Corporate governance

We integrate sustainability into our core business practices, working to create economic value for the Group while delivering ongoing benefits to all our stakeholders.

Through our robust corporate governance practices, we are able to conduct our business responsibly, providing attractive returns to our investors and actively contributing to the societies in which we operate.

OUR APPROACH TO CORPORATE GOVERNANCE

Corporate governance is embedded in the way we organise our business, with local boards and sub-committees taking responsibility for our operations in local jurisdictions. As a Board, we are committed to maintaining regular open dialogue and effective communication with all our shareholders, customers, employees, suppliers and local communities.

To maintain the best governance system, the Board remains committed to encouraging integrity and transparency at all levels across all aspects of the Group. We believe our governance framework and our company policies support effective decision-making that contributes to the success of the Group in the long term. We also continue to ensure the Board and its committees function effectively and that they provide strong and valuable contributions to our deliberations and that no individual or group dominates the Board’s decision-making process.

In 2018, we have continued to be mindful of our duties as Directors to manage the Group for the long-term benefit of all its stakeholders. We conduct ongoing formal and informal training in order that we remain appraised of all legislative and regulatory updates that affect how we conduct our business.

In July 2018 the FRC released the 2018 UK Corporate Governance Code (the ‘Code’). The Code is applicable to all companies with a premium listing, whether incorporated in the UK or elsewhere, and applies to accounting periods beginning on or after 1 January 2019. The new Code emphasises the importance of businesses building trust by forging strong relationships with key stakeholders. It calls for companies to create a corporate culture that is aligned with the company purpose, business strategy, promotes integrity and values diversity.

The Directors welcome this update and the committees and our advisers have introduced a review process of our governance policies and terms of reference to ensure our practices and behaviours throughout the Group remain consistent with our current high standard of best governance practice.

Leadership

NON-EXECUTIVE DIRECTORS

HARRY KENYON-SLANEY

Non-Executive Chairman

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MICHAEL LYNCH-BELL

Senior Independent Director

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MIKE BROWN

Non-Executive Director

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JOHNNY VELLOZA

Non-Executive Director

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Harry Kenyon-Slaney

Non-Executive Chairman

BSc Geology (Southampton University), International Executive Programme (INSEAD France)

Harry Kenyon-Slaney is currently a senior advisor to McKinsey & Co and has over 33 years of experience in the mining industry, principally with Rio Tinto. He is a geologist by training and his experience spans operations, marketing, projects, finance and business development. He has worked in South Africa, Australia and the UK. Harry is also a Partner at Audley Capital Advisors LLP, a member of the boards of directors of Bridon Bekaert Ropes Group and Schenck Process AG and a non-executive director of several private companies. Until 2015, Harry was a member of the Group Executive committee of Rio Tinto where he held the roles of CEO of Energy, and before that CEO of Diamonds and Minerals. Prior to this he variously led Rio Tinto’s global titanium dioxide business, was CEO of Rio Tinto’s listed subsidiary, Energy Resources of Australia Ltd, was GM Operations at Palabora Mining Company in South Africa and held senior marketing roles in copper, uranium and industrial minerals. He began his career as an underground geologist with Anglo American on the gold mines in South Africa.

Appointed

Harry was appointed as Chairman of the Board in June 2017.

Key skills and experience

Commercial and capital markets. Leadership of large and complex global mining and processing businesses. Public company board governance and government stakeholder engagement.

Board committee membership

Chairman of the Nominations Committee and a member of the Remuneration, Audit and HSSE Committees.

 

Michael Lynch-Bell

Non-Executive Director

BA Hons Economics and Accountancy (University of Sheffield); FCA of the ICAEW

Michael spent a 38-year career with Ernst & Young (EY) having led its Global Oil and Gas, UK IPO and Global Oil and Gas and Mining transaction advisory practices. He was a member of the assurance practice from 1974 to 1996 when he transferred to the Transaction Advisory Practice. He was also UK Alumni sponsor and a member of the firm’s EMEIA and Global Advisory Councils. He retired from EY as a partner in 2012 and continued as a consultant to the firm until November 2013. Michael is currently Deputy Chair, Senior Independent non-Executive Director and Nominations Committee Chair at Kaz Minerals Plc; Chair of Seven Energy International, Chair of the Audit Committee at Lenta Limited; and non-Executive Director of Barloworld Limited.

