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AIM Notice 50

Frenkel Topping

Corporate Governance

Introduction from the Chairman

All members of the board believe strongly in the value and importance of good corporate governance and in our accountability to all of Frenkel Topping’s stakeholders, including shareholders, staff, clients and suppliers. In the statement below, we explain our approach to governance, and how the board and its committees operate.

Changes to AIM rules on 30 March 2018 require AIM companies to apply a recognised corporate governance code by 28 September 2018.

The corporate governance framework which the group operates, including board leadership and effectiveness, board remuneration, and internal control is based upon practices which the board believes are proportional to the size, risks, complexity and operations of the business and is reflective of the group’s values. Of the two widely recognised formal codes, we have therefore decided to adhere to the Quoted Companies Alliance’s (QCA) Corporate Governance Code for small and mid-size quoted companies (revised in April 2018 to meet the new requirements of AIM Rule 26).

The QCA Code is constructed around ten broad principles and a set of disclosures. The QCA has stated what it considers to be appropriate arrangements for growing companies and asks companies to provide an explanation about how they are meeting the principles through the prescribed disclosures. We have considered how we apply each principle to the extent that the board judges these to be appropriate in the circumstances, and below we provide an explanation of the approach taken in relation to each. The board considers that it does not depart from any of the principles of the QCA Code.

The Board believes that it complies with all ten principles of the QCA code, although it has identified one area where it is not complicit with regard to the balance of the board, however it intends to address this and appoint another non-executive in the future.

Paul Richardson

Non-executive Chairman

Board composition and compliance

The QCA Code requires that the boards of AIM companies have an appropriate balance between executive and non-executive directors of which at least two should be independent. We have recently announced the Chairman’s decision to move from being executive to non-executive having completed and announced the conclusions of the project to develop the strategic direction of group that he and the three other executive directors had been focused on. This decision also reflected the board’s decision to increase the number of non-executive directors, such that today it comprises three executive directors and two non-executives. It is the board’s intention that in the medium term the number of non-executives will be increased to three, however the company is small and the decision to add a third non-executive will be made as we grow, and we can justify the additional cost.

During 2018, Mark Richards who was formerly our only non-executive director resigned following an increase in his other obligations. The board considers that the size of the group does not justify the establishment of a formal nominations committee, and consequently all of the directors played an active part in the recruitment of a new non-executive director and are pleased to be joined by Tim Linacre who joined the Group in June 2018. Tim is an experienced City practitioner. After qualifying with Deloitte Haskins and Sells he spent 5 years with Hoare Govett before moving to Panmure Gordon in 1992, working at that firm for 20 years including 8 years as CEO. Tim is currently Senior Managing Partner at Instinctif Partners, a leading business communications firm.

Board evaluation

For many years we have supported the QCA Code’s principle to review regularly the effectiveness of the board’s performance as a unit, as well as that of its committees and individual directors.

Shareholder engagement

Since the board changes made in 2017 and reported in the 2017 Report and Accounts, the Chairman, CEO and CFO have made significant efforts to renew and continue effective engagement with both institutional and private shareholders in conjunction with the announcement of our annual and interim results, meeting both existing and potential investors

The board has ultimate responsibility for reviewing and approving the Annual Report and Accounts and it has considered and endorsed the arrangements for their preparation, under the guidance of its audit committee. The directors confirm that the Annual Report and Accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the group’s position and performance, business model and strategy.

The following paragraphs set out Frenkel Topping’s compliance with the ten principles of the QCA Code.

Principle 1: Establish a strategy and business model which promote long-term value for shareholders

The purpose of the group is described in in the Frenkel Topping mission, which is to be a major manager of wealth for vulnerable clients, as well as being an innovator and employer of choice. Our reputation in this arena is allowing us to extend our offering to new clients through the provision of general independent financial advisory services and through managing clients’ assets on a discretionary basis. We believe that the quality of the service we provide and our reputation with our clients and their advisors, plus the wider range of services we can provide will contribute to the growth of in sales revenue and assets under management and the operational gearing we will enjoy as the business grows will accelerate the growth in shareholder value.

