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S172 Statement

Arval UK Limited

Statement by the Directors in relation to Performance of their Statutory Duties in accordance with Section 172(1) Companies Act 2006

Section 172 of the Companies Act 2006 (“the Act”) requires directors to take into consideration the interests of stakeholders in their decision-making having regard to the matters set out in S172(1)(a)-(f) of the Act.

The directors consider that they have acted in the way that they consider in good faith would be most likely to promote the success of the company for the benefit of its members as a whole, having regard to the matters set out in S172(1)(a)-(f) of the Act in the principal decisions taken by the Board during the year.

 

Corporate governance arrangements

Arval UK is committed to promoting the highest standards of corporate governance, and has practices in place to support the Board in achieving sustainable value, Board effectiveness and, as applicable, to ensure consistency and alignment with the wider Arval Group’s goals.

For the year ending 2019, under The Companies (Miscellaneous Reporting) Regulations 2018, Arval UK applied the Wates Corporate Governance Principles for Large Private Companies (published by the Financial Reporting Council ‘FRC’ in December 2018).

 

Purpose and Leadership

Arval UK’s purpose is to improve people’s lives through personalised and sustainable seamless journeys - mobility solutions, offering convenient, efficient and flexible solutions.

Arval UK’s communication strategy identifies the individuality of each stakeholder, and believes in fostering understanding and trust with an open approach to communication.

 

Values and Culture

Arval UK is committed to diversity, community engagement, social responsibility and environmental sustainability.

Its Code of Conduct sits at the heart of every action and guides all decisions at all levels of the organisation, informing how business is done. Upholding Arval UK’s values is essential for pursuing strategy whilst safeguarding the trust of customers, shareholders and the wider community.

Individual Senior Managers have an important part to play in establishing and embedding the right culture and governance, and to improve the standard of conduct at all levels.Customer experience sits at the heart of Arval UK and its BRAVO Customer Experience training develops and enhances communication skills and customer awareness amongst our employees.

 

Strategy

Arval UK’s strategy is to remain as co-pilot, looking beyond cars, providing mobility solutions within a rapidly changing environment. Arval UK believes car-on-demand is the future of mobility. At the same time environmental sustainability sits at the heart of Arval UK’s strategy and the company is always looking at ways to reduce, reuse and recycle.

Arval UK has adopted a SMaRT methodology to its sustainability ambitions, including current fleet analysis, transition to a greener fleet and alternative mobility solutions. The company is at the forefront of diverse vehicles technologies, is part of The Hydrogen Hub and has saved over 110 tonnes of CO2 in 2019 through operational and fleet policy changes. Arval UK is committed to helping its customers limit their environmental impact and supporting them with their energy transition to electrified vehicles by offering alternative sustainable mobility solutions and products such as Arval Active Link which monitor fuel efficiency and co2 emissions.

 

Board Composition

The Board is committed to boardroom diversity and ensuring it has the appropriate balance of skills, experience, independence and knowledge of the company to enable directors to discharge their respective duties and responsibilities effectively.

Both appointments and succession plans are based on merit and objective criteria promoting diversity of gender, social and ethnic backgrounds as well as cognitive and personal strengths. The Board assesses the suitability of its composition on an annual basis, in light of its underlying activities and by use of a skills matrix, in accordance with BNP Paribas Group’s Suitability Policy. The Board has recently been through composition changes to improve its diversity of skills, backgrounds, experience and knowledge. The Arval Group in the UK has enhanced its Corporate Governance Framework to support the Board in achieving sustainability and effectiveness.

The Board comprises of diverse skills, external and international experience and a strong knowledge of the business. Identified gaps in specific knowledge are closed off by advisors the Board can consult with. Whilst the diversity has improved, there is a need for greater gender and ethnic diversity and strategies are in place to combat this, including a newly formed Talent Committee and Rise Programme. All directors are subject to the requirements of the Senior Managers Regime, including the conduct rules and must satisfy requirements relating to their fitness and propriety.

All directors are provided with periodic training both collectively and individually. Arval UK is enhancing its Director induction and training programme to assist the directors in having a detailed understanding of their duties and responsibilities as well as the governance arrangements.

In 2019 an internal Board evaluation was conducted on behalf of the Chair. It concluded the Board, although in its infancy, was effective and could benefit from improvements to its governance framework, diversity and Director training. Many of the recommendations set out in the report have been put in place.

