Investor Relations

The Board is committed to good governance and endorses the principles of the King Code in both letter and spirit to ensure consistent practices throughout the Group, providing effective leadership that displays integrity, competence, responsibility, accountability, fairness and transparency in directing the business of the Company to create and maintain value. During this financial year the Board focused on the application of the King IV principles and is satisfied that these have been substantially applied. There will be continued focus on identifying and addressing any shortcomings in FY19. An overview of the steps taken by the Company to comply with the King Code.

GOVERNANCE STRUCTURES

The Group has a unitary Board structure comprising a majority of independent non-executive directors (including the Chairman). There are 5 directors in total, 3 of whom are non-executive, and 2 full-time salaried executive directors. The Board’s diversity policy was adopted during the prior reporting period and is reviewed annually. The size of the Board is appropriate given the nature and size of the business and the Board therefore has not set targets in relation to gender and ethnicity – this approach will be reviewed next year in accordance with the principles of the King Code. The roles of the Chairman and the Chief Executive Officer are separate and clearly defined. This division of responsibilities ensures a balance of authority and power. The range of skills, experience and backgrounds currently represented on the Board ensure robust decision-making processes and diversity of viewpoints, enhancing the effective governance of the Group with no individual director having unrestricted decision-making authority. A number of Board Committees assist the Board in fulfilling its mandate, and the roles and responsibilities of the respective committees are set out in their formal terms of reference. The terms of reference of the Board and the respective committees are reviewed annually to ensure that they remain relevant and are available on the Company’s website.

INTERNAL CONTROL SYSTEMS

While the Board has delegated its responsibility for risk management to the Audit and Risk Committee, the Board remains ultimately responsible for the governance of risk. The risk management framework defines Cartrack’s risk 45 management philosophy and encourages a risk-conscious business culture through agreed internal controls and commitment to mitigating actions.

Cartrack’s risk management framework implements a bottomup and top-down approach and has been reviewed to specifically consider the governance of risk to support the achievement of strategic objectives, including compliance and performance-related matters. To this end the identification and assessment of structural opportunities will be further explored to achieve a more complete risk response.

The Risk Management Plan ensures an effective system of risk identification, analysis, evaluation and treatment throughout the Group. Major risk categories have been identified as Financial Risk, Operational Risk, Business Risk and Legal & Regulatory risk. A dashboard of significant risks is compiled through the internal Risk Committee from risks identified by business. Individual risk ratings are determined by the probability and impact of each risk. Appropriate risk response planning is ascribed to each risk and mitigating actions are monitored. This report is regularly reviewed and interrogated by the Audit and Risk Committee. Opportunities will be approached in a similar manner.

A system of internal controls, designed to protect value and enable business growth in a sustainable manner, encompasses financial, operational, compliance and sustainability issues. This system includes a documented organisational structure and division of responsibility, clarity of accountability, established policies and procedures which are communicated throughout the Group, and the careful selection, training and development of people.

The Internal Audit function undertakes a programme of financial and operational audits and reviews, as agreed by the Audit and Risk Committee and covering all Group activities. The annual Internal Audit Plan is developed applying a risk-based approach and is reviewed and ultimately approved by the Board upon recommendation by the Audit and Risk Committee. It is revised regularly to ensure that it remains relevant to the key business priorities and changing risk environment.