The key challenges we face include:

  • Maintaining consistently high levels of quality – high standards are rightly expected by our clients and their advisors and it is our responsibility to continue to raise standards and meet those expectations.
  • Extending the services and products we can offer – our reputation as the leading specialist independent financial advisor and wealth management business to the vulnerable in society is allowing us to extend the services we can offer into the provision of generalised independent financial advice and into discretionary fund management. Developing these opportunities and increasing the scale of the business will deliver growth for our shareholders.
  • Investing in developing our people – we do not believe that our industry does enough to train new financial advisors. The skills needed by the advisors we employ are even more specialised. Accordingly, we are investing in junior advisors to become the lead advisors of tomorrow and we have launched a graduate training academy to train the best talent to become the technical advisors, para-planners and consultants of the future.
  • Recruiting, motivating and retaining our team of consultants – the group’s capacity for generating new business and retaining existing clients is dependent, in part, on the consultants we employ.
  • Recruiting and retaining suitable office-based staff– the group’s ability to execute its strategy is dependent on the skills and abilities of all of its staff. We undertake ongoing initiatives to foster good staff engagement and ensure that remuneration packages are competitive in the market.

We believe we have the right strategy in place to deliver strong growth in sales over the medium to long term. We expect that the new services added will contribute to the growth in revenues and AUM and that the operational gearing within the organisation will result in improving EBITDA margins and the value of the Group. This will enable us to deliver sustainable shareholder value.

Principle 2: Seek to understand and meet shareholder needs and expectations

Responsibility for investor relations rests with the CEO, supported by the CFO, whilst giving shareholders access to the Chairman if and when requested. These meetings are organised by the Group’s Nomad, finCapp, at or close to results announcements or when requested, or directly with the company as requested by investors.

The group is committed to communicating openly with its shareholders to ensure that its strategy and performance are clearly understood. We communicate with shareholders through the Annual Report and Accounts, full-year and half-year announcements, trading updates and the annual general meeting (AGM), and we encourage shareholders’ participation in face-to-face meetings. A range of corporate information (including all Frenkel Topping announcements) is also available to shareholders, investors and the public on our website.

Private shareholders: The AGM is the principal forum for dialogue with private shareholders, and we encourage all shareholders to attend and participate. The Notice of Meeting is sent to shareholders at least 20 days before the meeting. The chairs of the board and all committees, together with all other directors whenever possible, attend the AGM and are available to answer questions raised by shareholders. Shareholders vote on each resolution, by way of a poll.

Institutional shareholders: The directors actively seek to build a mutual understanding of objectives with institutional shareholders. Our CEO and CFO make presentations to institutional shareholders and analysts immediately following the release of the full-year and half-year results. We communicate with institutional investors frequently through a combination of formal meetings, and informal briefings with management. The majority of meetings with shareholders and potential investors are arranged by the broking team within the group’s nominated advisor. Following meetings, the broker provides anonymised feedback to the board from all fund managers met, from which sentiments, expectations and intentions may be gleaned.

In addition, we review analysts’ notes to achieve a wider understanding of investors’ views. This information is considered by the board and has contributed to the preparation of the group’s investor relations strategy.

Principle 3: Take into account wider stakeholder and social responsibilities and their implications for long-term success

Stakeholder Reason for engagement How we engage
Staff – our ability to provide professional advice to clients and regular reports on the performance of their investments depends on having professional, intelligent, talented and motivated staff. Good two-way communication with staff is a key requirement for high levels of engagement, fostering a culture of innovation. Monthly meetings with consultants and regular meetings with administration staff to brief on developments in the industry and within the Company

Invitation to consultants and staff to ask questions of management that are answered in the briefings.

Periodic meetings with Consultants to receive feedback from them and the market in order to consider how this might influence the future direction of the business

Annual engagement survey.

These have provided insights that have led to enhancement of management practices and staff incentives.

Clients and their advisors – our success and competitive advantage is dependent upon fulfilling the expectations and requirements of our clients and their advisors. Understanding current and emerging requirements of current and potential clients enables us to develop new and enhanced products and services. Seek feedback on services provided and to earn recommendations to potential clients.

