The board of directors (“the Board”) of Grand Vision Media Holdings PLC (“GVMH” or “the Company”) recognises the importance of good corporate governance and has elected to apply the QCA Corporate Governance Code that was published on 25 April 2018 (“QCA Code”) as its corporate governance code, as the Board believes that this is now the most appropriate corporate governance code for the Company.
The QCA Code has ten principles of corporate governance that the Company has committed to apply within the foundations of the business. These principles are:
1. Establish a strategy and business model which promote long-term value for shareholders;
2. Seek to understand and meet shareholder needs and expectations;
3. Take into account wider stakeholder and social responsibilities and their implications for long tern success;
4. Embed effective risk management, considering both opportunities and threats, throughout the organisation;
5. Maintain the board as a well-functioning balanced team led by the Chair;
6. Ensure that between them the directors have the necessary up to date experience, skills and capabilities;
7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement;
8. Promote a corporate culture that is based on ethical values and behaviours;
9. Maintain governance structures and processes that are fit for purpose and support good decision-making
by the Board; and
10. Communicate how the Company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders.
There follows a short explanation of how the Company applies each of the principles.
Principle 1 – Business Model and Strategy
Grand Vision Media Holdings Plc is a Hong Kong based out-of-home media (OOH) and digital marketing company. The Company completed a reverse takeover of GVC Holdings Limited in 2018.
The OOH business focusses on innovative visual technologies in cinema spaces, with a view to broaden the technologies and locations. The partnerships with cinema groups across China provide a strong platform for the development and growth in business opportunities.
The digital marketing business has well established clients and uses common digital platforms across the Asia region.
For further information on the market, the future strategy of the Company and the risks the Board consider to be the most significant for potential investors, Shareholders are referred to Strategic Report in the latest Annual Report and Accounts (which is available on our website).
Principle 2 – Understanding Shareholders‘Needs and Expectations
Communication with shareholders is co-ordinated and led between the CEO who is the Company’s principal spokesperson with investors and other interested parties.
The Company is in dialogue with, and holds meetings with, shareholders and brokers representing private shareholders as required, providing them with such information on the Company’s progress as is permitted MAR and requirements of relevant legislation.
The Company regularly updates its website and releases news flow and operational updates. Communications are also provided through the Company’s Annual and Interim Reports.
Shareholders are encouraged to attend the Annual General Meeting, which the Board believes is a good opportunity to communicate directly with shareholders.
The Company discloses contact details on its website and on all announcements released via RNS, should shareholders wish to communicate with the Board.
Principle 3 – Consider Wider Stakeholder and Social Responsibilities
The Board believes that its stakeholders (other than shareholders) are its employees, customers, suppliers and their funders.
The Board recognises that the long-term success of the Company is reliant upon the efforts of the Company, advisers and these stakeholders.
The Board makes every effort to communicate effectively with all stakeholders, to ensure that the Company complies with contractual terms.
Principle 4 – Risk Management
The Board has overall responsibility for the determination of the Company’s risk management objectives and policies and recognises the need for an effective and well-defined risk management process. The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Company’s competitiveness and flexibility. The Board is responsible for the monitoring of financial performance against budget and forecast and the formulation of the Company’s risk appetite including the identification, assessment and monitoring of the Company’s principal risks.
For further information on the risks the Board consider to be the most significant for potential investors, Shareholders are referred to the Strategic and Directors’ Report contained in the latest Report and Accounts which are available on the Company’s website.
Principle 5 – A Well-functioning Board of Directors
The Board is responsible for the management of the business of the Company, setting the strategic direction of the Company and establishing the policies of the Company. It is the Board’s responsibility to oversee the financial position of the Company and monitor the business and affairs of the Company on behalf of Shareholders, to whom the Directors are accountable. The primary duty of the Board is to act in the best interests of the Company at all times.
The Board also addresses issues relating to internal control and the Company’s approach to risk management.
The Board consists of one Executive Director and two Non-Executive Directors, both of whom are considered to be independent. All the Directors are expected to devote as much time to the affairs of the Company as may be necessary to fulfil their roles.
Jonathan Lo is CEO of the Board, and acts as Chairman for meetings. The CEO has industry and technical knowledge and expertise and financial expertise. The Non-Executive Directors have accounting, fund management, technical, public market experience.
At formal meetings, the Board receives reports by the CEO on the overall performance since the
previous Board meeting. He is supported by the subsidiary financial controller on financial detail. They are followed by reports on other matters, particularly progress with development projects.
