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Corporate Governance.

The Board and its Committees have a fundamental role in the governance framework by using their wide experience inproviding independent challenge and support and ensuring that good governance is promoted across the different businesses within the Group. The Board is responsible for the success of the Group and providing leadership within the framework of existing controls and ensures that its duties to shareholders and other stakeholders are understood.

We have adopted the Quoted Companies Alliance Corporate Governance Code (“QCA Code”) to assist in putting into place an effective corporate governance framework which will deliver results. Your Board understands that good governance isone of the foundations of its sustainable growth strategy.

The Chairman is responsible for Corporate Governance in the Group.

There were no key governance related matters that occurred in the year and no significant changes in governance arrangements.

Details on how the Company applies the principles of the QCA Code are set out below.

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

Newmark is a leading provider of electronic and physical security systems through its subsidiaries, Grosvenor Technology Limited and Safetell Limited, in the UK with exports to Europe and USA, and worldwide through our established customer base. The Company aims to help address some of the major challenges facing corporations in an environment of ever-increasing global security concerns and add value for all of our stakeholders through partnership and innovation. We will continue to develop exceptional and secure products backed up by industry leading support. The Company strategy is focused on delivering growth through the development of new products, providing its customers with much-needed peace of mind whilst also improving business efficiency and flexibility through innovative technology. The three core markets served, ElectronicAccess Control, Human Capital Management (HCM) and Counter Terror Equipment, are anticipated by industry analysts to grow significantly in the medium to long-term. The company takes a ‘deep and narrow’ approach in each of these markets through the provision of products and services that are highly developed and specialist, thus delivering tangible added-value to its downstream partners and creating barriers to entry to potential competitors.

Grosvenor Technology’s products are at the cutting edge of access control and human capital management technology. The business is well positioned to capitalise on the crossover between these two aspects of electronic security and continued investment ensures that it stays at the forefront of this marketplace. Long term strategies are in place to increase recurring revenues through the provision of more cloud-based services on an ongoing basis, particularly in the HCM sector. This is envisaged to deliver greater shareholder value over time as both quantity and quality of earnings increase through this strategy.

Safetell is one of the industry leaders in a number of high-demand physical security products and is perfectly placed to service the industry. The market for asset security products and services is fast growing with the ever-increasing threat of terrorism and crime placing security high on the priority list for corporate clients. It is the policy of the Company to maintain the highest standards of product quality meeting statutory and regulatory requirements by the control of its sales, purchasing, production, delivery, installation and service activities.

The principle risks and uncertainties associated with the business activities are set out on page 16 of the Strategic Report in the 2019 Annual Report.

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

The Company engages with shareholders through a variety of traditional and digital media. In addition to regulatoryannouncements and reports, the Company communicates through a variety of channels. The CEO participates in periodic interviews with online investor news platforms and channels as well as giving weekly non- material updates on social media platforms. The Company makes announcements in industry, trade and general business publications and through RNS feeds.

The board members attend AGMs and welcome shareholder attendance.

Our corporate broker maintains a dialogue with our institutional investors and arranges meetings with the Executive Directors as required.

The website contains an overview of the markets operated in, the Company’s vision and strategy and multi-media detail of the separate Physical Security and Electronic Divisions. Historic reports, statements, announcements and share price information are also accessible within the website.

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

The Company recognises that there are several resources and relationships that are considered to be strategically important. These include major clients and key suppliers and these relationships are managed at a senior level within each division withthe most important receiving additional executive attention.

The Company further identifies the need to nurture and develop relationships with all stakeholder groups. Feedback is gathered from customers through sales and marketing functions with face to face key customer meetings. Regular supplier reviews are conducted to ensure the company’s and vendor’s needs and ambitions are met.

The Company recognises the importance of its employees to its achievements. Regular internal communication meetingsare conducted across all sites to ensure employees are knowledgeable about a number of topics. Questions and suggestions are encouraged through a range of formal and informal channels directly to Divisional Managing Directors. These employee feedback channels have led to a number of tangible outputs and changes to working practices. Our staff expect to be able to work in a safe and comfortable environment, and to be provided with the necessary skills and knowledge to perform their work to the required standard. We provide ongoing training wherever required and conduct routine appraisals with the staff.

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

The Board has overall responsibility for the Group’s systems of internal control and risk management. The Board identifies the major business risks with management and establishes appropriate procedures to measure and manage those risks. These involve a system of measurement, control and reporting on a variety of internal and external factors. There are detailed procedures for the production of budgets covering profit and loss accounts, balance sheets and cash flows. Monthly subsidiary and group management accounts are produced with comparisons against budget and prior year.

Management also reports on major changes in the business environment including any possible impact on forecasts.

The principle risks and uncertainties associated with the business activities are set out in the Strategic Report on page 16 of the 2019 Annual Report.