Win new business and advise on the investment of clients’ assets


Suppliers – three groups of suppliers group support our business i) the investment managers whose products we recommend to our clients ii) the investment advisors who provide support to our fund management activity and iii) the providers of computer services who action investment decisions made on behalf of our clients and report the performance of their assets. To deliver the services that we provide to our clients. We optimise our systems to efficiently and safely complete the investments made on behalf of clients and accurately and promptly report the performance of the assets invested.

We monitor the performance of the funds in which their assets are invested to ensure that they are performing in line with our and the clients’ expectations.

Shareholders – as a public company we must provide transparent, easy-to-understand and balanced information to ensure support and confidence. Meeting regulatory requirements and understanding shareholder sentiments on the business, its prospects and performance of management. Regulatory news releases.

Keeping the investor relations section of the website up to date.

Annual and half-year reports and presentations.


We believe we have successfully engaged with our shareholders: over the past 12 months this engagement has led to support for the group.

Regulatory bodies – the services we provide must meet certain requirements. The Financial Conduct Authority regulates the conduct within our industry and sets standards that we are obliged to adhere. The London Stock Exchange regulates companies listed on AIM. Being registered with the FCA means that we are obliged to adhere to the standards set and report on meeting those standards

Being quoted on AIM requires the Group to meet the standard, transparency and frequency of financial reporting and Corporate Governance that the LSE sets.

Communities– the advice we provide supports individuals who have been injured in an incident and helps them pursue compensation when they are entitled to compensation. In other cases, an injured party will receive no settlement. The Frenkel Topping Charitable Foundation aims to provide some support to injured parties where they receive no compensation. Activities to support fundraising for Frenkel Topping Charitable Foundation.



Principle 4: Embed effective risk management, considering both opportunities and threats, throughout the organisation

Within the scope of the annual audit, specific financial risks are evaluated in detail, including in relation to liquidity and credit control.

Managers and staff who may be aware of price sensitive information are required to seek approval from the CFO if they, or their families, plan to trade in the group’s equities.

Principle 5: Maintain the board as a well-functioning, balanced team led by the chair

The members of the board have a collective responsibility and legal obligation to promote the interests of the group and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the chair of the board.

The board consists of five directors of which three are executive and two are independent non-executives (Paul Richardson and Tim Linacre). Tim Linacre was appointed during the period. The board is supported by two committees: audit and remuneration. The board does not consider that it is of a size at present to require a separate nominations committee, and all members of the board are involved in the appointment of new directors. The board intends to appoint additional non-executive directors as its business expands.

There are currently no female directors.  The board remains confident both that the opportunities in the Company are not excluded or limited by any diversity issues (including gender) and that the board nevertheless contains the necessary mix of experience, skills and other personal qualities and capabilities necessary to deliver its strategy.

Non-executive directors are required to attend 6-8 board and board committee meetings per year (in Salford and London) and to be available at other times as required for face-to-face and telephone meetings with the executive team and investors.

Meetings held during 2018 and the attendance of directors is summarised below:

board meetings* Audit Committee Remuneration Committee
Possible Attended Possible Attended Possible Attended
Executive directors
Richard Fraser 5 5 1 1
Stephen Bentley (appointed 21 November 2017) 5 5
Mark Holt 5 4
Non-executive directors
Paul Richardson (appointed 21 November 2017) 5 5 1 1 2 2
Mark Richards (resigned 19 June 2018) 4 3 1 1 1 1
Tim Linacre (appointed 19 June 2018) 2 2 1 1


* There was one further meeting called and held by conference call for the sole purpose of approving the interim results announcement

The board has a schedule of regular business, financial and operational matters, and each board committee has compiled a schedule of work to ensure that all areas for which the board has responsibility are addressed and reviewed during the course of the year. The chairman is responsible for ensuring that, to inform decision-making, directors receive accurate, sufficient and timely information. The company secretary compiles the board and committee papers which are circulated to directors prior to meetings. The company secretary provides minutes of each meeting and every director is aware of the right to have any concerns minuted and to seek independent advice at the group’s expense where appropriate.