Appointed

Michael joined the Board in December 2015 and was appointed Senior Independent Director in November 2017.

Key skills and experience

Finance and capital markets; Oil and gas; Mining and metals.

Board committee membership

Chairman of the Audit and Remuneration Committees and a member of the Nomination and HSSE Committees.

 

Mike Brown

Non-Executive Director

B.Sc.Eng. Mining PR Eng (ECSA) Engineering (University of Witswatersrand), Strategic Executive Programme (London Business School)

Mike has over 35 years’ experience in the resources industry in operational, senior management, and director roles. He spent six years in Switzerland as the Managing Director Technical at Pala where he oversaw all technical aspects of the investments, including the risks associated with resource performance, project management, ramp up, operations, and the associated working capital and financial controls. Prior to joining Pala, Mike spent 21 years with De Beers in Southern Africa in various roles culminating in the post of Chief Operating Officer where he was accountable for five operating mines, including greenfield and brownfield growth projects. He also managed the restructuring at De Beers Consolidated Mines (DBCM) in 2005/2006 and again in 2009. Mike has overseen growth projects and building of mines in Namibia, South Africa, Sierra Leone, Vietnam and USA.

Appointed

Mike joined the Board in January 2018.

Key skills and experience

Operational, resource performance, project growth and finance

Board committee membership

Chairman of the HSSE Committee, member of the Audit, Remuneration and Nomination Committees

 

Johnny Velloza

Non-Executive Director

Bachelor's Degree in Mining & Mineral Engineering (University of Johannesburg), Bachelor's Degree in Business/Commerce, General (University of South Africa)

Johnny is a Mining Engineer with broad mining experience in both open pit and underground operations across Southern and East Africa, Chile and Australia. Johnny has worked in a number of different commodities including Iron Ore, Copper, Gold and Diamonds. Johnny has held senior operational management roles in large mining companies, including De Beers, AngloGold Ashanti and BHP Billiton. Since starting his career twenty-five years ago Johnny has gained experience in exploration, feasibility studies, opening new mines and running mines. Most recently prior to joining Gem Diamonds, Johnny held a General Manager role in the Pilbara region of Australia with BHP Billiton.

Appointed

Johnny joined Gem Diamonds as Chief Operating Officer in May 2016 and was appointed to the Board as an Executive Director in July 2018. Johnny resigned as Chief Operating Officer in September 2018 and was appointed to the Board as a non-Executive Director on 16 September 2018.

Key skills and experience

Mining industry; Operations; Commercial

Board committee membership

HSSE Committee.

EXECUTIVE DIRECTORS

CLIFFORD ELPHICK

Chief Executive Officer

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MICHAEL MICHAEL

Chief Financial Officer

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Clifford Elphick

Chief Executive Officer

BCom (University of Cape Town); BCompt Hons (University of South Africa)

Clifford joined Anglo American Corporation in 1986 and was seconded to E. Oppenheimer and Son as Harry Oppenheimer’s personal assistant in 1988. In 1990, he was appointed Managing Director of E. Oppenheimer and Son, a position he held until leaving in December 2004. During that time, Clifford was also a Director of Central Holdings, Anglo American and DB Investments. Following the privatisation of De Beers in 2000, Clifford served on the De Beers Executive Committee. Clifford is also the non-Executive Chairman of Zanaga Iron Ore Co. Limited

Appointed

Clifford formed Gem Diamonds in July 2005.

Key skills and experience

Diamond and mining industries; Commercial and capital markets.

Board committee membership

Nominations Committee.

