Just Group plc | Annual Report and Accounts 2024
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GOVERNANCE IN OPERATION continued
AUDIT, RISK AND INTERNAL CONTROL
SUBSIDIARIES’ GOVERNANCE The governance of the Group’s wholly owned subsidiaries (the “subsidiaries”) is of paramount importance to the Board in ensuring that its strategy, purpose, values, and culture permeate all business areas. Due to the significance of the regulated life companies (“life companies”) within the Group’s business model, the Board conducts its meetings concurrently with the Boards of these companies. Additionally, it receives reports from other regulated entities as necessary regarding their activities and any significant issues or concerns. The Group Chief Executive Officer provides updates on the performance and key developments of the Group as a whole. The Group Board Committees oversee matters within their remit to the extent relevant and necessary for the subsidiaries. With the exception of JRL and PLACL which have established separate audit committees and investment committees as outlined below, the regulated companies have not established any separate Board Committees as it is more effective to manage any specific matters on a Group-wide basis. The following provides an overview of the governance arrangements for our UK regulated entities. REGULATED LIFE COMPANIES JRL and PLACL are the Group’s life companies. JRL serves as the primary operating entity within the Group, thereby exerting a strategic and substantial influence on the consolidated Group performance. The principal activities of JRL include underwriting premiums for Defined Benefit de-risking solutions, Guaranteed Income for Life solutions, the Secure Lifetime Income product, and residential lifetime mortgage solutions in the UK, in addition to servicing and administering existing policies. PLACL’s principal activities focus on the orderly run-off of life assurance products and annuities, and writing new Care annuities in the UK. Boards Operating the life companies’ Boards on a nested basis with the Board ensures the Group strategy and governance are aligned and implemented effectively. To maintain independence in mindset and decision making, the JRL and PLACL Boards include two independent Non-Executive Directors who are not Directors of Just Group plc. One of these Directors, John Perks, chairs the life company Boards. A separate section is included in the nested meeting agendas for JRL and PLACL business to ensure time is allocated for each Board to address matters specific to each respective company. The matters reserved for the JRL and PLACL Boards have been documented and approved by their respective Boards. They are reviewed annually to ensure they reflect best practice and are aligned with the approach for other entities, where appropriate. Board committees Audit The Boards of JRL and PLACL have established independent subsidiary audit committees to ensure effective oversight of financial reporting and internal controls, and to ensure compliance with relevant regulatory requirements. The JRL and PLACL Audit Committees primarily convene concurrently with the Group Audit Committee. During these meetings, topics of mutual interest are discussed simultaneously from the perspective of each respective Committee. Dedicated time is allocated, when necessary, to address issues specific to each company. Each of the JRL and PLACL Audit Committees comprise one independent Non-Executive Director who is not a Director of Just Group plc, ensuring an independent focus and adherence to good governance practices. The terms of reference, which outline the scope and delegated responsibilities of each Committee, are reviewed and approved by the JRL and PLACL Boards at least annually.
PREPARATION OF THE ANNUAL REPORT The Board diligently ensures that a fair, balanced and understandable assessment of the Group’s position and prospects is presented. The Board believes that the Annual Report delivers the essential information required for shareholders to assess the Group’s position, performance, business model and strategy. The going concern statement and a review of whether there are any material uncertainties to the Group’s ability to continue to adopt the going concern basis of accounting in respect of the Annual Report is set out in the Group Audit Committee report and Directors’ report. The Viability statement is on page 65. ASSESSING EMERGING AND PRINCIPAL RISKS The Board defines the nature and scope of risks it is prepared to undertake in pursuit of its strategic objectives by establishing its risk appetite framework. The Directors conducted a robust assessment of the emerging and principal risks facing the Group, including those that could affect its business model, future performance, and constraints on capital and liquidity. A detailed description of these principal and emerging risks, along with the procedures for identifying emerging risks, is provided in the section on principal risks and uncertainties. RISK MANAGEMENT AND INTERNAL CONTROL SYSTEMS Throughout the year, the Board, with assistance of the Group Audit Committee and GRCC, as well as support from the Risk and Group Internal Audit functions where appropriate, monitored the Group’s risk management and internal control systems and assessed their effectiveness. The Group Internal Audit function provides independent and objective assurance regarding the adequacy and effectiveness of the Group’s controls to the Group Audit Committee annually. Further details on this review can be found in the Group Audit Committee report. Remuneration The Remuneration Committee focuses on determining and agreeing Just’s remuneration policy and practices and reviewing their ongoing appropriateness and relevance. It ensures remuneration is strongly aligned to Just’s purpose and strategy, encourages long-term stewardship and rewards individual contributions towards the success of Just. Just’s Directors’ Remuneration Policy (the “Policy”) was approved with over 95% of shareholder votes in favour at the Company’s AGM on 9 May 2023. It is intended the Policy will apply for a period of up to three years and shareholders will be asked to approve the updated Policy at the 2026 AGM (or earlier if required). The full Policy is provided in the 2022 Annual Report, which is available on the Just website. The Directors’ Remuneration report describes how the factors set out in the Code (clarity, simplicity, risk, predictability, proportionality and alignment to culture) are addressed in the Policy on page 121. Further details on how the Remuneration Committee has complied with the Code in 2024 can be found on pages 108 to 122.
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