There is a formal schedule of matters reserved for the Board. This includes the setting of high-level targets, approval of budgets, strategy, funding, capital expenditure, license agreements and incentive schemes. Specific authority levels for expenditure are delegated to individual executives or management committees according to a schedule agreed by the Board.
Whilst the bulk of the formulation of budgets and strategy is undertaken by senior management, this is done against a framework set by the whole Board, challenged by it in detail and finally approved by it.
Financial information submitted regularly to the Board includes monthly balance sheets and profit & loss accounts; together with analyses of movements in cash, trade debtors and creditors, and fixed assets.
Certain other high level decisions that cannot await the convening of a formal Board meeting may be agreed by way of written resolutions. In such cases supporting papers are submitted to the directors and they are given the opportunity to discuss the matter with other directors and executive management. Written resolutions are deemed passed only if all directors vote in favour.
Overcoming geographic and time differences
The Board is conscious of the need to overcome the difficulties that can arise from the time differences and geographic separations that face directors; both between and within regions.
It is not practical or cost-justified for the whole Board to meet face-to-face at every board meeting. So where one or more director is unable to be physically present, use is made of telephone conference calls.
Principle 6 – Appropriate Skills and Experience of the Directors
The Company believes that the current balance of skills within the Board as a whole reflects a broad and appropriate range of commercial, technical and professional skills relevant to the business.
Biographical details of each of the Directors and officers are set out below:
Jonathan Yat Pang Lo
Chief Executive Officer
Jonathan Yat Pang Lo, FCA, is the founder and CEO of GVC Holdings Ltd. He is a Chartered Accountants in England and Wales (ICAEW) and the Canadian Institute of Chartered Accountants (CICA). Mr Lo has significant management experience in both the financial and TMT ( telecommunications, media and technology) sectors.
Frederick Oon Kian, Chua
Non-executive Director
Mr. Frederick Chua Oon Kian is a Founder & Chief Executive Officer at Quantum Asset Management Pte Ltd. He is on the Board of Directors at CMON Ltd.He has over 20 years of equity research, private equity and fund management experience.
He started his career in 1991 as equity research and sales in Nomura Singapore. Between 1994- 1998, he was a portfolio manager in ABN AMRO Bank Singapore, managing Asian Equities for wealth management division. From 2001 to present, he has invested in more than 12 PRE IPO investments in Chinese companies that are successfully listed in both the Hong Kong and Singapore exchanges. He holds a Bachelor of Arts Degree in Economics from the Indiana University, Bloomington.
Ajay Rajpal
Non-executive Director
Mr. Ajay Rajpal, ACA, is a Chartered Accountant and member of ICAEW, qualifying in 1999. During his career, he has gained broad-ranging commercial experience developed in the US, Europe, Middle East and Far East, with a particular focus on M&A, financial management and insolvency/ restructuring.
The Directors have access to the Company’s external advisers e.g. lawyers and auditors as and
when required and are able to obtain advice from other external advisers when necessary.
All Directors have access to independent legal advice at the Company’s expense.
The Board will seek to take into account Board imbalances for future nominations, with areas to take
into account including gender balance.
Principle 7 – Evaluation of Board Performance
Evaluation of the performance of the Company’s Board has historically been implemented in an informal manner.
From 2018 however, the Board will formally review and consider the performance of each director at or around the time of publication of the company’s annual report.
On an ongoing basis, board members maintain a watching brief to identify relevant internal and external candidates who may be suitable additions to or backup for current board members.
The Company undertakes annual monitoring of personal and corporate performance. Responsibility for assessing and monitoring the performance of the executive directors lies with the independent
non-executive director.
Agreed personal objectives and targets including financial and non-financial metrics are set each year for the executive directors and performance measured against these metrics.
The Board as a whole is mindful of the need for considering succession planning.
Principle 8 – Corporate Culture
The Board believes that the promotion a corporate culture based on sound ethical values and behaviours is essential to maximise shareholder value in the medium to long-term. The Company recognises the importance of promoting an ethical corporate culture, interacting responsibly with all stakeholders and the communities in which the Company operates.
The Company maintains and annually reviews a handbook that includes clear guidance on what is expected of every employee and officer of the company. Adherence of these standards is a key factor in the evaluation of performance within the company, including during annual performance reviews.
Guided by the Group’s core values of simplicity, empowerment, passion, innovation and authenticity, the Group seeks to promote a culture where its people can thrive. For GVMH, this means promoting strong business ethics and putting in place policies and programmes to build trust with employees.
As a first priority, GVMH seeks to uphold individual human rights in its operations and expects the same from all partners. The Group’s policies outline the behaviours expected from employees and suppliers at all times and set out the Group’s zero tolerance approach towards any form of modern slavery, discrimination or unethical behaviour relating to bribery, corruption or business conduct.