 

Directors Responsibilities

The Board aligns the company’s values, standards, strategic aims and appetite to risk with the BNP Paribas Group (“Group”) after ensuring they are in Arval UK’s interest. The directors act in good faith, in what they honestly believe to be the best interests of the Company, and not for any collateral purpose. directors will both individually and collectively consult with and challenge the wider Arval Group on alignment issues.

The Board convenes for at least three Board meetings per year, has additional meetings as required, quarterly business review meetings and annual offsite meetings. Arval UK does not have Board Committees. The Managing Director is delegated responsibility for the day to day operation and general management of Arval UK and chairs the Senior Managers Committee (“SMC”) and Executive Committee (“Exec”). The Managing Director communicates the strategic objectives and values to the company. The SMC and Exec escalate matters to the Board in accordance with their Terms of Reference.

Throughout 2019 the Board received regular reports and information from the business both in and outside Board Meetings. This information includes regulatory changes, current risks and opportunities, financial performance, operational issues and market conditions.

 

Remuneration

Arval’s directors are not remunerated for their role on the Board.

 

Opportunity and Risk

Arval UK contributes regularly to the wider Arval Group’s Strategic Plan, the current plan, “Arval Beyond”, spans the period 2020 to 2024. A comprehensive set of annual plans are prepared by Arval UK covering the three main operational areas - Sales, Operations and Remarketing. These plans are discussed and agreed with the wider Arval Group and constitute the base of the global budget approved by the Board. Throughout the year Arval UK takes a balanced approach to opportunity and risk, and both are presented to the Board at each Board Meeting.

A recent focus on adjustments has re-defined Arval UK’s approach to risk appetite. Key Performance Indicators are set against different business areas and this appetite is monitored with a justification and action plan. Risk controls and checks are increasingly aligned with corporate policy, adopting the same methodology to underlying asset risk.

 

Stakeholder Relationships and Engagement

The Board is committed to social responsibility and environmental sustainability. It also believes in fostering open and strong relationships with its ultimate parent company, shareholders, subsidiaries, customers, suppliers and local communicates.

The Board is actively engaged with ensuring customers stay connected. It regularly holds Customer Forums and has, together with the members of the Exec, promoted connection with its customers through a digital ecosystem of platforms such as My Arval for clients, Arval Active Link, Service Delivery and My Arval for drivers.

Throughout the year Arval UK runs its Net Promoter programme which generates a Net Promotor Score (“NPS”) from its customers. The programme gives Arval UK an insight into progress, improvements and systemic issues from the customer’s perspective. Account managers speak directly to its customers about the findings, irrespective of the outcome and Arval UK generates an action plan based on the NPS and feedback. Arval UK has seen an incremental increase in the NPS over the years the programme has been run.

Arval UK is fully committed to working together with suppliers to ensure it delivers Corporate Social Responsibility in a meaningful way. Arval UK does this by consistently engaging with suppliers and developing action plans to maintain and enhance the delivery of environmental, sustainable and socially aware products and services both now and into the future. Arval UK is passionate about road safety; the company sponsors the Global Fleet Champion programme and has educated over 14,000 school children in road safety. The company also runs programmes such as Arval Inspires, which aims to develop business skills in students from local schools. As part of BNP Paribas, Arval UK supports the United Nation’s 17 Sustainable Development Goals.

 


 

ARVAL UK GROUP LIMITED

 

Statement by the Directors in relation to performance of their statutory duties in accordance with Section 172(1) Companies Act 2006

The following section sets out how the directors have engaged with the company’s stakeholders during the year. In the companies provision of management services to the Arval UK group and in their decision-making, the directors have regard to the impact on its key stakeholders; parent company, subsidiaries, employees and suppliers, as well as Corporate Social Responsibility (“CSR”) and environmental sustainability. For the year ending 2019, under The Companies (Miscellaneous Reporting) Regulations 2018, the company applied the Wates Corporate Governance Principles for Large Private Companies (published by the Financial Reporting Council ‘FRC’ in December 2018). Arval UK Group’s Code of Conduct sits at the heart of every action and guides all decisions at all levels of the organisation. It informs how business is done, how work is performed and how people are cared for. Upholding the company’s values is essential for pursuing strategy while safeguarding the trust of customers, employees, shareholders and the wider community. The company’s individual directors and senior managers have an important part to play in establishing and embedding the right culture and governance, and to improve the standard of conduct at all levels.

