Corporate Governance

As the Company is listed on the Alternative Investment Market (AIM) of the London Stock Exchange, it is not required to comply with the provisions of the Combined Code. However, the Board is committed to the high standards of good corporate governance embodied in the Combined Code on Corporate Governance and seeks to apply the principles of the Combined Code where practicable for a company of Nautical’s size and complexity.

Board of Directors
The Board is responsible for the direction and overall performance of the Group with emphasis on policy and strategy, financial results and major operational issues.

The Code recommends that at least one-third of Board members should be non-executive directors.The Board comprises three executive and three non-executive directors who are independent of management and do not participate in the Group’s bonus or pension schemes, although the non-executive directors have share options and Mr P Kennedy is a shareholder.

The roles of the Chairman and Chief Executive are separate, thus ensuring a division of responsibility at the head of the Group.

The current excutive directors are employed under a service contract with the Company. All directors are subject to re-election by shareholders every three years and, on appointment, at the first Annual General Meeting after appointment. Appropriate directors and officers’ liability insurance has been arranged by the Company.

Meetings of the Board of Directors
The Board meets at least four times a year after all relevant information has been circulated in good time, to discuss a formal scheduled agenda covering key areas of the Group’s affairs including operational and financial performance and quarterly management accounts.

All members of the Board are expected to attend Board Meetings which are scheduled in advance.

Audit Committee
The Audit Committee chaired by P Kennedy and its other member is
J Conlin. Executive directors may attend by invitation. The minutes of every meeting are taken by the Chairman and circulated to the Board at the next Board Meeting at which the Chairman provides a verbal report of meetings of the Committee.

The Audit Committee, which meets at least twice a year, is responsible for keeping under review the scope and results of the audit, its cost effectiveness and the independence and objectivity of the auditors. It also has oversight responsibility for public reporting and the Company’s internal controls.

Remuneration Committee
The Remuneration Committee is chaired by P Dimmock and its other member is J Conlin. The minutes of every meeting are taken by the Chairman and circulated to the Board at the next Board Meeting at which the Chairman provides a verbal report of meetings of the Committee.

The Remuneration Committee, which meets at least twice a year, is responsible for considering the remuneration packages for executive directors and the bonus and share option strategy for the Group and making recommendations as appropriate.

The Remuneration Committee is also responsible for reviewing the performance of the executive directors and ensuring that they are fairly and responsibly rewarded for their individual contributions to the Group’s overall performance. The Committee’s scope extends to all remuneration of directors including bonus and share options.

None of the Committee has any day-to-day involvement in running the Company and no director participates in discussions about his own remuneration.

Internal control
The Board is responsible for the effectiveness of the Group’s internal control and is supplied with information to enable it to discharge its duties. Internal control systems are designed to meet the particular needs of the Group and to manage rather than eliminate the risk of failure to meet business objectives and can only provide reasonable and not absolute assurance against material misstatement or loss or the risk of failure to meet business objectives.