At Northgate we recognise the vital role that governance plays in delivering the best outcomes for all stakeholders in the business.

Andrew Page Chairman

Dear Shareholder,

At Northgate we recognise the vital role that governance plays in delivering the best outcomes for all stakeholders in the business. Our rigorous systems of risk management and internal control ensure that our businesses operate within the Board approved risk appetite levels set out in the Managing Risk report.

Governance issues tackled during the year include changes to the Board and further acting upon the recommendations from the previous external and internal Board evaluations. The Board has continued its focus on the monitoring of the Group's renewed strategy and improving employee engagement.

Board changes

David Tilston replaced Paddy Gallagher as CFO in the year on an interim basis. I am pleased to report that the Group has concluded the search for a permanent replacement with the appointment of Philip Vincent with effect from 16 July 2018. David Tilston will remain in the business for a short period in order to facilitate an effective handover.

I am delighted to welcome Philip Vincent to the Board of Northgate. He brings a wealth of relevant financial and commercial experience gained in a wide range of senior roles, in the UK and internationally, which will enable him to make a significant contribution to Northgate's future success. I would like to thank David Tilston for undertaking the role of CFO on an interim basis.

Board evaluation

An internal Board evaluation was conducted in the year and the Board has concentrated on further implementation of recommendations from previous reports. One of the key areas for development has been overseeing the structural changes across the Group, including establishing a commercial hub and monitoring Group progress against the renewed strategic objectives.

Compliance with the Code

As disclosed in last year's Annual Report, Andrew Allner completed ten years' service to the Group in September 2017, meaning that he could no longer be classed as independent by the Code or ABI. However, due to the continued benefit of Andrew's wise counsel it was determined that he should remain on the Board for a further year, until September 2018. We are also proposing that Andrew be re-elected for a further year.

This means that the Board did not comply with section B.1.2 of the Code. However, we feel that maintaining a Board with an appropriate mix of skills and experience serves our stakeholders well.

There have been no significant changes to the UK Corporate Governance Code during the year and the Board considers that it has complied with the provisions of the Code throughout the year, other than as described above.

Good governance is a cornerstone of our business and the disciplines and practices that contribute to this are well understood by the Northgate team.

Andrew Page


25 June