CORPORATE GOVERNANCE
BOARD MISSION
The Honey Bun’s Board of Directors represents the owners’ interest in maintaining and growing a successful business, including optimizing long term financial growth. The mission of the Board is to be accountable and transparent in increasing long term value for the stakeholders. The Board is committed to achieving the highest standards of corporate governance, corporate responsibility and risk management in directing and controlling the business.

The Board is responsible for ensuring that Honey Bun is managed in such a way to achieve this result. The Board has the responsibility to ensure that management is capably executing its responsibilities. The Board’s responsibility is to regularly monitor the effectiveness of management policies and decisions including the execution of its strategies.

In addition to fulfilling its obligations for increased stockholder value, the Board has a responsibility to deliver holistic performance embracing corporate responsibility towards Honey Bun’s stakeholders all of whom are essential to a successful business.

BOARD FUNCTIONS
The Board makes decisions and reviews and approves key policies and decisions of the Company in particular in relation to:
1. Corporate governance
2. Compliance with laws, regulations and the Company’s code of business conduct
3. Corporate citizenship, ethics, environment
4. Strategy and operating plans
5. Business development including major investments and disposals
6. Financing and treasury
7. Appointment or removal of Directors
8. Remuneration of Directors and Executives
9. Risk management
10. Financial reporting and audit
11. Pensions

SPECIFIC RESPONSIBILITIES
Chairman
The Chairman is principally responsible for the effective operation and chairing of the Board and for ensuring that information that it receives is sufficient to make informed judgments. He also provides support to the CEO, particularly in relation to external affairs.

Company Secretary
The Company Secretary is responsible for ensuring that Board processes and procedures are appropriately followed and support effective decision-making and governance. She is appointed by, and can only be removed by the Board. She is also responsible for ensuring that new Directors receive appropriate training and induction into Honey Bun. She ensures compliance with laws, rules and regulations and timely filing of all documents with the respective bodies including the JSE.

Company Mentor
Each company that joins the Junior Market is required to appoint a mentor who acts as a compliance adviser to the Board of Directors. The mentor must be a suitably experienced person, and he must enter into the standard form Mentor Agreement and be approved by the JSE for the purposes of the Company’s admission to the Junior Market.
The duties and the responsibilities of the mentor as it relates to governance include overseeing of establishing procedures and controls for the purposes of compliance with good standard of corporate governance, among them: holding regular board meetings, establishment of board committees – audit and remuneration, good fiscal discipline, and adhering to junior market rules

Board Members
Each Board Member is expected to commit sufficient time for preparing and attending meetings of the Board and its Committees. Regular attendance at Board meetings is a prerequisite unless explicitly agreed upfront; a Director should not miss two consecutive regular Board meetings. Because in-depth knowledge of the particulars of the Company’s business is vital for each Director in making informed and objective decisions, management is to allow direct involvement and review of operational activities. Similarly, management also is to communicate to Board members opportunities to interact in strategy and day-to-day business settings. Board members are strongly encouraged to take advantage of such opportunities as frequently as feasible. The Directors have complete access to the Leadership of the Company. The quorum for the Board meetings is three (3) directors of whom two must be independent directors.

The company maintains a record of the attendance of each Board Member at all meetings.

SELECTION AND COMPOSITION OF THE BOARD
The Board is responsible for the over viewing of the interest of all stakeholders on the matters as outlined above. The composition of the Board should be such that these interests are best served and therefore the Directors require diversity in skills and characteristics.

The Directors shall have power at any time and from time to time to appoint any other person to be a Director of the Company, either to fill a casual vacancy or as an addition to the Board, but so that the total number of Directors shall not at any time exceed the maximum number fixed. Any Director so appointed shall hold office only until the next following annual general meeting, when he shall retire but shall be eligible for re-election. New Directors are considered for appointment based on:

1. The boards determination that there is a need for appointment based on resignations, death, rotation or to enlarge the knowledge base of the company.
2. The diversity of experience they provide to the board
3. The experience they possess in their field
4. Shall not be involved in another capacity which might be considered a conflict of interest

New Directors considered for appointment must:
1. Provide professional CV for the boards consideration
2. Provide references from professional bodies

Each newly appointed Director of the company shall be inducted by the Secretary as outlined by the Company in the Orientation Procedures of Directors.

Size of the Board
Unless otherwise determined by a general meeting, the number of directors of the Company shall be not more than six (6) in numbers.

Executive and Non-Executive/Independent Directors
At any time the number of Executive Directors should not exceed 50 % of the total number of Directors. Non-Executive/Independent Directors are expected to be truly Independent in executing their responsibilities.

