QCA Code

The Quoted Companies Alliance Corporate Governance Code (the QCA Code) ensures a worthwhile, effective and flexible governance model. It encourages positive engagement between the Company and all of its stakeholders. Good governance is one of the foundations of a sustainable corporate growth strategy.

The QCA Code is constructed around ten broad principles. The appropriate application of these principles will ensure that good governance practices are in place.

The 10 principles of the QCA code

Below we have outlined the 10 principles of the QCA code together with a brief description of how we apply them.

1. Establish a strategy and business model which promote long-term value for shareholders

Our business model and strategy is clearly explained on pages 2 to 3 of our 2017 Annual Report.

2. Seek to understand and meet shareholder needs and expectations

The Chief Executive Officer and the Chief Financial Officer regularly meet with institutional shareholders to foster a mutual understanding of objectives. In particular, an extensive programme of meetings with analysts and institutional shareholders is held following the announcement of results. Feedback from these meetings and market updates prepared by the Company’s nominated adviser and broker are presented to the Board to ensure they have an understanding of shareholders’ views. The Chairman and the other Non-Executive Director are available to shareholders to discuss strategy and governance issues. The Directors encourage the participation of all shareholders, including private investors, at the annual general meeting. The Annual Report, which includes the Company’s financial accounts, is published on this website and can be accessed by shareholders.

3. Take into account wider stakeholder and social responsibilities and their implications for long-term success

We have mechanisms in place to collect regular feedback from a range of stakeholders. We conduct regular surveys of employees to understand the issues that are important to them and to track their engagement over time. We conduct an ongoing customer satisfaction survey allowing us to track customer satisfaction levels and Net Promoter scores as well as more detailed feedback. Ad hoc research is conducted where more in-depth exploration is required.

The Group is a licensed gas and electricity supplier, and therefore has a direct regulatory relationship with the various regulatory bodies within the industry, in particular Ofgem. If the Group fails to maintain an effective relationship with these regulatory bodies and comply with its licence obligations, it could be subject to fines or to the removal of its respective licences.

The Group has a management team and senior staff with significant industry experience, and significant experience in dealing effectively with the various regulatory bodies. The Group will continue to invest in the right people with the right skill set to ensure all obligations are met by the business and that the strong regulatory relationship that currently exists is maintained.

4. Embed effective risk management, considering both opportunities and threats, throughout the organisation

The Board has identified what it believes to be a sensible approach to risk management for a Company of Yu’s size.

Our risk management framework and processes are clearly described on pages 10 to 11 of our Annual Report

The Company receives regular feedback from its external auditors on the state of its risk management and internal controls.

This is an area that is subject to regular review as our business and the risks we face continues to evolve.

5. Maintain the board as a well-functioning, balanced team led by the chair

The structure of our Board of Directors, outlining those directors who are considered to be independent, together with the detail of the Board committees, is detailed on the Board of Directors and Corporate Governance pages on our website. The board is satisfied that it has an appropriate balance between executive and non-executive directors, as well as independent directors.

6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities

The skills and experience of our Board of Directors are outlined on the Board of Directors page of our website and in our most recent Annual Report and Accounts

The Board currently comprises three Executive and two Non-Executive Directors with an appropriate balance of industry, financial and PLC skills and experience

The Board and Committees receive training as appropriate. In particular, the members of the Audit Committee receive technical updates from the Company’s external auditors to keep them abreast of the latest accounting, auditing, tax and reporting developments.

The Directors also receive regular briefings and updates from the Company’s nominated adviser in respect of continued compliance with the AIM Rules and other regulatory matters.

7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement

An annual review of the effectiveness of the Board will be conducted through discussions with the Board which will be led by the Chairman.

8. Promote a corporate culture that is based on ethical values and behaviours

Recruiting an engaged and motivated team and developing a positive, ethical corporate culture remains a priority for the business. A huge part of the Group’s success has been due to our people. We continue to invest in our team, in a carefully controlled manner, to ensure a balance between growth, cost control and service delivery as the Group expands. We will continue to invest in growing our team to take advantage of the market opportunity. We continue to strengthen our senior management team to help with the challenges that rapid growth brings for a company of our size. This team have wide experience of sales, marketing, finance, human resources, IT and energy industry operations in larger corporates that reflect best practice. This has had a positive impact on the culture of the business. This investment will ensure that the Group maintains high standards of customer care and ethics as well as adhering to stringent industry regulations.

The Company has a whistleblowing policy, in which staff may notify management or human resources of any concerns regarding suspected wrongdoing or dangers at work.

We conduct regular employee surveys to ensure that we are delivering against our corporate culture objectives.

We are committed to preventing acts of modern slavery and human trafficking from occurring within our business and supply chain and we expect the same high standards of our suppliers. We are establishing working practices that enable us to monitor and reduce modern slavery risk within our business and supply chains. Our Modern Slavery Statement outlines the actions we are taking.

9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the board

The corporate governance section of our Annual Report (on pages 12 to 19) details the roles and responsibilities of the board of directors.

Our website details the role and make-up of our Board Committees and this is also detailed on page 14 in our Annual Report.

The appropriateness of the Board’s structures and processes are reviewed through the ongoing Board evaluation process and on an ad hoc basis by the Chairman together with the other Directors, and these will evolve in parallel with the Company’s objectives, strategy and business model as the Company develops.

10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders

The Company communicates progress throughout the year through Regulatory News Service announcements and in more detail in its interim financial statements and annual report and accounts.

Results of shareholder votes are made public on the Company’s website after the meetings concerned.

As mentioned above in principle 2, the Chief Executive Officer and the Chief Financial Officer regularly meet with institutional shareholders to foster a mutual understanding of not only the Groups trading performance but also its governance and Corporate culture.