Synectics is a leader in advanced security and surveillance systems. The Group’s strategy and business model is described in the Strategic Report on pages 8 to 23 of the Company's 2023 Annual Report and Accounts.

Synectics believes that its shareholders are vital for the future success of our business providing funds which aid business growth and the generation of sustainable returns.
 

Throughout the year, the Company continued to engage with its shareholders and stakeholders on the current position of the business and its future strategy, including regular investor meetings, investor presentations around financial results, and a site visit for investors which was held in November 2023. Further information on our stakeholder engagement can be found on pages 34 to 35 of the Company's 2023 Annual Report and Accounts. Our primary means of communicating the Group’s corporate governance structure is through our Annual Report, various disclosures made on our website and announcements to the London Stock Exchange. Where specific questions are raised by private individual shareholders and institutional investors, we engage directly with those shareholders.
 

Twice-yearly investor roadshows and analyst presentations are held, alongside the Company’s AGM, that affords all shareholders the opportunity to take part in and see the business first-hand, as well as engage directly with members of the management and the Board.

Our engagement with all our stakeholder groups is important in any strategic decision making, with formal and informal feedback from stakeholders being shared at Board meetings and used to inform and influence key matters and decisions made by the 

Board 

The annual Employee Opinion Survey provides valuable insights into the views of our workforce, which the Board carefully considers each September. 

Our engagement in investor relations activities, such as capital markets days, investor roadshows and regular perception audits with sector analysts, demonstrates our commitment to transparent communication with investors. 

The completion of phase one of our ESG review, including stakeholder mapping and materiality assessment, underscores our proactive approach to understanding and addressing stakeholder concerns. This is further explained in the Company's 2023 Annual Reports and Accounts. 

Customer feedback is prioritised through surveys, advisory group meetings, webinars, and in-person seminars. The Board actively reviews and discusses the outcomes of these engagements, highlighting our commitment to customer-driven and informed decision-making. 

The development of a new partner program reflects our dedication to fostering strong relationships with our global network of partners and resellers, enhancing collaboration and engagement with this stakeholder. 

The Audit Committee undertakes a detailed review of the approach to risk management on behalf of the Board (though the Board retains overall responsibility for setting both the framework and risk appetite of the Group, in line with best practice). Further details can be found on pages 38 to 41 of the Company’s 2023 Annual Report and Accounts.

The Group has clear procedures for capital investment appraisal, contract risk appraisal and financial reporting. The Audit Committee and Board also receive the detailed risk reviews on a bi-annual basis which are used to inform strategy setting (as well as informing the Group’s internal audit strategy).

During the year, there were changes to the leadership of the Board with Craig Wilson being appointed Chair, following David Coghlan’s retirement in February, and then subsequently resigning himself in October when Steve Coggins stepped into the role on an interim basis. Despite the changes in leadership, the size and composition of the Board has remained sufficiently independent, balanced and contained a breadth of experience to provide effective oversight of the Group’s strategy, performance, resources, and standards of conduct. 
 

The QCA Code recommends that an AIM company should have at least two independent Non-Executive Directors, but clarifies that independence is a Board judgement. Accordingly, the Board considers that Steve Coggins, due to his length of tenure, is not independent for the purposes of the QCA Code, but his greater depth of experience and knowledge facilitates challenge and provides support to the Executive Directors. He, together with Alison Vincent and Andrew Lockwood who fulfil the criteria of two independent Non-Executive Directors as recommended, form an effective team with a blend of skill sets which meet the needs of the Company and are fully committed to working for the benefit of all shareholders and stakeholders. 
 

The Group recognises the benefits of having a diverse Board, senior management team and workforce in general and seeks to recruit and develop the best-qualified candidates to support and achieve the Group’s long-term strategic and business objectives. The Group monitors and encourages diversity across the whole workforce in terms of gender, skills, culture, disability and ethnicity and believes such diversity contributes to the success of the Group.
 

