Park Plaza Hotels’ pursuit of excellence extends to corporate governance as well as hospitality.

As a company registered in Guernsey, the company is eligible for exemption from the requirements of the UK Corporate Governance Code (the Code) issued by the Financial Report Council.

The Board has however put in place a framework for corporate governance which enables the company to voluntarily comply with the main requirements of the Code.

The Directors are committed to maintaining a high standard of corporate governance and intend to comply with those aspects of the Code which they consider appropriate, taking into account the size of the company and the nature of its business.

Board composition, roles and independence

The Code recommends that the Board of Directors of a listed company should include a balance of Executive and Non-Executive Directors (and in particular Non-Executive Directors) such that no individual or group of individuals can dominate the Board’s decision making. The Code also recommends that the Chairman should, on appointment, be independent.

The company currently has six Directors, four of whom are Non-Executives (including the Chairman, Eli Papouchado). The two Executive Directors are Boris Ivesha, Chief Executive Officer, and Chen Moravsky, Chief Financial Officer. As recommended by the Code, three of the Directors, (being more than half of the board excluding the Chairman), Elisha Flax, Kevin McAuliffe and Nigel Jones are regarded by the company as being independent of management and free from any business or other relationship that could materially interfere with the exercise of their independent judgement. Kevin McAuliffe had an indirect 1% interest in C.L. Secretaries Limited, the company's secretary. The Board, however, does not consider this interest to be sufficiently material to affect Mr. McAuliffe's independence. The company’s Chairman, Eli Papouchado, is the founder of the Red Sea Group (of which Euro Sea, the company’s largest Shareholder, is a part) and was not therefore on appointment, and is not, independent of the company.

As recommended by the Code, the Board has appointed Kevin McAuliffe as the Senior Independent Director to provide a sounding board for the Chairman and to serve as an intermediary for the other Directors when necessary. 

The Board has responsibility for the Group’s strategic and financial policies and meets regularly. All the Directors have access to the advice and services of the Group's General Counsel and are able to gain access to external independent advice should they wish to do so.

An appropriate balance of Executive and Non-Executive members of the Board is maintained and the Board is supplied with regular and timely information concerning the activities of the Group in order to enable it to exercise its responsibilities and control functions in a proper and effective manner.

The Board has a breadth of experience relevant to the company, and the Directors believe that any changes to the Board’s composition can be managed without undue disruption. With any new Director appointment to the Board, an appropriate induction will be set up.

The Board considers agenda items laid out in the Notice of General Meeting and Agenda which are formally circulated to the Board in advance of the Board meetings as part of the Board papers and therefore Directors may request any agenda items to be added that they consider appropriate for Board discussion. Additionally, each Director is required to inform the Board of any potential or actual conflicts of interest prior to Board discussion.

The primary focus at Board meetings is a review of investment performance, potential investments and joint ventures and matters such as financing arrangements, as well as marketing/investor relations, risk management, general administration and compliance, peer group information and industry issues.

The Board evaluates its performance and considers the tenure of each Director on an annual basis, and believes that the mix of skills, experience, ages and length of service is appropriate to the requirements of the company.The directors retire and stand for re-election in accordance with the provisions set out in the company's articles of incorporation.

The roles of Charmain and the Chief Executive Officer are separate and clearly defined. The scope of these roles is approved and kept under review by the Board so that no individual has unfettered decision-making powers.

The Charmain is responsible for the leadership and governance of the Board and Chief Executive Officer for the management of the Group and the implementation of the Board strategy and policy on the Board's behalf. In discharging his responsibilities, the Chief Executive Officer is advised and assisted by senior management.

During the financial year, the Board held seven Board and Board Committee Meetings.

The Directors have adopted a set of reserved powers, which establish the key purpose of the Board and detail its major duties.

These duties cover the following areas of responsibility:

• statutory obligations and public disclosure;
• strategic matters and financial reporting;
• oversight of management and personnel matters;
• risk assessment and management, including reporting;
• monitoring, governance and control; and
• other matters having material effects on the company

These reserved powers of the Board have been adopted by the Directors to clearly demonstrate the seriousness with which the Board takes its fiduciary responsibilities and as an ongoing means of measuring and monitoring the effectiveness of its actions.

External appointments

Directors may hold directorships or other significant interests with companies outside the Group which may have business relationships with the Group. Executive directors may not accept external directorships and retain any fees earned from those directorships subject to prior discussion with the Chief Executive Officer and always provided this does not lead to any conflicts of interest. In the case of the Chief Executive Officer, prior discussion will need to be held with the Chairman. 

Directers' indemnities and protections

The company has arranged appropriate insurance cover in respect of legal action against Directors and senior managers of companies within the Group. In addition, the articles of incorporation of the company permit the Directors and officers of the company to be indemnified in respect of liabilities incurred as a result of their office.

 Board Committees

In accordance with the Code, the company has established,  the following committees in order to carry out work on behalf of the Board: an Audit Committee, a Remuneration Committee, a Nominations Committee, an Investment Committee and an Operational Committee.

Audit Committee

An Audit Committee has been established and comprises Kevin McAuliffe (Chairman), Elisha Flax and Nigel Jones and meets at least three times a year. The Audit Committee assists the Board in observing its responsibility for ensuring that the Group’s financial systems provide accurate and up-to-date information on its financial position and that the published financial statements represent a true and fair reflection of this position. It also assists the Board in ensuring that appropriate accounting policies, internal financial controls and compliance procedures are in place. The Audit Committee receives information from the Company Secretary and from the external auditors.

Download Audit Committee Terms of Reference (.PDF) >>

Remuneration Committee

A Remuneration Committee has been established and comprises Kevin McAuliffe (Chairman) and Elisha Flax. The Remuneration Committee advises the Board on an overall remuneration policy and meets as and when required. The Remuneration Committee also determine, on behalf of the Board, and with the benefit of advice from external consultants, the remuneration packages of the Executive Directors. The Board determines the remuneration of the Non-Executive Directors.

Download Remuneration Committee Terms of Reference (.PDF) >>

Nomination Committee

A Nomination Committee has been established and comprises Elisha Flax (Chairman), Nigel Jones and Kevin McAuliffe. Whenever possible, all Non-Executive Directors will be present. The Nomination Committee carries out the selection process for the appointment of candidates to the Board and proposes names for approval by the full Board.

Download Nomination Committee Terms of Reference (.PDF) >>

Investment Committee

An Investment Committee has been established and comprises Eli Papouchado (Chairman), Boris Ivesha, Chen Moravsky and Elisha Flax. The Investment Committee assesses and approves new projects in accordance with an agreed approval process.

The Investment Committee is also responsible for carrying out post-investment appraisals.

Operational Committee

An Operational Committee has been established and comprises Eli Papouchado (Chairman), Boris Ivesha, Chen Moravsky and Elisha Flax. The Operational Committee develops and implements the overall operations strategy. The Operational Committee also determines the framework of the Operational Board and monitors its activities.

Share Dealing Code

The company has also adopted a share dealing code, based on the Model Code (as set out in the Listing Rules of the UK Listing Authority) for Directors, persons discharging managerial responsibilities and relevant employees.