A Statement from our Board
Section 172 Statement
This section of the Strategic Report provides an overview of how the directors have fulfilled their duties to promote the success of the company and had regard to the matters set out in section 172(1) (a) to (f) Companies Act 2006. In additon, it also forms the directors’ statement required under section 414CZA of the Companies Act 2006.
Our Approach to the Long Term Success of the company
The Board of Directors recognise that the long-term success of the company is dependent upon having regard to the interests of our stakeholders. During the year, the board of the immediate parent company (South Essex Insurance Holdings Limited) discussed with the Group possible restructure arrangements. As a result, the sale of the entire issued share capital from Ecclesiastical Insurance Office plc (the shareholder) to Lloyd & Whyte Group Limited (the buyer) was agreed. This was completed on 30th December 2022. Therefore, the company is now part of the Lloyd & Whyte Group, who are also a part of Benefact Group plc. Being part of the Benefact Group with its ambition to be the most trusted and ethical specialist financial services group, we understand how important it is to listen and and respond to the needs of stakeholders.
Our stakeholders are identified in the Governance Framework, and are at the core of all decision making. Key stakeholders are clients, insurers, employees, shareholders, regulators, suppliers, and the environment and community groups. Examples of the way the Board has engaged with some of these stakeholder groups throughout the year are set out below.
Stakeholder Engagement in Decision Making
The Board adopts a range of approaches to engage with stakeholders and recognises that the importance of a stakeholder group differ depending on the matter to be considered. During the year, the Board would consult with the parent company on matters which were of Group wide significance or have the potential to affect the reputation of the Group and its charitable owner, Benefact Trust Limited.
A one-year rolling plan of business for discussion is agreed annually to ensure that the Board is focused on the right issues at the right time and sufficient time is allowed for appropriate consideration and debate. Information is provided to directors in papers in advance of each meeting. In addition, people from the business are invited to attend meetings to provide insight into key matters and developments. At each Board meeting, the directors discuss strategic and business matters, financial, operational and governance issues and other relevant issues that arise. As a consequence of this, the Board has an appreciation of engagement with stakeholders and other relevant matters, which enables the directors to comply with their legal duty under section 172 of the Companies Act 2006.
Although the Company’s Articles of Association allow the Board to delegate powers to committees, to date, no committees have been formed by the Company. During the year, the company would consult, engage and work with the Group Compliance and Group Risk teams and meet with Group management committees to discuss and report on risk and compliance matters. The Board maintained open dialogue between the directors and matters were escalated to either the Group Audit Committee or Group Risk Committee as appropriate.
Below is an example of a principle decision taken by the Board during the year in and how it has had regard to the interests of, and impact on a selection of its stakeholders.
Principle Decision of the Board
Consumer Duty Plan and Champion
Following publication of the Financial Conduct Authority’s (FCA) PS22/9 A Consumer Duty (the Duty) in July 2022, which outlined a new consumer principle requiring firms to act to deliver good outcomes for customers, the Board discussed with management the implementation of the Duty and its requirements at its meeting on 8 November 2022. The Board reviewed the Consumer Duty Plan (the Plan) developed by management to ensure that it was deliverable and robust, prior to approving the Plan… Prior to this, the Board had been provided with regular updates on the development of the FCA’s new Duty from consultation stage to publication and management’s preparation. The Board also appointed Mr Barry Fehler, being a non-executive director, as the Consumer Duty Champion. The directors continue to receive regular updates on the progress of the Plan to ensure that they are meeting their regulatory obligations whilst ensuring the best possible outcomes for customers.
Our Strategy in action:
|Our key stakeholders||Methods of engagement and outcomes|
|The Board recognises that employees are the Company’s biggest asset given their specialist skills and knowledge and propensity to go above and beyond. Employee matters are regularly considered by the Board via the Chief Executive Officer’s Report.||The Board receives regular updates on a range of Company matters. This includes the Chief Executive Officer’s resource updates as part of her Chief Executive Officer Report.|
Members of the management team are subject matter experts and are invited to board meetings to present on items and input into discussions.
Staff have the opportunity to engage in two staff surveys during the year. The Board considered the results of these during the year and agreed action plans as necessary to address any shortfalls in company offering or support.
|The Board considers the impact of any actions or decisions on the Company’s customers (both direct and indirect customers) before proceeding with the same.||The Board considers that customers should be at the heart of everything we do, treating them fairly and ethically and ensuring any actions or decisions demonstrate our passion for customers and make us first choice for customers both today and in the future.|
Directors of the Board met regularly during the year with the Group CEO and other executive directors to discuss strategy plans. Customers are given the opportunity to engage in feedback surveys and the results of these are considered by the Board.
|South Essex Insurance Holdings Limited owns the entire issued Ordinary Share Capital of the Company, which in turn is owned by Lloyd & Whyte Group.||As a group Company, the Directors are aware of the importance of demonstrating its value to the Group, which includes ensuring financial performance, long term return on capital and a culture of transparency and propensity to “do the right thing” is set from the top. At each routine board meeting, the directors consider whether there are any matters to be escalated to the Parent Company. |
During the year, Mark Hews (Group Chief Executive Officer) provided relevant highlights from the parent company. Moreover, regular dialogue took place on the Group’s expectations of the Company and the strategy for the development of the business. This ensures that the views of the shareholder are effectively communicated to the Board as a whole. Going forward, the board will be engaging regularly with the Lloyd & Whyte Group.
Consequently, there is a two-way channel of communication between the Board and the shareholder.
The Board has an honest and constructive relationship with its shareholder. There is at least one “Common Director” (who sits on the board of the company as well as the board of the parent company) who attends every Board meeting and provides insights and feedback from the shareholder. This ensures that the views of the shareholder are communicated to the Board as a whole. In turn, the Common Directors are able to support the directors to understand the performance and strategic issues faced by the Company.
|Community and Environment|
|The Board received updates on corporate responsibility including the work with the Company’s charitable partners including Farleigh Hospice, Chelmsford and St Luke’s Hospice Basildon. During 2022 the Board considered outcomes from the SEIB Giving Awards totalling £40,000. As part of the Benefact Group family, the Group as a whole is the UK’s fourth largest corporate donor. Employees are supported to give to causes they care about through MyGiving. This enables them to offer support with volunteering, small grants and fundraising matching to create direct involvement and help to drive charitable giving at a local level.|
|The Company is regulated by FCA.||The Board recognises the importance of open and honest dialogue with Regulators and is committed to complying with applicable legislation and regulation.The Board receives regular reports detailing the Company’s regulatory interactions. As a member of a regulated entity within a responsible financial service group, the Board understands the need to keep up to date with any communications received by the Regulators. Further the directors know that this duty transcends the board room. Consequently, the directors receive regular and timely targeted communications from Group Compliance on any pertinent regulatory matters. |
The Board also receives regular reports on the evolving legal and regulatory landscape incorporating a detailed impact and progress assessment, which undergoes a rigorous cross-departmental challenge process before being presented to the Board.