Corporate Governance

Corporate Governance

The Group has established its own policies and procedures. 

The Companies (Miscellaneous Reporting) Regulations 2018 introduced new statutory reporting requirements for financial years beginning on or after 1 January 2019. Although the Group does not exceed the requirement thresholds, the directors of EthosEnergy have decided to provide a statement in the Report of the Directors stating which corporate governance code if any, EthosEnergy Group followed during the year, how it applied the code and any part of the code it did not follow. 

For the financial year ended 31 December 2024, Ethos Energy Group Limited has chosen to report against the Wates Corporate Governance Principle for Large Private Companies, published by the Financial Reporting Council (FRC) in December 2018 and available on the FRC website (the Wates Principles). The disclosures below explain how Ethos Energy Group Limited has reported against the Wates Principles in the context of its corporate governance arrangements. 

Purpose and leadership

The directors provide governance to the executive leadership team and spend significant time on strategic development and planning. They determine the leadership of the Group and continually look into ways to further enhance the performance of the Group. 

Board Composition

The EthosEnergy Board has currently two directors. The names of the current directors and the secretary are shown on page 2. 

All directors receive accurate, timely and clear information on relevant matters and have access to the advice and services of the Company Secretary. 

The directors have substantial experience in industry and this experience brings various insights on how the Group should perform. 

Directors’ responsibilities

All directors receive guidance on their statutory duties under the Companies Act and are supported in the discharge of their duties by the Company Secretary. 

The directors are the main decision-making forum for Ethos Energy Group Limited. The directors are collectively responsible for the long-term success of Ethos Energy Group Limited and the delivery of sustainable value to its shareholders. The directors’ role is to provide leadership to the Group, monitoring and maintaining the consistency of the Group’s activities. 

The Board and Company Secretary are responsible for the quality and integrity of information provided to the Board of directors for the parent entity, OEP Emerald Bidco Limited. At each scheduled Board meeting the directors receive reports from the CEO, which are prepared by the CEO and the leadership team as appropriate and these members may attend certain Board meetings to provide an opportunity for the Board to engage directly with management on key issues and supports succession planning. 

There are quarterly Board meetings each year where the CEO will present the Group’s current financial position, as well as, at the appropriate time each year, the annual budget for the forthcoming year which will be reviewed and approved by the Board. In between these meetings the CEO is in regular contact with the Board, with calls occurring to discuss key specific matters as appropriate.

Opportunity and risk

The role of the directors is to promote the long-term sustainable success of Ethos Energy Group Limited. 

The Group’s risk strategy is informed and shaped by an understanding of the risk landscape including a range of significant risks and uncertainties in the external economic, political and regulatory environments. 

The directors regularly review and identify potential opportunities that will help create and preserve the value of the Group as well as considering any potential risks or issues that may arise which could prevent the continued success of the business. 

Remuneration

Executive remuneration structures incentivise individuals to deliver sustainable performance based on strategic objectives for the Group. The approach to performance management provides clarity to employees about how their contribution links to the Group’s ambition and all employees have goals set against different measures. The Group continues to ensure employees are paid fairly for the work they do, and the pay is periodically compared against the external market to ensure that it is competitive.

Stakeholders

For details of the Board’s engagement with the different stakeholders see below in the S172 statement. 

S172 statement

This section serves as our section 172 statement and should be read in conjunction with the Strategic report on pages 3 to 5. Section 172 of the Companies Act 2006 requires Directors to take into consideration the interests of stakeholders in their decision making. The Directors continue to have regard to the interests of the Group and Company’s employees and other stakeholders, including the impact of its activities on the community, the environment and the Group’s reputation, when making decisions. Acting in good faith and fairly between members, the Directors consider what is most likely to promote the success of the Company for its members in the long term.

The S172 statement looks into the key matters as noted below:

• Likely consequence of any decision in the long term
• Employee engagement
• Stakeholder and shareholder engagement
• Community and the environment
• Impact of strategic decisions

Likely consequence of any decision in the long term

The Directors understand the business and the evolving environment in which we operate. Based on EthosEnergy’s purpose ‘to make energy affordable and available for everyone, everywhere’, the strategy set by the Board is intended to strengthen our position as a leading Independent Service provider of rotating equipment supporting the Power Generation, Industrial and Oil and Gas sectors while keeping safety and social responsibility fundamental to our business approach.

