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Corporate Governance Statement

The Board is committed to high standards of corporate governance and believes that a sound governance structure engenders a successful company.


The Board is responsible for the overall management, strategic direction, maintaining sound risk management and internal control systems, succession planning and performance of the Group. It discharges its responsibilities through regularly scheduled meetings and ad hoc meetings, as may be required. The Board has formally reserved specific matters to itself for determination and approval which include strategic issues, the Group’s risk profile, the annual budget, changes in share capital, approval of the Group’s financial statements, approval of material contracts and succession planning for senior management. In addition, it reviews the Group’s internal controls and risk management policies and approves its Code of Ethics. It also monitors and evaluates the performance of the Group as a whole.

Earl McLaren President/CEO and Derek McLaren Vice President are both on the top of the board and performing their task in a very keen manner.

Supply of information

Before decisions are made, consideration is given to the adequacy of information available to the Board and, if necessary, decisions are deferred if further information is required.

Committees of the Board

The Board has established the Audit, Compliance & Risk Committee, the Remuneration Committee, the Nomination Committee and the Science & Technology Committee (together ‘the Committees’). Each Committee has written terms of reference which have been approved by the Board.

Audit, Compliance & Risk Committee

The Audit, Compliance & Risk Committee (the ‘ACR Committee’) has been established for the purpose of overseeing the accounting and financial reporting processes of the Group, the audit of its financial statements and the effectiveness of the Group’s risk management and internal control framework.

Remuneration Committee

The Remuneration Committee is responsible for developing, reviewing and overseeing the implementation of the Group’s compensation and benefits policy.The remuneration of the members of the Leadership Team, other than the Directors, is determined by the Chief Executive Officer following discussion with the Remuneration Committee.

Science & Technology Committee

The Science & Technology Committee is responsible for periodically reviewing and advising the Board on Company’s strategic direction and investment in research, development and technology. The members of the Science & Technology Committee are all Independent.

Leadership Team

The Board has delegated the day-to-day management of McPharma Biotech Inc. to the Leadership Team, which operates within clear and formal parameters. The Leadership Team reports to and seeks guidance from the Board on a regular basis and normally meets once a month to deliberate on major business issues. It also considers those matters that are of a size and significance as to require referral to the Board before such matters are referred to the Board for final consideration and decision.

Directors’ remuneration

The Group’s remuneration policy is described in the Directors’ remuneration report . The report details the Directors’ remuneration and the basis upon which executive remuneration is determined.

Company’s approach to Responsibility

Company strives to ensure it delivers value to its customers and to society. It is therefore critical that Responsibility is at the heart of McPharma Biotech Inc’s business in order that we continue to build and maintain trust with our many stakeholders (customers, policy makers, investors, employees and others) as well as in the community and environment in which we operate. Our company therefore attaches great importance to ethical business practices and to societal and environmental issues. Accordingly, ultimate responsibility for them is taken at the highest levels. The Board reviews McPharma Biotech Inc.’s overall approach to Responsibility. The Board also reviews the specific business risks related to Responsibility matters, as part of the overall risk management review process.

Code of Ethics

The Group is committed to the maintenance of high ethical standards. The Group’s Code of Ethics applies to all Directors and employees.

Financial reporting and disclosure, internal control and the role of the auditors

The Board has established formal and transparent arrangements for financial reporting, external auditing and the review of the internal control environment including compliance issues. The Committee’s terms of reference extend to the Group’s compliance and risk management activities as a whole and not just the financial aspects of internal control.

All employees can, via an independently managed Global Compliance Helpline, raise any concerns in any of these areas and any other area, anonymously if they wish, to the Chief Compliance and Risk Officer in the strictest confidence without fear of discrimination or reprisal.

Financial reporting and disclosure

The Board, with the assistance of Committee members, has ultimate responsibility for the preparation of accounts and for the monitoring of systems of internal control. The Board strives to present a balanced assessment of the Group’s financial position and prospects and it endeavors to present all financial, scientific and other information so as to be comprehensible to investors. The Group publishes quarterly financial reports so that its shareholders can monitor the Group’s financial position regularly.

In addition the Group has established a Disclosure Committee, which is chaired by the Chief Financial Officer. Its membership includes executives and senior managers from the legal, finance, compliance and risk functions. Its responsibilities include ensuring that all material information is disclosed to investors in the Group’s periodic financial reports and that such information is recorded, summarized and reported accurately.

Fairly presenting the financial condition, results of operations and cash flows of the Group;

The Chief Executive Officer and the Chief Financial Officer are responsible for determining and maintaining disclosure controls and procedures for the purposes of financial reporting in the United States;

The Chief Executive Officer and the Chief Financial Officer have evaluated the effectiveness of those disclosure controls and procedures;

Risk management, compliance and internal control

The Board, in accordance with the Turnbull Guidance on internal control, recognizes its overall responsibility to maintain sound risk management and internal control systems to safeguard shareholders’ investments and the Group’s assets and to regularly review the effectiveness of such systems. The Board acknowledges its responsibility for the systems of risk management and internal control.

The Group has risk management, compliance and internal audit functions. The Chief Compliance and Risk Officer and the Vice President of Internal Audit report to the Chief Executive Officer and Chief Financial Officer, respectively, but each has direct and regular access to the Chairman of the Group.

The Group’s risk management, compliance and internal audit strategy is based on a risk and control framework containing a control environment, an effective process, managing risks, Internal control procedures, effective internal audit.

Management of risks

Management of business risk is essential for ensuring that the Group creates and preserves shareholder value. The Group has an ongoing process for identifying and managing the significant risks that the company faces. This process has been in operation throughout the period under review and up to the date of signing the Annual Report and Accounts.

Effective internal control procedures

The Group has a system of internal control procedures. Compliance with these procedures is monitored through a system of internal review and regular reports prepared by Internal Audit and the Group’s external auditors.

Effective internal audit

The internal review of the Group’s control procedures and compliance with such procedures is mostly undertaken through internal audit.