conduct, Distributors and Applicators Code of Conduct and Modern Slavery requirements.
The Company assesses its customer base to ensure compliance with applicable laws in relation to the sales of its products, including those related to corruption.
Moreover, the Directors receive information updates on a variety of topics that indicate and inform how customers and suppliers have been vetted and engaged. These can range from Information regarding contract management, business strategies, projects, and investments.
S172(1) (D) “The impact of the Company’s operations on the community and the environment”
In conduction of business, the Company seeks to minimise waste, reduce our impact on the environment and reduce the use of energy and resources and is accredited to ISO14001 Environmental Management Systems and regularly reports on safety and environmental performance matters to the Board and the RPM group. The company aims to meet the demand for its products and services in ways which are economically, environmentally and socially responsible.
The company always considers the environmental impact on our neighbours and plans working hours accordingly to avoid noise pollution to the local housing estate.
S172(1) (E) “The desirability of the Company maintaining a reputation for high standards of business conduct”
The Board periodically reviews and approves business conduct frameworks, such as standards of conduct, policies and procedures related thereto, and ensures personnel participate in training covering topics regarding health and safety, bribery and corruption, data protection, cyber security and modern slavery. All personnel have access to the RPM Compliance Hotline, as well as the RPM reporting platform through which any compliance or ethics issues can be discussed or reported. The Company also performs due diligence before entering in to new supplier or distributor agreements. These measures help to ensure high standards of business conduct are maintained.
S172(1) (F) “The need to act fairly as between shareholders of the Company”
After weighing up all relevant factors, the Directors consider which course of action best enables delivery of the Company's strategy through the long-term, taking into consideration the impact on the Company's stakeholders.
Below, we outline some of the principal decisions made by the Board over the year, explain how the Directors have engaged with, or in relation to, the different key shareholders and how shareholders' interests were considered as part of the decision-making process.
Strategic review of the business - This ultimately concluded in the disposal of the contracting businesses post year end. This review included a consultation process post year end which was conducted with effected colleagues and the concluded in the sale of parts of the trade and assets of the Company.
Statement published: 05/02/2024