Annual Report 2016
Annual Report 2016
CORPORATE GOVERNANCE
The Group seeks to apply the principles of the UK Corporate Governance Code (“ the UK Code ”), where considered applicable to a private , unlisted group . The Group also applies the Walker Guidelines on transparency and disclosure and regularly monitors corporate governance best practice and the applicability of any developments to the Group . Any changes to the Group ’ s governance arrangements considered appropriate are implemented within agreed timescales .
South Staffordshire Water PLC corporate governance South Staffordshire Water PLC continues to apply the principles of its own Corporate Governance Code ( the “ SSW Code ”) which supports Ofwat ’ s published principles on board leadership , transparency and governance . Although South Staffordshire Water PLC is not a public listed company , its Board of Directors recognises that they should act , where applicable , as if it were and therefore the SSW Code has also specifically drawn on certain principles of the UK Code that may be applicable to a privately owned regulated company . A copy of the SSW Code can be found on South Staffs Water ’ s website ( www . south-staffs-water . co . uk ).
As the immediate parent company of South Staffordshire Water PLC , South Staffordshire Plc and its Board of Directors recognise the responsibilities that come from providing a public service and the Company is therefore fully committed to maintaining high standards of leadership , transparency and governance as a parent of a regulated business . The Company maintains an open dialogue with all of its subsidiaries and fully supports South Staffordshire Water PLC in complying with its statutory and regulatory obligations , including but not limited to the SSW Code and ensuring that it can make strategic and sustainable decisions that are in the long-term interests of the regulated business . Details of how South Staffordshire Water PLC follows the principles in the SSW Code are provided separately in its own Report and Accounts for the year ended 31 March 2016 . Details of how South Staffordshire Plc , as the immediate parent of South Staffordshire Water PLC , follows Ofwat ’ s Holding Company Principles are detailed in this Corporate Governance report .
The Board can also confirm , on behalf of KKR Infrastructure Limited , that it , as the ultimate controlling party of the Group , also fully supports these Holding Company Principles from Ofwat and it will continue to apply high standards of board leadership and governance .
There have been no material changes to Corporate Governance arrangements in the Group during the year , although additional disclosure has been made in respect of risk management procedures and the long term viability of the Company in the Strategic Report on pages 37 to 39 . The Board confirms that , to the best of its knowledge , there are no issues or risks at the Group level which may negatively impact on South Staffordshire Water PLC .
Group structure The Group is controlled by the Global Infrastructure Fund of the investment business Kohlberg Kravis Roberts & Co . L . P . ( KKR ), which is quoted on the New York Stock Exchange , and which holds a majority controlling interest in the Group , together with certain co-investors of KKR . The KKR Infrastructure Fund is controlled and managed by KKR Infrastructure Limited , a company registered in the Cayman Islands ( the “ Holding Company ”).
South Staffordshire Plc , as the immediate parent company of South Staffordshire Water PLC , ensures through its detailed knowledge of all of its subsidiaries and the water industry that it understands the duties and obligations of a regulated company including Condition P of its licence and , although some Directors sit on both Boards , South Staffordshire Water PLC acts , where applicable , with the support of the Company , as if it were a separate listed company . South Staffordshire Plc has processes in place to provide South Staffordshire Water PLC with information that it requires about the wider Group . South Staffordshire Plc provides management , professional and administrative support services to South Staffordshire Water PLC and other of its subsidiaries on a cost basis . There is no direct interaction between South Staffordshire Water PLC and the Holding Company .
There are a number of UK registered intermediate holding companies above South Staffordshire Plc in the Group structure , headed by Hydriades IV Limited , the ultimate holding company registered in the UK . There are also intermediate holding companies above Hydriades IV Limited which are registered in
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