QCA Code


The Board of Directors ("Board") is fully committed and strives to take the necessary measures to uphold the best principles and practices of corporate governance in the Group. Good corporate governance is fundamental to the Group's discharge of its corporate responsibilities and accountability to protect and enhance the financial performance and shareholders' value of the Group. The Board sets the tone by defining and demonstrating the Company's values and standards. The Board recognises that a robust corporate governance framework is essential to effective delivery of the strategy of the Group and ensure the highest standards of integrity.

The Chairman's role is to ensure that the governance structure remains relevant and appropriate, whilst supporting the Group's strategy and culture and ensuring that the Board delivers effective leadership in order to discharge its duties responsibly and effectively to ensure the long-term success of the Group.

Steppe Cement complies with the latest Quoted Companies Alliance Corporate Governance Code ("QCA") guidelines published in 2018. Nonetheless, Steppe Cement adopts the principal requirements of the UK Combined Code of Corporate Governance (Combined Code), as far as practicable, to ensure high standards of corporate governance.

Steppe Cement is not required to comply with the Combined Code published by the UK Financial Reporting Council. The Combined Code applies to companies listed on the Main Board but not AIM companies.

The QCA has published a set of corporate governance guidelines for as a minimum standard to follow for companies, such as those listed on AIM, which adopt the QCA. The QCA guidelines are less rigorous than the Combined Code and recommendations, examples of which include the following:

  • Separation of Chairman and Chief Executive Officer (CEO) roles -both roles should not be performed by the same individual.
  • Independent non-executive Directors - at least two independent non-executive Directors, one of whom may be the Chairman.
  • Establishment of Audit, Remuneration and Nomination Committees and that Audit and Remuneration Committees should comprise at least two independent non-executive Directors.
  • Re-election of Directors - All Directors should be submitted to re-election at regular intervals subject to continued satisfactory performance of the Directors.
  • Dialogue with shareholders - there should be a dialogue with shareholders based on mutual understanding of objectives.
  • Matters reserved for the Board - there be a formal schedule of matters specifically reserved for the Board's decision.
  • Timely information - the Board should be supplied with timely information to discharge its duties.
  • Review of internal controls annually. The review should encompass all material controls including financial, operational and compliance controls and risk management systems.

The following sets out the application of the principles of the QCA code by Steppe Cement.

Application of the principles of QCA code

The Board must be able to express a shared view of the company's purpose, business model and strategy. It should go beyond the simple description of products and corporate structures and set out how the company intends to deliver shareholder value in the medium to long-term. It should demonstrate that the delivery of long-term growth is underpinned by a clear set of values aimed at protecting the company from unnecessary risk and securing its long-term future.


The Board of Steppe Cement is responsible for establishing the group's objective, strategy and business model, establishing visions and goals for delivery of long-term values, ensuring effective leadership through oversight on management and continuously monitor, oversee and evaluate the group's strategies, policies and performance in order to protect and enhance shareholders value. The Board ensures that necessary resources are in place for Steppe Cement to meet its objectives and deliver the desired performance.

There is a division of functions between the Board and the management. The Board is focused on the group's overall governance by ensuring that the implementation of strategic plans and objectives are in line with its vision and goals; and that accountability to the group and shareholders is monitored effectively. The Board does not actively manage but rather oversees the overall management, which is delegated to the General Directors and management. The General Directors and management support the CEO and implement the running of the financial and general operations of the group.



Directors must develop a good understanding of the needs and expectations of all elements of the company's shareholder base.

The Board must manage shareholders' expectations and should seek to understand the motivations behind shareholder voting decisions.


The Board believes that maintaining strong relationship with shareholders, both retail and institutional, is crucial in understanding the needs and expectations of shareholders.

Steppe Cement seeks dialogue with analysts and investors to understand their views and assist them in better understanding the cement manufacturing business. The CEO is the main point of contact for shareholders and is primarily responsible for investor relations (supported by the management team). The Board receives regular updates on investor sentiment and feedback through briefings and reports from the management. The CEO conducts meetings with investors throughout the year and investor relations maintain an open channel of communication with shareholders on enquiries via email.

Presentations of full year and interim results and meetings with institutional investors provide a valuable opportunity to liaise with these groups and understand their needs and expectations. Direct engagement with investors is mainly carried out via face-to-face meetings, telephone or videoconferencing, but is also supplemented by other methods of engagement such as attendance at investor roadshows and events.