Principle 6: Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities

Four members of the board bring relevant sector experience in independent financial advice, three have at least twenty years of public markets experience and two members are chartered accountants. The board believes that its blend of relevant experience, skills and personal qualities and capabilities is sufficient to enable it to successfully execute its strategy. Directors attend seminars and other regulatory and trade events to ensure that their knowledge remains current.

Paul Richardson, Non-Executive Chairman

Term of office: Appointed as Executive Chairman on 21 November 2017 before becoming Non-Executive Chairman on 5 September 2018; Chair of the Remuneration Committee and a member of the Audit Committee.

Background and suitability for the role: Paul brings more than 30 years executive experience in the legal, wealth management and charity sectors. A solicitor, he has worked in various positions in finance, private banking, wealth management at Coutts and Barclays Wealth.

Current external appointments: Paul is currently a trustee for WellChild the national children’s charity that strives to keep children and young people with exceptional health needs at home rather than in hospital. He is also a former trustee for the Steve Redgrave Trust, Comic Relief and the NSPCC, where Paul was on the sports committee for 10 years

Time commitment: one to two days per week.

Tim Linacre, Independent Non-Executive Director

Term of office: Joined as Non-Executive Director on 19 June 2018; Chair of the Audit Committee and member of the Remuneration Committee.

Background and suitability for the role: Tim is a chartered accountant and an experienced City practitioner. After qualifying with Deloitte Haskins and Sells he spent 5 years with Hoare Govett before moving to Panmure Gordon in 1992, working at that firm for 20 years including 8 years as CEO. Tim is currently Senior Managing Partner at Instinctif Partners, a leading business communications firm.


Time commitment: one to two days per month.


Richard Fraser, CEO and Company Secretary

Term of office: Richard joined Frenkel Topping Ltd in 1991, was appointed at Managing Director in 1999 and appointed to the board of Frenkel Topping Group Plc in 2001.

Background and suitability for the role: Richard joined Frenkel Topping Ltd (the trading subsidiary of Frenkel Topping Group Plc) in 1991 after gaining experience in financial services whilst working at Lloyds Bank, Bradford and Bingley Building Society and Scottish Widows. Richard has been fully involved in the development of both structured settlements and Frenkel Topping Ltd, becoming Managing Director in 2000. He played a key role in the appointment of Frenkel Topping Ltd as an alternative investment broker to the Court of Protection and Richard has also been a regular speaker at financial services conferences across the UK.

Current external appointments: None

Time commitment: full time.


Stephen Bentley, CFO

Term of office: Appointed as CFO in November 2017.

Background and suitability for the role: Stephen is a graduate chartered accountant who has held senior financial roles in companies quoted on the London Stock Exchange and private equity backed businesses for over thirty years.  These roles include Group Finance Director of Brunner Mond Plc, TDG PLC and Ellis & Everard PLC and most recently, James Dewhurst Limited where he helped with the sale of the business to a large Belgian Textile Group before joining Frenkel Topping.

Current external appointments: Stephen is a non-executive director of Frigoglass S.A.I.C., a major international manufacturer of refrigeration equipment.

Time commitment: 80% time.

Mark Holt, Commercial Director

Term of office: Originally engaged as a senior consultant in 2011, Mark was appointed Commercial Director and joined the board on 1 September 2016.

Background and suitability for the role: Since graduating in 1996, Mark has worked in the Financial Services Industry, working for Nelson’s Money Managers before joining Barclays Financial Management in 1998. He was Managing Director of his own IFA firm which he ran successfully before joining Frenkel Topping nine years ago.  Mark has written a response to The Ministry of Justice on the Discount Rate Consultation and regularly spends time in Chambers delivering training seminars to Counsel and Solicitors on the discount rates used to quantify personal injury and clinical negligence settlements and periodical payments. He is authorised and regulated by the Financial Conduct Authority and currently holds the ‘Statement of Professional Standing’ as issued by the London Institute of Banking and Finance.

Current external appointments: None

Time commitment: full time.

