QCA Compliance

Cerillion plc (the”Company”) is committed to high standards of corporate governance.  The Company’s Ordinary Shares are admitted to trading on AIM and the Company has adopted the Quoted Companies Alliance Corporate Governance Code for Small and Mid-Size Quoted Companies (the “QCA Code”).

The Directors recognise that it is in the best interests of the Company and its Shareholders to follow the QCA Code’s principles of Corporate Governance and to have in place risk controls appropriate for a public company of its size along with the NAPF Corporate Governance policy and Voting Guidelines for AIM Companies.

The Company’s adherence to the code was last reviewed on 17 September 2024.

The section below sets out to explain how Cerillion seeks to apply the principles of the QCA Code and how its application supports the group’s success.

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

The Company’s vision is to be the enabler of seamless digital experiences for the world’s communications service providers.  Our mission is to deliver exceptional software solutions with the greatest certainty of outcome for our customers.

We strive to fulfil this mission by a focusing on Research and Development (R&D) to continually innovate for the future and by working with a strong partner network to enable delivery of the best experiences to service providers.

To this aim an annual strategic review is held by the company’s management team, to re-validate and - if necessary - reset business objectives, to assure continuous alignment with the promotion of long-term shareholder value.  The conclusions of this review, and a financial plan designed to deliver against those conclusions, are then presented to the board for further discussion and final approval.  Further strategic reviews are then held on a quarterly basis to track progress against the agreed objectives.  The Company’s purpose, strategy and business model is communicated to shareholders via the Company's Annual Report and Accounts and via the Annual General Meeting.

Promote a Corporate Culture that is based on Ethical values and Behaviours

The Board recognises its responsibility to members of the Company as well as to all other stakeholders including employees, customers and suppliers and has a culture based on ethical values and behaviours which are promoted by the CEO and management team.

The Board seeks to maintain the highest standards of integrity and probity in the conduct of the Group’s operations.  These values are enshrined in the written policies and working practices adopted by all employees in the Company.

The Company adopts a policy of equal opportunities and diversity in the recruitment and engagement of staff, as well as during the course of their employment.  It endeavours to promote the best use of its human resources on the basis of individual skills and experience, matched against those required for the work to be performed and strives to provide an environment where all employees can thrive and feel valued.

The Company recognises the importance of investing in its employees and, as such, offers opportunities for training and personal development and encourages the involvement of employees in the planning and direction of their work. The Company also recognises that commercial success depends on the full commitment of all its employees, and commits to respecting their human rights, to providing them with favourable working conditions that are free from unnecessary risk, and to maintaining fair and competitive terms and conditions of service at all times.

To support employees and their physical and mental wellbeing we provide several resources to ensure that the workforce, regardless of age, race, religion, gender, sexual orientation or disability, has access to additional support including:

• The Employee Assistance Programme, which provides independent help for mental health, financial and legal issues;
• Trained mental health first aiders across the business; and
• Private medical health insurance.

Seek to understand and meet shareholder needs and expectations

The Directors continually seek to understand the objectives of the Company’s shareholders by meeting to discuss current performance, future plans and receive feedback. Communication continues throughout the year via the Annual General Meeting and the issuing of trading updates as required. The Company's shareholder engagement activities are described in the Annual Report and Accounts. Shareholder relations contacts are provided on the Company's website IR Contacts & Advisers.

The CEO and CFO meet with major and potential shareholders and present to analysts after the full year and interim results announcements and as requested throughout the year.  The Company is also involved at presenting at various ‘Capital Market Days’ to provide the opportunity for further engagement.

Investors and potential investors are invited to contact the Company via email: company.secretary@cerillion.com

Take into account wider stakeholder interests, including social and environmental responsibilities and their implications for long-term success

Cerillion takes its responsibilities to the wider environment seriously.  Whilst the Board’s responsibility is to provide shareholder value it understands the need to do this in a responsible way which benefits all stakeholders.  Current policies and practices in the context of Environmental, Social and Governance Standards are detailed in our Annual Report and on our website Environmental, Social & Governance (ESG).

Embedded effective risk management, internal controls and assurance activities, considering both opportunities and threats, throughout the organisation

Management maintain a detailed risk register which is reviewed by the board on a quarterly basis. The Audit Committee is convened at least twice a year and considers all aspects of the Company's financial reporting, internal controls and risk management including auditor independence and the sufficiency of assurance activities. Key risks are communicated to shareholders via the Company's Annual Report and Accounts (Principal Risks and Uncertainties).