Over the past few years, the Chairman, CEO, independent Director and the key management team have met or had contact with the significant shareholders including the largest shareholders, analysts and institutional investors to keep them informed of significant developments of the business and report accordingly on the views of these shareholders and important matters raised by them to the Board.

Steppe Cement's annual general meeting (AGM) provides the main forum and opportunity for discussion and interaction between the Board and the shareholders, particularly where matters of voting and major decisions are concerned. The Board encourages the active participation of shareholders at the AGM on important and relevant matters.



Long-term success relies upon good relations with a range of different stakeholder groups both internal (workforce) and external (suppliers, customers, regulators and others). The Board needs to identify the company's stakeholders and understand their needs, interests and expectations.

Where matters that relate to the company's impact on society, the communities within which it operates or the environment have the potential to affect the Company's ability to deliver shareholder value over the medium to long-term, then those matters must be integrated into the company's strategy and business model.

Feedback is an essential part of all control mechanisms. Systems need to be in place to solicit, consider and act on feedback from all stakeholder groups.


Steppe Cement operates factories in Karaganda, Kazakhstan and sells cement in several major cities, in particular Astana and Almaty, in Kazakhstan. In line with its business model providing value in these areas, the Board has identified six stakeholders - shareholders, employees, customers, suppliers, government and regulators and communities in locations in which it operates as vital to the long-term success of the group. The Board recognises the importance of stakeholder engagement and is committed to building long-term value for these stakeholders. The group has in place communication channels to ensure feedback from various stakeholders.

Steppe Cement creates value to its customers by identifying and satisfying their needs. The General Directors are tasked with keeping abreast of market development, maintaining dialogues with customers, conduct meetings, visit customers at their premises and monitoring the quality of the cement sold.

Employees are an important asset and ensuring Steppe Cement has an engaged, productive, safe and effective workforce is essential to the successful delivery of the Group strategy. The Board makes regular visits to the cement factory to obtain feedback from, and views of, the employees. The Board is briefed on the developments of the business through Board presentations during meetings with the management to ensure that these are in line with the Group strategy and business.

The Suppliers are important to the operational success of the cement manufacturing. The Group has arrangements with key suppliers and contractors to ensure steady and continuous supply of raw materials and equipment. The Group recognises the importance of building long-term sustainable relationships with suppliers.

The Group engages with policy makers and regulators to ensure support for a business environment that allows the group to continue to create long-term value. Meetings are organised with local government officials in respect of the process of project approvals and issuing of necessary permits and compliance with environmental regulation.

The Group seeks to understand the problems and needs of communities and collaborates with the local government to ensure that environmental concerns are addressed.



The Board needs to ensure that the Company's risk management framework identifies and addresses all relevant risks in order to execute and deliver strategy; Companies need to consider their extended business, including the Company's supply chain, from key suppliers to end-customer.

Setting strategy includes determining the extent of exposure to the identified risks that the company is able to bear and willing to take (risk tolerance and risk appetite).


The Board recognises the importance of sound risk management practices and internal controls to safeguard shareholder value and the group's assets. The Board acknowledges its responsibility over the group's risk management and internal control system and recognises that effective risk management and internal control form an integral part of good management. The Group has an ongoing process for identifying, assessing, monitoring, managing and mitigating the risks that may affect the Company's ability to achieve its corporate objectives and strategies.

The Audit Committee's function is to evaluate the adequacy and effectiveness of the group's internal control systems, including risk management and compliance. The Audit Committee reviews the audit findings and recommendations to improve any weaknesses or non-compliance and the respective responses from the management, to ensure that all key business risks and internal control weaknesses are being properly and adequately addressed. The Audit Committee also deliberates on internal control issues highlighted by the external auditors during the course of annual statutory audits.



The Board members have a collective responsibility and legal obligation to promote the interests of the company, and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the Chair of the Board.

The Board (and any committees) should be provided with high quality information in a timely manner to facilitate proper assessment of the matters requiring a decision or insight.

The Board should have an appropriate balance between executive and non-executive Directors and should have at least two independent non-executive Directors. Independence is a Board judgement.

The Board should be supported by committees (e.g. audit, remuneration, nomination) that have the necessary skills and knowledge to discharge their duties and responsibilities effectively.

Directors must commit the time necessary to fulfil their roles.


The Board comprises of the Chief Executive Officer, two Independent Non-Executive Directors, including the Chairman and Non Independent Director.

The positions of Chairman and CEO are held by two different individuals. The roles and responsibilities of the Chairman and CEO are separated with a clear division of responsibilities to ensure that there is a balance of power and authority, such that no individual has unfettered decision-making powers.

