The Directors of Futura Medical plc recognise the importance of sound corporate governance and have chosen to apply the Quoted Companies Alliance Corporate Governance Code (the "QCA Code").
Futura Medical has adopted the QCA Corporate Governance Code (the “QCA Code”), which the Board considers to be an appropriate governance framework for a company of our size and stage of development. The Board is responsible for leading and controlling the activities of the Group, setting strategy and overseeing its implementation.
The Board believes that good corporate governance enhances long-term success. We remain responsive to the views of our shareholders and stakeholders as we execute our strategy and pursue sustainable growth.
Our application of the QCA Code is described in this Annual Report and in the Investors section of our website at www.futuramedical.com. The Corporate Governance Report on pages 37 to 41 sets out how the Group has applied each of the ten principles of the QCA Code, with cross-references where appropriate.
Last updated June 26.
Click on the plus icons to view the application of each principle.
Principle 1: Business Model and Strategy
The Board is responsible for establishing the Group’s purpose, strategy and business model to promote long-term value for shareholders, while having regard to the interests of wider stakeholders.
Purpose and long-term objective
The Group’s purpose is to develop and commercialise innovative, clinically proven consumer-focused products for the sexual health market, addressing significant unmet consumer needs.
Its long-term strategic objective is to build a differentiated portfolio of consumer-focused and insight-led sexual health products and maximise shareholder value through disciplined development, regulatory execution and commercial partnering. The strategy is aligned with structural demographic trends, including ageing populations, increasing global prosperity and growing expectations of maintaining a full and active life at all ages. The Board believes these trends support sustained demand growth within the sexual health category.
Business model
The Group operates an innovation-led, partnership-driven model:
- Focusing on research, development, clinical validation and regulatory approval of proprietary products;
- Entering into licensing and distribution partnerships with established consumer healthcare companies that possess the scale and marketing capabilities to maximise commercial potential; and
- Leveraging external commercial expertise while managing capital deployment and operational risk.
Following regulatory approval of Eroxon® in the United States, the European Union and other key territories, the Group executed out-licensing and distribution agreements with commercial partners, who have since launched the product in those markets.
Subject to available financial resources and strategic priorities, the Group may elect to retain greater commercial participation in selected products in order to capture an increased share of long-term value.
Current strategic priorities
During 2025, the Group focused its available resources on the commercialisation and development of:
- Eroxon® – ongoing commercial operations within current markets
- Eroxon® Intense – a range extension designed to meet the needs of men seeking a stronger sensorial action; and
- WSD4000 – a new portfolio in development for female sexual health which currently focuses on a range of topical gels specifically designed to treat impaired sexual response or function (sexual dysfunction) in women.
The Board regularly reviews the product pipeline and capital allocation framework to ensure resources are deployed to programmes offering an appropriate balance of risk and potential return.
Governance and oversight
The full Board meets formally at least six times per year, with additional meetings convened as required. The Board:
- Sets and monitors the Group’s strategic direction;
- Reviews operational and financial performance against agreed objectives;
- Oversees risk management and internal controls; and
- Ensures compliance with applicable legal, regulatory and corporate governance requirements.
During the year, the Board increased the frequency of its meetings to provide enhanced oversight of trading performance, liquidity management and strategic execution. These measures strengthened financial discipline and reinforced focus on commercial and operational priorities.
The Chief Executive Officer, supported by the senior management team, develops strategic proposals for Board approval and is responsible for implementing the agreed strategy and managing the day-to-day operations of the business.
Risk and financial sustainability
The Group operates in a high-risk and heavily regulated sector. The principal risks and uncertainties facing the business are described in the Strategic Report.
A key challenge in executing the Group’s strategy is ensuring that sufficient short-term financial resources are available to support development activities ahead of sustainable revenue generation. The Board therefore places significant emphasis on prudent capital management, disciplined cost control and securing appropriate funding to support long-term value creation.