In 2020, the Group strategy was transformed creating ‘OneEthos’ to help achieve its strategic ambitions and become more self-reliant and a nimbler organisation. This restructure resulted in the Group becoming more focused, allowing for greater co-ordination and teamwork to occur in order to combat the effects of the COVID-19 pandemic and to improve the performance of the Group in certain areas.  This transformation has continued to provide numerous benefits to the Group in the current year including further development in the ESG program where there is one overall committee with three sub-committees in place and allowing the Group to align effectively against the impact of the war in Ukraine.

Given the complexity of the energy sector, the Directors have taken the decisions they believe best support EthosEnergy’s strategic ambitions.

Employee engagement

Our employees are fundamental to the delivery of EthosEnergy’s services and therefore to the long-term success of the business. It is important to develop our employees and keep them engaged and motivated. We engage with our workforce so that we can understand and address areas where we need to improve to ensure we deliver rewarding careers and retain our talented people. 

Regular contact is provided by the leadership of the Group providing updates on the business performance including significant contract wins, recognising the crucial performance of individuals within the business and detailing the various actions that have been carried out as the ESG framework has been rolled out. 

Stakeholder and shareholder engagement

The directors regularly review our principal stakeholders and how we engage with them. The stakeholder voice is brought into the boardroom by regular reporting from our CEO, CFO, and Heads of HSSE (Healthy, Safety, Security & Environment), HR and Legal and the Strategic Business Unit Leaders.   The Group has identified 5 Ethos principles (Safety, Service Excellence, People, Financial Responsibility and Integrity), as its driving principles. The Group have identified employees, shareholders and lenders, customers and suppliers as the principal stakeholders in the business. The relevance of each stakeholder group may increase or decrease depending on the matter or issue in question, so the Board seeks to consider the needs and priorities of each stakeholder group during its discussions and as part of its decision making.

The Group understands the importance that our shareholders have confidence in the Group, how it is managed in its strategic objectives to ensure the Group has a stable and long-term performance for the shareholders. Details of the work performed by the leadership of the Group in relation to shareholder engagement can be located within the Corporate Governance section above. 

The Executive Leadership team and other employees are in regular contact with the lenders to the Group, ensuring they are provided with the up-to-date financial performance information and there are opportunities to discuss any specific areas. 

The Group’s long-term success is underpinned by our customers and the delivery of predictable project outcomes that are aligned to our customers’ requirements. To deliver a great service, we listen to our customers to make sure we are leveraging the full capabilities of our organisation, our global reach and technical depth. This insight from customer engagement helps to inform the Group’s operational, business development and long-term strategic direction.

In 2024, EthosEnergy launched a centralised customer experience programme called VOICE (Valuable Observations to Improve Customer Experience). This programme was introduced to improve the customer feedback process and bring in line with our OneEthos approach and has allowed for the Group to react quicker to customers’ feedback and perform actions where necessary. 

Embracing constantly updating technology is vital in business and EthosEnergy have developed an augmented reality (AR) Apple Vision Pro 7F Turbine demo environment which allows our customers to undergo a truly unique experience. With AR, this allows us to bring the power of EthosEnergy anywhere in the world so customers can experience our capabilities and product line in an engaging, hands-on manner. 

EthosEnergy also recognise the key role suppliers play in ensuring that EthosEnergy provide a high-quality service to their customers and the Group aims to maintain the strong relationships with their suppliers. The ‘OneEthos’ restructure has helped to build on these relationships with focused targets being provided by supply chain and understanding the full range of services that can be provided by our suppliers. 

Third party suppliers are one of the key aspects defined in the ESG framework as EthosEnergy is continually monitoring the third party supplier spend by country and region including transactions with small businesses, minority owned businesses and disadvantaged owners. This monitoring allows for EthosEnergy to work with our suppliers to ensure good relations are maintained as well as recognising the Group’s responsibility to other businesses. 

