Corporate Governance

This section provides a brief view of the Company's governance and explains how it applies the principles and supporting principles of the Combined Code.

Further information is available in the Annual Report, which provides the Statement of corporate governance and the Remuneration Report.

The Company recognises the importance of, and is committed to, high standards of corporate governance. The principles of good governance adopted by the Company have been applied as follows:

The Board

The overall strategy and objectives for the Group are agreed by the Board as a whole, with the day-to-day management being delegated to the Chief Executive and the Executive Directors, with each Executive Director being responsible for the performance of his area of the business. The Board is also responsible for satisfying itself as to the integrity of financial information and the effectiveness of the Group’s system of internal control and risk management processes.

All Directors are equally accountable under the law for the proper stewardship of the Group’s affairs. However, the Non-Executive Directors have a particular role to:

• challenge constructively the strategy proposed by the Chief Executive and the Executive Directors;
• scrutinise and challenge performance;
• assess risk and the integrity of financial information and controls; and
• ensure appropriate remuneration and succession planning arrangements are in place in relation to Executive Directors and other senior executive roles.

Directors

The Board currently consists of four Executive and four Non-Executive Directors, all of whom are considered by the Board to be independent under the terms of the Combined Code.

Board committees

The Board has delegated specific responsibilities to committees, as described below. Executive Directors attend both the Audit Committee and Remuneration Committee on the request of the respective Chairman of each Committee. The Company Secretary acts as Secretary to each Committee. The Terms of Reference of each Committee are available here.

For the year 2008/09 the Committee memberships were as follows:

Internal controls

The Board acknowledges its responsibility for the Company’s and the Group’s systems of internal control and for monitoring their effectiveness. In order to fulfill this responsibility and safeguard shareholder investment and the Company’s and the Group’s assets, the Directors have established an organisational framework with clear operational procedures, lines of responsibility and delegated authority which has operated throughout the year under review and up to the date of approval of the Annual Report and Financial Statements. The Directors are satisfied that there are suitable ongoing processes for identifying, evaluating and managing the significant risks faced by the Group.

Relations with shareholders

The Company maintains good communications with shareholders. The Executive Directors meet regularly with representatives of institutional shareholders to discuss the strategies and objectives of the Company. Investors are welcome to meet with the Non-Executive Directors if they wish to do so and have such an opportunity at the Preliminary and Interim Announcements which are attended by the Senior Independent Director and other Non-Executives. Other arrangements are made during the year and investors have an open invitation to contact the Directors at any time. The whole Board is briefed on any concerns raised by shareholders.

Accountability and audit

The Statement of Directors’ responsibilities in relation to the accounts is set out on page 30 of the Annual report and accounts 2009. The Statement by the Auditors on their responsibilities in respect of the accounts is contained in their report on page 75. Details of the auditor’s remuneration for audit work and non-audit fees for the periods ended 2 May 2009 and 3 May 2008 are disclosed in note 3 to the Financial Statements.

Going concern

The Group’s financial statements have been prepared on the basis that the Directors have a reasonable expectation that the Group will continue to be a going concern for the foreseeable future. In forming this opinion the Directors have reviewed the Company’s budget for the year ending 1 May 2010 and outline projections for the subsequent two years, including capital expenditure and cash flow forecasts.

Corporate Responsibility

The Company is very aware of its responsibilities to the wider community and has published a Corporate Responsibility policy which is available on the corporate website. The policy includes relations with staff, shareholders and the community, trade bodies and suppliers and will be updated regularly.

Compliance with the Combined Code

The Company complied with the Code provisions (set out in section 1 of the Combined Code) throughout the period ended 2 May 2009 except provision A.2.1 as the roles of Chairman and Chief Executive are combined, as discussed above. In addition, for the last eight months of the year the independent Non-Executive Directors did not comprise 50% of the Board following Mr Toogood’s retirement from the Board in September 2008, which imbalance was corrected by Mr Kitching’s retirement from the Board at 2 May 2009.

Our auditors, PricewaterhouseCoopers LLP, have reviewed the Directors’ statement on the Company’s compliance to the extent required by the listing rules and their report appears on page 75.