Principle 5: Maintaining the Board as a well-functioning, balanced team led by the Chair

The Chairman’s role is to ensure that the Board operates effectively to deliver the long term success of the Group. This includes ensuring that the Non-Executive Directors always have access to the executive management team to provide bothsupport and challenge, all directors are able to express their views openly at Board meetings and that all directors areencouraged to bring independent judgement to bear on all issues. There are specific instructions in place for the timetableand content of Board papers so that the directors are properly briefed before the Board meetings. The Board has a number of matters reserved for its consideration, with the principal responsibilities being to monitor performance and to ensure that there are proper internal controls in place, to agree overall strategy, to approve major capital expenditure and to review budgets.

At 30 April 2019, the Board comprised a Non-Executive Chairman, two Executive Directors and two Non-Executive Directors.Under the Company’s Articles of Association, the appointment of all Directors must be approved by the shareholders inGeneral Meeting, and additionally one-third of the Directors are required to submit themselves for re-election at each AnnualGeneral Meeting. Additionally, each Director has undertaken to submit themselves for re-election at least every three years.

Board meetings are held a minimum of four times a year and the Board of the parent company also attend the Board meetingsof the subsidiary companies on the same day. All members of the Board attended all four Board meetings held over the last year.The Board members also have discussions during the year on the progress of the Group and any particular issues which arise.

All directors commit the time necessary to meet their responsibilities as directors.

There were two meetings of both the audit and remuneration committee during the year, both of which were attended by all members of those committees.

All of the Non-Executive Directors are considered to be independent apart from Maurice Dwek in view of his substantial shareholding in the Company. However the board considers that Mr Dwek brings a wealth of experience from across arange of businesses, as well as his knowledge of being a chairman of listed and other companies together with his experienceof the electronic division gained over 23 years.

Any Director may, in furtherance of his duties, take independent professional advice where necessary, at the expense of theCompany. All Directors have access to the Company Secretary whose appointment and removal is a matter for the Board as a whole, and who is responsible to the Board as a whole for ensuring that agreed procedures and applicable rules are observed.

Marie-Claire Dwek and Brian Beecraft, as executive directors, are full time employees of the company. There are nominimum time commitments for the three non-executive directors who spend whatever time is required to fulfil their duties and responsibilities.

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

The CEO works closely with the senior management teams of the subsidiary companies to keep abreast of market trends,economic trends, technological advances and customer expectations to remain agile and adjust to the changing times. She meets with customers and suppliers on a regular basis. She also regularly attends security exhibitions in the UK and worldwideas well as forums, corporate and networking events, and keeps the Board up to date with all developments.

Changes in the business and economic environment are discussed fully at Board meetings. The Board is informed ofchanges in accounting requirements by the company auditors and in regulatory requirements by the NOMAD’s via the GroupFinancial Director.

A brief summary of the career history of each of the directors is given below showing their vast experience in seniormanagement positions across a wide variety of industries.

Maurice Dwek was the founder of the Dwek Group in 1963 as a distributor of PVC products with factories involved inengineering and other consumer products. The company was listed on LSE in 1973 and he was director of subsidiarycompanies and subsequently responsible for Group acquisitions and disposals. He disposed of this interest in 1988 through amanagement buyout. Subsequently he was chairman of Arlen PLC (electronics) and Owen & Robinson PLC (sports footwear,retailing and jewellery) and floated Newmark Security on the Alternative Investment Market of the London Stock Exchange in1997 and was Executive Chairman until 2005.

Michel Rapoport held various senior positions in Ripolin (paint) in Paris between 1974-79 including President 1976-79. Hethen worked at Alcatel (telephony and electronics) 1979-91 including President Mailing and Shipping products division 1990-91. He moved to Pitney Bowes between 1991-95 where he was Chairman Pitney Bowes France and Vice President PitneyBowes International. Michel was president and CEO of Mosler ($300m revenue physical and electronic security productsand services) 1995-2001 and was President and CEO at Laroche Industries Inc., (chemical product manufacturer anddistributor) between 2001 and 2005. He has been managing partner of SAR Industries (real estate holdings) since 2007. Michel thus brings to the board his experience from holding senior positions in similar industries, and his knowledge of operatingin US markets which is particularly relevant given the growth in revenue from that source in the current year.

Robert Waddington qualified as a Chartered Accountant in 1964. He was a director of Hambros Bank Ltd from 1984 to1997 and director/chairman of a number of private companies involved in engineering, property, and steel stockholding between 1996 and 2008. He was also a director from 1997 to 2006 of Stanley Leisure PLC, a UK Stock Exchange listed company operating in the Betting and Gaming industries. Robert therefore contributes his experience from holding senior positions indifferent businesses as well as his financial and accounting knowledge.

