Investor Relations

Board Risk and Compliance Committee (BRCC)

The primary purpose of the Board Risk and Compliance Committee (“BRCC”) is to assist the Group Board of Directors in its oversight of management’s responsibility to execute an enterprise-wide risk management strategy and framework designed to identify, assess and manage the Group’s strategic, credit and investment, market, and operational risks within risk appetite. The Board retains overall responsibility for managing risk.

This is performed through an in-depth and detailed oversight of the Group’s risk management and compliance strategy, policies and practices and monitoring its actual performance against the risk appetite approved by the Board. The Risk function and the Compliance function both report to the Board Risk and Compliance Committee.

Amongst the primary responsibilities of the Board Risk and Compliance Committee are:

– to ensure that the Group’s risk strategy and Risk Appetite Framework (including its Risk Appetite Statement and associated thresholds for escalation and related controls) are comprehensive and consistent with the Group’s business strategy, objectives, corporate culture and values;

– to assess, and report at least annually on, the effectiveness of the Group’s Risk Management Function, the Compliance Function and the Money Laundering Reporting Officer, including the adequacy of staffing levels and expertise as well as the completeness of the function’s coverage;

– to ensure the sufficiency and effectiveness of the process of pricing assets and liabilities; and

– to vet and approve related party transactions in accordance with Capital Markets Rule 5.138.

The Board Risk and Compliance Committee has oversight of all the Group’s risk and compliance matters, even if they arise in its main subsidiary, MeDirect Belgium, which has its own Board Risk and Compliance Committee.

The Board Risk and Compliance Committee coordinates its activities with the Board Risk and Compliance Committee of MeDirect Belgium, and where common issues are being addressed, certain meetings are held jointly by the committees.

The Group Chief Financial Officer, the Group Chief Risk Officer, MeDirect Malta’s Chief Compliance Officer and the MeDirect Malta Money Laundering Reporting Officer attend the Board Risk and Compliance Committee meetings by invitation. The Group’s and MeDirect Belgium’s Board Chairs attend meetings as observers.

The Chair of the Committee reports on all matters to the Group’s Board after each meeting and notifies the Board of any decisions made. The Committee makes whatever recommendations to the Group Board it deems necessary.

Board Audit Committee (BAC)

The purpose of the Group Audit Committee (“GAC”) is to oversee the quality and integrity of the Group’s financial reports, particularly the key financial judgments, and review the accounting policies. In addition, the Audit Committee oversees the design adequacy and operating effectiveness of the Group’s internal control framework and governance structure through the activities of the Internal Audit Function. The primary responsibilities of the Group Audit Committee are the following:

– review accounting policies;

– monitor the Group’s financial and other disclosures, ensuring compliance with legal and regulatory requirements;

– review the qualifications, performance and independence of the external auditor;

– review and approve Internal Audit’s plan and oversee the execution of the plan; and

– assess the effectiveness of Internal Audit, including the adequacy and competence of its staff.

In terms of Capital Markets Rules 5.117 and 5.118, John Zarb is the Independent Non-Executive Director whom the Group Board considers as and/or auditing. John Zarb retired from his role as partner at PricewaterhouseCoopers at the end of 2014 after a career spanning over 40 years in the audit and advisory practices of the firm. He is a past President of the Malta Institute of Accountants and served for a number of years on the Accountancy Board and as Malta’s representative on the EU Accounting Regulatory Committee. John Zarb was also the Chair of PG plc and is currently a director of Tumas Investments plc and director and Chair of the remuneration committee of Tumas Group Company Limited. He also serves as a director of Foster Clark Products Limited and Chairman of Mizzi Organisation Finance plc and of Consolidated Holdings Limited, Mizzi Organisation Limited, The General Soft Drinks Company Limited, and GSD Marketing Limited, the four guarantors of the listed bonds issued by Mizzi Organisation Finance plc. Mr Zarb also chairs a number of other companies forming part of the Mizzi Organisation, particularly in the automotive sector, and an associated company Mizzi Associated Finance Limited.

Furthermore, Maria Micallef is also an Independent Non-Executive Director (subject to regulatory approval) whom the Group Board considers as competent in accounting and/or auditing. She holds a Bachelor of Arts (Honours) in Accountancy from the University of Malta and is a Certified Public Accountant. Maria Micallef has over 35 years of experience in business advisory services, specialising in corporate finance, mergers and acquisitions, governance, internal controls and fraud. Her previous roles include serving as an Independent Non-Executive Director of HSBC Bank Malta p.l.c., where she chaired the audit committee and was a member of the remuneration and nomination committee. Ms. Micallef was also Managing Partner of RSM Malta. She is a fellow and former President of the Malta Institute of Accountants, a member of the US Institute of Internal Auditors, and a member of the US Association of Certified Fraud Examiners. Ms Micallef also serves as an Independent Non-Executive Director of PG p.l.c. and as a member of its audit committee.

MeDirect Malta and MeDirect Belgium hold Joint Board Audit Committees in order to boost efficiency, improved information sharing, and foster better interaction among independent non-executive directors, all while respecting each committee’s autonomy and legal obligations. Typical agenda items include presentations from Finance, Internal Audit, and statutory auditors, as well as the approval of financial statements and disclosures. For matters specific to MeDirect Malta, Belgian representatives excuse themselves to allow independent deliberation by the Malta members, and a similar arrangement exists for MeDirect Belgium. Conflicts of interest are discussed separately, and closed sessions with auditors are conducted independently.

Board Nominations and Remuneration Committee (BNRC)

The primary purpose of the Group Nominations and Remuneration Committee (that also covers MeDirect Malta) and the Nominations and Remuneration Committee of MeDirect Belgium (“NRCs”) is to review remuneration levels in the Group and to consider whether to approve performance-related and other variable bonus awards that may be delivered in cash or share- linked instruments. A list of Material Risk Takers is revised and approved at least on an annual basis.

The NRCs are charged with aligning the Group’s remuneration policy and in particular performance-related elements of remuneration, with the Group’s business strategy and risk tolerance, objectives, values and long-term interests. The key objectives of the NRCs in this regard are the following:

– annual review of the proposals put forward by management relating to the principles of the remuneration policy and verification with management that they are effectively implemented;

– monitoring of the budgets allocated to the fixed salary increases for the forthcoming year and the variable remuneration pools for the previous financial year; and

– annual review of the individual remuneration of senior management and staff members who are employed in control functions, as well as that of staff with total remuneration above a threshold fixed by the NRCs.

One of the NRCs primary functions of the NRCs is to ensure that the Group is able to attract and retain suitable employees at all levels at an acceptable cost. It may request market-related information from time to time, to verify the recommendations made by management. On an annual basis, the NRCs review the budgets allocated to the fixed salary increases for the forthcoming year and the variable remuneration pools for the previous financial year and review the individual remuneration of senior management and staff members who are employed in control functions such as Risk and Compliance, as well as that of staff with total remuneration above a threshold fixed by the relative NRC.