ESG committee

• MEMBERS & MEETINGS
  
  • Members of the ESG Committee shall be appointed by the Board, in consultation with the chairman of the ESG Committee. The minimum number of members shall be two.
  • Members of the committee shall be a majority of non-executive directors who are considered by the Board to be independent, as determined by reference to the QCA Corporate Governance Code, with relevant executive directors as members also.
  • Only members of the committee have the right to attend meetings. However, other individuals such as the chief executive officer, chief operating officer, representatives from the finance team, local operations and external advisers may be invited to attend for all or part of any meeting, as and when appropriate.
  • The Board shall appoint the committee chairman from amongst the committee, who shall be an independent Non-Executive Director. In the absence of the Committee chairman and/or an appointed deputy, the remaining members present shall elect one of themselves to chair the meeting from those who would qualify under these terms of reference to be appointed to that position by the Board.
  • Two independent Non-Executive Director members of the Committee shall constitute a quorum. Matters arising at any meeting that require a vote of the Committee shall be decided by a majority of votes. If a vote is required, each member of the Committee present at a meeting of the Committee shall have one vote. A member of the Committee shall not vote in respect of any matter being considered by the Committee in which he has, directly or indirectly, a personal interest and shall not be counted in the quorum at a meeting in relation to any matter on which he cannot vote. If required under circumstances where there are an equal number of votes in favour of and against a particular matter arising, the chairman shall have a second and casting vote.
  • Committee meetings shall be held not less than two times a year and at such other times as any member of the Committee may require,
  • Meetings of the committee shall be called by or on behalf of the chairman of the Committee. Unless otherwise agreed, notice of each meeting confirming the venue, time and date together with the agenda of items to be discussed, shall be forwarded to each member of the committee no later than four working days before the date of the meeting. Supporting papers shall be sent to committee members and to other attendees as appropriate, at the same time.
  • Meetings may be held by video conference, telephone or by any other manner permitted by the company’s constitution.
  • The chairman of the Committee shall ensure that appropriate minutes of its proceedings are kept. The chairman can request the Company Secretary or his nominee to act as the secretary of the Committee and ensure that the Committee receives information and papers in a timely manner to enable full and proper consultation to be given to all issues. The appointed secretary of the Committee shall keep a record of all minutes and attendances at all meetings.
  • The chairman of the Committee shall make available the minutes of meetings of the Committee, once agreed, to all members of the Board, unless in the opinion of the Committee Chairman it would be inappropriate to do so.
  • Appointments to the Committee shall be for a period of up to three years, which may be extended for two further three-year periods, provided the member in question continues to be determined by the Board as being independent.
  • The Board may from time to time review the composition of the Committee to ensure that membership of the Committee rotates amongst the company’s independent non-executive directors.
• PURPOSE AND ROLE
  
  • Assist the Board in defining and recommending San Leon’s strategy relating to ESG matters;
  • Review the policies and practices of the Group relating to ESG matters ensuring they remain effective, valid and up to date;
  • Oversee the San Leon management of ESG matters and compliance with legal and regulatory requirements, including applicable rules and principals of corporate governance, and applicable industry standards;
  • Report as required to the shareholders of the Company on the activities and remit of the committee; and
  • Report on ESG matters to the Board and, where appropriate, make recommendations to the Board.
• DUTIES
  
