Introduction
The Board controls the business but delegates day-to-day responsibility to executive management. However, there are a number of matters which are required to be or, in the best interests of the Company should be, determined by the Board of Directors (Board). These are the matters reserved for a decision of the Board:
1. Strategy and Management
1.1 Responsibility for the overall leadership of the Group and setting the Group’s values and standards.
1.2 Approval of the Group's strategic aims and objectives.
1.3 Approval of the annual operating and capital expenditure budgets and any material changes to them.
1.4 Oversight of the Group's operations ensuring:
(a) competent and prudent management;
(b) sound planning;
(c) maintenance of sound management and internal control systems;
(d) adequate accounting and other records; and
(e) compliance with statutory and regulatory obligations.
1.5 Review of performance in the light of the Group's strategic aims, objectives, business plans and budgets and ensuring that any necessary corrective action is taken.
1.6 Extension of the Group's activities into new business or geographic areas.
1.7 Any decision to cease to operate all or any material part of the Group's business.
2. Structure and Capital
2.1 Approval of changes relating to the Group's capital structure including reduction of capital, share issues (except under employee share plans) and share buy backs including the use of treasury shares.
2.2 Approval of major changes to the Group's corporate structure, including, but not limited to acquisitions and disposals of shares which are material relative to the size of the group (considering initial and deferred consideration).
2.3 Changes to the Group's management and control structure.
2.4 Any changes to the Company's listing or its status as a public limited company.
3. Financial Reporting and Controls
3.1 Approval of the annual results announcement, half-year results announcement and any trading updates to the market.
3.2 Approval of the annual report and accounts (including the corporate governance statement, directors’ remuneration report and section 172 statement).
3.3 Approval of the dividend policy.
3.4 In relation to the ordinary shares; declaration of an interim dividend and recommendation of a final dividend. Approval of the payment of the annual preference dividend.
3.5 Approval of any significant changes in accounting policies or practices.
3.6 Approval of the treasury policy and matters requiring Board approval under that policy.
3.8 Approval of material unbudgeted capital or material unbudgeted operating expenditures (outside the scope of the authority delegated to the Chief Executive).
4. Risk Management and Internal Controls
4.1 Establishing a framework of prudent and effective controls which enable risk to be assessed and managed.
4.2 Determining the nature and extent of the Company’s principal risks and risk appetite.
4.3 Ensuring the monitoring and maintenance of sound risk management and internal control systems, including:
Receiving reports from the Audit Committee on the effectiveness of the Group’s risk management and control systems;
Undertaking an assessment of these systems via the Audit Committee; and
Approving an appropriate statement for inclusion in the annual report
5. Contracts, Bank Facilities, Guarantees and Indemnities
5.1 Approval of major capital projects and oversight over execution and delivery.
5.2 Approval of contracts which are material strategically or by reason of size, entered into by the Company or any subsidiary in the ordinary course of business.
5.3 Approval of the appointment or termination of the appointment of bankers, bank mandates applicable to the Company, bank facilities, borrowing from banks or financial institutions, and the issue of guarantees, indemnities and letters of comfort to bankers of the Company.
5.4 Approval of material contracts of the Company or any subsidiary not in the ordinary course of business, including foreign currency transactions and material acquisitions or disposals of any business or assets.
5.5 Approval of contracts for material investments including the acquisition or disposal of interests of 3% or more in the voting shares of any company (excluding intra group re-organisations) or the making of any binding takeover offer.
5.6 The giving or entering into of any material guarantee (including a parent company guarantee) or material indemnity to any third party (not in the ordinary course of business and not being a subsidiary or a bank) in respect of any debt, liability or obligation of any subsidiary.
5.7 The entering into of any other contract which would, at the time of signature, constitute a material contract under the AIM Rules for Companies.
5.8 The granting of security over any Group assets.
5.9 Approval of any material action to eliminate any deficiency in a pension scheme.
6. Communication
6.1 Ensuring a satisfactory dialogue with shareholders based on the mutual understanding of objectives.
6.2 Approval of resolutions and corresponding documentation to be put to shareholders at a general meeting.
6.3 Approval of all circulars, prospectuses and listing particulars.
6.4 Approval of press releases concerning matters decided by the Board.
7. Board Membership and other Appointments
7.1 Approval of changes to the structure, size and composition of the Board, following recommendations from the Nomination Committee.
7.2 Ensuring adequate succession planning for the Board and senior management so as to maintain an appropriate balance of skills, diversity and experience within the Company and on the Board.
