Non-executive Chairman’s introduction “Effective corporate governance is the cornerstone to long-term sustainable success.” Greg Lock Non-Executive Chairman 76 Micro Focus International plc Annual Report and Accounts 2020 Overview During the year ended 31 October 2020, the key developments Dear fellow shareholders, in relation to our corporate governance were principally focused on board composition, the changes to the composition of the This is my first corporate governance section of our Annual report Strategic Report, following my appointment as non-executive Chairman board since the last Annual Report being as follows: on on 14 February 2020. 14 February 2020, Kevin Loosemore stepped down as Executive Chairman and I joined as non-executive Chairman. As mentioned My appointment took place just as the potential impacts of earlier, my appointment as non-executive Chairman means that what would soon be declared a global pandemic – and the far there is now a clear division of responsibilities between the reaching effects this would have on everybody’s lives – were leadership of the board and the executive leadership of the beginning to emerge. Lockdowns were already in place for some Company’s business (as detailed on pages 86 to 88); and on of the locations in which we operate and the UK followed on 16 April 2020, Robert Youngjohns was appointed as a 23 March 2020. This, unfortunately, led to our Annual General non-executive director, with Sander van ‘t Noordende also being Meeting (“AGM”) which took place on 25 March 2020 not being appointed as a non-executive director on 2 June 2020, thus the opportunity to meet with shareholders I had envisaged, a strengthening the blend of skills and experience of our board governance Corporate situation which, regrettably, perisists to this day, with the result of directors. that our 2021 AGM will also be held behind closed doors with no shareholder attendance permitted. There will be an opportunity Karen Slatford continues to play a key role as Senior for shareholders to raise questions, as set out in the Notice of Independent Director. While she has now served for more than Meeting for the AGM. The pandemic also led to the board’s the nine years highlighted by the Code, she is regarded by the difficult decisions to both withdraw the proposed final dividend board as retaining her independence and providing valuable for FY19 and to not pay a FY20 interim dividend. On behalf of the counsel, at least in part informed by her long service as a board, I would like to thank shareholders for their patience during director of the Company. these unprecedented times and am pleased that we are now in a position to propose that a final dividend be paid for FY20. More Finally, as we announced on 8 January 2021, Brian McArthur- Consolidated Consolidated financial statements information on dividend policy can be found in the Chief Muscroft has notified the board of his intention to leave the Executive’s Strategic review on page 17. Company. Brian continues in his role as CFO, whilst the board conducts a formal process to identify a new CFO to help drive This Annual Report marks the first time the Group has reported the Group forward through the second half of our three-year against the requirements of the UK Corporate Governance Code plan and beyond. 2018 (“the Code”). Whilst my appointment as non-executive Chairman does mean we are now compliant with the Code in this respect, the Board recognises that there remains room for improvement in certain areas. The board is reviewing appropriate governance around ESG matters. The board seeks high Greg Lock standards of corporate governance and operates a strong Company financialstatements corporate governance framework with a comprehensive set Non-Executive Chairman of procedures and processes to support and enable this 8 February 2021 governance requirement. Our governance function now sits within the remit of Suzanne Chase, a lawyer who was appointed as Group Company Secretary on 14 June 2020 and also heads up our Assurance function. Suzanne’s appointment signals the board’s recognition of good governance as a key mitigator of risk. Additional information Additional 77 Micro Focus International plc Annual Report and Accounts 2020 Board of directors Greg Lock Stephen Murdoch Brian McArthur- Karen Slatford Richard Atkins Non-executive Chief Executive Officer Muscroft* Senior Independent Independent Chairman Chief Financial Officer Director non-executive director N R A N A N R Chairman since Stephen is our Chief Brian is our Chief Financial Karen is a non-executive Richard is Chairman of February 2020. Executive Officer and Officer and a member of director of Softcat plc, Acora, an IT Services a member of the Micro the Micro Focus board, Chair of AIM-listed Draper outsourcing company Before embarking on his Focus board, positions he positions he has held Esprit plc and a non- and YSC, an international adventures as a PLC has held since 19 March since 21 February 2019. executive director at Leadership Development Chairman Greg enjoyed 2018. Stephen joined Accesso