EthosEnergy has worked closely with both its customers and suppliers to ensure services were still continually being provided when it was possible. This regular contact and close working with both customers and suppliers have helped to maintain the strong relations, generating positive feedback especially with customers, highlighting excellent performances and processes which the Group will look to maintain and enhance even further in the future with the wider customer base.

Community and the environment

EthosEnergy as a large organisation recognises its duty to help both the community and the environment across the various locations the Group operates in. The Group has considered the positive actions it can perform in order to benefit these stakeholders and is continually challenging itself to make energy affordable and available for everyone. 

Throughout the last three years, the Group have been progressing on the Environmental, Social and Governance (ESG) framework in order to build growth, financial sustainability and deliver long-term value through effective engagement with all stakeholders including the community and environment. The ultimate vision for the ESG framework is to fulfil our purpose; making energy available and affordable for everyone everywhere, thereby supporting the sustainability of the world and ensuring the needs of future generations are not compromised by actions we take today. 

The Framework targets a number of wide-ranging initiatives however the Group is specifically focusing on six key areas to launch the ESG journey and these are:

• Environmental Stewardship
• Engineering Solutions
• Inclusion and Diversity
• Policies and procedures
• Alliances and partnerships
• Third party suppliers
  
  
• We have made great progress over the years holding a high standard on environmental compliance and we already undertake many environmental activities in the company globally. Environmental stewardship is a focus area for us. We plan to quantify our global carbon footprint and establish future reduction strategies and targets.
• We will be challenging ourselves to invest in and develop more sustainable engineering solutions, this may include further technology efficiency improvements, doing more in alternative energy, or investing in clean fuel solutions. Different aspects of the work performed so far can be found in the Streamlined Energy and Carbon Reporting (SECR) section.
• I&D (Inclusion and diversity) is an important component of the social dimension of ESG.  The Inclusion and Diversity Council, which was introduced in 2020, is responsible for enforcing the equal opportunities policy within EthosEnergy ensuring all employees are treated in a fair and consistent manner and not to discriminate unlawfully. EthosEnergy recognises Internation Women’s Day as a key date in the calendar with the key theme of embracing equity to create an inclusive world which aligns strongly with the Group's own commitments and behaviours.
  
• We are also focusing on our existing structure of governance. We want to review and update all of our systems, policies, and procedures to ensure they align and support our sustainability journey.
• Given our extensive geographic reach, we will continue to look for opportunity to establish alliances and partnerships including potentially in developing or underdeveloped countries. The Group acknowledges its responsibility to the wider community, recognising the knowledge and experience its experts bring is the backbone of the business development and therefore priorities collaboration efforts with local education institutions where employees will assist students across the World in order to build technical skills for the future.
• We also aim to improve our governance by holding all our suppliers around the world to our standard of integrity. A new supplier due diligence program was implemented in 2021.

Throughout the year, there has been a number of environmental and social community outreach activities initiated including the introduction of ‘Environmental Month’ within the organisation, which is a specialist initiative dedicated to raising awareness, promoting sustainability and driving positive environmental impact across the Group. This allowed for emphasising the importance of incorporating eco-friendly practices and sharing with the wider team to allow for more uptake in these practices as well as highlighting how each employee can make a difference when focusing on different areas from sustainable fashion to plastic consumption and involvement in clean-up activities. Some sites have also participated in charity campaigns which benefit the children of local rehabilitation centres, which provide specialist care for children and adolescents with different types of disabilities and a plant in the Group portfolio donated monies to the local Fire Department which was utilised to purchase essential equipment, enhance training programs and improve overall emergency response capabilities.  

Educating younger generations is pivotal and various sites have provided tours of our facilities to enhance the knowledge and understanding of the younger generation to help inspire for a better future, pushing the students to research specific areas and share their thoughts. In addition, some employees have attended university as a guest lecturer and attended school visits to share their knowledge and experience of the industry and the current challenges today. Further efforts performed by EthosEnergy to create a sustainable environment for all can be located within Streamlined Energy and Carbon Reporting (SECR) below.   

Impact of strategic decisions

The ‘OneEthos’ structure now utilised by EthosEnergy has allowed for the leadership of the Group to be transformed, bringing in talent and expertise that has benefited both the short and long term success of the business.