 

Michael Michael

Chief Financial Officer

BCom Hons (Rand Afrikaans University); CA(SA)

Michael Michael has over 20 years’ experience in financial management. He joined RSM Betty & Dickson (Audit Firm) in Johannesburg South Africa in January 1993 and became audit partner at the firm in March 2000. From August 2006 to February 2008 Michael was seconded to Gem Diamonds Limited to assist with the financial aspects of the Main London Listing including the financial reporting, management accounting and tax relating to the Initial Public Offering. In March 2008 Michael joined Gem Diamonds on a full-time basis as the Group Financial Manager. On 2 April 2013 he was promoted to the position of Chief Financial Officer.

Appointed

Michael joined Gem Diamonds in March 2008 and was appointed to the Board in April 2013.

Key skills and experience

Finance and capital markets; Diamond industry.

EXECUTIVE MANAGEMENT

GLENN TURNER

Chief Legal and Commercial Officer
and Company Secretary

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BRANDON DE BRUIN

Chief Business Transformation
Officer

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Glenn Turner

Chief Legal and Commercial Officer and Company Secretary

BA LLB (University of Cape Town); LLM (Cambridge)

Glenn was called to the Johannesburg Bar in 1987 where he spent 14 years practising as an advocate specialising in general commercial and competition law, and took silk in 2002. Glenn was appointed De Beers’ first General Counsel in 2002 and was also a member of the Executive Committee. Glenn was responsible for a number of key initiatives during his tenure, including overseeing De Beers’ re-entry into the USA.

Appointed

Glenn joined Gem Diamonds in May 2006 and served on the Board from April 2008 to November 2017. Glenn was appointed as the Company Secretary in January 2015

Key skills and experience

Diamond industry; Legal.

Board committee membership

HSSE Committee.

 

Brandon de Bruin

Chief Business Transformation Officer

Bachelor of Commerce degree (Economics and Business Economics) and a Bachelor of Laws degree from the University of the Witwatersrand, South Africa; qualified attorney in South Africa and solicitor in England and Wales

Brandon de Bruin joined Gem Diamonds from Clifford Chance LLP, one of the world's leading international law firms. Practicing in New York and London, he specialised in Debt and Equity Capital Markets and Corporate Finance. Brandon gained extensive commercial and legal experience in international corporate and finance transactions working for clients such as Citigroup, UBS, JPMorgan, ABN Amro, Bank of America, Lehman Brothers and Morgan Stanley. He also gained valuable experience in stock exchange listings in London, Luxembourg and New York and also in the UKLA (UK) and SEC (USA) rules and regulations. At Gem Diamonds, Brandon has been closely involved in numerous corporate and financial transactions and in the set-up and management of the Group's Sales, Marketing and Manufacturing division. More recently Brandon has been appointed as the Group's Chief Business Transformation Officer.

Appointed

Brandon joined Gem Diamonds in August 2007

Key skills and experience

Business Transformation; Sales, Marketing and Manufacturing; Legal and Commercial

Board evaluation

We undertake annual Board evaluations to assess the Board’s approach to strategy, the ongoing effectiveness of the committees and risk management. The 2017 evaluation was carried out by way of a questionnaire and a detailed description of the evaluation process and the findings can be found in our 2017 Annual Report.

In 2018, we plan to undertake a more extensive external Board evaluation to ensure that the structure of the new Board and the composition of the Committees are effective and that we have the correct size, skills, experience and attributes required to continue to effectively govern and manage risk within the Group.

Board committees

The Audit Committee assists the Company's Board of Directors in discharging its responsibilities with regard to:

  • financial reporting;
  • external and internal audit controls, including reviewing the annual financial statements;
  • considering the scope of the Company's annual external audit and the extent of non-audit work undertaken by external auditors;
  • advising the appointment of external auditors;
  • approving the internal audit programme; and
  • reviewing the effectiveness of the Company's internal control systems.

The Audit Committee comprises of three independent non-Executive directors, as per the recommendations of the Code. The Audit Committee meets formally at least two times a year and senior management, including the Chief Financial Officer, may be invited to attend all or part of the meetings. The external Auditors attend the meetings on a regular basis.

The Remuneration Committee considers and determines all elements of the remuneration of the Chief Executive Officer, the Chief Financial Officer and the senior executive team and determines the terms of any performance-related remuneration paid by the Company. The Committee also considers the level and structure of remuneration across the Company and advises on any major changes proposed.