Principle 2: Corporate culture
The Board recognises that culture is fundamental to the successful delivery of the Group’s strategy and long-term value creation. The Board seeks to promote a culture of integrity, accountability and responsible risk management throughout the organisation. The Group is committed to maintaining high standards of ethical conduct in all aspects of its operations. An open and transparent working environment is encouraged, with regular communication between management and employees regarding performance and strategic priorities. Employees are encouraged to provide feedback and raise matters of concern in an appropriate forum.
The Board monitors culture through regular engagement with the executive team and review of operational and risk reporting. The Board considers that the Group maintains a culture characterised by mutual respect, open dialogue and a strong commitment to advancing its product portfolio and supporting its commercial partners and consumers.
Principle 3: Understanding shareholder needs and expectations
The Group seeks to maintain an open and constructive dialogue with both existing and prospective shareholders in order to communicate its strategy, performance and development priorities, and to understand shareholders’ views and expectations.
Institutional shareholders and analysts are offered the opportunity to meet with management to discuss the Group’s activities and provide feedback. The Board receives regular updates on investor engagement and market sentiment, and considers shareholder feedback as part of its ongoing review of strategy, capital allocation and governance matters.
All shareholders are encouraged to attend and participate in the Group’s Annual General Meeting, which provides an opportunity to ask questions of the Board and engage directly with the Group. The Board values this engagement and takes into account the outcome of shareholder votes when considering future actions.
The Group communicates with shareholders through its Annual and Interim Reports, regulatory announcements, investor presentations and its corporate website, where up-to-date information on the Group’s strategy, governance and business activities is available. Regulatory announcements are released via a Regulatory Information Service to ensure timely and transparent disclosure to the market. The Board is committed to providing clear, fair and balanced information to enable shareholders to assess the Group’s performance and prospects.Principle 4: Stakeholder responsibilities
The Board recognises that the long-term success of the Group depends on maintaining effective relationships with a broad range of stakeholders. In addition to shareholders, key stakeholders include employees, regulators, commercial partners, manufacturers, consumers and healthcare professionals. The Board seeks to ensure that the Group’s operations and working practices appropriately balance the interests of these stakeholder groups, while fulfilling its duty under section 172 of the Companies Act 2006 to promote the success of the Company for the benefit of its members as a whole.
Engagement with stakeholders takes place through regular and ongoing interaction appropriate to each group. Feedback received through these channels is considered by management and, where appropriate, by the Board, and informs decision-making, risk management and the delivery of the Group’s long-term strategy.
Further information regarding stakeholder engagement is set out on pages 23 to 25 of the Annual Report.
Principle 5: Risk management
The Board has overall responsibility for the Group’s risk management framework and system of internal controls. The Audit Committee and the Risk and Oversight Committee (“ROC”) support the Board by overseeing the identification, assessment and management of the Group’s principal risks.
The system of internal control is designed to manage, not eliminate, risk and provides reasonable (but not absolute) assurance against material misstatement or loss. The Audit Committee reviews the effectiveness of the control environment at least annually and reports its conclusions to the Board.
The Risk Oversight Committee (“ROC”) is an internal management committee focused on oversight of operational risk and compliance, including the Group’s Medical Device Quality Management System (“QMS”). During 2025, the ROC monitored QMS compliance and reviewed operational risks arising from commercial activities and clinical programmes. The ROC meets at least annually, and more frequently as required. The Chair of the Audit Committee is a member of the ROC
Given the Group’s current size and stage of development, the Board does not consider a separate internal audit function to be necessary. This position is kept under review.Details of the principal risks and uncertainties, together with mitigating actions, are set out on pages 26 to 30 of the Strategic Report.
Principle 6: A well-functioning Board of Directors
A well-functioning Board of Directors
At the year end the Board comprised of three Executive Directors and two Non-Executive Directors, including the Non-Executive Chairman. The Chairman is responsible for leading the Board, setting its agenda and ensuring its effective operation, including promoting open discussion and constructive challenge.
