MCNICHOLS : CONSOLIDATED PLC - NCCG 2023 REPORT

FINANCIAL REPORTING COUNCIL OF NIGERIA

(Federal Ministry of Industry, Trade & Investment)

FRC/CG/001: TEMPLATE FOR REPORTING COMPLIANCE WITH THE NIGERIAN

CODE OF CORPORATE GOVERNANCE 2018

Section A: Introduction

Corporate Governance is a key driver of corporate accountability and business prosperity. The Nigerian Code of Corporate Governance, 2018 (NCCG 2018) seeks to institutionalize corporate governance best practices in Nigerian companies. It is also aimed at increasing entities' levels of transparency, trust and integrity, and create an environment for sustainable business operations.

The Code adopts a principle-based approach in specifying minimum standards of practice that companies should adopt. Where so required, companies are required to adopt the "Apply and Explain" approach in reporting on compliance with the Code. The 'Apply and Explain' approach assumes application of all principles and requires entities to explain how the principles are applied. This requires companies to demonstrate how the specific activities they have undertaken best achieve the outcomes intended by the corporate governance principles specified in the Code.

This will help to prevent a 'box ticking' exercise as companies deliberately consider how they have (or have not) achieved the intended outcomes. Although, the Code recommends practices to enable companies apply the principles, it recognises that these practices can be tailored to meet industry or company needs. The Code is thus scalable to suit the type, size and growth phase of each company while still achieving the outcomes envisaged by the principles.

This form seeks to assess the company's level of compliance with the principles in the NCCG 2018. Entities should explain how these principles have been applied, specify areas of deviation from the principles and give reasons for these deviations and any alternative practice(s) adopted.

Please read the instructions below carefully before completing this form:

• i. Every line item and indicator must be completed.

• ii. Respond to each question with "Yes" where you have applied the principle, and "No" where you are yet to apply the principle.

• iii. An explanation on how you are applying the principle, or otherwise should be included as part of your response.

• iv. Not Applicable (N/A) is not a valid response.

Section B - General Information

S/No.	Items	Details
i.	Company Name	McNichols Consolidated Plc
ii.	Date of Incorporation	26th April, 2004
iii.	RC Number	509201
iv.	License Number
v.	Company Physical Address	7, Jeminant Laalu Street, off Journalist Estate Road, Arepo, Ogun State
vi.	Company Website Address	www.mcnicholsplc.com
vii.	Financial Year End	December 31, 2023
viii.	Is the Company a part of a Group/Holding Company? Yes/No If yes, please state the name of the Group/Holding Company	No
ix.	Name and Address of Company Secretary	S.E NOMUOJA & Co. 12B, Fagba Crescent, Agidingbi, Ikeja, Lagos.
x.	Name and Address of External Auditor(s)	Gbenga Badejo & Co, 8a, Ajumobi Olorunoje Street, Off Acme Road, Ikeja. Lagos.
xi.	Name and Address of Registrar(s)	Coronation Registrars Limited 9, Amodu Ojikutu Street, Victoria Island, Lagos
xii.	Investor Contact PersonRelations (E-mail and Phone No.)	Ephraim Nwaimo [e-mail]
xiii.	Name of the Governance Evaluation Consultant	TOLG Nominees
xiv.	Name of the Board Evaluation Consultant	TOLG Nominees

Section C - Details of Board of the Company and Attendance at Meetings

1. Board Details:

S/No.	Names of Board Members	Designation (Chairman, MD, INED, NED, ED)	Gender	Date First Appointed/ Elected	Remark
1	Olusegun Layode	Chairman	Male	19/04/2019
2	Chimaraoke Ekpe	Managing Director	Male	26/04/2004
3	Onyebuchi Agubesi	Non-Executive Director	Male	08/2007
4	Ozurumba Afigbo	Independent Non-Executive Director	Male	08/2015
5	Hilda Nkor	Independent Non-Executive Director	Female	04/2021
6	Nzeakor Atulomah	Independent Non-Executive Director	Male	04/2021
7	Nneka Briggs	Non-Executive Director	Female	08/2007

