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Corporate governance

At Costain we take corporate governance very seriously and are committed to robust corporate governance practices and accountability.

The Board considers that the principles set out in the UK Corporate Governance Code (the “Code”) are central to the effective management of the business and to maintaining the confidence of investors.

The Board as a whole is responsible for providing strong leadership to the Costain Group and effective leadership is realised through collaboration between the Board and the executive management team. The non-executive directors use their experience to assist with the development of the Group’s strategy and both support and constructively challenge the executive directors in the operation of the business. Costain’s Chairman is responsible for promoting good governance, ensuring that the experience and knowledge of the Board is harnessed and for driving a culture of continual improvement in standards, decision-making, policies and accountability.

A key strength of the Board lies in its diversity across a range of measures, including skills, experience, gender and nationality. The Board sets the tone for the Costain Group by conducting itself in an ethical manner, embodying the important values of trust, integrity and independence. The Board is ultimately responsible for the success of Costain and the directors are committed to the highest standards of corporate governance to enable Costain to achieve its vision of being one of the UK’s leading engineering solutions providers.

The Governance section within the Group’s Annual Report & Accounts sets out Costain’s procedures for applying the principles of corporate governance and the extent to which it has complied with the provisions of the Code.

Section 430(2B) Companies Act 2006 Statement

As announced on 5 October 2020;
The following remuneration arrangements have been agreed for Tony Bickerstaff, which are consistent with the Directors’ Remuneration Policy approved at the Company’s 2020 AGM.

  • He will continue to receive his salary and benefits until 30 November 2020 (the “Termination Date”). On or after the Termination Date he will receive a payment in respect of accrued but untaken holiday. Details of payments made will be included in the Company’s 2020 Directors’ Remuneration Report.
  • In respect of the period from the Termination Date until 30 September 2021, in accordance with his service agreement he will be paid a monthly sum in respect of his salary and a cash supplement in lieu of pension contribution, and will continue to receive his other benefits (car allowance, private health insurance and life assurance cover) or be paid their value as part of the monthly sum. Details of payments made will be included in the relevant Directors’ Remuneration Report.
  • He will not be granted an award under the Long Term Incentive Plan (“LTIP”) or receive a bonus in respect of the 2020 financial year.
  • He holds a deferred share award granted under the Share Deferral Plan (“SDP”) in respect of his 2018 bonus over 31,051 shares. Recognising his contribution to the business over the relevant bonus period and the fact that this award is not subject to further performance conditions, he will be permitted to retain this award which will vest at the originally envisaged time in April 2021, subject to the rules of the SDP.
  • The second tranche of Tony’s 2016 LTIP award (which is vested over 46,703 shares) is due to be released in April 2021. Since this award was earned based on performance over the three years to 31 December 2018, the Remuneration Committee has exercised discretion to allow him to retain this award without a reduction for time pro-rating. There will be no early release of the award.
  • His 2018 LTIP will vest based on performance over the three years ending 31 December 2020. As he will be employed for the majority of the performance period, the Remuneration Committee has exercised its discretion to allow him to retain this award, the vesting of which will be subject to the performance conditions. There will be no early release of either tranche of this award.

             - The first tranche has been reduced on a time pro-rata basis to reflect the proportion of the performance period elapsed at the Termination Date to be  over 35,810 shares, will be released in April 2021 to the extent it vests by reference to the performance conditions. 

             - The second tranche has been reduced on a time pro-rata basis to reflect the proportion of the vesting period elapsed at the Termination Date to be over 19,605 shares and will be released in April 2023 to the extent it vests by reference to the performance conditions.

  • His 2019 LTIP will lapse.
  • He holds SAYE options which will either lapse or remain exercisable in accordance with the rules of the scheme.
  • He will receive a contribution of up to £3,300 (excluding VAT) towards the legal fees incurred in connection with the cessation of his employment, the actual amount of which will be based on the fees incurred. Details of any payment made will be included in the relevant Directors’ Remuneration Report.


The Company confirms that Tony will not receive any other remuneration payment or any payment for loss of office of the type specified in section 430(2B) of the Companies Act 2006.

David McManus - Section 430 (2B) of the Companies Act 2006

The following information is provided in accordance with Section 430 (2B) of the Companies Act 2006.

As announced on 6 February 2020, David McManus has stepped down from the Board and ceased to be a Non-executive Director of the Company with effect from the conclusion of the Annual General Meeting held on 19 June 2020.

David will receive his annual fee of £47,048 per annum (reduced by 30% with effect from 1 April 2020 as announced on 31 March 2020 as a result of measures taken to mitigate the financial impact of the COVID-19 pandemic), on a pro-rata basis up until 19 June 2020 (less deductions for tax and national insurance). No other remuneration payment or payment for loss of office will be made.

The Company’s Directors Remuneration Report for the financial year ending 31 December 2020 will include details of the fees earned by David during the relevant period.

19 June 2020

 

Audit Committee

  • Jane Lodge (Chair)
  • Alison Wood
  • Jacqueline de Rojas

Nomination Committee

  • Dr Paul Golby (Chair)
  • Jane Lodge
  • Bishoy Azmy
  • Alison Wood
  • Jacqueline de Rojas

Remuneration Committee

  • Alison Wood (Chair)
  • Jane Lodge
  • Jacqueline de Rojas

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