The Board acknowledges that its current composition of two Non-Executive Directors does not fully align with the Quoted Companies Alliance (“QCA”) Corporate Governance Code recommendation regarding board composition. During the year, however, the Board comprised an independent Non-Executive Chairman and three Non-Executive Directors, one of whom was not considered independent. Following careful consideration, the Group has determined that it is not appropriate to appoint an additional Non-Executive Director at this time, as the current Board structure provides an appropriate balance of skills, experience and independent oversight for the Company’s present stage of development.
The Board will continue to keep its composition under regular review to ensure it remains fit for purpose as the Group evolves and intends to reassess this position during 2026. The Board meets regularly to consider matters reserved to it, including strategy, major investments, financing and governance.
During the year, changes were made to the composition of the Board to ensure that the skills and experience of the Directors remained aligned with the Group’s strategic and operational requirements. Details of Directors who served during the year are set out on page 50.
Attendance at Board and Committee meetings
The Board is accountable to shareholders for the proper management of the Group and meets to set strategy, review performance, and advise on key matters. All major operational and investment decisions are subject to Board approval. In 2025, the Board met formally seven times. During a period of increased operational and financial focus in 2025, informal meeting frequency was increased to ensure appropriate oversight and timely decision-making.
Certain statutory matters, including approval of the full-year results and interim statements, were delegated on an ad hoc basis to subcommittees.Non-Executive Directors’ letters of appointment require them to devote such time as is necessary for the proper performance of their duties, being not less than 25 days per year. Non-Executive Directors are required to consult the Chairman before accepting additional commitments that may affect the time available to fulfil their role. The Board is satisfied that all Directors continue to demonstrate appropriate commitment and effectiveness in the discharge of their responsibilities.
Independence of Directors
The Board considers that its Non-Executive Directors who are serving at the year end are independent in character and judgement and free from any relationship or circumstance that could materially interfere with the exercise of their independent judgement. The Board is satisfied that it meets the QCA Code expectation of having at least two independent Non-Executive Directors.
Non-Executive Directors receive a basic cash fee for their services. In 2025, 25% of Non-Executive Directors’ service fees were satisfied in shares, which the Non-Executive Directors acquired at market rate, with the intention of aligning their interests with those of shareholders. The market rate was determined at the end of 2024, calculated as the average mid-market closing price over the last ten trading days of 2024. The Board considered the size of these share acquisitions and concluded that they were not material, either individually or in aggregate, and therefore did not compromise independence.
No further equity-based fee arrangements are intended in 2026, with remuneration reverting solely to the standard cash fee structure. The Board considers the remuneration of Non-Executive Directors to be proportionate, transparent and consistent with market practice for companies of a comparable size and stage of development.
The Board determines whether Executive Directors may undertake external appointments. Any such appointments are subject to prior approval by the Board and are permitted only where they do not give rise to a conflict of interest and do not adversely affect the Director’s ability to fulfil their duties and responsibilities to the Group.
Principle 7: Governance structures and Board capabilities
The Board considers that the Non-Executive Directors are of sufficient calibre and experience to provide objective oversight and to contribute meaningfully to the commercial, operational and financial development of the Group’s products.
The Board regularly reviews its composition to ensure that it maintains an appropriate balance and breadth of skills and experience to support the delivery of the Group’s long-term strategy. The Board is committed to promoting diversity of skills, experience and gender, recognising the benefits that diversity brings to effective decision-making.
Directors maintain and develop their knowledge through their executive and professional roles and through ongoing training where appropriate. This includes both internally arranged briefings and external courses. During the year, Directors received updates from the Company Secretary on corporate governance developments and regulatory matters.
The Board may engage external advisers where specialist knowledge or additional expertise is required. Professional advisers, including legal and financial advisers, are engaged as appropriate in connection with specific projects and compliance matters. The Nomination and Remuneration Committees also use external recruitment and remuneration advisers where necessary.
The Company Secretary supports the effective functioning of the Board by providing advice on corporate governance and Directors’ duties, ensuring that Board procedures are followed, and confirming compliance with company law and the AIM Rules. The Company Secretary works closely with the Chairman to ensure that Directors receive timely and appropriate information to enable effective decision-making.
The Board has overall responsibility for promoting the success of the Group. The Executive Directors have day-to-day responsibility for the operational management of the Group’s activities. The Non-Executive Directors provide oversight and constructive challenge to the operational management of the Group’s activities and bring independent and objective judgement to Board decisions.
Nomination Committee
The Nomination Committee meets as required and is responsible for reviewing the size, composition and succession planning of the Board, overseeing the appointment or reappointment of Directors and ensuring compliance with relevant corporate governance guidance.
The Committee comprises the Independent Non-Executive Director and the Non-Executive Chairman. The Chief Executive Officer attends by invitation where appropriate.
Principle 8: Evaluation of Board performance
The Board undertakes an annual evaluation of its performance, that of its Committees and individual Directors. The most recent review was completed in April 2026 and comprised peer appraisal, questionnaires and discussions led by the Chairman. The process assessed Board effectiveness, Committee performance and the continued independence of the Non-Executive Directors.
The evaluation considers matters including Board composition, diversity and balance, governance processes, strategic oversight and the quality of information provided to the Board. Individual Directors are assessed against criteria including leadership, strategic contribution, governance, integrity and interpersonal effectiveness.
The performance of the Chairman is evaluated separately and was led by the Senior Independent Non-Executive Director, Roy Davis.
The Chairman conducts the annual performance review of the Chief Executive Officer. The Chief Executive Officer reviews the performance of the Finance Director/Chief Operating Officer and the Head of R&D against agreed corporate objectives.
The April 2026 review concluded that the Board and its Committees operate effectively, with identified enhancement actions focused on continuous improvement rather than structural change. Any areas for enhancement are addressed as part of ongoing Board development.
The Nomination Committee keeps succession planning under review to ensure the Board retains the appropriate balance of skills and experience to support the Group’s long-term strategy.
Principle 9: Remuneration policy
The Board has established a Remuneration Committee, which meets as required and at least annually. The Committee is responsible for determining the remuneration policy for Executive Directors and setting individual remuneration packages within its agreed terms of reference.
The Committee seeks to ensure that remuneration arrangements support the Group’s long-term strategy and promote sustainable value creation for shareholders, while remaining appropriate for the size and stage of development of the business. Executive remuneration is structured to provide an appropriate balance between fixed and performance-related elements, with share-based incentives designed to align the interests of executives with those of shareholders.
The Committee oversees the operation of the Group’s share incentive schemes and sets performance conditions for share-based awards where appropriate.
The Committee comprises the Independent Non-Executive Chairman and is chaired by Roy Davis. The Chief Executive Officer attends by invitation where appropriate but is not present when their own remuneration is discussed.
Details of Directors’ remuneration are set out in the Remuneration Committee Report on pages 43 to 49. The Board considers that those disclosures meet the requirements of the QCA Code and continues to monitor governance developments to ensure reporting remains appropriate.
Principle 10: Shareholder Communication
The Group places a high priority on transparent and effective communication with shareholders and other stakeholders. The Board seeks to ensure that all communications regarding the Group’s strategy, performance and governance are clear, fair and not misleading. The Group’s corporate website provides up-to-date information on its business, strategy, governance framework and financial performance. Shareholders may register to receive alerts when regulatory announcements, investor presentations and other relevant updates are published.
The Group’s Annual and Interim Reports reports are available in the Investors section of the website at www.futuramedical.com. Notices of General Meetings and the results of voting on all resolutions are released via a Regulatory Information Service and made available on the website following the relevant meeting. The Board is committed to maintaining an open dialogue with shareholders and ensuring that governance disclosures evolve in line with regulatory requirements and best practice.