2. Attendance at Board and Committee Meetings:

S/No.	Names of Board Members	No. of Board Meetings Held in the Reporting Year	No. of Board Meetings Attended in the Reporting Year	Membership of Board Committees	Designation (Member or Chairman)	Number of Committee Meetings Held in the Reporting Year	Number of Committee Meetings Attended in the Reporting Year
1	Olusegun Layode	5	5	nil	Nil	nil	Nil
2	Chimaraoke Ekpe	5	5	nil	Nil	nil	Nil
3	Onyebuchi Agubesi	5	5	2
Audit Committee	member	4	3
Governance Committee	Chairman	2	2
4	Ozurumba Afigbo	5	3	2	member
Audit Committee	4	2
Finance & Risk Committee	Chairman	1	1
5	Hilda Nkor	5	5	1
Governance Committee	member	2	2
S/No.	Names of Board Members	No. of Board Meetings Held in the Reporting Year	No. of Board Meetings Attended in the Reporting Year	Membership of Board Committees	Designation (Member or Chairman)	Number of Committee Meetings Held in the Reporting Year	Number of Committee Meetings Attended in the Reporting Year
6	Nzeakor Atulomah	5	4
Finance & Risk Committee	1	Member	1	1
7	Nneka Briggs	5	4	1	Member	2	1
Governance Committee

Section D - Details of Senior Management of the Company

1. Senior Management:

S/No.	Names	Position Held	Gender
1	Chimaraoke Ekpe	Managing Director	Male
2	Ephraim Nwaimo	Human Resource Manager	Male
3	Temitope Adebayo	Finance Manager	Male
4	Sylvester Eluanya	Chief Accountant	Male
5	Caleb Olatundun	Marketing Manager	Male
6	Jennifer Uzondu	Production Manager	Female
7	Magdalene Dosunmu	Quality Assurance Manager	Female

