The Board acknowledges the importance of the principles set out in the Combined Code issued by the Financial Reporting Council.

Although the Combined Code is not compulsory for AIM companies, the Board intends to apply the principles as far as practicable and appropriate for a relatively small public company as follows:

Board

The Board meet regularly and are responsible for strategy, performance, approval of major capital projects and the framework of internal controls. To enable the Board to discharge its duties, all directors receive appropriate and timely information. Briefing papers are distributed to all directors in advance of board meetings, and all directors have access to the advice and services of the Company Secretary, who is responsible for ensuring that board procedures are followed and that applicable rules and regulations are complied with. The Articles of Association provide that directors are subject to re-election at the first opportunity after their appointment and the board will voluntarily submit to re-election at intervals of three years.

Audit Committee

The audit committee comprises Lord Daresbury (Chairman) and Steven Poulton. The committee are responsible for ensuring the appropriate financial reporting procedures are properly maintained and reported on, and for meeting with Stellar’s auditors and reviewing their reports and accounts and the Company’s internal controls.

Remuneration Committee

The remuneration committee comprises, Lord Daresbury (Chairman) and Steven Poulton. The committee are responsible for reviewing the performance of the executive directors setting their remuneration levels, determining the payment of bonuses, determining at what point Stellar should adopt any form of share option plan and considering the grant of options under any such plan and, in particular, the price per share and the application of the performance standards which may apply to any grant.

Nomination Committee

The nomination committee comprises, Lord Daresbury and Steven Poulton. The committee are responsible for board appointments and making recommendations to the Board.

AIM Rules Compliance Committee

In line with the AIM Rules for Companies, the Board constitutes an AIM Rules Compliance committee which adopts an AIM Rules for Companies compliance policy setting out the procedures to be followed in order that Stellar complies with the AIM Rules for Companies. The Committee comprises Steven Poulton and Lord Daresbury(Chairman). There is in place a share dealing code applicable to the directors and their connected persons.

Internal Financial Control

The Board are responsible for establishing and maintaining Stellar’s system of internal financial control and places importance on maintaining a strong control environment. The key procedures which the directors establish with a view to providing effective internal financial control are as follows:

  • The Company’s organisational structure has clear lines of responsibility;
  • Stellar prepares a comprehensive annual budget that is approved by the Board. Monthly results are reported against the budget and variances are closely monitored by the directors
  • The Board is responsible for identifying the major business risks faced by Stellar and for determining the appropriate courses of action to manage those risks and oversight of and involvement in regular subsidiary company board meetings, complete with structured operational reporting requirements.

The Board recognises, however, that such a system of internal financial control can only provide reasonable, not absolute, assurance against material misstatement or loss. The Board has reviewed the effectiveness of the system of internal financial control as will be operated by Stellar.