Section 172 statement, early adoption, with cross references to disclosure (not reproduced in this extract) of relationships with stakeholders

Victrex plc – Annual report – 30 September 2019

Industry: manufacturing

Statement of corporate governance (extract)
Section 172 statement
This section serves as our section 172 statement and should be read in conjunction with the Strategic report on pages 14 and 15. Section 172 of the Companies Act 2006 requires Directors to take into consideration the interests of stakeholders in their decision making. The Directors continue to have regard to the interests of the Company’s employees and other stakeholders, including the impact of its activities on the community, the environment and the Company’s reputation, when making decisions. Acting in good faith and fairly between members, the Directors consider what is most likely to promote the success of the Company for its members in the long term. Whilst the importance of giving due consideration to our stakeholders is not new, we are explaining in more detail this year how the Board engages with our stakeholders, thus seeking to comply, a year early, with the requirement to include a statement setting out how our Directors have discharged this duty.

  •      The Directors are fully aware of their responsibilities to promote the success of the Company in accordance with section 172 of the Companies Act 2006. To ensure the Company was operating in line with good corporate practice, all Directors received refresher training on the scope and application of section 172 from the Company’s legal advisors, Slaughter and May, in July 2019. This focused activity allowed the Board to reflect on how the Company engages with its stakeholders and opportunities for enhancement in the future.
  •  The Board regularly reviews our principal stakeholders and how we engage with them. The stakeholder voice is brought into the boardroom throughout the annual cycle through information provided by management and also by direct engagement with stakeholders themselves. On pages 14 and 15 of our Strategic report, we set out our principal stakeholders, how and why we engage and detail engagement outcomes. The relevance of each stakeholder group may increase or decrease depending on the matter or issue in question, so the Board seeks to consider the needs and priorities of each stakeholder group during its discussions and as part of its decision making.
  •  Relations with shareholders are considered in more detail on pages 14 and 15.
  •  The Board continues to enhance its methods of engagement with the workforce. With effect from 1 October 2019, and following an assessment by the Board of the three formal options suggested for workforce engagement, it was concluded that the most effective method for engagement in the Company’s particular circumstances would be the appointment of a non-executive Director with designated responsibility for workforce engagement. Brendan Connolly will take on this role and we will report in more detail in next year’s Annual Report on the scope of that role and the activities undertaken.
  •  We aim to work responsibly with our suppliers. During the year, the Board reviewed our arrangements and approved Victrex’s Modern Slavery and Human Trafficking Statement which sets out the steps taken to prevent modern slavery in our business and supply chains. For more information, refer to pages 35 and 36.
  •  Following the retirement of Tim Cooper and a subsequent internal reorganisation of senior management, the Chief Executive Officer has established the Victrex Management Team (‘VMT’), with effect from 1 October 2019, to support him in his duties and decision making. The VMT, designated as ‘senior management’ for the purpose of the 2018 Code but not for the purposes of section 414C(8) of the Companies Act 2006, comprises the senior functional management roles and together is comprised of those with responsibility for interacting with the Company’s principal stakeholders. It is envisaged that this change in management structure will further enhance consideration of stakeholder interests in decision making at both Board and management level. We will report in more detail on how the VMT operates in our 2020 Annual Report.
  •  The Board has overseen the implementation of measures to ensure that stakeholder interests are always taken into account. The General Counsel & Company Secretary includes a written reminder of the section 172 duty on each Board agenda. Approval papers prepared by management for Board approval highlight relevant stakeholder considerations to be considered as part of the debate when making decisions. As required, the General Counsel & Company Secretary will provide support to the Board to help ensure that sufficient consideration is given to stakeholder issues.