All Board members have confirmed they have sufficient available time to undertake their duties effectively. A register of interests, including external appointments, is maintained by the Company Secretary and any subsequent external appointments require the express approval of the Chair.

The Board considers that it benefits from a range of highly experienced individuals, with sector specialist skills and personal qualities and capabilities that can deliver the strategy of the Company. It is satisfied that between its members it has an effective and appropriate balance of skills and knowledge including experience in the areas of technology, engineering, finance, international trading, innovation, sales and marketing.
 

The Executive and Non-Executive Directors’ skill sets are complementary, and together provide a blend of commercial, operational and financial expertise. The skill set is suitably broad and sufficiently high calibre such that all decision making at Board level is robust and mindful of the fiduciary responsibilities that need to be discharged to all shareholders. 
 

Each Board member takes responsibility for maintaining their individual skill set, which includes roles and experience with other boards and organisations. They are also aware of the importance of keeping informed of the various activities and developments in the markets in which they operate and attend conferences and training events throughout the year to keep their skills, contacts and knowledge current. Formal training requirements for all Board members are reviewed annually and arranged where appropriate.

The Board carries out an annual self-assessment of its performance. This includes evaluation of the performance and effectiveness of the Board and of its Committees. The process is led by the Chair and involves detailed questionnaires and one-to-one reviews of the feedback. The results of the evaluation are the subject of a full, robust, and open debate at a meeting of the Board, where actions for improvements are agreed. Progress against these actions is then monitored and reported on throughout the year. Currently, individual Directors do not get individually appraised and they do not formally appraise the Chair’s performance. However, the performance evaluation of the Committees on which the Non-Executive Directors sit is deemed appropriate for the evaluation of their performance. 
 

In 2022, the Board identified five areas of improvement against which progress has been made during the year especially improving communication for investors and demonstrating shareholder value and focusing on Synectics delivering profit recovery at or above market expectations in 2022 and 2023. 
 

This year’s Board evaluation took place in April, however, this focused on the previous tenure under Mr Coghlan rather than being forward looking under Mr Wilson. Accordingly, the Board took the decision to delay the evaluation until later in the year when the Board had experienced further time under Mr Wilson’s leadership. Unfortunately, due to unforeseen circumstances, the delayed evaluation of the Board did not take place. Following the resignation of Mr Wilson and the appointment of an Interim Chair, the Board did not feel that it was appropriate to undertake the evaluation during an interregnum. 
 

Following the appointment of a new Chair the Board evaluation will be put back on the agenda as a matter of priority.

The Board and senior management endeavour to lead by example and to demonstrate the Company values (see inner front cover) at all times. The values underpin the Company’s strong ethical culture and influence decision making and behaviours across the Group. Internal policies and practices support this, ensuring no one is discriminated against and that the values are upheld in everything we do. 
 

The Group’s Anti-Bribery and Corruption Policy is reviewed annually and communicated throughout the Group to prevent bribery from taking place. Any known non-compliance with the policy is reported to the Board as part of the Governance Report, with no reports received to date. 
 

The Company opposes modern slavery in all its forms and will try to prevent it by any means that it can. Anyone who has any suspicions of modern slavery within the business, or the supply chain is encouraged to raise their concerns without delay. The Group maintains relationships with many different organisations in its supply chain, as well as directly employing over 250 people worldwide. Each year the Board reviews internal measures to ensure the Group is doing what it can to prevent slavery and human trafficking. The Company’s modern slavery statement can be found here.  

As an AIM-quoted company, Synectics has additional obligations relating to seeking shareholder approval for certain decisions. Additionally, Synectics has an open dialogue with both its shareholder and stakeholder base, through the various events it holds during the year.

Synectics holds investor roadshows following publication of its annual and interim results, as well as an analyst presentation. Additionally, the Chair and Executive Directors hold informal meetings with shareholders who request such meetings and the outcomes of any discussion are reported to the Board as a whole.