The GVMH diversity policy outlines the Group’s commitment to building an inclusive culture, where people feel able to be their best at work, irrespective of age, race, sexual orientation, religion, national origin or gender.
Principle 9 – Maintenance of Governance Structures and Processes
The Board provides strategic leadership for the Company and operates within the scope of a robust corporate governance framework. Its purpose is to ensure the delivery of long-term shareholder value, which involves setting the culture, values and practices that operate throughout the
business, and defining the strategic goals that the Company implements in its business plans.
The Board meets regularly to determine the policy and business strategy of the Group and has adopted a schedule of matters that are reserved as the responsibility of the Board. The CEO leads the development of business strategies within the Group’s operations. The Board currently consists of one Executive Directors and two
Non-executive Directors.
The Board considers that there is an appropriate balance between the Executives and Non-executives and that no individual or small group dominates the Board’s decision making.
The Board’s members have a wide range of expertise and experience and it is felt that concerns may be addressed to the Non-executive Directors.
The Board has considered mechanisms by which the business and the financial risks facing the Company are managed and reported to the Board. The principal business and financial risks have been identified and control procedures implemented. The Board acknowledges its responsibility for reviewing the effectiveness of the systems that are in place to manage risk and to provide reasonable but not absolute assurance with regard to the safeguarding of the Company’s assets against misstatement or loss.
Internal controls
The Board has ultimate responsibility for the Company’s system of internal control and for reviewing its effectiveness. However, any such system of internal control can provide only reasonable, but not absolute, assurance against material misstatement or loss. The Board considers that the internal controls in place are appropriate for the size, complexity and risk profile of the Group. The principal elements of the Group’s internal control system include:
• Close management of the day to day activities of the Group by the executive Directors;
• An organisational structure with defined levels of responsibility, which promotes entrepreneurial decision making and rapid implementation whilst minimising risks;
• A comprehensive annual budgeting process producing a detailed integrated profit and loss, balance sheet and cash flow, which is approved by the Board;
• Detailed monthly reporting of performance against budget; and
• Central control over key areas such as capital expenditure authorisation and banking facilities.
The Company continues to review its system of internal control to ensure compliance with best practice, whilst also having regard to its size and the resources available. The Board considers that the introduction of an internal audit function is not appropriate at this juncture.
The CEO has overall responsibility for corporate governance and in promoting high standards
throughout the Company. He leads and chairs the Board, ensuring that that performance of individual Directors, the Board and its committees are reviewed on a regular basis, leads in the development of strategy and setting objectives, and oversees communication between the Company and its shareholders.
The Executive Director is responsible for implementing and delivering the strategy and operational decisions agreed by the Board, making operational and financial decisions required in the day-to-day operation of the Company, providing executive leadership to managers, championing the Company’s core values and promoting talent management.
The Independent Non-Executive Directors contribute independent thinking and judgement through the application of their external experience and knowledge, scrutinise the performance of management, provide constructive challenge to the Executive Director and ensure that the Company is operating within the governance and risk framework approved by the Board.
The Board reviews annually the effectiveness of its corporate governance structures and processes.
The primary duty of the Board is to act in the best interests of the Company at all times. The Board
also addresses issues relating to internal control and the Company’s approach to risk management.
The Company has also implemented a code for Directors´ and employees´ dealings in securities which is appropriate for a company whose securities are traded on the London Stock Exchange and is in accordance with the requirements of the Market Abuse Regulation which came into effect in 2016.
Principle 10 – Shareholder Communication
The Board is committed to maintaining good communication with its shareholders and investors,
providing them with such information on the Company’s progress as is permitted by MAR and the requirements of the relevant legislation.
The Board believes that the Company’s Annual Report and Accounts, and its Interim Report published after the half year, play an important part in presenting all shareholders with an assessment of the Company’s position and prospects.
The Annual General Meeting is the principal opportunity for private shareholders to meet and discuss the Company’s business with the Directors. There is an open question and answer session during which shareholders may ask questions both about the resolutions being proposed and the business in general. The Directors are also available after the meeting for an informal discussion with shareholders.
Results of shareholder meetings and details of votes cast will be publicly announced through RNS and displayed on the Company’s website with suitable explanations of any actions undertaken as a result of any significant votes against resolutions.
All reports and press releases are published on the Group’s website: www.gvmh.co.uk,
and the Company will continue to keep its website up to date, participate in investor presentations,
attend conferences and release news flow and operational updates as appropriate.