The Board is committed to principles of best practice in corporate governance. The Board has relied on the ASX Corporate Governance Council’s Revised Corporate Governance Principles and Recommendations in formulating its corporate governance policies and practices.
Principle 1 - Lay solid foundations for management and oversight
The Board and management have agreed on their respective roles and responsibilities and the functions reserved to the Board and management. The Board is currently documenting this agreement and may prepare a Board Charter for this purpose. The Board has established a Nomination and Remuneration Committee which, among other functions, will evaluate the performance of senior executives.
Principle 2 - Structure the Board to add value
The Board ultimately takes responsibility for corporate governance, and will be accountable to the shareholders for the performance of the Company. The function and responsibilities of the Board are set out in the Company's Constitution and the Corporations Act. These include:
(a) one third of the Board retiring and being subject to election at the next Annual General Meeting (AGM) of the Company;
(b) the Directors being initially appointed by the Board are then subject to election by Shareholders at the next AGM of the Company;
(c) the Board is to be comprised of a majority of independent Directors;
(d) the Board is at all times to be comprised of at least two independent Australian Directors;
(e) the Chair of the Board is to be elected by the Board and the performances of the Directors are to be reviewed on an ongoing basis;
(f) the Directors have the right, in connection with their duties and responsibilities as Directors, to seek independent professional advice at the Company's expense with the prior approval of the Chairman which will not be unreasonably withheld;
(g) the Directors have the right, in connection with their duties and responsibilities as Directors, to delegate any of their powers and discretions to committees responsible to the Board,
(h) an Audit and Risk Committee is to be established;
(i) a Nomination and Remuneration Committee is to be established;
(j) the Board must approve the strategic direction and related objectives of the Company and monitor management performance in the achievement of these objectives;
(k) the Board must adopt budgets and monitor the financial performance of the Company;
(l) the Board must ensure that all major business risks are identified and effectively managed;
(m) the Board is responsible for ensuring that the Company meets its legal and statutory obligations;
(n) the Board is responsible for establishing and maintaining adequate internal control procedures and effective monitoring systems. Compliance with these procedures is to be regularly monitored; and
(o) the Board must schedule meetings on a regular basis (not less than 10 each year) and other meetings as and when required.
The Board has resolved, given the size of the Board and the Company, that it is not appropriate to disclose the process for performance evaluation of the Board, its committees, individual Directors and key executives. Rather than a formal review procedure, the Board has adopted a self evaluation process to measure its own performance which is to be overseen by the Nomination and Remuneration Committee.
Principle 3 - Promote ethical and responsible decision making
All Directors, managers and employees are expected to act with the utmost integrity and objectivity, striving at all times to enhance the reputation and performance of the Company. The Board is currently establishing a code of conduct to guide the Directors, the Managing Director and other key executives. The Company's share trading policies are set out below.
Principle 4 - Safeguard integrity in financial reporting
The Directors require the Managing Director and any chief financial officer (or equivalent) to state in writing to the Board that the Company's financial reports present a true and fair view, in all material respects, of the Company's financial condition and operational results and are in accordance with relevant accounting standards. The Board has established an Audit and Risk Committee.
Principle 5 - Make timely and balanced disclosure
The Directors are committed to keeping the market fully informed of material developments to ensure compliance with the ASX Listing Rules and the Corporations Act.
At each Board meeting consideration is given as to whether any matters should be disclosed under the Company's disclosure policy.
The Board has appointed a Company Secretary in Australia and has required the Company Secretary to establish and maintain adequate disclosure procedures and effective monitoring systems to ensure timely and appropriate disclosure to the market.
The Company Secretary will act as the primary ASX liaison officer will ensure timely and appropriate access to information for all investors. The Directors are establishing written policies and procedures to ensure compliance with the disclosure requirements of the ASX Listing Rules and to ensure accountability at a senior management level.
Principle 6 - Respect the rights of Shareholders
The Directors intend to establish a communications strategy to promote effective communication with shareholders and encourage effective participation at general meetings. As well as ensuring timely and appropriate access to information for all investors via announcements to ASX, the Company will ensure that all relevant documents are released on the Company's website.
The Directors will request the external auditor to attend AGMs of the Company and be available to answer questions from the shareholders about the conduct of the audit and the preparation and content of the auditor's report.
Principle 7 - Recognise and manage risk
The Company's Audit and Risk Committee is establishing policies on risk oversight and management, risk management and internal control systems, including non-financial risks, which must be approved by the Board. The Committee must regularly report to the Board on compliance with any risk and audit policies and protocols in place at the time.
The Directors require the Managing Director and any chief financial officer (or equivalent) to state in writing to the Board that:
(a) the statement given in accordance with Principle 4 (the integrity of financial statements) is founded on a sound system of risk management and internal compliance and control which implements the policies established by the Board; and
(b) the Company's risk management and internal compliance and control system is operating efficiently and effectively in all material respects.
The Directors intend to establish and disclose a code of conduct to guide compliance with legal and other obligations to legitimate stakeholders.
Principle 8 - Remunerate fairly and responsibly
The Board has provided disclosure in relation to the Company's remuneration policies in this Prospectus to enable investors to understand:
(a) the costs and benefits of those policies; and
(b) the link between remuneration paid to the Directors and key executives and corporate performance.
Further disclosure will be given to investors annually in accordance with the ASX Listing Rules and the Corporations Act. The Board has also established a Nomination and Remuneration Committee.
The Board has clearly distinguished the structure of non-executive directors' remuneration from that of executives, as set out in this Prospectus. However, the Directors are entitled to options as set out in this Prospectus, which the Board considers appropriate given the structure of the Company's management team and the international nature of the Company's operations.
The Board has ensured that payment of equity-based executive remuneration is made in accordance with thresholds set in plans approved by shareholders.