Corporate governance

Directors must develop a good understanding of the needs and expectations of all elements of the company’s shareholder base. The Board must manage shareholders’ expectations and should seek to understand the motivations behind shareholder voting decisions.

The Board recognises the importance of active shareholder dialogue with both institutional and private shareholders, and this is led by the Chairman and the Chief Executive Officer.

Following both the annual and interim results announcements, meetings are held with analysts, private investors and institutional investors of the Company. The Company’s website also has details of public announcements, Annual and Interim Reports and investor presentations.

The Company has also hosted a series of investor presentations open to all shareholders through the Investor Meet Company platform, which have been well attended and served as a useful method of engagement with retail shareholders.

The Annual General Meeting of the Company remains a key focus to give the Directors an opportunity to meet with shareholders and to provide an opportunity to give an update on the Company’s performance. It also provides shareholders with the opportunity to ask questions of the Directors, either in the formal AGM proceedings or informally after the event.

Long-term success relies upon good relations with a range of different stakeholder groups both internal (workforce) and external (suppliers, customers, regulators and others). The board needs to identify the company’s stakeholders and understand their needs, interests and expectations.

Where matters that relate to the company’s impact on society, the communities within which it operates or the environment have the potential to affect the company’s ability to deliver shareholder value over the medium to long term, then those matters must be integrated into the company’s strategy and business model.  Feedback is an essential part of all control mechanisms. Systems need to be in place to solicit, consider and act on feedback from all stakeholder groups.

Further detail of the Company’s engagement with the wider stakeholder community can be found in our Section 172 Statement.

The Board is conscious that our long-term success depends upon our interaction with our wider stakeholder base: patients, commissioning groups, staff, regulators and the wider community.

Totally operates in a heavily regulated sector where our work is subject to independent audit and review by ICBs and the Care Quality Commission. Formal or informal feedback is encouraged from employees and from other stakeholders. Employees are able to provide feedback through channels such as the employee survey, regular “all-hands” calls, 121s and by email direct to the Chief Executive Officer and other members of the leadership team. Patients can provide feedback through our website and friends and family feedback forms which are well promoted within all of our centres and on the Company website. Other stakeholders can provide feedback through, amongst other routes, the Contact section of the Company website.

Employee engagement is fostered by regular Group-wide communication with all employees through regular employee meetings (including monthly “all-hands” calls), and internal communication through email and all-people intranet, My Totally.

Compliance with all central legislation around bribery and corruption and modern slavery is maintained.

The board needs to ensure that the company’s risk management framework identifies and addresses all relevant risks in order to execute and deliver strategy; companies need to consider their extended business, including the company’s supply chain, from key suppliers to end customers. Setting strategy includes determining the extent of exposure to the identified risks that the company is able to bear and willing to take (risk tolerance and risk appetite).

Full details of the risks and uncertainties faced by Totally, and actions to mitigate risk, can be found in the Principal Risks and Uncertainties section of the current Annual Report and Accounts on pages 41 to 45.

The business operates in a highly regulated market with activities complying with NHS operational and administrative procedures. Additional measures, implemented as part of the Group’s response to COVID-19, remain where appropriate during the period.

Risk management is a core focus for the Board and this is reviewed at each Board meeting. Detailed feedback is received from each operating subsidiary, together with external regulatory bodies, at these meetings. Formal risk registers for the business are reviewed on a regular basis by the Board. Operational risk and any newly identified risk to the business are also considered.

Management of risk is embedded across the Group through the Risk Management Strategy and Board Assurance Framework, comprising the Group’s systems of governance, risk management processes and risk appetite framework.

The Group Clinical Governance Board meets on a regular basis and reports from that Committee are circulated to the Group Board.

Regular dialogue is maintained with Clinical Commissioning Groups, the CQC, NHS England and insurers.

The Company maintains appropriate levels of insurance cover.

The board members have a collective responsibility and legal obligation to promote the interests of the company and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the chair of the board.

The board (and any committees) should be provided with high quality information in a timely manner to facilitate proper assessment of the matters requiring a decision or insight.

The board should have an appropriate balance between executive and non-executive directors and should have at least two independent non-executive directors. Independence is a board judgement.
The board should be supported by committees (e.g. audit, remuneration, nomination) that have the necessary skills and knowledge to discharge their duties and responsibilities effectively.
Directors must commit the time necessary to fulfil their roles.