Principle 7: Evaluate board performance based on clear and relevant objectives, seeking continuous improvement

A board evaluation process led by the chairman is to be performed over the coming year which will involve a 360-degree review in which each gathers feedback from a number of sources, including peers, direct reports, more senior colleagues.

The review considers effectiveness in a number of areas including general supervision and oversight, business risks and trends, succession and related matters, communications, ethics and compliance, corporate governance and individual contribution.

Principle 8: Promote a corporate culture that is based on ethical values and behaviours

Our long-term growth is underpinned by our five core values, they are:

  1. We place our clients first. The criteria applied in recruiting our consultants and other front-line staff include both technical capabilities and their people skills because being able to relate to our clients is a key responsibility of all members of our team. Putting ourselves in the shoes of our clients to understand their current and future needs helps us to relate to the people for whom we are providing advice and investing their assets.
  2. We have an enduring positive attitude that stems from being self-motivated, adaptable and agile and feeling fully empowered to make a difference, speaking out with ideas and suggestions to make things better.
  3. We are team players who recognise that Frenkel Topping is a company worth much more than the sum of its parts, we are passionate about communicating with colleagues and our clients and their advisors.
  4. We are committed to improving the service we provideby understanding the needs of our clients and their advisors and by exploiting the information technology that is available to us.
  5. We respect one another and are courteous, honest and straightforward in all our dealings, we honour diversity, individuality and personal differences, and are committed to conducting our business with the highest personal, professional and ethical standards.

The culture of the group is characterised by these values which are communicated regularly to staff through internal communications and forums. The board believes that a culture that is based on the five core values is a competitive advantage and consistent with fulfilment of the group’s mission and execution of its strategy.

The culture is monitored through the use of a widely-used satisfaction and engagement survey that is operated on an annual basis and to which all permanent staff are invited to contribute. The board reviews the findings of the survey and determines whether any action is required.

Principle 9: Maintain governance structures and processes that are fit for purpose and support good decision-making by the board

The board provides strategic leadership for the group and operates within the scope of a robust corporate governance framework. Its purpose is to ensure the delivery of long-term shareholder value, which involves setting the culture, values and practices that operate throughout the business, and defining the strategic goals that the group implements in its business plans. The board defines a series of matters reserved for its decision and has approved terms of reference for its audit and remuneration committees to which certain responsibilities are delegated. The chair of each committee reports to the board on the activities of that committee.

The Audit Committee monitors the integrity of financial statements, oversees risk management and control, monitors the effectiveness of the internal audit function and reviews external auditor independence.

The Remuneration Committee sets and reviews the compensation of executive directors including the setting of targets and performance frameworks for cash- and share-based awards.

The Executive board, consisting of the executive directors, operates as a management committee, chaired by the CEO, which reviews operational matters and performance of the business, and is responsible for significant management decisions while delegating other operational matters to individual managers within the business.

The Chairman has overall responsibility for corporate governance and in promoting high standards throughout the group. He leads and chairs the board, ensuring that committees are properly structured and operate with appropriate terms of reference, ensures that performance of individual directors, the board and its committees are reviewed on a regular basis, leads in the development of strategy and setting objectives, and oversees communication between the group and its shareholders.

The CEO provides coherent leadership and management of the group, leads the development of objectives, strategies and performance standards as agreed by the board, monitors, reviews and manages key risks and strategies with the board, ensures that the assets of the group are maintained and safeguarded, leads on investor relations activities to ensure communications and the group’s standing with shareholders and financial institutions is maintained, and ensures that the board is aware of the views and opinions of employees on relevant matters.

The Executive Directors are responsible for implementing and delivering the strategy and operational decisions agreed by the board, making operational and financial decisions required in the day-to-day operation of the group, providing executive leadership to managers, championing the group’s core values and promoting talent management.

The Independent Non-Executive Directors contribute independent thinking and judgement through the application of their external experience and knowledge, scrutinise the performance of management, provide constructive challenge to the executive directors and ensure that the group is operating within the governance and risk framework approved by the board.

The CFO is responsible for providing clear and timely information flow to the board and its committees and supports the board on matters of corporate governance and risk.