Conflicts of Interest/ Disclosure
A Director who has an interest in the Company or in any transactions with the Company which could create or appear to create a conflict of interest must disclose such interests to the Company. These would include:

1. Any Interest in contracts or proposed contracts with the company
2. General disclosure on interest in a firm, which does business with the company
3. Interest in securities held in the Company
4. Emoluments received by the Company
5. Loans or Guarantees granted by the Company to/for the Director.

Disclosure shall be made at the first opportunity at a Board Meeting and such disclosure shall be recorded in the Minutes of the Board Meeting. The Director shall then excuse himself from the Board meetings when the Board is deliberating over any such contract/matter and shall not vote on any such issue. The disclosure of Director’s interest shall include interests of his family and affiliates.
Disclosure on Related Party Transactions

A related party is a person or entity that is related to the entity that is preparing its financial
statements (referred to in IAS 24 Related Party Disclosures as the “reporting entity”)

(a) A person or close member of that person’s family is related to a reporting entity if
that person:
i. has control or joint control over the reporting entity;
ii. has significant influence over the reporting entity ; or
iii. is a member of the key management personnel of the reporting entity or of a parent of
the reporting entity.

(b) An entity is related to a reporting entity if any of the following conditions applies:
i. The entity and the reporting entity are members of the same group (which means that
each parent, subsidiary and fellow subsidiary is related to the others.)
ii. One entity is an associate or joint venture of the other entity (or an associate or joint
venture of a member of a group of which the other entity is a member)
iii. Both entities are joint ventures of the same third party.
iv. One entity is a joint venture of a third entity and the other entity is an associate of the
third entity
v. The entity is associated with a post-employment benefit plan for the benefit of the
employees of either the reporting entity or an entity related to the reporting entity.
vi. The entity is controlled or jointly controlled by a person identified in (a)
vii. A person identified in (a)i above, has significant influence over the entity or is a
member of the key management personnel of the entity (or of a parent of the entity).
A related party transaction is a transfer of resources, services or obligations between
related parties, regardless of whether a price is charged.
The financial statements of the company shall report on detailed financial transactions with any related party and the balances.
Trading in Securities
A director/officer should not deal in any of the securities of Honey Bun at any time when he is in possession of unpublished price-sensitive information in relation to those securities.
After the end of each accounting quarter and the year, the directors and officers of the company shall not purchase or sell shares of the company until after the release of the financial results to the Jamaica Stock Exchange.

Further details are covered in the company document on Code on Trading in Securities.

Election, Terms, Re-election and Retirement
Election, terms, re-election and retirement of each Board member is conducted in line with the articles of association of the Company, articles 92 to 100. Equally the maximum number of terms of the Chairman should not exceed 10 successive years, unless a resolution of exemption of this rule is passed by the Board.

Board Compensation
The level of compensation of the Non-Executive Directors reflects the time, commitment and responsibilities of the role. It consists of a package appropriate to attract, retain and motivate Non-Executive Directors of the quality required. The compensation is competitive and subject to regular review to what is paid in comparable situations elsewhere. A review by the Board of the remuneration policies for all Directors and the members of the management team will take place during a regular Compensation and Nomination Committee meeting annually.

Director Induction and Training
The Board and Management will conduct a comprehensive orientation process for new Directors to become familiar with the Company’s vision, strategic direction, core values, financial matters, corporate governance practices and other key policies and practices through a review of background material, meetings with senior management and visits to the Company’s facilities. The Board recognizes the importance of training for its Directors. It is the responsibility of the Board to advise the Non-Executive Directors about their training, including corporate governance issues. Directors are encouraged to participate in continuing Director training programs.

All directors will make continuous efforts to keep themselves up to date regarding economic, social and corporate developments, laws/rules/regulations, stock market, accounting and financial matters, etc affecting the company’s operational and future plans. The Company Secretary will provide necessary up dates/documents to the directors on a continuous basis to help them to keep abreast of the developments. The company will, from time to time, sponsor the directors/secretary for attending appropriate training courses/seminars to enable them to keep abreast of the developments.
Access to Outside Advisors and Funds
The Company will make such funds available to the Board and in particular the Non-Executive Directors as is reasonably required for those Directors to objectively make decisions. This may include providing funds to access outside advisors and cover cost associated with travel and the gathering of relevant information for the execution of their responsibilities.

Code of Conduct
The Board expects all Directors, as well as officers and employees, to act ethically at all times and to adhere to all Honey Bun’s codes and policies. The Board will not permit any waiver of any of these policies for any Director or Executive officer. If an actual or potential conflict of interest arises for a Director, the Director shall promptly inform the Chairman. If a conflict exists and cannot be resolved, the Director should resign.