dotdigital Group PLC Navigation Corporate governance Statement of Compliance with QCA Corporate Governance Code As an AIM quoted company, we recognise the importance of applying sound governance principles in the successful running of the Group. The Board has sought to comply with the Quoted Companies Alliance (QCA) Corporate Governance Code for small and mid-size quoted companies given the size and nature of the company and the composition of the Board and will report annually on our compliance with the code. The sections below set out how we currently comply with the ten principles of the QCA Code. 1. Establish a strategy and business model which promote long-term value for shareholders (fully complies) The strategy and business operations of the Group are set out in the Strategic Report on pages 2 to 29 of the Group Annual Report 2021. The risk section of the Annual Report are on pages 22 and 26 and these deals with the challenges the business faces and how these challenges are mitigated/addressed. The Chief Executive is responsible for the leadership and day-to-day management of the Group. This includes formulating and recommending the Group’s strategy for Board approval and then executing the approved strategy. You can find a full description of the roles of the Board and the founder at dotdigitalgroup.com/about-us/board. Our simple and transparent business model has consistently delivered value to our shareholders. 2. Seek to understand and meet shareholders needs and expectations (fully complies) The Group seeks regular dialogue with both existing and potential new shareholders either through the management team, investor relations or through the company analysts, ensuring its strategy, business model and performance are clearly understood as well as to understand the needs and expectations of shareholders. The Chief Executive and Chief Finance Officer meet regularly with investors and analysts via investor roadshows, attending investor conferences and carry out capital markets days to provide them with updates on the Group’s business and obtain feedback regarding the market’s expectations of the Group through the Brokers or direct feedback to the management team. The Board invites communication from its private investors and encourages participation by them at the Annual General Meeting (AGM). All Board members are present at the AGM and are available to answer questions from shareholders. Notice of the AGM is at the least 21 clear days and the business of the meeting is conducted with separate resolutions, voted by proxy and with the result of the voting being clearly indicated throughout the meeting. The results of the AGM are subsequently published on the Company’s corporate website and are announced through a regulatory information service. Our Senior Independent Director, Boris Huard, is available to shareholders where concerns have not been resolved through the normal channels of communication with the Board and for when such contact would be inappropriate. The board believes that they have successfully engaged with their shareholders in the past and will continue to do so going forward. 3. Take into account wider stakeholder and social responsibilities and their implications for long-term success (fully complies) We are committed to meeting with customers to seek their regular feedback to ensure a high level of customer service and to improve our platform. We have various channels for customers and prospects to communicate with the group whether it be through the messaging channels or the customer success executives. The feedback is then reviewed on a regular basis by senior management team of the group. The Group is mindful of its corporate social responsibilities and the need to build and maintain strong relationships across a range of stakeholder groups. As a company, we regard this as a key principle in what we do. The Group has established a Social Committee that consists of employees across all departments and seniority levels to engage with stakeholders to help enrich communities. The corporate social responsibility report can be found on page 27 of the Group's Annual Report 2021. The Group is fully committed to encouraging the ‘employee voice’ and acting on the feedback we receive. Whether by informal discussion or by our annual employee satisfaction survey, the opinion and feedback provided by our employees is vital to shaping the business. Our employees are at the heart of our business and we consistently strive to train and develop them for career progression. The Board closely monitors the results of the Company’s Employee Engagement Survey to address where possible any concerns raised and ensure the alignment of interests between the Company and that of its employees. This alignment is vital to shaping the business. 4. Embed effective risk management, considering both opportunities and threats, throughout the organisation (fully complies) The Group’s system of internal controls, identification of significant risks and reviewing its effectiveness are the responsibility of the Board. These systems are designed to mitigate the risk of failure to achieve the business objectives. These systems can only provide reasonable but not absolute, assurance against material misstatement or loss. There is an ongoing process for identifying, evaluating and managing the Group’s significant risks and is regularly reviewed by the Risk Committee and the Board. The Group also keeps an active risk register and is also formally reviewed by the Committee on a quarterly basis. The internal control procedures are delegated to Executive Directors and senior management in the Group, operating within clearly defined terms set by the Risk Committee. The Board regularly reviews the internal control procedures in light of the ongoing assessment of the Group’s significant risks and is reviewed on a quarterly basis. On a monthly basis, the management accounts, including a comprehensive financial report, are reviewed by the Board in order to provide effective monitoring of financial performance. A summary of the principal risks and uncertainties facing the Group, as well as mitigating actions, are set out on pages 22 to 26 of the Group's Annual Report 2021. 