The Company has a strong and experienced Board of Directors with appropriate financial and sector experience.

The Board, led by the Chairman, is responsible for the overall management of the Group including the approval and implementation of the Group’s objectives and strategy, budgets, operational performance along with the maintenance of sound internal control, corporate governance and risk management procedures.

Whilst the Board may delegate day to day management to the Executive Directors, subject to formal delegated authority limits, certain matters are reserved for full Board approval. Details of matters reserved for the Board and the terms of reference for each of the Board Committees may be found on the Company website.

The Board of Directors comprises a Non-Executive Chairman, two further Non-Executive Directors and three Executive Directors. Gloria Cooke, Clinical Quality Director, retired from Totally and resigned from the Board on 31 December 2022. John McMullan, previously joint managing director of Pioneer Healthcare, was appointed to the Board with effect from 2 January 2023 in the broader role of Medical Director. Other than this change, the composition of the Board remained stable. All Non-Executive Directors are considered to be independent.

Details of the Directors, including brief biographies, Committee membership, key strengths and experience, skills and qualifications, can be found in the in the our leadership section of this website.

The work of the Board is supported by Audit, Remuneration and Nomination Committees, membership of which is made up of the Non-Executive Directors. The table below summarises the membership of the Board and the Board Committees and the attendance record of the Directors.

<sup>1. Gloria Cooke resigned from the Board with effect from 31 December 2022.
2. John McMullan was appointed to the Board with effect from 2 January 2023.</sup>

All Directors are required to commit sufficient time to their respective roles in order to adequately discharge their duties.

Directors retire by rotation and are subject to re-election at the Annual General Meeting of the Company.

The Board has considered the independence of the Non-Executive Directors. Each of the Directors is subject to either an Executive Service Agreement or a letter of appointment.

Read more about our Board here.

The board must have an appropriate balance of sector, financial and public markets skills and experience, as well as an appropriate balance of personal qualities and capabilities. The board should understand and challenge its own diversity, including gender balance, as part of its composition.

The board should not be dominated by one person or a group of people. Strong personal bonds can be important but can also divide a board.

As companies evolve, the mix of skills and experience required on the board will change, and board composition will need to evolve to reflect this change.

The Board considers that there is currently an appropriate balance between sector, financial and public market skills and experience at Board level. Directors’ biographies including details of their key strengths and experience and their skills and qualifications can be found in the Annual Report and on Our leadership page.

The Directors are mindful of the need to maintain gender and equality balance on the Board.

Sector specific training for the Directors is maintained through regular business updates from the Executive Directors and briefings from external advisers.

External professional advice has only been sought for routine business matters.

The board should regularly review the effectiveness of its performance as a unit, as well as that of its committees and the individual directors.

The board performance review may be carried out internally or, ideally, externally facilitated from time to time. The review should identify development or mentoring needs of individual directors or the wider senior management team.

It is healthy for membership of the board to be periodically refreshed. Succession planning is a vital task for boards. No member of the board should become indispensable.

A formal Board review evaluation process was concluded during the financial year ending 31 March 2023 by an independent, external evaluator. The conclusions were that the Board was well-governed and well-led, working in an open and direct way.

There is a performance evaluation undertaken of all Directors being proposed for re-election to ensure their performance continues to be effective and in the case of Non-Executive Directors that their continuing independence and time commitment to the role are demonstrated.

The board should embody and promote a corporate culture that is based on sound ethical values and behaviours and use it as an asset and a source of competitive advantage.

The policy set by the board should be visible in the actions and decisions of the chief executive and the rest of the management team. Corporate values should guide the objectives and strategy of the company.

The culture should be visible in every aspect of the business, including recruitment, nominations, training and engagement. The performance and reward system should endorse the desired ethical behaviours across all levels of the company.

The corporate culture should be recognisable throughout the disclosures in the annual report, website and any other statements issued by the company.

The Strategic Report within the current Annual Report sets out how the Group is run. Totally’s values can be found on page 2 and on the Totally Group website.

Given the nature of the Group’s activities, Totally is subject to significant external scrutiny from Clinical Commissioning Groups and regulators. The business is fully compliant with all NHS requirements for governance, information security and quality management.