Establish and maintain the board as a well-functioning, balanced team led by the chair

The board comprises 2 executive directors and 3 non-executive directors, 2 of whom are independent.  The board is supported by audit, remuneration and nominations committees, each chaired by a non-executive director. Details of the board's composition and operation are communicated via the Company's Annual Report and Accounts, and via the directors’ section of this website where biographies of all board members are provided.

Maintain appropriate governance structures and ensure that individually and collectively the directors have the necessary up-to-date experience, skills and capabilities

The board reviews its composition on a regular basis and will develop its mix of skills and experience as the Company evolves. Details of all directors are currently provided on the Company's website and in the Annual Report and Accounts. The Company has determined governance structures and processes appropriate to it, based on corporate culture, size, capacity and appetite for risk, and business complexity.  The board has done this through its adoption of the QCA Code and has the relevant audit, nominations and remuneration committees as detailed in the Company's Annual Report and Accounts and on the Company's website. The following is a list of matters reserved for the board, as originally outlined in the Company's FPP document at the time of admission to AIM: 

Reserved Matters for the Board

1.  Management

• Executive director responsibilities
• Board and executive director appointment or removals
• Board and executive director succession, training, development and appraisal
• Appointment or removal of Company Secretary
• Remuneration, contracts, grants of options and incentive arrangements for executive directors and any employee where base compensation exceeds £150,000 per annum
• Delegation of the Board's powers
• Agreeing membership and terms of reference of board committees and task forces
• Establishment of managerial authority limits for smaller transactions
• Matters referred to the Board by the board committees 

2.  Strategic/policy considerations

• Business strategy
• Diversification/retrenchment policy
• Opening of new regional markets
• Major upgrades or enhancements to core software Product
• Specific risk management policies including insurance, hedging, borrowing limits and corporate security
• Agreement of codes of ethics and business practices
• Receipt and review of regular reports on internal control
• Annual assessment
• Calling of shareholders' meetings
• Avoidance of wrongful or fraudulent trading

3.  Transactions

• Acquisitions and disposals of subsidiaries or other assets over 5% of net assets/profits • Investment and other capital projects over a similar level
• Substantial commitments including: Contracts which contain a performance bond in excess of £100,000 and Giving security over Group assets (including mortgages and charges over the Group's property)
• Contracts not in the ordinary course of business
• Actions or transactions where there may be doubt over propriety
• Approval of certain announcements (including all RNS announcements), prospectuses, circulars and similar documents
• Disclosure of directors' interests
• Transactions with directors or other related parties

4.  Finance

• Raising new capital and agreement of new/renewed banking and financing facilities
• Treasury policies including foreign currency and interest rate exposure
• Discussion of any proposed qualification to the accounts
• Final approval of annual and interim reports and accounts and changes in accounting policies 

5.  General

• Governance of Group pension schemes and appointment of Company nominees as trustees (required for admin issues and liaising with company broker and fund manager)
• Allotment, calls or forfeiture of shares

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

The Board is responsible for reviewing its own effectiveness, as well as that of the committees and of individual directors. The Board performance review process is currently an internal process, which considers matters such as the performance of the Executive Directors against the Board‐approved Corporate Objectives. The Board considers a more formal, externally-facilitated review process has not been required in the past year, but will continue to consider whether such a review is necessary in future. The Nomination Committee is responsible for establishing succession plans for the Executive Directors.

Establish a remuneration policy which is supportive of long-term value creation and the company's purpose, strategy and culture

The Company's Remuneration Committee has developed a policy to reward executive directors and key management using a variety of means including basic salary and incentive arrangements including bonuses and long term incentive plans.

The Company also operates a Save as you Earn scheme open to all employees. Further details of all schemes are detailed in the Company's Annual Report.

Further benefits offered to demonstrate the value of staff to the business include Private Health Insurance including mental health provision, salary sacrifice schemes, long term paid sabbatical leave, interest free loans, referral bonus’ and quarterly above and beyond recognition schemes.

Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other key stakeholders

The remuneration and audit committee reports are included in the Company's Annual Report and Accounts. The Company's website includes details of shareholders votes, historic Annual Reports and Accounts and historic notices of General Meetings.