Corporate Governance

The Company's board of directors appreciates the value of good corporate governance not only in the areas of accountability and risk management but also as a positive contribution to business prosperity. It believes that corporate governance involves more than a simple “box ticking” approach to establish whether a Company has met the requirements of a number of specific rules and regulations. Rather the issue is one of applying corporate governance principles (including those set out in the Corporate Governance Guidelines for AIM companies published by the Quoted Companies' Alliance in February 2007) in a sensible and pragmatic fashion having regard to the individual circumstances of the Group's business. The key objective is to enhance and protect shareholder value.

The directors believe it essential that the Group should be led and controlled by an effective Board. To this end, regular board meetings were held during the year and the Board received a steady flow of information to enable it to discharge its duties. There is a formal schedule of matters reserved for the Board’s decision and all directors have access to independent advice paid for by the Company.

The Board currently comprises two executive directors and three non-executive directors.

To facilitate the smooth running of its operations, the Board has established the following committees which enable it to review the effectiveness of the Group’s system of internal controls.

The Audit Committee meets not less than twice a year and assists the Board in reviewing financial internal control systems. The committee comprises the non-executive directors and is responsible for ensuring that the financial performance, position and prospects of the Group are properly maintained and reported. The committee also meets with the auditors and reviews their reports relating to the accounts and internal controls of the Group.

The Remuneration Committee, which comprises the non-executive directors, meets as required and determines the Group’s policy on executive directors remuneration, including annual salary, pension entitlement, grant of share options and bonus awards. The committee consults with the managing director and has access to professional advice if required.