Hotel Chocolat Group plc
Corporate Governance Statement
Approved by the Board on 23rd September 2021
Corporate Governance Statement from the Chairman
The Directors recognise the value and importance of good corporate governance and are fully cognisant of their responsibilities to the Group’s stakeholders including shareholders, customers, suppliers and employees. In the Corporate Governance Statement section of our 2021 Report & Accounts (pages 45 to 49) we have set out our approach to governance and provided further information on how the Board and its Committees operate.
The Board believes that it complies with all of the principles of the QCA Corporate Governance Code (QCA code). The corporate governance framework which the Group operates, including Board leadership and effectiveness, Board remuneration, and internal control, is based upon practices which the Board believes are proportional to the size, risks, complexity and operations of the business and reflective of the Group’s values.
Below we have produced a description of how Hotel Chocolat complies with each QCA Code principle.
Andrew Gerrie, Chairman
|Governance Principles||Compliant||Explanation||Further Reading|
|Establish a strategy and business model to promote long-term value for shareholders.||✓||The strategy for the Group is decided by the Board and progress towards delivering objectives is actively tracked and debated by the Directors.||See page 10 of the 2021 Report & Accounts to find out more about our strategy and business model.|
|Seek to understand and meet shareholder needs and expectations.||✓||Regular meetings are held with investors and analysts and the Board regularly considers how decisions could impact, and be received by, shareholders. Our annual meeting provides an opportunity for all shareholders to hear from and ask questions of our Directors.||See pages 35 and 50 of the 2021 Report & Accounts for more information on our relations with shareholders. We also publish lots of information relevant to shareholders on our website.|
|Take into account wider stakeholder and social responsibilities and their implications for long-term success.||✓||The Board has identified the main stakeholders in the business and regularly discusses how employees, suppliers, customers and others might be affected by decisions and developments in the business. We take our social responsibilities seriously and constantly strive to enhance our environmental and social credentials.||See page 50 of the 2021 Report & Accounts to learn more about how we collate feedback from our stakeholders and take account of their needs and priorities.|
|Embed effective risk management, considering both opportunities and threats, throughout the organisation.||✓||Both the Board and Audit Committee regularly review risks, including new threats, and the processes to mitigate and contain them. Whilst the Board is responsible for risk, our culture seeks to empower all colleagues to manage risk effectively.||We have summarised the main risks faced by the business and how they are being managed on pages 24 and 25 of the 2021 Report & Accounts. Further details about our approach to risk management and internal controls are provided in the Audit Committee report on pages 54 and 55 of the 2021 Report & Accounts.|
|Maintain a dynamic management framework|
|Maintain the Board as a well-functioning, balanced team led by the Chair||✓||Our Board works well together as a team exploiting the deep experience of strategy, retail, international and financial matters. Meetings are characterised by lively debate and active idea generation and management are rigorously challenged and held to account.||Our Directors and details of their individual roles, backgrounds and experience are provided on pages 40 and 41 of the 2021 Report & Accounts.|
|Ensure that between them the Directors have the necessary up-to-date experience, skills and capabilities.||✓||We assess the adequacy of the Board’s collective skills and experience as part of the annual Board evaluation. Directors’ individual development needs are discussed annually.||Further information about how Directors keep their knowledge and skills up-to-date is provided on page 48 of the 2021 Report & Accounts|
|Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement.||✓||An annual Board evaluation is undertaken to review the Board’s effectiveness, track improvements since the previous year and plan additional actions.||The criteria assessed as part of the Board evaluation and the actions arising from it are summarised on page 49 of the 2021 Report & Accounts.|
|Promote a corporate culture that is based on ethical values and behaviours.||✓||The Hotel Chocolat values of Originality, Authenticity, and Ethics have always underpinned, and are evident in, everything we do. Examples include our Gentle Farming Charter, sustainability commitments, workforce engagement and community activities.||Our sustainability report on pages 26 to 33 of the 2021 Report & Accounts illustrates some of the ways in which our corporate culture positively influences what we do.|
|Maintain governance structures and processes that are fit for purpose and support good decision-making by the Board.||✓||Our governance structures are underpinned by the matters which the Board reserves to itself. A scheme of delegation, including established committees, an annual agenda plan, regular business deep-dives and good information flows all contribute to the Board making well-informed and properly debated decisions.||More detailed information about our governance structures and processes can be found in our Corporate Governance Statement on pages 45 to 50 of the 2021 Report & Accounts and the reports of the Audit Committee and Remuneration Committee on pages 54 to 59 of the 2021 Report & Accounts.|
|Communicate how the Company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders.||✓||We communicate with a range of stakeholders. Employee concerns and issues are represented in the boardroom by Sophie Tomkins who has been given special responsibility in this respect. We also actively engage with our cacao growers and other suppliers and with Hotel Chocolat guests in store and online.||Further information on our dialogue with stakeholders and shareholders can be found in our sustainability report on pages 26 to 33 of the 2021 Report & Accounts and in our Corporate Governance Statement on pages 45 to 50 of the 2021 Report & Accounts. We also publish lots of information relevant to our wider stakeholders on our website www. hotelchocolat.com/uk/investor-relations.html.|