Board Governance Principals
The Board is responsible for the policy governance and per fund/bond/LP oversight of Trebuchet Capital Partners. Trebuchet Management (GP) is the sponsor and originator of all funds and is responsible to them for the defined aspects of the fund’s business. The Board recognizes that in conducting its business, Trebuchet should be responsive to other relevant constituencies. The Trebuchet Board believes that good governance involves the clarity of roles, policies and responsibilities, as well as the proper utilization of distinct skills and processes. The Board therefore focuses on activities that enable it to promote streamlined and efficient fund management, such as the active consideration of long-term policy.
The Board believes that the governance of Trebuchet is best achieved by the delegation of its authority to a pre-appointed manager (GP) for the day to day management of the funds assets. The appointed manager, is subject to defined management duties. To reflect this approach, these Board Governance Principles (the Board Principles) are designed to enable the Board and the manager to operate within a clear policy governance framework.
The Trebuchet Goal
The purpose of the group of funds is to seek to own a substantial and diversified portfolio of income producing properties located in major and selected secondary markets.
The role of the board
1.0 The Board’s Role
The Board is collectively responsible for pursuing the Trebuchet Goal and is accountable to those investors within those funds.
The Board’s role is to govern Trebuchet by discharging its unique responsibilities, which include those responsibilities set out in paragraphs 2.2 to 2.4 below.
In carrying out its responsibilities the Board will:
(a) focus primarily on audit, policy & conflict of interest issues;
(b) have regard to economic, political and social issues and any other relevant external matters which may influence or affect the development of Trebuchet’s business; and
(c) seek to exemplify through these Board Principles.
Trebuchet Board Governance Principles
The Board will focus on policy issues set out by the appointed manager for the fund on which the board sits. The board will base policy decisions on investment thesis’s outlined by the GP for the specific fund or investment vehicle for achieving the Trebuchet Goal.
The Board will monitor the decisions and actions of the Manager and the performance of that specific Trebuchet fund including:
(a) the implementation of, and performance against, the Strategy and the Plan; and
(b) the exercise of authority delegated to the manager.
The Board will satisfy itself that:
(a) the material risks to Trebuchet are identified and understood and that systems of risk management, compliance and control are in place to mitigate such risks; and
(b) its expectations for the conduct of Trebuchet’s business and its employees are reflected in a set of values established by the Manager.
The Board will ensure that systems and processes are in place for the succession of independent directors.
Trebuchet Board Governance Principles
THE BOARD AND ITS PROCESSES
The Board is committed to the Trebuchet goal. It represents the interests of all investors, balances conflicts of interest, if any, and acts fairly to seek and equilibrium between them.
1.5 Board Meetings
The Board will determine the key items for its consideration for the coming financial year. The agenda will be set by the Chairman in consultation with the Manager and with the support of the Company Secretary. A similar process will be used for meetings of Board Committees. Discussion at Board meetings will be concise, open and constructive. All discussions of the Board and their record will be maintained in confidence unless there is a specific decision or legal requirement to make disclosure.
1.6 Independent Advice
Any director is entitled to obtain independent professional advice relating to such director’s own responsibilities and the affairs of Trebuchet. Each director should obtain independent advice where the director is required to consider any matter in which he or she may have an interest which may conflict with the interests of the Company.
Where advice is to be sought, the director will first discuss it with the Chairman as appropriate and, having done so, shall be free to proceed. The director can use the Company Secretary to facilitate the obtaining of such advice subject to the limitations set forth in the Audit committee charter.
Board Composition and Compensation
1.7 Composition, Size, Independence and Tenure
The Board will comprise a mix of individuals that ensures an appropriate range of knowledge, views and experience. The board shall not exceed more than 3 independent directors or 4 directors total.
Generally, Board members will be expected to have:
(a) experience in dealing with audit issues and long-term fund perspectives;
(b) leadership experience, a superior knowledge of business principles and capacity for independent thought;
(c) an ability to participate constructively in deliberations; and
(d) a willingness to exercise authority in a collective manner.
Tenure will be determined on the basis of contribution and continued evidence of the exercise of independent judgment. Given the annual re-election of all directors by shareholders, the Board believes that arbitrary term limits on a director’s service are not appropriate. The Board should be of a size which enables the full engagement of all the directors. The number of directors will not normally exceed 4 for funds with assets under 250 million dollars.
All directors will stand for re-election by shareholders if appropriate to the fund if appropriate to the fund, each year.
1.9 Terms of Engagement and Compensation
The Board will determine the terms of engagement and the level of remuneration paid to its members within the limitations approved by the offering documents in each fund or in policy.