Section E - Application

Principles	Reporting Questions	Explanation on application or deviation
Part A - Board of Directors and Officers of the Board
Principle 1: Role of the Board "A successful Company is headed by an effective Board which is responsible for providing entrepreneurial and strategic leadership as well as promoting ethical culture and responsible corporate citizenship. As a link between stakeholders and the Company, the Board is to exercise oversight and control to ensure that management acts in the best interest of the shareholders and other stakeholders while sustaining the prosperity of the Company"	i) Does the Board have an approved Charter which sets out its responsibilities and terms of reference? Yes If yes, when was it last reviewed?	Yes 2021
Principle 2: Board Structure and Composition "The effective discharge of the responsibilities of the Board and its committees is assured by an appropriate balance of skills and diversity (including experience and gender) without compromising competence, independence and integrity "	i) What are the qualifications and experiences of the directors?	Different professionals; Chartered accountants, lawyer, Governance Consultant, Statistician, Business Manager spanning different sectors of the economy and each with more than 2 decades experience.
ii) Does the company have a Board-approved diversity policy? Yes/No If yes, to what extent have the diversity targets been achieved?	Yes Target has been reasonably achieved.
iii) Are there directors holding concurrent directorships? Yes/No If yes, state names of the directors and the companies?	No
iv) Is the MD/CEO or an Executive Director a chair of any Board Committee? Yes/No If yes, provide the names of the Committees.	No
Principle 3: Chairman "The Chairman is responsible for providing overall leadership of the Company and the Board, and eliciting the constructive participation of all Directors to facilitate effective direction of the Board"	i)Is the Chairman a member or chair of any of the Board Committees? Yes/no If yes, list them.	No
ii)At which Committee meeting(s) was the Chairman in attendance during the period under review?	None
iii) Is the Chairman an INED or a NED?	Non-Executive Director
iv) Is the Chairman a former MD/CEO or ED of the Company? Yes/No If yes, when did his/her tenure as MD end?	No
v) When was he/she appointed as Chairman?	2019
vi) Are the roles and responsibilities of the Chairman clearly defined? Yes/No	Yes. The roles of the Chairman are specified in the board charter
Principles	Reporting Questions	Explanation on application or deviation
If yes, specify which document
Principle Director/ Officer 4: Chief Managing Executive "The ManagingDirector/Chief Executive Officer is the head of management delegated by the Board to run the affairs of the Company to achieve its strategic objectives for sustainable corporate performance"	i)Does the MD/CEO have a contract of employment which sets out his authority and relationship with the Board? Yes/No If no, in which documents is it specified?	Yes in his letter of employment
ii)Does the MD/CEO declare any conflict of interest on appointment, annually, thereafter and as they occur? Yes/No	There has been no conflict of interest with the Managing Director
iii)Which of the Board Committee meetings did the MD/CEO attend during the period under review?	None
iv)Is the MD/CEO serving as NED in any other company? Yes/no. If yes, please state the company(ies)?	No
v)Is the membership of the MD/CEO in these companies in line with the Board-approved policies? Yes/No	The MD is not serving as NED in any other company.
Principle Directors 5:Executive Executive Directors support the Managing Director/Chief Executive Officer in the operations and management of the Company	i)Do the EDs have contracts of employment? Yes/no	The Managing Director is the only Executive Director
ii)If yes, do the contracts of employment set out the roles and responsibilities of the EDs? Yes/No If no, in which document are the roles and responsibilities specified?	The contract of employment is set out for the Managing Director
iii)Do the EDs declare any conflict of interest on appointment, annually, thereafter and as they occur? Yes/No	No. The MD is the only ED and there is no conflict of interest.
iv)Are there EDs serving as NEDs in any other company? Yes/No If yes, please list	No
v)Are their memberships in these companies in line with Board-approved policy? Yes/No	The MD is not serving as NED in any other company.
Principle Directors 6:Non-Executive Non-Executive Directors bring to bear their knowledge, expertise and independent judgment on issues of strategy and performance on the Board	i)Are the roles and responsibilities of the NEDs clearly defined and documented? Yes/No If yes, where are these documented?	Yes In their letters of engagement
ii)Do the NEDs have letters of appointment specifying their duties, liabilities and terms of engagement? Yes/No	Yes
iii)Do the NEDs declare any conflict of interest on appointment, annually, thereafter and as they occur? Yes/No	There has been no conflict of interest
iv)Are NEDs provided with information relating to the management of the company and on all Board matters? Yes/No If yes, when is the information provided to the NEDs	Yes As at when due
v)What is theprocess ofcompleteness and information provided? adequacyensuring of the	The information is generated from management and sent to Non-Executive Directors as board papers. The board conducts its review and ensures completeness of information.