The Board aligns the company’s values, standards, strategic aims and appetite to risk with those of the BNP Paribas Group, after ensuring they are in the company’s best interest. Directors will both individually and collectively consult with and challenge the wider Arval Group on alignment issues.

The Board has recently been through composition changes to improve its diversity of skills, backgrounds, experience and knowledge. The Arval Group in the UK has enhanced its Corporate Governance Framework to support the Board in achieving sustainable and effectiveness.

In 2019 an internal Board evaluation was conducted on behalf of the Chair. It concluded the Board, although in its infancy, was effective and could benefit from improvements to its governance framework, diversity and director training. Many of the recommendations set out in the report have been put in place.

Throughout 2019 the Board received regular reports and information from the business on which decisions were made. This information includes regulatory changes, current risks and opportunities, financial performance, operational issues, market conditions, employee engagement and the impact on CSR.

A comprehensive set of annual plans are prepared, discussed and agreed with the wider Arval Group and constitute the base of the global budget approved by the Board. Throughout the year the company takes a balanced approach to opportunity and risk, and both are presented to the Board at each Board Meeting. A recent focus on adjustments has re-defined the approach to risk appetite. Risk controls and checks are increasingly aligned with the wider Group corporate policy, adopting the same methodology to underlying asset risk.

 

Employee Engagement Statement

Arval UK Group is committed to diversity and open engagement. It is people-orientated and cares about the individual success and well-being of each of its employees, known at Arval UK Group as Journey Makers. There are workplace policies in place setting behavioural expectations and providing guidance on its procedures for raising concerns about misconduct and unethical practices.

Its open approach to communication with its employees means internal communications are routinely sent out through the week and during demanding times to ensure its journey makers are well informed and kept up to date. Communications include financial information and economic factors affecting the performance of the company on a regular basis.

In support of Arval UK Group’s gender pay and diversity strategies, Arval UK Group has several programmes running, including a rising talent programme, as well as programmes for mental health, parents and carers. Arval UK Group also recently consulted with a specialist to ensure it is meeting the needs of its employees.

Arval UK Group has two newly formed groups: One Arval Academy, responsible for employee feedback, training, mobility and career paths; and, a talent committee, looking at the future of Arval UK Group’s work as its organisational profiles shift and change.

BNP Paribas Group conducts an annual Global People Survey (“GPS”) which produces a Net Promotor Score to monitor and continuously improve on employee engagement, and from which priority actions are derived so that improvements can be made. The results of the surveys are reported to the Board and it uses the results to understand the Company’s workforce and to develop new initiatives, benefits and development programmes

The group policy for the employment of disabled persons is that full consideration is given to their applications and candidates are offered employment on the basis of their ability and aptitude. In the event of an individual becoming disabled whilst in employment, every effort is made to ensure that such employment is continued and where necessary appropriate retraining is provided. The training, career development and promotion opportunities for disabled persons are the same as those for other employees.

 

Stakeholder Relationships and Engagement

The Board is committed to social responsibility and environmental sustainability. It also believes in fostering open and strong relationships with its ultimate parent company, shareholders, subsidiaries, customers, suppliers and local communicates.

The Board is actively engaged with ensuring customers stay connected. It regularly holds Customer Forums and has, together with the members of the Exec, promoted connection with its customers through a digital ecosystem of platforms such as My Arval for clients, Arval Active Link, Service Delivery and My Arval for drivers.

Throughout the year Arval UK runs its Net Promoter programme which generates a Net Promotor Score (“NPS”) from its customers. The programme gives Arval UK an insight into progress, improvements and systemic issues from the customer’s perspective. Account managers speak directly to its customers about the findings, irrespective of the outcome and Arval UK generates an action plan based on the NPS and feedback. Arval UK has seen an incremental increase in the NPS over the years the programme has been run.

Arval UK is fully committed to working together with suppliers to ensure it delivers Corporate Social Responsibility in a meaningful way. Arval UK does this by consistently engaging with suppliers and developing action plans to maintain and enhance the delivery of environmental, sustainable and socially aware products and services both now and into the future.

Arval UK is passionate about road safety; the company sponsors the Global Fleet Champion programme and has educated over 14,000 schoolchildren in road safety. The company also runs programmes such as Arval Inspires, which aims to develop business skills in students from local schools. As part of BNP Paribas, Arval UK supports the United Nation’s 17 Sustainable Development Goals.