The Chairman will be paid a fee inclusive of all services and will receive other support from Trebuchet appropriate to his office.
Non-Executive directors will be paid a fee determined by the Board.
2.0 Board and Director Evaluation
The Board will evaluate its own processes and performance including the work of its committees, to ensure its on-going effectiveness as a high performing board. This evaluation process will take place annually, in accordance with the procedures adopted by the Board from time to time.
The performance and contribution of individual directors as members of the Board will be reviewed periodically.
2.1 Board Induction and Education
An induction program and continuing training and education may be available to all directors depending on the fund budget and size of offering.
2.2 Other Directorships
Membership of the Board represents a minimal time commitment and Non-Executive directors must be prepared to give sufficient time for the discharge of their Trebuchet responsibilities. All directors should regularly inform the Board through the Company Secretary, of other directorships they hold. The Nominations Committee will keep under review the commitments of Non-Executive directors and make recommendations to the Board if the Committee concludes that a director’s other commitments are inconsistent with those required by Trebuchet. All appointments of Executive directors to other boards shall be subject to the approval of the Chairman and reported to the Board.
The Board will appoint a Chairman of who will be an employed executive of the Group. Chairman’s succession plan will automatically defer to the most senior person at the appointed GP if the current chairman cannot serve.
2.4 Role of the Chairman
The Chairman is the representative and employee of the sponsor GP and will provide leadership of the Board and will act as facilitator for meetings. The Chairman has authority to act and speak for the Board between meetings on all matters relating to the Board Principles and will engage with the Manager on behalf of the Board as required. The Chairman is empowered to make any decision, establish any policy, take any action or enter into any obligation which is consistent with the Board Principles and, in so doing, may interpret the Board Principles in any reasonable manner. The Chairman will report to the next meeting of the Board on any material or sensitive exercise of this authority. The Chairman will ensure that systems are in place to provide directors with accurate, timely and clear information to enable the Board to consider properly all matters before it. The Chairman is responsible for ensuring the integrity and effectiveness of the Board Principles.
2.5 Board Committees
The Board may at any time establish Committees of the Board to assist it in carrying out its responsibilities. Any Committee will be subject to the chairs approval and the Board Principles and will speak or act for the Board only when and to the extent so authorized. The permanent committees of the Board include the Audit Committee, and the Investment Committee. Regular meetings of the permanent Committees shall be scheduled annually. Each permanent Committee will be comprised of those directors the Board considers best suited to serve on that Committee. With the exception of the Audit Committee, all Committee members, of each Committee, shall be held by the Chairman or Executive directors. The main responsibilities and requirements for the composition of the permanent Committees are set out in the Appendix. Any Committee may establish more detailed policy processes and procedures for carrying out its responsibilities which are consistent with the Board Principles.
2.6 The Company Secretary
All Board members will have access to the advice and services of the Company Secretary concerning business relevant to Trebuchet.
The Company Secretary reports to the Chairman and is responsible to the Board. His or her appointment and removal is a matter for the Board as a whole. The Nomination Committee will be responsible for recommending candidates for appointment as Company Secretary and the Chair will determine the Company Secretary’s terms of engagement and remuneration. The Company Secretary is responsible for advising the Board and the Committees on all governance matters, ensuring that Board procedures are followed, that the applicable laws and regulations for the conduct of the affairs of the Board are complied with and for all matters associated with the maintenance of the Board or otherwise required for its efficient operation. The Company Secretary will advise on and be responsible for the engagement and retention of all independent monitoring and advisory services required by the Board or its Committees or by individual directors.
THE BOARD’S RELATIONSHIP WITH THE APPOINTED MANAGER
2.7 Delegation to the Manager
The Board is responsible for reviewing issues within the audit and investment policy. It delegates to the Manager full authority for the management of assets within the fund, consistent with the Trebuchet Goal and the funds goals. The Board will hold the Manager accountable but not liable for the discharge of this authority. The Manager will propose for Board consideration, the investment policy for achieving the Trebuchet Goal. Annually the Manager will propose the plan together with specific results to be achieved during the financial year in pursuit of the Trebuchet Goal. The appointed manager is authorized to establish any policy, make any decision, enter into any obligation, take any action and develop any activity that will achieve the Trebuchet Goal and which is within a reasonable interpretation of the Delegation of Authority Policy. Decisions or instructions of individual directors or Committees of the Board do not carry the authority of the Board, except in those instances where specific authorization is given by the Board (such as to the Chairman between meetings).
2.8 Limits on Policies
All Manager actions and decisions will be carried out in accordance with commonly accepted business practice and professional ethics and within the policy guidelines set out below.