5. Maintain the Board as a well-functioning, balanced team led by the Chair (fully complies) The Group is managed by a Board of directors chaired by Mike O’Leary. The Board is responsible for taking all major strategic decisions and also addressing any significant operational matters. In addition, the Board reviews the risk profile along with the Risk Committee of the Group and ensures that an adequate system of internal control is in place. Management information systems are in place to enable the Board to make informed decisions to properly discharge their duties. A formal schedule of Matters Reserved for the Board was adopted as at the Board on 25th August 2021 and will be reviewed annually. The Board currently consists of two Executive Directors and three Independent Non-Executive Directors. The Non-Executives spends a minimum of two days a month on Dotdigital Group business matters. The Independent Non-Executive Directors is considered by the Board to be independent of management and free from any business or other relationship that could materially interfere with the exercise of their independent judgement in accordance with the QCA Code. The Board believes it is appropriate to have a Senior Independent Non Executive Director and Boris Huard currently fulfils this role. Mike is available to shareholders where concerns have not been resolved through the normal channels of communication with the Board and for when such contact would be inappropriate. Roles of the Chairman and the Chief Executive are separate, with their roles and responsibilities clearly defined and set out in writing. The Chairman’s main responsibility is the leadership and management of the Board and its governance. He meets regularly and separately with the Chief Executive and the Non-Executive Directors to discuss matters for the Board. The Chief Executive is responsible for the leadership and day-to-day management of the Group. This includes formulating and recommending the Group’s strategy for Board approval and executing the approved strategy. The Board meets monthly, at least 12 times a year, and more frequently if necessary. In addition to this the Board attends an annual strategy meeting which also includes senior directors outside of the Board. of the table below shows attendance for the period July 2020 to June 2021. Board Audit Committee Risk Committee Remuneration Committee Nomination Committee Attended Total Attended Total Attended Total Attended Total Attended Total Executive directors Milan Patel 13 13 2 2 6 6 4 4 1 1 Paraag Amin 13 13 4 4 6 6 1 1 Non executive directors Boris Huard 13 13 4 4 4 4 1 1 Michael O'Leary 13 13 2 2 4 4 1 1 Elizabeth Richards 13 13 4 4 4 4 1 1 6. Ensure that between them, the directors have the necessary up-to-date experience, skills and capabilities (fully complies) The Board considers its current composition and overall size to be both appropriate and suitable with the adequate skills, experience and capabilities to make informed decisions, evaluate performance and constructively criticise strategy. The composition of the board is reviewed on annually basis by the Nomination Committee. The Board is fully committed to the appointment of the right skills that is required to grow shareholder value. One third of the directors retire at the AGM in rotation in accordance with the Company’s Articles of Association. Thereby providing shareholders the ability to decide on the election of the Company’s Board. Non-executive directors that do not meet the independence criteria will also stand for election annually, which will allow shareholders to voice their opinion. Their biographical details can be found with the Group’s Annual Report 2021 on pages 30 and 31. The Nomination Committee through a thorough evaluation of the skills, knowledge and experiences of a proposed new Director makes recommendations to the Board who then make the final decision on the appointment of a new member. Throughout the year, the directors receive updates on corporate governance matters from either the Company Secretary or the Company’s Nominated Advisors. To ensure that the Board continue to develop their skills and keep up to date with market developments they have access to independent professional advice which will be at the expense of the company. In addition, all members of the Board have access to the support and advice of the Company Secretary who is responsible for the induction programme of new members. 7. Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement (fully complies) The Nominations Committee is responsible for Board evaluation. The Committee in the past has carried out informal Board performance evaluations but embarked on this formal process for the Board where questionnaires were circulated to ensure they complied with this principle. The learnings from this process have been discussed by the Board and hence have been addressed. The Committee’s intention is to continue to conduct an internal evaluation on an annual basis, with the same process being repeated for each of the Committees of the Board. The results will be used by the Nominations Committee for its approach to succession planning. 8. Promote a corporate culture that is based on ethical values and behaviours (fully complies) We are committed to acting ethically and with integrity in all our business relationships. The Company recognises the benefits of a diverse workforce and is committed to providing a working environment that is free from discrimination. The Company seeks to promote the principles of equality and diversity in all its dealings with employees, workers, job applicants, clients, customers, suppliers, contractors, agencies and the public. Our people are the difference - hence we aim to hire, keep and train the best. We continue to encourage our unique and supportive culture, which we believe sets us apart from other companies. Our comprehensive set of policies and procedures cover all of our operations. They are constantly updated and communicated to relevant employees. We also within the organisation have a numerous policies that are communicated to all employees that have been adopted by the group for us to be compliant with our ethical and cultural values that we promote within the business. 9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board (fully complies) The Board is supported by a Remuneration Committee, Audit Committee and Nomination Committee. Any matters that falls out of the responsibility of these committees are then dealt with by the Board. The role and responsibilities of the Chairman, Chief Executive and other directors can be found separately. The details of the Committee are contained within their written terms of reference which can be found below. Throughout the year the Chairman of each of the committee feeds back to the Board any issues which require further consideration by the Board. Each of the Board committees has the ability to use external advisors as they see fit in furtherance of the duties which are at the Company’s expense. Further details of the composition and meetings of these committees can be fond within the annual report. Audit Committee terms of reference Remuneration Committee terms of reference Nomination Committee terms of reference 10. Communicate how the Group is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders (fully complies) The company is committed to open communication with all its shareholders. Communications with shareholders is predominantly through the Annual Report and AGM. The last AGM results can be found via the link. Other communications are in the form of, full-year and half-year announcements, periodic market announcements (as appropriate), one-to-one meetings and investor road shows. The remuneration committee report is included within the Group's Annual Report 2021 on pages 36 to 40. The Group’s website www.dotdigitalgroup.com is regularly updated and users can register to be alerted via email when announcements or details of presentations and events are posted on the website. Annual reports and notices of meetings for at least the last five years can be found on the Group’s website. Updated: 16 November 2021 Are you interested in investing in dotdigital? 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