Chairman's statement

At M.P. Evans, we firmly believe that good corporate governance underpins the success of the Group. It supports decision making in the boardroom, mitigates risk, and fosters a strong Group-wide culture that engenders trust in the way we operate and conduct our business. The Group operates in a sector where timelines are long, and hence where investors are keen to understand how the board’s governance structures are protecting the long-term interests of shareholders.

As chairman, one of my primary responsibilities is to ensure that an effective corporate governance framework exists. Over the course of the year, the agenda planning for the board and its committees ensures that all the areas encompassed by the ten principles of the QCA Code are reviewed, including an annual assessment of how we are applying the principles.

We have clear policies, which have been approved by the board, and which are promoted and embedded throughout all levels of the organisation. These policies reflect the desired ethical culture which the board considers to be a cornerstone of the Group’s success, and which aligns with the Group’s purpose of being a responsible producer of certified sustainable Indonesian palm oil. These policies are all the more important given the size and geographical spread of the Group’s workforce. In addition, the Group sees ethical behaviour as a competitive advantage to building trust with customers, suppliers and other key stakeholders, as well as attracting and retaining high-performing staff.

My other main role is to lead an effective board, including in its objective of setting the Group’s strategy. The composition of the board, the breadth and depth of its skill set, the diversity of its members to facilitate insight and perspective on matters being considered, and the inclusive environment within which constructive debate is enabled, are hugely important to the effectiveness of the board. Ensuring that we have the right people in the right roles is something to which we regularly dedicate time as a whole board, with succession planning and board evaluation routinely on the board’s agenda.

During 2024, there was almost 100% attendance at meetings. The Company calendar normally includes six board meetings, one of which is online. In 2024, the board also met in person for a full-day strategy review, as well as a further unscheduled online meeting. Members consistently demonstrated high levels of engagement in all areas of the business, whether meeting as a board or as remuneration or audit committees. I am confident that we have a very strong and fully engaged board which has a good balance of skills, experience and diversity to support and further the Group’s strategy, and which promotes the Group’s culture. More information on our non-executive board members, including whether they are considered independent, can be found in the corporate governance section of the 2024 annual report.

Bruce Tozer, who will have served on the board for nine years in June, chairing the audit and remuneration committees since 2022, in addition to his role as senior independent director, will be retiring at the next AGM. It will be a challenge to find someone who encompasses the multiple areas of expertise that make Bruce such a valued board member. However, since the second half of 2024, my colleagues and I have been engaged in a diligent succession-planning process. This has included mapping out, with a long-term perspective, key skills and personal attributes that will ensure the board continues to be effective and evolve to meet future needs.

The board has, for several years, carried out internally led evaluations of itself and its committees, and board members welcome these exercises as an opportunity to reflect and provide constructive feedback. In 2024, we decided to invite an external facilitator to conduct a board evaluation. The assessor was asked to focus on board composition and structure, skills, meetings and briefings and communications, specifically with a view to the outcomes feeding into the profile for the upcoming board appointment. I am pleased to report that the assessment concluded that the board is effective. My colleagues and I found the external perspective very useful and will reflect upon the outcomes, further details of which are included in the corporate governance report.

Board members are encouraged and facilitated to maintain and build their relevant knowledge and skills. Access to training is available to ensure knowledge is up to date and, where necessary, we engage external specialists to support the board and senior management in their decision making.
During the latter part of the year, awareness of the Group’s zero tolerance of bribery and corruption was refreshed by online training completed by board members and staff in Indonesia and the UK. This supplemented ongoing training and socialisation of the Group’s policies throughout the workforce, led by the Indonesian human resources team. Similarly, Group-wide online cyber-security training was carried out by staff and directors, as part of a mitigation strategy against cyber risk.
The board, supported by the audit committee, has continued to make progress on risk identification, management, mitigation, and disclosure. As well as reviewing matters reported by the internal audit team, and monitoring the internal controls over financial reporting, there is regular dialogue between the Group’s head of risk in Indonesia and executive directors, to ensure that mitigation strategies are being developed, deployed and are effective, and that any newly identified risks are assessed.

In 2024, the remuneration committee worked on developing appropriate remuneration packages for executives and senior management, including looking at long-term incentivisation and alignment of remuneration and bonuses to the Group’s strategic priorities and values. Further details of executive remuneration are set out in the remuneration report of the 2024 annual report.

We continue to be committed to our ESG agenda. Our specialist ESG consultants have again been working closely with the chief executive and the Group’s sustainability team during the year, including providing board-level briefings. They also led a climate-risk workshop in which the senior managers from across all the Group’s operational teams participated. We have also been able to launch two conservation initiatives which are discussed in more detail in the sustainability section on pages 35 and 37. Following extensive planning and expert-led research, a biodiversity project is now well under way at our Bangka estate, and we are anticipating positive impacts as the project matures. We are also conserving a mangrove forest adjacent to our Bumi Mas estate in East Kalimantan.

At least annually, the board considers who the Group’s stakeholders are, and how the board engages with them. This helps to embed into the board’s decision-making process the practice of considering wider stakeholder issues. The whistleblower hotline continues to be effective as a channel for stakeholders to report potential wrongdoing, and whilst we are pleased that no serious whistleblower issues have been identified to date, any grievances reported are treated as an opportunity to see if improvements need to be made in the way we do things. An employee-engagement initiative, led by the Indonesian human resources team, enables direct feedback to be shared by estate workers.

I have been, as always, delighted to receive positive feedback from shareholders and other stakeholders about the quality of our published materials. This reflects the efforts of the executive team who, in response to investor expectations, dedicate significant time to ensuring that high-quality information is readily available via the Group’s website, including financial and non-financial reports, videos of our operations, recorded investor presentations and interviews.

The chief executive and chief financial officer also conducted an extensive and well-received investor relations programme during 2024. Whilst I, myself, transitioned to the role of a non-executive chairman at the beginning of July 2024, I maintain, and will continue to maintain, strong relationships with our shareholders and other stakeholders where appropriate, alongside Matthew and Luke.

This has been our first year of implementing the updated QCA Code and we continue to value it, in its new form, as an appropriate framework within which to develop and refine our corporate governance practices.

Peter Hadsley-Chaplin
Chairman

25 March 2025