Technology company. He has spent 30 years at the IBM Micro Focus in 2012, first Prior to joining Micro Group plc. Prior to her the majority of his career Corporation. There he serving as General Focus Brian held a variety current responsibilities, within the IT industry. served, inter alia, as Manager of the Product of senior management she held various roles at Previously, he was a assistant to the Chairman, Group and Chief Marketing positions, including the board level since 2001 director at Data Sciences a member of the IBM Officer, responsible for all role of Chief Financial at a range of technology where he led its MBO from Worldwide Management software product and Officer at TeleCity Group companies. Karen began Thorn EMI in 1991 and Council, Governor of the services offerings plc and most recently as her career at ICL before then managed its IBM Academy of development, customer Chief Financial Officer of spending 20 years in successful sale to IBM in Technology and Global services, corporate Paysafe Group plc. Hewlett-Packard, where 1996. His final role at IBM General Manager for marketing and strategy. she headed up worldwide was as General Manager Industrial Sector. In In 2014, he was appointed Also a restructuring sales and marketing. Karen for IBM Global Services that role he had P&L as Chief Operating Officer specialist, Brian was the holds a BA Joint Honours Northern Europe where responsibility for a and Executive Director, Interim CFO on the degree in European he was also a member of $12 billion unit having responsibility for successful turnaround Studies, French and the IBM worldwide senior representing about 15% sales and marketing, of MCI Worldcom EMEA. Spanish from Bath leadership team. Since of the Corporation’s product strategy, University. leaving IBM in 2005 he has revenues. development and He is a non-executive acted as a non-executive management, services director and the senior director for several In his second career he and business operations. independent director at companies including Aon, has been Chairman of Robert Walters plc, where Compel, Message Labs, FTSE-listed companies Prior to Micro Focus, he has been chair of the Global Crossing, Morse Orchestream, Stephen spent seven audit committee since and Easynet. Richard SurfControl, Kofax, UBM, years at Dell, first building 2013. In addition, Brian qualified as a Chartered Computacenter, and Dell’s Global Infrastructure serves as the Responsible Accountant with EY. Deputy Chairman of Consulting Services Officer for Hockerill Informa. organisation, and then Anglo-European College, leading its business in a leading international Greg holds an MA in Europe, Middle East and secondary school in Natural Sciences from Africa. Before Dell, Hertfordshire. Churchill College, Stephen had 17 years’ Cambridge, where he is a experience at IBM, latterly Brian was named as Fellow and member of the serving as Vice President, Business Week’s Finance Development Board. Greg, Communications Sector Director of the Year in both together with his wife, with responsibility for the 2013 and 2017, and the Rosie, have established entire telco, media, and CBI’s FTSE 250 Finance a charitable foundation utilities industry portfolio. Director of the Year in aimed, inter alia, at During his IBM career, 2012. Brian holds a Law supporting education for Stephen held a number degree and qualified as a the less privileged. of Global, EMEA and UK chartered accountant with Through the foundation senior management roles PricewaterhouseCoopers they have endowed Lock with experience spanning in London. Bursaries at Churchill, software and services, aimed at supporting less storage, and enterprise * As announced on 8 January financially advantaged systems. 2021, Brian has notified the state school pupils to board of his intention to leave the Company. pursue STEM subjects. 78 Micro Focus International plc Annual Report and Accounts 2020 Overview Strategic report Strategic Amanda Brown Lawton Fitt Alexander van ‘t Robert Youngjohns Independent Independent Noordende Independent non-executive director non-executive director Independent non-executive director A N R A N R non-executive director A N R N R governance Corporate Amanda is the Chief Lawton is an investment Sander joined the Robert is a board member Human Resources Officer banker and a highly Micro Focus board in June at a small number of at Hiscox Ltd, a FTSE 250 experienced corporate 2020. He has had a 32 growth companies in the business and specialist director. She currently year career in Technology technology sector and an insurer with offices in serves on the boards of and Professional Services operating executive at 14 countries. Ciena Corporation, The at Accenture, where he Marlin Equity Partners. Progressive Corporation was a member of the Robert previously served Amanda has more than and The Carlyle Group, Global Management as Executive Vice 20 years of international and was previously a Committee from 2006 President and General Consolidated financial statements HR experience in a variety non-executive director to 2019.