Chair’s governance statement

Clarity and focus

On behalf of the Board, I am pleased to present the Group’s Corporate Governance Report for the year ended 29 February 2024.

As I outlined in my review earlier in this report, this year the Board undertook a comprehensive review of the optimal structure of the Group. This has resulted in the implementation of a plan to deliver a pure play, high-growth software business in KX, which is funded to execute on the exciting growth opportunities ahead of it. The process was led by the Board, working with its advisers, across a range of activities to ensure the strategy is robust and comprehensive and represents the optimal outcome for all stakeholders.

The work of the Board Committees during the year also supported the structure review process, notably within the Audit and Risk Committee which examined the financial reporting requirements arising from the separation of our businesses. It also had oversight of the refinancing of the Group at improved interest rates and covenants, providing financial flexibility and security as we implement our strategy.

The Remuneration and Talent Committee focused on the strategy to strengthen the KX senior management team to ensure we can deliver on our strategic priorities. The primary mechanism for this is through our Long-Term Incentive Plan, which was reviewed during the year to ensure transparency and alignment with our long-term goals, including designing and determining measures and targets for variable pay.

As we execute on our strategy to deliver a pure play KX software business, the work to steer the development of our technology, and address emerging opportunities and risks to meet our strategic goals, is increasingly vital. In FY23 the Board decided that with effect from the beginning of FY24 the subcommittee that dealt with these matters should become a full Board Committee. Named as the Technology and Product Committee, its first report is contained in this Annual Report and highlights the important contribution it has made to the evolution of KX’s strategy, including appraising the opportunity in AI, aligning product development priorities to repeatable use-cases and monitoring the development of our core kdb+ technology to deliver enhanced benefits for customers.

Culture and Board information

I believe that reaching our objectives demands the highest standards of governance and a strong organisational culture. As Chair, my aim is to exhibit objective judgement and foster productive dialogues among Board members.

It is crucial that Directors receive precise, timely and transparent information that enables them to execute their roles effectively. The CEO provided regular updates to the Board on business unit performance at every Board meeting. Additionally, divisional leaders attended Board meetings throughout the year to offer comprehensive updates on business unit performance, facilitating the Board’s assessment of progress and its provision of guidance as needed. Throughout the year, the locations of Board meetings rotate to enable the Board to visit the Group’s operations. This approach allows the Board to engage in dialogue with employees at varying levels in each location.

Developing our employees to reach their full potential and contribute to the Group’s development remained a key priority during FY24 and we again strengthened our leadership programmes as well as our programmes to increase the skills and knowledge of our workforce to foster a culture where learning and development is valued, encouraged and supported at all levels.

Employee engagement is a key metric reviewed by the Board to ensure alignment with our mission as it reflects our organisational culture, skills and strategic alignment. I am delighted with the high level of employee engagement evident in our annual employee survey, particularly in crucial areas such as sustainable engagement. This underscores our commitment to fostering an energised and motivated workforce.

Having a diverse and inclusive workforce is imperative for maintaining a sustainable and thriving business. Our work on diversity, inclusion and belonging continued this year. As well as our continued efforts to increase gender diversity and reduce our gender pay gap, we have established networks to increase diversity through the Company. In FY24 we established a Neurodiversity network to add to our Pride and Multicultural networks. We retained our Silver accreditation from Diversity Mark NI and continue to focus on outcome-based initiatives to demonstrate our progress.

Since my last report the only change to Board composition resulted from the resignation of Virginia Gambale in December 2023. Virginia had served on the Board for almost nine years, and we benefited from her deep domain expertise across the financial services, technology, cloud, data and AI sectors.

Aside from Virginia’s resignation, Board composition has been stable for the past two years. Our highly skilled and experienced Board has been instrumental in guiding us through significant strategic decisions over the past year. We review the composition of our Board on an annual basis and have a well-defined process and skills matrix that is updated to support our strategic goals.

Compliance with the UK Corporate Governance Code

The Board is committed to promoting high standards of corporate governance across the Company and has adopted the 2018 UK Corporate Governance Code (the “Code”). The Board notes the recent revisions to the Code, most of which will apply to financial periods beginning on or after 1 January 2025 and will consider in a timely way how the relevant changes apply to the Company. During the year, and as further set out in this report and with the exception of the comment made in relation to provision 36 of the Code in the Report of the Remuneration and Talent Committee, the Company has applied the principles of the Code and complied with the provisions of the Code.

Board effectiveness

Arranged by the Nomination and ESG Committee under my direction as Chair, the Board engaged Independent Audit again this year to undertake a review of its effectiveness. I am satisfied that the evaluation showed that the skills and experience of the Executive Directors and Non-Executive Directors were appropriate, with the Board working effectively together.

Annual General Meeting

The AGM is an important forum for shareholders to hear more about the general development of the business. The 2024 Annual General Meeting will be held on 18 July 2024. Full information is contained in the Notice of Annual General Meeting, which will be sent to shareholders with this Annual Report at least 21 working days prior to the date of the meeting and is available on the Company’s website at www.fdtechnologies.com.

Conclusion

In summary, the focus in FY24 has been on determining the optimal Group structure. The skills, experience and knowledge of the Board, supported by our governance framework providing a strong decision-making framework, were essential in delivering a comprehensive and thoughtful plan to deliver a high-growth pure play KX software business that I am confident will benefit all stakeholders.

Donna Troy

Chair
20 May 2024