7.3 Making appointments to the Board, following recommendations by the Nomination Committee.
7.4 The selection of the Chairman of the Board and the Chief Executive.
7.5 Appointment of the Senior Independent Director to provide a sounding board for the Chairman and to serve as an intermediary for the other directors when necessary.
7.6 Membership and chairmanship of Board Committees following recommendations by the Nomination Committee.
7.7 Continuation in office of Directors at the end of their term of office, when they are due to be re-elected by shareholders at the annual general meeting and otherwise as appropriate.
7.8 Continuation in office of any Director at any time, including the suspension or termination of service of an Executive Director as an employee of the Company, subject to the law and their service contract.
7.9 Appointment or removal of the Company Secretary.
7.10 Appointment, reappointment or removal of the external auditor to be put to shareholders for approval in general meeting, following the recommendation of the Audit Committee.
8. Remuneration, Employee Benefits and Employee Issues
8.1 Determining the remuneration policy for the Executive Directors following recommendation by the Remuneration Committee.
8.2 Determining the remuneration of the Non-Executive Directors (other than the Chairman), subject to the articles of association and shareholder approval as appropriate.
8.3 The introduction of new share incentive plans or major changes to existing plans, to be put to shareholders for approval.
8.4 Approval of annual gender pay statement.
8.5 Oversight of the whistleblowing policy.
9. Delegation of Authority
9.1 The division of responsibilities between the Chairman, the Chief Executive and other Executive Directors, which should be clearly established, and agreed by the Board.
9.2 Approval of the delegated levels of authority, including the Chief Executive’s authority limits (which must be in writing).
9.3 Establishing board committees and approving their Terms of Reference, and approving material changes thereto.
9.4 Receiving reports from Board Committees on their activities.
10. Corporate Governance Matters
10.1 Undertaking a formal review annually of the Board's own performance and that of its Committees.
10.2 Determining the independence of Directors.
10.3 Considering the balance of interests between the Company’s Stakeholders such as shareholders, employees, customers and the community.
10.4 Review of the Group's overall corporate governance arrangements.
10.5 Receiving reports on the views of the Company's shareholders.
10.6 Authorising conflicts of interest where permitted by the Company’s articles of association.
10.7 Determining changes to the Articles of Association and other constitutional documents.
11. Policies
11.1 Approval of new Group policies or material changes to Board approved Group policies which are material to the operation of the Group including:
a) the Code of conduct;
b) the Share dealing code;
c) the Anti-Bribery and Corruption policy;
d) the Health and Safety policy;
e) the Environmental and sustainability policy;
f) the Schedule of Matters Reserved for the Board;
g) the Disclosure Committee Terms of Reference;
h) the Board Standing Committee Terms of Reference;
i) the Data Protection principles; and
j) the Whistleblowing policy.
12. Other
12.1 The making of political donations.
12.2 Approval of the appointment of the Group's principal professional advisers.
12.3 Prosecution, defence or settlement of litigation, or an alternative dispute resolution mechanism being material to the interests of the Company or the Group.
12.4 Approval of the overall levels of insurance for the Group including Directors' and officers' liability insurance and indemnification of Directors.
12.5 Approval of major changes to the rules of the Group's pension scheme, or changes of trustees.
12.6 Approval of the Company’s Modern Slavery Act statement.
12.7 Taking any decision likely to have a material impact on the Company or Group from any perspective, including but not limited to, financial, operational, strategic or reputational.
12.8 Any matters which exceed the authorisation limits of the Chief Executive Officer as set out in the Renold Plc Group Divisional Authority Matrix from time to time.
12.9 Any changes to this schedule of matters reserved for Board decision.
Matters which the Board considers suitable for delegation are contained in the Terms of Reference of its Committees.
In addition, the Board will receive reports and recommendations from time to time on any matter which it considers significant to the Group.
In determining whether a matter falls to be decided by the Board under this schedule (both as to control and materiality) the Board will have regard to the Levels of Authority.
Interpretation:
In this document the following words have the below meanings ascribed to them:
Board means the Board of the Company
Company means Renold plc
Director means a director of the Company
Group means the Company and its subsidiaries and subsidiary undertakings for the time being
Levels of Authority means any document referring to the Company and describing or identifying the levels of authority of individual managers in the Group as approved by the Board from time to time
Listing Rules means the Listing Rules of the UK Listing Authority made under Part VI of the Financial Services and Markets Act 2000
Approved and adopted by the Board on 12 January 2021