The new UK Corporate Governance Code, applicable for financial periods commencing on or after 1 January 2019, emphasises the need for companies to forge strong relationships with all their key stakeholders and to establish a culture that is aligned to the company’s purpose and business strategy, and which supports integrity and diversity. From a remuneration perspective, the key changes that the Remuneration Committee are focussing on in 2018 relate to workforce alignment, and ensuring pay outcomes resonate with broader shareholder experience through use of Committee discretion, where appropriate.

The Remuneration Committee comprises two independent non-Executive Directors and the Chairman and meets formally at least two times a year and senior management and external advisors may be invited to attend meetings as the Remuneration Committee considers appropriate.

The Nominations Committee is responsible for the identification, evaluation and recommendation of candidates for Board vacancies as well as the making of recommendations for Board composition and balance. The terms of reference provide for a formal and transparent procedure.

The new UK Corporate Governance Code, applicable for financial periods commencing on or after 1 January 2019, emphasises the need for companies to forge strong relationships with all their key stakeholders and to establish a culture that is aligned to the company’s purpose and business strategy, and which supports integrity and diversity. From a nomination perspective, the key messages are about succession planning, diversity and board evaluation and the Nomination Committee is currently in the process of addressing these issues throughout the Group.

The Nominations Committee comprises the Chairman, two non-Executive Directors and one Executive Director and meets formally at least twice a year.

The HSSE Committee assists the Board in developing framework policies and guidelines for the management of sustainable development issues, including health, safety, Corporate Social Responsibility and environment issues, and ensures their implementation within the Company.

The HSSE Committee, which comprises four non-Executive Directors and one Executive Director, meets formally at least two times a year. Senior management and external advisers may be invited to attend meetings as the HSSE Committee considers appropriate.

For more information on the HSSE Committee, please see our section on sustainability.

Relations with shareholders

The Board places considerable importance on effective communication with shareholders. The Chief Executive Officer and Chief Financial Officer, assisted by the Investor Relations Officer, maintain regular dialogue with and give briefings throughout the year to analysts and institutional investors and are involved in a structured programme of investor, analyst and media visits.

Any concerns raised by a shareholder in relation to the Company and its affairs are communicated to the Board as a whole. Care is taken to ensure that any price-sensitive information is released to all shareholders, institutional and private, at the same time, in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority.

All shareholders can obtain access to the annual report and other current information about the Company through the Company’s website.

Policy on bribery and corruption – zero tolerance

It has been, and continues to be, Gem Diamonds Limited’s strict policy to conduct business in an honest and ethical way and without the tolerance or use of corrupt practices or acts of bribery to obtain an advantage in, or otherwise influence, its business or relationships.

Gem Diamonds acknowledges that bribery and corruption harm the societies in which these acts are committed by preventing economic growth and development therein. Gem Diamonds is committed to acting professionally, fairly and with integrity in all its business dealings and relationships wherever it operates.

In addition to Gem Diamonds global anti-corruption policies and practices, Gem Diamonds is committed to abiding by all anti-corruption law in those jurisdictions in which it operates.

Even the suggestion of corruption may damage the reputation of Gem Diamonds and its employees or associates and affect its ability to do business. Gem Diamonds is committed to doing business ethically and transparently, even if this means a potential loss of opportunity, not using the services of particular agents or other associated persons or incurring delays or other barriers to business.

Gem Diamonds applies a “zero tolerance” approach to acts of bribery and corruption involving any of its staff or third-party representatives or associates.

Gem Diamonds anti-corruption policy (the “Policy”) embodies Gem’s commitment to monitor its business operations, identify any risk of corruption and effectively deal with and prevent any potential for corrupt practices. The Policy is the responsibility of the Gem Company Secretary on behalf of the Chief Executive Officer of Gem and other directors. For a copy of the Policy please apply to the Company Secretary (gturner@gemdiamonds.com).

The Policy has been approved and adopted by the board of Directors of Gem Diamonds.