  The Committee shall:
  • Formulate the Group’s policies and systems for identifying and managing social/communities and environmental risks within the Group’s operations and publish them on the Company’s website;
  • Assess all policies and practices and systems in place to identify, manage and mitigate ESG risks within the Group;
  • Ensure compliance with all regulatory and legal requirements applicable to ESG matters;
  • Ensure procedures are in place to manage the Environmental performance of high risk contractors;
  • Ensure any independent audits of performance that are requested in regard to ESG matters are reviewed;
  • Assess the scope and review the effectiveness of the Company’s policies, programmes, practices and systems for:some text
    1. identifying, managing and mitigating or eliminating ESG risks in connection with San Leon’s operations and corporate activity, including the level of preparedness and readiness to respond to a major environmental incident; and
    2. Ensuring compliance with legal and regulatory requirements and international industry standards and guidelines applicable to ESG matters;
  • Assess the Group’s impact on the natural environment and its adaptation to climate change including greenhouse gas emissions, energy consumption, generation and use of renewable energy, biodiversity and habitat, impact on water resources and the status of water bodies, pollution, resources efficiency, the reduction and management of waste, and the environmental impact of the Group’s supply chain;
  • Assess the Group’s interactions with employees, regulators, commercial counterparties, stakeholders and the communities in which it operates and the role of the Group in society, workplace policies (for example, employee relations and engagement, diversity, non-discrimination and equality of treatment, health and safety and well-being), ethical procurement, any social or community projects undertaken by the Group and social aspects of the supply chain, community and stakeholder engagement or partnerships; and
  • Assess the ethical conduct of the Group’s business including its corporate governance framework (including compliance with the UK Corporate Governance Code), business ethics policies and codes of conduct, counterparty due diligence and on boarding policies and procedures, the management of bribery, corruption and money laundering risk and the transparency of reporting and financial and tax transparency;
  • Assess, review and approve the quality and integrity of internal reporting of ESG matters including statements and reporting in the annual report & accounts;
  • Ensure the Company’s Health, Safety and Environmental Policy (“HSE Policy”) meets or exceeds international oil and gas practice appropriate to the Company’s operations and meets the required legal and regulatory standards for the jurisdictions in which we work by:
    • Consider in particular the adequacy of the Group’s ESG policies and processes and review reports prepared by management on:some text
      1. [compliance with the licenses held by the company’s subsidiaries;]
      2. compliance with the Group’s regulatory obligations to treat customers fairly or similar obligations in the jurisdictions in which the Group operates;
      3. key learnings from internal or external reviews and investigations of any marketing, advertising campaigns and promotional activities which have had a significant negative impact on the brand or image of the Group;
      4. diversity in the workplace;
      5. security and health and safety in respect of the Group’s employees and premises;
      6. charitable donations and pro bono programmes; and
      7. the Group’s impact on the environment;
    • The Company will conduct business with the highest ethical values and will be socially responsible in the communities in which we work. The Committee with govern the Company’s ethics policy and code of ethics to ensure ethical business practice. It will also oversee San Leon Energy’s corporate responsibility strategy. To these ends, the Committee will:s
      1. ensure the Company has practical and sufficient polices in place to encourage the highest standards of ethical behaviour during all operations;
      2. ensure that there is effective training in the code of ethics at all levels;
      3. ensure that there is effective communication reinforcing ethical values and good practice in the business and censuring unacceptable practice;
      4. assess reports and oversee investigation and subsequent actions following breaches of the ethics policy or allegations of misconduct;
      5. review and develop the effectiveness of ethics policies and related policies;
      6. liaise with stakeholders over ethical issues;
      7. establish principles for ethical due diligence prior to a merger or an acquisition or the undertaking of a major new project; and
      8. review and endorse CSR plans and monitor performance against those plans;
    • Endeavour to ensure that sufficient focus and resource is given to implementing, monitoring and managing the company’s ESG policies and processes and that these remain effective;
    • Consider, in consultation with the executive management team, the appointment of third parties to advise on ESG policies and practices and/or audit the company’s ESG policies. In relation to any such programme the Committee shall, with the executive management team, evaluate potential third parties, agree the scope of the advisory/audit process and review the results of the exercise and agree the action to be taken;
    • Liaise and work with the Board’s other Committees and the [independent non-executive director discharging the employee engagement function (unless that director is a member of the ESG Committee)] to the extent necessary for the ESG Committee and/or another Board Committee to carry out its duties and responsibilities.

• complying with all relevant environmental legislation, regulations and approved codes of practice;
• striving to prevent and minimise our contribution to pollution of land, air, and water;
• seeking to keep waste to a minimum and maximise the efficient use of materials and resources;
• managing and disposing of all waste in a responsible manner;
• providing training for our staff so that they work in accordance with the HSE Policy and within an environmentally aware culture;
• regularly communicating our environmental performance to our employees and other significant stakeholders;
• developing our management processes to ensure that environmental factors are considered during planning, design and implementation of new systems; and
• monitoring and continuously improving our environmental performance;
• OTHER
  
  • The Committee shall have access to sufficient resources in order to carry out its duties, including access to the company secretary for assistance as required.
  • The Committee shall be provided with appropriate and timely training, both in the form of an induction programme for new members and on an ongoing basis for all members.
  • The Committee shall give due consideration to laws, regulations and any published guidelines or recommendations including but not limited to the provisions of the UK Corporate Governance Code, the requirements of the Listing Rules, the Prospectus Regulation Rules sourcebook and the Disclosure Guidance and Transparency Rules sourcebook as well as guidelines published by the Investment Association and the Pensions and Lifetime Savings Association and any other applicable rules, as appropriate.
  • The Committee shall report formally to the Board on its proceedings after each meeting on all matters within its duties and responsibilities.
  • The Committee shall escalate any significant issues to the board and make recommendations for resolving these issues.
  • The Committee shall arrange for periodic reviews of its own performance and, at least annually, conduct a review of its constitution and terms of reference and of its work and make recommendations to the Board.
  • The Committee shall compile a report to shareholders on its activities to be included in the company’s annual report.
• ANNUAL GENERAL MEETING
  
  • The chairman of the committee shall attend the Annual General Meeting and shall be prepared to respond to any shareholder questions on the committee’s activities.
• AUTHORITY
  
  • The committee is authorised by the Board to investigate any activity within these terms of reference and can seek any information it requires directly from any employee and all employees shall be directed to co-operate with any request by the committee. The committee may call any employee to be questioned at a meeting of the committee as and when required.
  • The committee may obtain, at the Company’s expense, outside legal or independent professional advice and such advisors may attend meetings as necessary and appropriate. Such advice must be sought at a reasonable cost commensurate with the matter under review.
  • The committee is authorised by the Board to ensure that the internal ESG function, the Company’s HSE Policy, the ethical standards of the Company, and the Company’s CSR objectives are adequately resourced and have appropriate authority within the Company.

Members

A Kolapo (Chair) M.Sunmonu (INED)

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