The following statement of corporate governance reflects the position of the Company as at 31 December 2016.
The board is responsible for the Company’s corporate governance policy, and recognize the importance of high standard of integrity, and consistently seeks to apply the principles set out in the Combined Code of on Corporate Governance (the “Code”) to the extant they are appropriate for, and applicable to, a company of MTIs’ size quoted on the AIM market of the London Stock Exchange plc.
Pursuant to the provisions of the Israeli Companies Law, the Company has nominated Lihi Elimelech Bechor and Richard Bennett as external (independent) directors. As such, the initial term of an external director is three years and this may be extended for two additional three-year terms. The external directors have to serve on the Audit committee and on the Remuneration committee. The rest of the board members are elected annually in the shareholders meeting.
All the directors have access to the advice and services of the Company Secretary and may, in furtherance of their duties, take independent legal and financial advice at the Company’s expense. They also have access to the minutes of the board, in which any concerns expressed by them regarding matters pertaining to the Company are recorded. While there is no formal process, the performance and effectiveness of each director, including the non-executive directors, is assessed on an on-going basis by the other members of the board. All members of the board are free to bring any matter to the attention of the board, at any time.
The board is responsible for formulating, reviewing and approving the Company’s strategy, budgets and corporate actions. The board generally meets five times a year and at such other times as required, and receives regular reports on a wide area of key issues including operational performance, risk management and corporate strategy, budget and corporate actions etc and other areas which are either required by law or deemed relevant by the management.
Audit & Financial Statements Committee
The audit committee and the financial statements committee are chaired by Mrs. Lihi Elimelech Bechor. The other members are Richard Bennett and Zvi Kanor. The external auditors, together with the finance director, are invited to attend these meetings as and when required.
In accordance with its terms of reference, the principal function of this committee is to determine the appropriateness of accounting policies to be used in the Company’s annual results. In addition the Committee is responsible for assessing the Company’s audit arrangements and the Company’s system of internal controls, and for reviewing the quarterly and annual results before publication. The responsibilities of the Audit Committee include all matters required to be covered by the Combined Code and the Israeli Companies Law. The Company has also decided pursuant to the Companies Law that the audit committee shall act as its Financial Statements Committee which is responsible to review the financial statements in detail and suggest to the board whether to amend or approve the financial statements.
The Israeli Companies Law requires the Company to have an internal auditor appointed by the board. The internal auditor is responsible for examination of the Company’s internal controls and reviewing their effectiveness and reports to the Audit Committee.
The Remuneration Committee is chaired by Lihi Elimelech Bechor. The other members are Richard Bennett and Zvi Kanor. In accordance with its terms of reference, the committee reviews the performance of the executive directors and key employees and makes recommendations to the board and the shareholders of the company, pursuant to Rule 20 of the Israeli Companies Law, on matters relating to their remuneration and terms of employment. Such remunerations usually includes both fixed and variable compensation package including share options and other equity incentives pursuant to any share option scheme or equity incentive scheme. The remuneration arrangements of the non-executive directors are determined by the board as a whole and, in accordance with the Israeli Companies Law, approved in the Annual General Meeting of its Shareholders.
On November 12, 2012 Amendment No. 20 to the Israeli Companies Law was published (the "Amendment").
According to the Amendment, a public company is required to appoint a remuneration committee (its composition and manner of discussion shall be in accordance with the provisions of the Amendment), and adopt a policy regarding the conditions of service and employment of officers of the Company, in accordance with the recommendations of such remuneration committee, subject to the approval of the general meeting of the shareholders of the Company. In addition, the Amendment regulates the method of approval of the terms of service and employment of officers of public companies.
The Company established its three years policy in July 2013 after receiving the approval of its shareholders. This Policy was renewed in May 2016.
Relations with Shareholders
The board welcomes the views of shareholders. The Annual General Meeting (“AGM”) is used as an opportunity to communicate with shareholders. All shareholders are encouraged to attend the Company’s AGM in order to take advantage of the opportunity to ask questions of the directors.
Shareholders may also contact the Company in writing or via its website, which is regularly updated. Additional information is supplied through the circulation of the Quarterly Report and the Annual Report and Accounts. During the year the Company issued a series of announcements to the Stock Exchange and updated its website in accordance with AIM Rule 26. The Chief Executive, Finance Director and the Chairman from time to time meet individual and institutional shareholders and provide such information as is permissible in order to facilitate a better understanding of the Company’s business and operations.