vi)Do NEDs have unfettered access to the EDs, Company Secretary and the Internal Auditor? Yes/No	Yes
Principles	Reporting Questions	Explanation on application or deviation
Principle 7: Independent Non-Executive Directors Independent Non-Executive Directors bring a high degree of objectivity to the Board for sustaining stakeholder trust and confidence"	i)Do the INEDs meet the independence criteria prescribed under Section 7.2 of the Code? Yes/No	Yes
ii)Are there any exceptions?	No
iii)What is the process of selecting INEDs?	In compliance with the provision in NCCG 2018
iv)Do the INEDs have letters of appointment specifying their duties, liabilities and terms of engagement? Yes/No	Yes
v)Do the INEDs declare any conflict of interest on appointment, annually, thereafter and as they occur? Yes/No	No. There has been no conflict of interest.
vi)Does the Board ascertain and confirm the independence of the INEDs? Yes/No If yes, how often? What is the process?	Yes Annually. Review of shareholding register and services offered to the company.
vii) Is the INED a Shareholder of the Company? Yes/No If yes, what is the percentage shareholding?	Only 1 INED is a shareholder and shareholding is less than 0.0001%
viii) Does the INED have another relationship with the Company apart from directorship and/or shareholding? Yes/No If yes, provide details.	No
ix)What are the remuneration? componentsofINEDs	Director's fees
Principle Secretary 8:Company "The Company Secretary support the effectiveness of the Board by assisting the Board and management to develop good corporate governance practices and culture within the Company"	i) Is the Company Secretary in-house or outsourced?	Outsourced
ii) What is the qualification and experience of the Company Secretary?	Chartered Secretaries and Administrators
iii) Where the Company Secretary is an employee of the Company, is the person a member of senior management?	Not an employee
iv) Who does the Company Secretary report to?	The board
v) What is the appointment and removal process of the Company Secretary?	As stated in CAMA 2020
vi) Who undertakes and approves the performance appraisal of the Company Secretary?	The Board
Principle 9: Access Independent Advice to "Directors are sometimes required to make decisions of a technical and complex nature that may require independent expertise" external	i) Does the company have a Board-approved policy that allows directors access to independent professional advice in the discharge of their duties? Yes/No If yes, where is it documented?	Yes Board charter
ii) Who bears the cost for the independent professional advice?	The Company
iii) During the period under review, did theDirectors obtain any professional advice? Yes/No If yes, provide details. independent	No
Principle 10: Meetings of the Board	i) What is the process for reviewing and approving minutes of Board meetings?	Board minutes are approved at the next board meeting
Principles	Reporting Questions	Explanation on application or deviation
"Meetings are the principal vehicle for conducting the business of the Board and successfully fulfilling the strategic objectives of the Company"	ii) What are the timelines for sending the minutes to Directors?	Board minutes are sent weeks before the next board meeting
iii) What are the implications for Directors who do not meet the Company policy on meeting attendance?	The corporate governance sanction is applied
Principle Committees 11:Board "To ensure efficiency and effectiveness, the Board delegates some of its functions, duties and responsibilities to well-structured committees, without abdicating its responsibilities"	i) Do the Board Committees have Board-approved Charters which set out their responsibilities and terms of reference? Yes/No	Yes
ii) What is the process for reviewing and approving minutes of Board Committee of meetings?	The minutes of previous meetings are reviewed and approved at subsequent meetings
iii) What are the timelines for sending the minutes to the directors?	Two weeks before the meeting
iv) Who acts as Secretary to board committees?	The Company secretaries
v) What Board Committees are responsible for the following matters? a) Nomination and Governance b) Remuneration c) Audit d) Risk Management	a. Governance Committee b. Governance Committee and andRemuneration Remuneration c. Audit committee d. Finance and Risk Management Committee
vi) What is the process of appointing the chair of each committee ?	The Chairman of each committee is appointed by the Board and on the basis of competence
Committee responsible for Nomination and Governance
vii) What is the proportion of INEDs to NEDs on the Committee responsible for Nomination and Governance?	1:2
viii) Is the chairman of the Committee a NED or INED ?	NED
ix) Does the Company have a succession plan policy? Yes/No If yes, how often is it reviewed?	Yes Whenever the need arises. Reviewed in 2023
x) How often are Board and Committee charters as well as other governance policies reviewed?	Every 3 years
xi) How does the committee report on its activities to the Board?	Quarterly
Committee responsible for Remuneration
xii) What is the proportion of INEDs to NEDs on the Committee responsible for Remuneration?	1:2
xiii) Is the chairman of the Committee a NED or INED ?	NED
Committee responsible for Audit
xiv) Does the Company have a Board Audit Committee separate from the Statutory Audit Committee? Yes/No	No
xv) Are members of the Committee responsible for Audit financially literate? Yes/No	Yes, for the Board members in the statutory audit committee.
