Proposed changes to Sedex Governance

Sedex is currently working to adapt the way we are governed as an organisation. We are proposing to change the composition of the Sedex Board and enable all members to have equal voting rights at Board elections. This will not have any impact on your Sedex membership package or services that you use, and will support Sedex to better meet the needs of our members. This page explains the changes we are proposing and the process for agreeing these changes with our membership.

 

Benefits of the changes 

At the moment, not all members have equal voting rights at Sedex Board elections, and members are limited to only voting for 3 Member Directors in their own membership category. We would like to enable all members to have equal voting rights, that allows one vote for each member, and removes the hierarchy of the three membership categories of Buyer, Buyer/Supplier and Supplier membershipThis will not change your membership fees or the products and services you access in your membership package.  

Under the proposed changes, the new Board will consist of 5 Member Director roles, 5 Independent Directors, and 2 Executive Directors (CEO and CFO). Members will be able to vote for any of 5 Member Director roles at Board elections.  

The new Board composition will increase the variety of skills relevant to Sedex’s strategic priorities, encourage diversity, enable a robust and fair, enhanced Grievance Process, and will ultimately support a fair voting process for Member Director elections. 

Making these changes will require us to amend our Articles of Association, which provides the legal framework for how to operate and run the Sedex organisation. Making changes to our Articles will align us more closely with the UK Corporate Governance Code, which establishes a fair and transparent set of principles for all businesses to operate within. 

Below are more detailed Frequently Asked Questions (FAQ) about these changes. You can read the proposed changes in a copy of the Sedex Articles of Association in clean and mark-up format.

 

Notice of Extraordinary General Meeting

Sedex will be holding an Extraordinary General Meeting (EGM) on Monday 7th December at 3.30pm GMT, where we will be seeking member approval to update our Articles of Association, which set out Sedex’s governance. You can view the notice for the EGM here. We would like to invite all Sedex members to attend in person, or to appoint the Chairperson to vote on your behalf as your proxy, at the EGM. In accordance with the existing articles, only Buyers (A) and Buyer/Supplier (AB) members have the right to vote at this meeting. Supplier (B) members can attend but cannot vote.

In November 2020, Sedex held 3 class consent meetings – one for each of its categories of member: Buyer, Buyer/Supplier and Supplier. All 3 class consent meetings (required to approve the changes outlined above) were passed by more than a 75% majority vote of those attending, on 12th November, as required as a matter of UK company law.

During the meeting, the Chair and the Sedex CEO will outline the proposed changes to the Articles to Sedex members and you will have an opportunity to ask questions on the day. A quorum of at least 10 members joining the meeting virtually, on 7th December, must be met for a vote to take place including at least one Buyer and one Buyer/Supplier member.  The vote will take place electronically by means of a poll vote.

The purpose of holding the EGM is for the members to approve by Special Resolution the amendments to the Articles of Association proposed by the Sedex Board of Directors. A successful resolution to adopt these changes will require at least 75% of the votes cast, by both those joining the meeting virtually and voting and those voting by proxy, to be in favour.

 

Frequently Asked Questions 

Why is Sedex making these changes? 

Sedex would like to enable all members to have equal voting rights; this allows one vote for each member and remove the hierarchy of the three membership categories of Buyer, Buyer/Supplier and Supplier membershipThis will not change your membership fees or the products and services you access in your membership package. 

This will increase the variety of skills relevant to Sedex’s strategic priorities, encourage diversity, enable a robust and fair, enhanced Grievance Process, and will ultimately support a fair voting process for Member Director elections. 

The changes will also ensure that our Articles of Association align us more closely with the UK Corporate Governance Code, which establishes a fair and transparent set of rules for all businesses to operate within.  

What are Articles of Association?  

Article of Association are the legal document that provides the legal framework for how to operate and run the Sedex organisation.  

How will these changes affect the Sedex Board?   

The new Sedex Board will include 5 Member elected Directors from the whole Sedex membership; 5 Independent Directors and 2 Executive Directors (the CFO and CEO) remains the same. This will create a fair and balanced Board and increase the diversity and skills that drive Sedex’s strategic vision.  

Why is Sedex holding Class Consent meetings?  

The Class Consent meetings are required to consult on changes relevant to a particular membership category or “class”. These meetings are required for any changes to the Articles. At current Board elections, members are limited to only voting for Member Directors in their own membership package category and appoint 3 directors to the Board. The changes are seeking to enable all members to have the right to vote to appoint any of 5 Member Director roles to the Board. 

What are the benefits of these changes?

The changes will give all Sedex members equal voting rights at Board elections, regardless of which category you come from and enable all members to appoint any of the 5 Member Directors to the Board. Increasing the number of independent directors will increase the variety of skills relevant to Sedex’s strategic priorities, encourage diversity, enable a robust and fair, enhanced Grievance Process and remove the hierarchy of membership. 

Why is Sedex aligning with the UK Code if we are a global business?  

Sedex’s head office is located and registered in the UK, and we must therefore operate within the local laws that apply here.  

 

How will these changes affect my membership category and commercial package?  

These changes will not have any impact on your Sedex membership package or the tools and services that you can use on a daily basis. The changes will provide all members with the ability to have one equal vote each at Board elections.  

 

 

What will happen to the names Buyer (A), Buyer/Supplier (AB), Supplier (B)? 

The names Buyer (A), Buyer/Supplier (AB), Supplier (B) will continue to be used throughout all Sedex tools and the platform and will indicate the annual package that you have paid for, to access Sedex membership.  

I am concerned these changes will create additional work for my company – what do I need to do? 

You do not need to do anything. We encourage members to participate in the Class Consent Meeting and vote if you wish, however these changes will not have any impact on your current Sedex membership package, and you can continue to interact with the Sedex platform as usual.  

Will this cause any changes to the Sedex platform or Sedex tools? 

No, the platform and tools will remain exactly as they are.  

When will the changes come into effect?  

Once we hold the Class Consent meetings in November, an Extraordinary General Meeting (EGM) will be required to be held, which will take place on 7th December 2020. All members will be invited to attend the EGM to ratify the changes to the Articles, but under the existing Articles, only Buyers (A) and Buyer/Suppliers (AB) members can vote. This is why we are seeking to change the Articles – to enable an equal vote for all members in future.  

How do I know who the authorised voter is at my company? 

The authorised voter for your membership is the main contact for Sedex within your business.  

How can I feedback on the changes?  

You can read through the proposed changes to the Articles here and register to attend a Class Consent meeting on Thursday 5th November to ask questions.  

I am interested in applying to run as a Member Director for the Board. What is the process for this? 

We will provide more information about Board elections and Member Director eligibility criteria in January 2021, once the governance changes are approved.  

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