The Chairman is responsible for leadership and management of the Board and ensures that it operates effectively and fully discharges its responsibilities. The Board has delegated responsibility for the day-to-day management and operations of the Group in accordance with the objectives and strategies established by the Board to the CEO and the management.

The Board has two thirds independent and non-executive Directors, the Chairman and a non-executive Director. The independent non-executive Directors are responsible for providing independent advice and are considered by the Board to be independent of management and free from any business or relationship that would materially interfere with the exercise of independent judgment as a member. No one individual in the Board has unfettered powers of decision making and no Director or group of Directors is able to unduly influence the Board's decision making. This enables the independent Directors to debate and constructively challenge the management on the Group's strategy, financial and operational matters. Their participation as members of the various Board Committees enables them to contribute towards the enhancement of corporate governance and controls of the Group.

The Board has 3 committees to assist it in discharging its responsibilities. The Committees are the Nomination, Audit and Remuneration Committees. The responsibilities of these committees are set out in the respective terms of reference.

Board meetings are planned 4 times per year on a quarterly basis. Agendas are discussed before the meetings to ensure that important agendas are scheduled and there is sufficient time for discussion by the Board, thus allowing the Directors to discharge their duties effectively. This process ensures that the Chairman is comfortable that each Director is able to devote the time and resources required to discharge their duties effectively.

The Board maintains an open communication with each other throughout the year and contact via electronic means and telephone whenever necessary.



The Board must have an appropriate balance of sector, financial and public markets skills and experience, as well as an appropriate balance of personal qualities and capabilities. The Board should understand and challenge its own diversity, including gender balance, as part of its composition.

The Board should not be dominated by one person or a group of people. Strong personal bonds can be important but can also divide a Board.

As Companies evolve, the mix of skills and experience required on the Board will change, and Board composition will need to evolve to reflect this change.


The mix of skills, business and industry experience of the Directors is considered to be appropriate for the proper and efficient functioning of the Board. The Board has delegated the functions of selection and appointment of Directors to the Nomination Committee including the annual review of the structure, size, composition and balance of the Board.

The Board consists of individuals with the appropriate balance of skills, knowledge, experience and personal attributes. The Board brings together extensive domestic and international experience with varied background in business, finance and engineering and a range of technical and operational competencies. This ensures an effective Board and to reflect the nature of the business environment in which Steppe Cement operates.

The Board does not adopt any formal policy on gender balance, ethnicity or age group as Steppe Cement is committed to provide fair and equal opportunity and nurturing diversity of the Board.

The Board and management have strong understanding of the nature of the cement industry in which Steppe Cement operates, and an understanding of the health, safety, environmental and community challenges that it faces to ensure that the long-term interests of the shareholders and other stakeholders are safeguarded.



The Board should regularly review the effectiveness of its performance as a unit, as well as that of its committees and the individual Directors.

The Board performance review may be carried out internally or, ideally, externally facilitated from time to time. The review should identify development or mentoring needs of individual Directors or the wider senior management team.

It is healthy for membership of the Board to be periodically refreshed. Succession planning is a vital task for Boards. No member of the Board should become indispensable.


The Board effectiveness review is conducted internally each year. The Nomination Committee to annually review the effectiveness of the Board and Committees, as well as the performance of each Director.

The evaluation process involves a peer and self-review assessment, where each Director will assess their own performance and that of their fellow Directors, to identify their effectiveness, areas where improvements and focus should be considered. The assessments and comments by all Directors are summarised and discussed at the Nomination Committee meeting which are then reported to the Board.

Board evaluation is performed based on the following major aspects:

  • board composition, committee structures;
  • oversight of strategy and business; and
  • oversight of financial reporting, risk and audit.

Succession planning is used to identify talents for potential future roles and align development to ensure that the group continues to have effective management well into the future. The Nomination Committee works closely with the CEO to ensure that succession plans are in place and periodically reviewed for the Board and management.

The Nomination Committee's functions are described in the Board Committees section of the governance statement.



The Board should embody and promote a corporate culture that is based on sound ethical values and behaviours and use it as an asset and a source of competitive advantage.

The policy set by the Board should be visible in the actions and decisions of the Chief Executive and the rest of the management team. Corporate values should guide the objectives and strategy of the company.

The culture should be visible in every aspect of the business, including recruitment, nominations, training and engagement. The performance and reward system should endorse the desired ethical behaviours across all levels of the company.

The corporate culture should be recognisable throughout the disclosures in the annual report, website and any other statements issued by the company. Succession planning is a vital task for Boards. No member of the Board should become indispensable.


