Caspian Sunrise is a Kazakhstan based natural resources Company established in 2006 whose shares have been listed on AIM since 2007.
Caspian Sunrise owns and operates three oilfields in Western Kazakhstan, trades the oil it produces, provides on shore and offshore oilfield services, and is in the process of acquiring significant mineral assets.
This section of the website contains information on Caspian’s financial and operational performance, providing up-to-date information of value to an analyst, shareholder or potential investor.
Oil and gas exploration and production is a long-term activity requiring effective environmental stewardship. We have operated in Kazakhstan now for more than 18 years and have only been able to do so by complying with applicable environmental standards.
The Group’s overriding corporate objective is to build a successful commercial enterprise. In this the board regards an effective governance structure to be a useful tool rather than being an objective in its own right.
Governance starts with the board where we believe competence and integrity are the key attributes.
In recent times and largely as the result of limited funding and the desire to deploy as much of our available cash as possible in protecting and developing our assets our adherence to the highest accepted standards of corporate governance has been patchy.
As we move into the next phase of the Group’s development with significantly more funding expected we are looking to improve our governance performance, however, the on-going reality is that:
We fully accept that good governance goes hand in hand with a successful company, but what is good governance?
We believe it essentially boils down to having a board that is competent, trustworthy and motivated to act in the interests of all shareholders.
Under the prevailing regulations we are required to document how we comply with one of the two governance regimes in operation. In common with the vast majority of AIM quoted companies the Group has elected to follow the QCA governance code and below we set out how we comply and how and why, where appropriate, we do not”.
The Group has adopted and operates a share dealing code for Directors and employees in accordance with the AIM Rules.
The Board acknowledges responsibility for maintaining appropriate internal control systems and procedures to safeguard the shareholders’ investments and the assets, employees and the business of the Group. The Board also intends to periodically review the Group’s financial controls and operating procedures.
The Board does not consider it appropriate for the current size of the Group to establish an internal audit function. However, this will be kept under review.
The Company is committed to acting ethically, fairly and with integrity in all its endeavours and compliance with legislation is monitored. The principal terms of the UK Bribery Act have been translated into Russian and circulated to our Kazakh based staff. Consideration of the Bribery Act is a standing item at board meetings.
Our culture might best be described as one where we strive for commercial success while treating others fairly and with respect. Accordingly, in dealing with each of the Groups principal stakeholders, we encourage our staff to operate in an honest and respectful manner. We also believe in getting proper value for money spent and believe this goes hand in hand with being a low-cost operator.
Kazakhstan plays an important part in the Group’s culture. It is where we operate; where almost all staff are based; it is the nationality of most staff and most of its shareholders.
The Group is committed to promoting a culture based on ethical values and behaviours across the business. Policies are in place covering key matters such as equality, protection of sensitive information, conflicts of interest, whistleblowing and health and safety as well as environmental concerns.
The board has three committees, the audit committee, the remuneration committee and the governance committee. However, as the board currently includes only one non-executive director, who is not deemed independent, the operation of the board committees has been suspended until further appointments to the board are made. In the meantime the full board will undertake the work of the committees.
The Governance Committee comprises Clive Carver, Seokwoo Shin with Clive Carver acting as chairman. The committee intends to meet at least once a year to review the Group’s governance procedures compared to accepted industry best practice.
At the appropriate time the Board plans to include a formal risk register including all the principal operational and non-operational risks to the business to be considered by the Governance Committee.
The Audit Committee, which comprises Clive Carver and Seokwoo Shin, with Clive Carver being the acting chairman, determines and examines any matters relating to the financial affairs of the Group including the terms of engagement of the Group’s auditors and, in consultation with the auditors, the scope of the audit.
The Audit Committee is responsible for monitoring the integrity of the Company’s financial statements, reviewing significant financial reporting issues, reviewing the effectiveness of the Group’s internal control and risk management systems.
The Remuneration Committee comprises Seokwoo Shin and Clive Carver and is chaired by Aibek Oraziman.
The Group’s and the Company’s policy is to provide remuneration packages that will attract, retain and motivate its executive Directors and senior management. This consists of a basic salary, ancillary benefits and other performance-related remuneration appropriate to their individual responsibilities and having regard to the remuneration levels of comparable posts.
The Remuneration Committee determines the contract term, basic salary, and other remuneration for the members of the Board and the senior management team.
The board comprise three executive directors and one non executive director
The Board consists of four directors, one of which is a non executive director. The Group holds at least four Board meetings each year, at which time financial and other reports are considered and, where appropriate, voted on.
