b'66 Mercia asset Management PLc Annual Report and Accounts 2021Corporate governance report continuedgovernance principles compliant explanation Further reading3.Take into account Mercias Annual Report identifies its key stakeholders within thePages 18 to 21 of this wider stakeholderResponsible Business section and how seriously the Group takesAnnual Report and and socialits Environmental, Social and Governance responsibilities. the AIM Rule 26 responsibilities andsection of the Groups their implications forwebsitelong-term success4.Embed effective risk The Groups approach to risk management together with thePages 52 to 57 of this management,principal risks and uncertainties applicable to Mercia, theirAnnual Report and considering bothpossible consequences and mitigation are set out in the Principalthe AIM Rule 26 opportunities andRisks and Uncertainties section of this Annual Report. The Boardsection of the Groups threats throughout reviews, evaluates and prioritises risks to ensure that appropriatewebsitethe organisation measures are in place to effectively manage and mitigate those identifiedfor risk tolerance (focusing on Mercia-specific internal, external and strategic risks) and risk appetite (specifically in terms of the Groups investing policy).Maintain a5.Maintain the Board as The Board has a formal schedule of matters reserved for itsPages 63 to 65 of this dynamica well-functioning,approval and is supported by the Nominations, Audit and RiskAnnual Report and the managementbalanced team led byand Remuneration Committees. All Directors are required toAIM Rule 26 section of framework the Chair devote sufficient time to carry out their role. The Governancethe Groups websitesection of Mercias Annual Report details the composition of its Board and Committees. These are also included within the Investor Relations section of its website, under the Organisational Structure page.6.Ensure that between The Board is satisfied that, between the Directors, it has anPages 58 and 59 of this them the Directorseffective and appropriate balance of experience, skills andAnnual Report and the have the necessarycapabilities. To ensure that the Directors maintain appropriateAIM Rule 26 section of up-to-dateskills, they are provided with training when identified asthe Groups websiteexperience, skills andappropriate by the Chair. Mercias Annual Report includes a capabilities biography of each Board member. These are also included within the Investor Relations section of its website, under Meet the Board. They list the current and past roles of each Board member and also describe the relevant business experience that each Director brings to the Board, plus their academic and professional qualifications. This Annual Report describes and explains where external advisers have been engaged (e.g. by the Board in April 2019). Internal advisory responsibilities, such as the role performed by the Company Secretary in advising and supporting the Board, are also described in this Annual Report.7.Evaluate Board The Board regularly considers and evaluates its own performancePage 64 of this Annual performance basedand that of its individual members. An externally facilitated BoardReport and the AIM on clear and relevantevaluation and effectiveness review was undertaken during AprilRule 26 section of the objectives, seeking2019 and the actions taken in response to the recommendationsGroups websitecontinuousarising from this review are set out in this Annual Report.improvement8.Promote a corporate The Board believes that the promotion of a corporate culturePages 20 to 25 of this culture that is basedbased on sound ethical values and behaviours is essential toAnnual Report and on ethical values andcreating a workplace environment that allows people to flourishthe AIM Rule 26 behaviours and that this will contribute to enhancing shareholder value.section of the Groups Within this Annual Report, the Chairs statement includes specificwebsitereference to people and culture. The People, Culture and Values section of the Strategic Report includes a section on business ethics and further details on how Mercias culture is consistent with the Groups objectives, strategy, business model and approach to risk management. The Remuneration Report refers to the Executive Directors KPIsthose for 2020/21 and 2021/22 include Mercias cultural values.'