Compliance with laws:

• Formalised whistleblowing procedures for staff, contractors and agency staff to raise concerns relating to danger, fraud or other illegal or unethical conduct.

• A Group Anti-Slavery and Human Trafficking Policy statement in relation to the Modern Slavery Act 2015.

• A Company Code of Conduct.

• An Anti-Corruption Policy relating to compliance with the Bribery Act 2010.

• Measures to take appropriate actions to comply with the provisions of the Market Abuse Regulation together with a Share Dealing Policy.

• The Group has complied with the provision of statutory information relating to the gender pay gap legislation and payment practices regime.

• Energy usage, associated emissions, energy efficiency actions and energy performance for Totally plc are reported under the government policy Streamlined Energy and Carbon Reporting (“SECR”) as implemented by the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018.

The company should maintain governance structures and processes in line with its corporate culture and appropriate to its:

• size and complexity; and

• capacity, appetite and tolerance for risk.

The governance structures should evolve over time in parallel with its objectives, strategy and business model to reflect the development of the company.

Details of how the Board, its Committee structure and governance structures operate can be found on our Board Committees page.

The Totally plc Board held six meetings during the year. The Company Secretary works closely with the Chairman and the Chairmen of the various Board Committees to ensure that Board procedures, including setting agenda and the timely distribution of papers, are complied with, and that there is good communication flow between the Board and its Committees, and between senior management and Non-Executive Directors.

There is a formal agenda for each Board meeting which includes an operational update from the Chief Executive Officer, financial updates from the Chief Financial Officer and a detailed clinical quality update, including any interface with regulators from the Clinical Quality Director. The reports from the Executive Directors cover all business units within the Group and new business opportunities.

Strategic issues are dealt with at each Board meeting by the Chairman.

Within the annual calendar of Board meetings there is normally an annual budget presentation at which the Executive team presents its budget for the forthcoming financial year.

The Non-Executive Directors are encouraged to attend visits to the individual operating businesses to discuss performance and other issues with the management teams.

During the course of the year, other matters considered by the Board have included annual and half year results announcements, AGM resolutions, interactions with NHS England and the CQC, the acquisitions of Energy Fitness Professionals Limited and Premier Health Care Limited, reports from the Group Clinical Governance Board, principal risks and uncertainties, shareholder communications and management incentivisation.

Board papers are circulated to the Directors at least three clear business days in advance of the meetings to enable proper consideration of the content of the papers.

The Chairman maintains regular contact with the Non-Executive Directors outside of formal Board meetings.

The roles of all Board members are as detailed below:

All Directors have access to the support and advice of the Company Secretary as required. Directors are also able to take independent professional advice at the Company’s expense in the furtherance of their duties where considered necessary.

Board Committees

There are three Board Committees, all with formally delegated powers: an Audit Committee, a Remuneration Committee and a Nomination Committee. All are chaired by and comprise the Non-Executive Directors.

The terms of reference for all Board Committees are reviewed regularly and can be found on the Company website on the Corporate Governance page. Committee Chairmen attend the Company AGM and are available to answer any questions from shareholders regarding the activities of the Committees.

A healthy dialogue should exist between the board and all of its stakeholders, including shareholders, to enable all interested parties to come to informed decisions about the company.

In particular, appropriate communication and reporting structures should exist between the board and all constituent parts of its shareholder base. This will assist:

• the communication of shareholders’ views to the board; and

• the shareholders’ understanding of the unique circumstances and constraints faced by the company.

It should be clear where these communication practices are described (annual report or website).

In the year to 31 March 2023, the Executive Directors and members of the Board met and had dialogue with a large number of shareholders and investors.

The Board maintains an active dialogue with institutional and private shareholders and employees, both employee shareholders and others.

The Company’s website includes a specific Investor Relations section containing all RNS announcements, share price information and details of significant shareholders, corporate governance and annual documents available for download on the Investors page. The website also provides details for contacting the Company about any issues.

The AGM remains an important opportunity for the Board to engage with shareholders. Formal questions may be tabled to the Board during the AGM or asked informally in conversation after the AGM.

There is feedback to the full Board of any shareholder interaction at each Board meeting.

This year’s AGM will be held on 1 September 2023 and full details of venue and resolutions proposed may be found in the Notice of Meeting enclosed with these accounts or on the Company website.

Approved by order of the Board.