Marie-Claire Dwek was marketing director of Newmark Technology Limited (specialised electronic security systems) 1996-2000, responsible for the planning, leadership and strategic marketing. Between 2002–2013 Marie- Claire was responsible for the management and investment in various property portfolios for Motcomb Estates and joined Newmark Security as ChiefExecutive officer in 2013. Marie-Claire regularly attends training course and modules for executive development e.g. Cranfield University. Any changes in the business environment are monitored and researched closely within managementlevel with the CEO. Strategic responses are formed accordingly and executed with Board approval. Trade journals and news articles are used to keep abreast of current marketconditions.

Brian Beecraft qualified as a chartered Accountant in 1973 with Touche Ross and was a senior manager there until leaving in1985 to become Group Chief Accountant at United Transport International (transport division of BET PLC with freight andpassenger transport companies in UK, Europe and Africa). He left United Transport as Group Financial Controller, having been responsible for all aspects of financial control and accounting for the Group, after Rentokil acquired BET in 1994. Heworked for himself providing freelance financial services until joining Newmark in 1998. During his career he has been involvedin numerous acquisitions and disposals and brings a wealth of experience in financial accounting to the Board.

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

The Chairman carried out an evaluation of the Board during the year and deemed that it was working satisfactorily in particular:

  • The good mix of skills and experience of the Board members,
  • The amount of challenge and expression of views at meetings,
  • The attendance of all the Company Board members at the subsidiary company Board meetings,
  • The level of information, both financial and operational, available prior to and at the Board meetings,
  • Matters arising at each meeting are followed up promptly and the results reported back to Board

The performance of the Board is kept under continuous review. The Board does not consider that it is appropriate to performa more formal board appraisal process utilising third parties at the current date, taking into consideration the size andnature of the Company. However, this will be kept under review and the board will consider on an annual basis whether toimplement a more formal appraisal process.

Brian Beecraft is retiring on 31 October 2019 and Graham Feltham was appointed as financial director designate on 9 September 2019.

In view of the size of the Company, no consideration has been given to other succession planning at this stage.

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

The Group aims to have a corporate culture that keeps staff satisfied in their roles and fully motivated so that staff retentionlevels are high, and absenteeism is low. All senior management are aware of our culture. Staff are encouraged to submit ideas and suggestions as to how this can be achieved. The Group also tries to ensure that the staff have the appropriate lifestyle benefits and are provided with appropriate development training, both internally and externally.

All senior management members (including Group Human Resources manager) attend monthly management meetings, attended by both executive directors, to report on their department’s activities and where relevant to highlight any issues withcustomers, suppliers, employee or other stakeholders.

The Group is committed to maintaining high standards for the environment, and our relationship with employees, customersand suppliers.

The Group is committed to being environmentally friendly and we have identified the key waste streams from our businessesso that the amount of landfill is reduced by separating waste into these different streams. Records are maintained asevidence that these forms of waste are separated and collected by licensed waste collection companies and these arereported at management meetings

Our efforts with stakeholder groups are detailed under principle 3 above.

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

The Chief Executive Officer, Marie-Claire Dwek, is responsible for the day-to-day management of the business, developing theGroup’s strategy for discussion with the Board and then implementing that strategy. The Group Finance Director, Brian Beecraft,is responsible for the financial reporting of the Group and supporting the CEO in developing and implementing the Groupstrategy. The two executive directors have prime responsibility for engagement with shareholders.

The Non-Executive Directors, Michel Rapoport and Robert Waddington, are responsible for bringing their expertise and judgement in assisting in the development of strategy and measuring its performance, challenging the Executive Directors and reviewing their performance.

All directors are required to notify the Company Secretary of any conflicts of interest and there have been no suchrelationships declared.

The Audit Committee assists the Board and its terms of reference are included on the company web site. Its composition,duties and main activities during the year is included in the Report of the Directors.

The terms of reference of the Remuneration Committee are included on the company web site. Its composition, duties andmain activities during the year is included in the Report of the Remuneration Committee.

There is no Nomination Committee. Given the size of the business, all senior appointments are considered by the Board as awhole.

The matters reserved for the Board are set out under Principle 5.

The Board will continue to monitor the governance framework in line with the Group’s plans for growth and will make furtheradjustments and improvements as required.

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

The Board communicates with shareholders through the annual report and accounts, interim report other regulatory announcements, the Annual General Meeting (AGM) and one-on-one meetings with both existing and potential shareholders. At the end of the Annual General Meeting shareholders are encouraged to express their views to the Directors. Corporateinformation is available to shareholders and other stakeholders on the Company website including details of the activities ofthe different businesses, and announcement. The Company also receives updates from its brokers on the views ofshareholders.

The remuneration committee report is on page 21 of the 2019 Annual Report and an overview of the audit committee’s dutiesand activities during the year are on page 19.

Results of shareholder votes
AGM 2018 (30 October 2018)

Maurice Dwek
18th September 2019