Corporate Governance

Corporate Governance 

The Governance of the Group is set out in a formal Operating Agreement. The Group has established its own policies and procedures as well as adopting the pre-existing processes from the shareholders where appropriate. The Group has appropriate internal controls and risk management programs which are subject to shareholder review.

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 2021, 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 

EthosEnergy Group’s purpose is established by the Board of Directors who provide governance to the CEO and the leadership team. The CEO and executive leadership team continued to implement the new strategy introduced in 2020. The Board continue to be in full support of the transformation which has helped to produce the best financial position in the Group’s history. The CEO and executive leadership team 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 Board has currently five directors, comprising the Chairman and four Directors. The names of the current directors and the secretary are shown on page 2.

The Board considers that the Chairman was independent on appointment and individual directors’ continuing contribution to Ethos Energy Group Limited are considered at least annually.

The role of the Chairman is to lead the Board and ensure its overall effectiveness. This is distinct and separate from that of the Chief Executive Officer (CEO) who manages the business day to day.

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

The Board is structured to ensure that the directors provide Ethos Energy Group Limited with the appropriate balance of skills, experience and knowledge as well as independence. A number of the directors have substantial experience in the industry and this experience brings various insights on how the Group should perform.

The Board monitors the commitment of the Chairman and directors and is satisfied that they are able to allocate sufficient time to enable them to discharge their duties and responsibilities effectively. Any additional external appointments require prior Board approval.

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

The Chairman, CEO and Company Secretary are responsible for the quality and integrity of information provided to the directors. 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 Board 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. This strategy still considers the impact of COVID 19 across the world and the impact it has had on all industries.

The Board 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 they are competitive.

Stakeholders 

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

Section 172 statement 

Section 172 of the Companies Act 2006 requires directors to take into consideration the interests of stakeholders in their decision making. The Directors of EthosEnergy continue to have regard to the interests of the Group’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 Section 172 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

More information can be found in the Directors’ Report contained within latest financial statements which can be found below.