Steppe Cement adopts a Code of Conduct to ensure that the Board, management and employees maintain and enforce the highest standards of ethics and professional conduct in the performance of their duties and responsibilities. The Board, management and all employees of the Group are responsible and committed to adhere to the best practices in corporate governance and observing the highest standards of integrity and behaviour in the interaction with its stakeholders, mainly shareholders, government and regulators, customers and suppliers. This serves to build and drive an organisational culture and continued awareness within the Group to understand, develop and promote ethical values, behaviour and conduct.

All Directors must keep the Board advised, on an ongoing basis, of any interest that could potentially conflict with those of the Group. Where the Board believes that a significant conflict exists for a Director on a board matter, the Director concerned shall abstain from voting decision in that matter. Directors are required to take into consideration any potential conflicts of interest when accepting appointments to other Boards.



The Company should maintain governance structures and processes in line with its corporate culture and appropriate to its:

  • size and complexity; and
  • capacity, appetite and tolerance for risk.

The governance structures should evolve over time in parallel with its objectives, strategy and business model to reflect the development of the Company.


The Chairman regularly reviews the governance structure in ensuring it remains relevant and appropriate over time, whilst supporting the Group's objectives, strategy and business model and ensuring that the Board delivers prudent and effective leadership in order to discharge its duties responsibly and effectively.

The Chairman is responsible for providing leadership to the Board while the day-to-day management of the Group is delegated to the CEO. The CEO is primarily responsible for the Group's business performance and manages the Group in accordance with the strategies and business plan. The independent Non-Executive Directors are responsible for providing independent advice and are considered by the Board to be independent of management and free from any business or relationship that would materially interfere with the exercise of independent judgment as a member.

Matters reserved for the Board are stated in the primary objectives of the Board of Directors section.

The Board has 3 Committees to assist it in discharging its responsibilities. These are the Nomination Committee, Remuneration and Audit Committee. The responsibilities of each Committee are set out in the respective terms of reference.

The Nomination Committee comprises of majority independent non-executive Directors. The functions of the Nomination Committee's function are to review the Board structure, size, composition and the mix of skills and expertise to ensure that these are in line with the Group's strategies and to recommend to the Board the potential candidates for directorship. The selection criteria for selection and recruitment of the potential candidates for directorship shall include qualifications of the individual, experience, knowledge and achievements, credibility and background and ability of the candidates to contribute effectively to the Board and group.

The Remuneration Committee comprises entirely of independent non-executive Directors. The Remuneration Committee's function is to ensure that the broad remuneration policy and practices of the Group reflect the level of responsibilities, performance, relevant legal requirements and high standards of governance. In determining such policy, the Committee shall ensure that remuneration levels are appropriately and competitively set to attract, retain and motivate people of the highest quality.

The Audit Committee comprises entirely of independent non-executive Directors. The functions of the Audit Committee are to monitor and review the adequacy, integrity and compliance of the Group's financial reporting and policies, internal controls system and procedures including risk management, and compliance and the external audit process. The Committee makes the necessary recommendations to the Board to achieve its objectives.

A healthy dialogue should exist between the Board and all of its stakeholders, including shareholders, to enable all interested parties to come to informed decisions about the Company.

In particular, appropriate communication and reporting structures should exist between the Board and all constituent parts of its shareholder base. This will assist:

  • the communication of shareholders' views to the Board; and
  • the shareholders' understanding of the unique circumstances and constraints faced by the company.

It should be clear where these communication practices are described (annual report or website).


The Board recognises the importance of establishing and maintaining good relationship with Steppe Cement's shareholders. The Board is responsible for ensuring satisfactory dialogue with shareholders throughout the year. In order to establish and maintain good relationship with the shareholders of Steppe Cement, the Board meets with major shareholders in order to keep them informed of significant developments and obtain their views and feedbacks.

Steppe Cement recognises the importance of being transparent and accountable to its shareholders and has used various means of communications to enable the Board to continuously communicate and disseminate timely information to shareholders and stakeholders.

The primary means of communication with Steppe Cement's shareholders are the annual report and the interim report which are available on the Company's website.

Steppe Cement communicates with shareholders and stakeholders via the following communication channels: -

  • RNS announcements on AIM;
  • annual and interim reports;
  • circulars;
  • annual general meetings of shareholders;
  • briefings and meetings with investors, analysts and fund managers;
  • website at www.steppecement.com; and
  • email at ir@steppecement.com


Significant changes in key governance matters

There are no significant changes in key governance matters during the year.

Last reviewed on 11 July 2023