2.9 General Limitations
The Manager will not engage in or cause or permit any practice, activity or decision to be taken:
(a) without having regard to:
• the health, safety and environmental consequences;
• the interests of Trebuchet’s employees or those of other parties doing work for Trebuchet and, in particular, the need both to endeavor to treat them in an equitable and dignified manner and to maintain a safe working environment;
• the political consequences;
• the need to foster Trebuchet’s business relationships with suppliers, customers and others;
• its effect on the reputation of Trebuchet;
(b) which represents a material deviation from the Strategy and/or the Plan; and
(c) without ensuring that a system of control is in place for the prevention of conduct which is dishonest, illegal or involves coercion.
3.0 Risk and Internal Control
The Manger will not cause or permit Trebuchet to operate without a comprehensive system of controls and internal audit to identify and manage the risks that are material to Trebuchet, to protect Trebuchet’s assets and to monitor the application of Trebuchet’s resources in a manner, which meets the standards of excellence.
3.1 Financial Limitations
The Manager will not cause or permit Trebuchet to operate in a manner which would or would be likely, to result in Trebuchet becoming financially distressed and in particular, the GP will not cause or permit any of the following:
(a) Trebuchet to operate outside the financial limits, authorities or ratios determined delegation of authority policy;
(b) the allocation of capital and resources of Trebuchet unless for the purpose of meeting the Trebuchet Goal; or
(c) the assets of Trebuchet to be inadequately maintained, unnecessarily risked or unprotected.
3.2 Accountability and Monitoring
The Board will carry out its many monitoring responsibilities through approved means that it considers appropriate.
The Manager will report to the Board at each meeting and advise the Board (or the relevant Board Committee) in a timely manner of all material matters currently or prospectively affecting Trebuchet and its performance including, among others:
(a) any potential strategically or politically significant development prospects that can affect assets within the fund(s);
(b) progress on the development and implementation of the Plan;
(c) Trebuchet’s business and financial performance including any materially under-performing business activities and proposals to remedy the situation, if appropriate;
(d) any action or project that represents a adverse or severe material deviation from the Strategy or the Plan;
(e) any action or project (otherwise than permitted by the Strategy or the Plan) that takes Trebuchet into a new country if outside the investment parameters;
(f) any action or project (otherwise than permitted by the Plan) that will involve capital investment or revenue commitments exceeding the amounts determined by the Delegation of Authority Policy;
(g) any failure to observe the investment policies;
(h) the identification of the material risks to Trebuchet and an assessment of the effectiveness of the controls in place to assess and manage such risks;
(i) any material political, economic or other developments in the markets where Trebuchet operates;
(j) any material developments or issues concerning the skills and capability of the Trebuchet business;
(k) all material matters currently or prospectively affecting the investors;
(l) the outcome of any agreed actions or significant developments relating to any material agenda items considered at previous Board meetings.
Between Board meetings the manager will engage with the Chairman as the representative of the Board as and when required in respect of those matters referred to above.
Main Tasks and Requirements for the Board Committees
(a) Audit Committee (Non-Executive Directors)
• Obtain assurance that the Manager’s internal control system is designed and implemented effectively in support of his observance of the relevant policies
• Obtain assurance that the management or mitigation of significant Trebuchet risks of a financial nature is appropriately addressed by the Manager
• Receive and review regular reports from the Manager or his delegate, the Group Internal Auditor (if any) and the Group Compliance or Ethics Officer (if any) which evidence the Managers’s adherence to the relevant policies and his management in responding to risk if applicable
• Monitor and obtain assurance that the legally required standards of disclosure are being fully and fairly observed
• Review all financial disclosure documents including quarterly results, annual accounts, prospectuses, information and offering memoranda to be placed before investorsor filed with regulatory bodies and make recommendations to the Board about their adoption and publication
• Monitor and review the effectiveness of Trebuchet’s audit function
• Review Trebuchet’s financial controls and its systems of internal control and risk management
• Review and monitor the external auditor’s independence, objectivity and the effectiveness of the audit process. Recommend to the Board the appointment, re-appointment and removal of the external auditor and to approve their remuneration and terms of engagement
• Implement and monitor policy on the engagement of the external auditor to supply non-audit services to Trebuchet, if needed.
(b) Nomination, Audit Committees
• Identify, evaluate and recommend candidates for appointment or reappointment as directors
• Identify, evaluate and recommend candidates for appointment as Company Secretary, if needed
• Keep under review the mix of knowledge, skills and experience of the Board to ensure the orderly succession of directors
• Review the outside directorship/commitments of the Non-Executive directors.
(c) Investment Committee
see investment committee charter