The matters reserved for the board are:

  • Setting long-term objectives and commercial strategy.
  • Approving annual operating and capital expenditure budgets.
  • Changing the share capital or corporate structure of the group.
  • Approving half-year and full-year results and reports.
  • Approving dividend policy and the declaration of dividends.
  • Approving major investments, disposals, capital projects or contracts.
  • Approving resolutions to be put to general meetings of shareholders and the associated documents or circulars.
  • Approving changes to the board structure.

The board has approved the adoption of the QCA Code as its governance framework against which this statement has been prepared and will monitor the suitability of this code on an annual basis and revise its governance framework as appropriate as the group evolves.


Principle 10: Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders

In addition to the investor relations activities described above, the following audit and remuneration committee reports are provided.

The votes at the Group’s most recent AGM held on 30th May 2018 were cast as follows:

For Against Abstained
Votes Votes Votes
Ordinary Resolution 1 To receive the annual report and accounts for the year ended 31st December 2017 together with the directors’ report and auditor’s report on those accounts 18,696,545
Ordinary Resolution 2 To approve the payment of a final dividend for the year ended 31 December 2017 of 0.9324 pence per share 18,696,545
Ordinary Resolution 3 To approve the election of Paul Richardson as Executive Chairman 17,893,491 803,054
Ordinary Resolution 4 To approve the election of Stephen Bentley as Director  of the company 18,696,545
Ordinary Resolution 5 To approve the re-election of Richard Fraser as Director of the company 17,893,401 54,090 803,054
Ordinary Resolution 6 To re-appointment the auditors, RSM UK Audit LLP 18,696,545
Ordinary Resolution 7 To authorise the directors to determine the auditors’ remuneration 18,696,545
Ordinary Resolution 8 to renew the annual authority conferring powers on the directors to allot shares restricted to the circumstances set out in the notice of meeting 17,893,401 857,144
Ordinary Resolution 9 to empower the directors too allot equity securities for cash without first offering them to existing shareholders up to the customary amount of 5% of the entire issued share capital of the company. Authority is restricted to the circumstances that are set out in the notice meeting 17,893,401 857,144
Ordinary Resolution 10 to empower the directors too allot equity securities for cash without first offering them to existing shareholders up to the customary amount of 5% of the entire issued share capital of the company. Authority is restricted to the circumstances that are set out in the notice meeting 17,893,491 803,054
Ordinary Resolution 11 to empower the directors too allot equity securities for cash without first offering them to existing shareholders up to the customary amount of 5% of the entire issued share capital of the company in relation to acquisitions and specified capital investments. Authority is restricted to the circumstances that are set out in the notice meeting 17,893,401 823,054 54,090

Audit Committee Report

During the year, the Audit Committee has continued to focus on the effectiveness of the controls throughout the group. The Audit Committee consists of Paul Richards, Chair, Richard Fraser and Tim Linacre. The committee met once, and the external auditor, Mark Holt and the CFO were invited to attend this meeting. The external auditor meets with the CFO on a regular basis to be briefed on developments in the Group and with the CEO as an when necessary.  Consideration was given to the auditor’s pre- and post-audit reports and these provide opportunities to review the accounting policies, internal control and the financial information contained in both the annual and interim reports. The committee also met with the auditors with no executives present.

Remuneration Committee Report

The remit of the Remuneration Committee is to determine the framework, policy and level of remuneration, and to make recommendations to the board on the remuneration of executive directors. In addition, the committee oversees the creation and implementation of all-employee share plans. The Remuneration Committee consists of Paul Richards, chair, and Tim Linacre. The committee met twice.

In setting remuneration packages the committee ensured that individual compensation levels, and total board compensation, were comparable with those of other AIM-listed companies.

During the period under review the Remuneration Committee has granted options over ordinary shares in the company to executive directors and employees of the company. In granting these options, the Remuneration Committee’s objective was to attract, motivate and retain key staff over the long term, designed to incentivise delivery of the company’s growth objectives.

The Group’s Financial Statements for the year ended 31 December 2017 and the Interim Results to 30 June 2018 can be found on the Group’s website or through the following links:

The Notice of the 2018 Annual General Meeting can also be found on the Group’s website or through the following link: