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Cabinet received report ES/1267 by the Leader of the Council, which sought the approval to enter into a shareholder agreement with the Council's companies, create a Shareholder Reference Group (SRG) as a committee of Cabinet to undertake the Council's functions as shareholder/owner and to appoint Cabinet Members to the SRG.
The report, introduced by the Leader, set out that East Suffolk Services Limited (ESSL) had been incorporated to deliver Council services currently undertaken by East Suffolk Norse from July 2023. Councillor Gallant noted that ESS had been incorporated within the group structure East Suffolk Holdings Limited (ESHL), which contained three dormant companies - East Suffolk Property Investments Limited, East Suffolk Property Developments Limited, and East Suffolk Construction Services Limited.
The Leader explained that to provide the necessary control and governance for the Council's group companies it was proposed that a Shareholder Agreement be entered into and the SRG be established, which would be a committee of the Cabinet and have some delegated decision-making responsibilities for the group companies. Cabinet was advised that some matters would be reserved to Cabinet and Full Council, along with some rights that would be reserved to the companies themselves.
It was also proposed that the Leader of the Council and the Cabinet Members with responsibility for Economic Development, Resources, the Environment, and Customer Experience, ICT and Commercial Partnerships be appointed to the SRG each for a term of four years.
The Leader advised that he would be tabling a sixth recommendation, not in the published report, to delegate authority to the Head of Legal and Democratic Services, in consultation himself, to draft Terms of Reference for the SRG for incorporation into East Suffolk Council’s Constitution.
There being no questions or comments, it was on the proposition of Councillor Gallant, seconded by Councillor Cook, and by a unanimous vote
RESOLVED
1. That the entering into of the Shareholder Agreement and any associated “deeds of adherence” which commit group companies to the obligations set out in the shareholder agreement be approved.
2. That the establishment of a committee of Cabinet, to be known as the Shareholder Reference Group, be approved to undertake the functions of the Council as shareholder/ultimate owner of its group of companies and exercise the Council’s rights under the Articles of each company and under the Shareholder Agreement, with the exception of any rights which the Cabinet or Leader reserves to itself/himself from time to time or which can only be exercised by Full Council.
3. That the approval of the Consolidated Business Case, which is to be produced by the Council’s Holding Company on an annual basis, be reserved to the Cabinet (this will accordingly be a matter which is not within the delegated authority of the SRG).
4. That the appointment of the Leader of the Council along with the Cabinet Members with responsibility for Economic Development, Resources, The Environment and Customer Experience, ICT and Commercial Partnerships to act as members of the Shareholder Reference Group be approved, each for a term of 4 years (provided that where an individual Member ceases to hold the relevant role during the allotted term, their replacement in that role or such role as the Leader may identify as its replacement shall also take over the role of Member of the Shareholder Reference Group for the remainder of the term or such other term as the Leader may specify).
5. That on the appointment of the Members whose roles are identified above, the Shareholder Reference Group be hereby established on 6 September 2022 and the terms of office for the Members referred to in the second resolution above shall also commence on the same date.
6. That the Head of Legal and Democratic Services, in consultation with the Leader of the Council, be given the delegated authority to draft Terms of Reference for the Shareholder Reference Group (SRG) for incorporating into East Suffolk Council’s Constitution, including a quorum of three for meetings of the SRG which must include the Leader of the Council (or the Deputy Leader of the Council in the absence of the Leader), the appointment of a Shareholder Representative from the members of the SRG and the inclusion of such other provisions as will enable the SRG to provide strategic oversight of the Council’s companies and support the development of those companies.