Caspian Sunrise, in line with most AIM companies, elected to apply the rules of the Quoted Companies Alliance (QCA) Corporate Governance Code (“QCA Code”), which is based around 10 broad principles.
The QCA has introduced an updated code which for Caspian Sunrise takes effect in these financial statements.
Caspian Sunrise’s objective is to create shareholder value from the development of oil & gas and mineral projects and associated activities.
The Group has several secondary objectives, including promoting the highest level of health and safety standards, developing our staff to their highest potential and being a good corporate citizen in our chosen countries of operations.
The Group’s long-term strategy is to build shareholder value by assembling an attractive portfolio of oil & gas and mineral exploration and production assets in Central Asia, and more particularly in Kazakhstan where the board has the greatest experience. The Group is also exploiting associated opportunities, such as oilfield services and commodity trading, and mineral exploration and production where the board believes it can add significant value and contribute towards the success of the Group as a whole.
Our business model is to invest in and develop promising oil & gas, mineral and other projects. Success in the long term will be measured by a sustainable appreciation in the Group’s profitability and in well-functioning stock markets the Company’s share price.
Our culture can best be described as one where we strive for commercial success while treating others fairly and with respect. The board firmly believes that sustained success will best be achieved by following this simple philosophy.
Accordingly, in dealing with each of the Company’s principal stakeholders, we encourage our staff to operate in an honest and respectful manner.
The Company communicates with its shareholders via RNS announcements, its website, formal company meetings and periodic investor presentations.
The Company is clear that the objective of the shareholder group is for the Company to successfully develop its assets, which should result in a sustainable increase in the Company’s valuation.
In addition to our shareholders the Company regards its employees and their families, local and national government, suppliers and customers to form the core of the wider stakeholder group.
Almost all staff employed by the Group are based in Kazakhstan. The Group draws most of the workers at its oilfields from the Mangistau region where alternative employment opportunities are limited.
The Group enjoys good relations with its employees as evidence by a numerous long-standing employee relationships.
Oil & gas and mineral exploration and production are dangerous activities and as such are necessarily subject to an extreme health and safety regime. Risk assessment and evaluation is an essential part of the Company’s planning and an important aspect of the Company’s internal control system.
It is planned to introduce a formal risk register, including all the principal operational and non-operational risks to the business. Such a risk register would be reviewed and assessed at least once a year by the Audit Committee.
The board currently comprises three executive directors and one non-executive director. All are male with three Kazakh nationals one South Korean one Swedish citizen and one from the United Kingdom. Ages range from 40 to 67. The board contains deep commercial, operational, technical, financial and legal expertise.
The number of board meetings attended each year by the directors is set out in the Directors’ report which forms part of the Annual Report and Financial Statements.
The board also has a list of standing items, including compliance with the UK Bribery Act, litigation, and existence of open and closed periods for director dealings, which are considered at each meeting.
The Audit Committee typically meets before each set of results (interim and final) are published and the Remuneration Committee typically meets at least once a year, when the Financial Statements for the full year results are approved. All Committee members attend these meetings.
Our Report and Accounts contain reports from the Chairman of the Remuneration. and the Audit Committees.
The appropriateness of the Company’s governance structures will be reviewed annually considering further developments of accepted best practice and the development of the Company.
Operational skills are maintained and developed through active day to day interactional with leading international consultancies and contractors.
Non-operational skills are maintained and developed principally through board members interactions with professional advisers plus the experience of sitting on other boards.
Directors receive a base salary and have the opportunity for annual bonuses. Additionally, on a case-by-case basis Directors are awarded share options and membership of long-term incentive plans where any rewards are aligned to the returns to shareholders generally.
No annual bonuses have been paid since the Group’s formation in 2006.
From 2020 the executive directors have accepted significant pay reductions to assist the Group while short of development funding.
The Company reports formally to its shareholders and the market twice each year with the release of its interim and full year results.
The Annual Report and Financial Statements set out how the corporate governance of the Company has been applied in the period under review including the work undertaken by the Audit Committee and the Remuneration Committee.
The Annual Report and Financial Statements contain full details of the principal events of the relevant period together with an assessment of current trading and prospects. They are sent to shareholders and made available on the Company’s website to anyone who wishes to review them.
The Board discloses the result of general meetings by way of RNS announcements, disclosing the voting numbers. The Company’s website also contains all the information prescribed under the AIM Rules.
The Company does not typically engage in selective conversations with shareholders to avoid the risk of disclosing information on a selective basis, which is against the rules.
Employee stakeholders are regularly updated with the development of the Company and its performance.
We are in almost constant communication with our Governmental and regulatory stakeholders via their involvement in our day-to day operational activities.
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