xvi) What are experience? theirqualificationsand	Chartered accountants and financially literate
Principles	Reporting Questions	Explanation on application or deviation
xvii) Name the financial expert(s) on the Committee responsible for Audit	Godslove Okorie Ozurumba Afigbo
xviii) How often does the Committee responsible for Audit review the internal auditor's reports?	Quarterly
xix) Does the Company have a Board approved internal control framework in place? Yes/No	Yes
xx) How does the Board monitor compliance with the internal control framework?	The audit committee helps with the monitoring and reports to the Board
xxi) Does the Committee responsible for Audit review the External Auditors management letter, Key Audit Matters and management response to issues raised? Yes/No Please explain.	Yes
xxii) Is there a Board-approved policy that clearly specifies the non-audit services that the external auditor shall not provide? Yes/No	No The external auditors do not provide other service(s)
xxiii) How many times did the Audit Committee hold discussions with the head of internal audit function and external auditors without the management during the period under review?	None during the year
Committee responsible for Risk Management
xxiv)Is the Chairman of the Risk Committee a NED or an INED?	INED
xxv) Is there a Board approvedRisk Management framework? Yes/No? If yes, when was it approved?	Yes
xxvi)How often does the Committee review the adequacy and effectiveness of the Risk Management Controls in place? Date of last review	Twice a year. July 26, 2023
xxvii) Does the Company have a Board-approved IT Data Governance Framework? Yes/No If yes, how often is it reviewed?	No
xxviii) How often does the Committee receive and review compliance report on the IT Data Governance Framework?	None
xxix) Is the Chief Risk Officer (CRO) a member of Senior Management and does he have relevant experience for this role? Yes/No	Yes. He is a member of Senior Management. Yes. He has a relevant experience in corporate business risks.
xxx) How many meetings of the Committee did the CRO attend during the period under review?	All the meetings
Principle 12: Appointment to the Board "A written, clearly defined, rigorous, formal and transparent procedure serves as a guide for the selection of Directors to ensure the	i) Is there a Board-approved policy for the appointment of Directors? Yes/No	Yes
ii) What criteria appointment? areconsideredfortheir	Competence, skills and ability to bring diversity
iii) What is the Board process for ascertaining that prospective directors are fit and proper persons?	The skill gap is identified, the nomination committee scouts for an appropriate fit and makes recommendation to the Board
Principles	Reporting Questions	Explanation on application or deviation
appointment of high-quality individuals to the Board"	iv)Is there a defined tenure for the following: a) The Chairman b) The MD/CEO c) INED d) NED e) EDs	The INEDs and NEDs tenure is renewable every 3 years The managing director does not have a tenure
v) Please state the tenure	The INEDs and NEDs tenure is renewable every 3 years
vi) Does the Board have a process to ensure that it is refreshed periodically? Yes/No?	Yes
Principle 13: Induction and Continuing Education "A formal induction programme on joining the Board as well as regular training assists Directors to effectively discharge their duties to the Company"	i) Does the Board have a formal induction programme for new directors? Yes/No	Yes
ii) During the period under review, were new Directors appointed? Yes/No If yes, provide date of induction.	There was no new director in the period under review
iii) Are Directors provided relevant training to enable them effectively discharge their duties? Yes/No If yes, provide training details.	Yes. There was no training in the year under review
iv) How do you assess the training needs of Directors?	Training needs are identified based on the roles the directors play on the board
v) Is there a Board-approved training plan? Yes/No	No
vi) Has it been budgeted for? Yes/No	No
Principle 14: Board Evaluation "Annual Board evaluation assesses how each Director, the committees of the Board and the Board are committed to their roles, work together and continue to contribute effectively to the achievement of the Company's objectives"	i) Is there a Board-approved policy evaluating Board performance? Yes/No for	Yes
ii) For the period under review, was there any Board Evaluation exercise conducted? Yes/No	Yes
iii) If yes, indicate whether internal or external. Provide date of last evaluation.	External 1st Quarter 2024
iv) Has the Board Evaluation report been presented to the full Board? Yes/No If yes, indicate date of presentation.	No
v) Did the Chairman discuss the evaluation report with the individual directors? Yes/No	Not yet
vi) Is the result of the evaluation for each Director considered in the re-election process? Yes/No	Yes
Principle 15: Corporate Governance Evaluation "Institutionalizing a system for evaluating the Company's corporate governance practices ensures that its governance standards, practices and processes are adequate and effective"	i) For the period under review, has the Company conducted a corporate governance evaluation? Yes/No If yes, provide date of the evaluation.	Yes 1st Quarter 2024
ii) Is the result of the Corporate Governance Evaluation presented and considered by the Board? Yes/No	Not yet.
iii) If yes, please indicate the date of last presentation.

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