Governing Principles

CORPORATE GOVERNANCE PRINCIPLES AND RECOMMENDATIONS

PRINCIPLE 1: LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT

Recommendation 1.1: Companies should establish the functions reserved to the board and management.

Recommendation 1.2: Companies should disclose the process for evaluating the performance of senior executives.

Recommendation 1.3: Provide the information indicated in the ASX Corporate Governance Council’s Guide to Reporting on Principle 1.

PRINCIPLE 2: STRUCTURE THE BOARD TO ADD VALUE

Recommendation 2.1: A majority of the Board should be Independent Directors.

Recommendation 2.2: The Chairperson should be an Independent Director.

Recommendation 2.3: The roles of the chairperson and chief executive officer should not be exercised by the same individual.

Recommendation 2.4: The Board should establish a nomination committee.

Recommendation 2.5: Disclose the process for performance evaluation of the Board, its committees and individual Directors, and key executives.

Recommendation 2.6: Provide the information indicated in the ASX Corporate Governance Council’s Guide to Reporting on Principle 2.

PRINCIPLE 3: PROMOTE ETHICAL AND RESPONSIBLE DECISION MAKING.

Recommendation 3.1: Establish a code of conduct to guide Directors, the chief executive officer (or equivalent), the chief financial officer (or equivalent) and any other key executives as to:

3.1.1    The practices necessary to maintain confidence in the Company’s integrity
3.1.2    The practices necessary to take into account the legal obligations and the reasonable expectations of stakeholders
3.1.3    The responsibility and accountability of individuals for reporting and investigating reports of unethical practices.

Recommendation 3.2: Disclose the policy concerning trading in company securities by directors, officers and employees.

Recommendation 3.3: Provide the information indicated in the ASX Corporate Governance Council’s Guide to Reporting on Principle 3.

PRINCIPLE 4: SAFEGUARD INTEGRITY IN FINANCIAL REPORTING

Recommendation 4.1: The Board should establish an audit committee.

Recommendation 4.2: Structure the Audit Committee so that it consists of:

  • Only non-executive directors
  • A majority of independent directors
  • An independent chairperson, who is not chairperson of the Board
  • At least 3 members

Recommendation 4.3: The Audit Committee should have a formal charter.

Recommendation 4.4: Provide the information indicated in the ASX Corporate Governance Council’s Guide to Reporting on Principle 4.

PRINCIPLE 5: MAKE TIMELY AND BALANCED DISCLOSURE

Recommendation 5.1: Establish written policies and procedure designed to ensure compliance with ASX Listing Rules disclosure requirements and to ensure accountability at a senior management level for that compliance.

Recommendation 5.2: Provide the information indicated in the ASX Corporate Governance Councils’ Guide to Reporting on Principle 5.

PRINCIPLE 6: RESPECT THE RIGHTS OF SHAREHOLDERS

Recommendation 6.1: Design and disclose a communications strategy to promote effective communication with shareholders and encourage effective participation at general meetings.

Recommendation 6.2: Provide the information indicated in the ASX Corporate Governance Councils’ Guide to Reporting on Principle 6. The Company effectively communicates with shareholders via ASX announcements and newsletters.

PRINCIPLE 7: RECOGNISE AND MANAGE RISK

Recommendation 7.1: The Board or appropriate committee should establish policies on risk oversight and management of material business risks and disclose a summary of those policies.

Recommendation 7.2: The board should require management to design and implement the risk management and internal control system to manage the company’s material business risks and report to it on whether those risks are being managed effectively.  The board should disclose that management has reported to it as tot the effectiveness of the company’s management of its material business risks.

Recommendation 7.3: The board should disclose whether it has received assurance from the chief executive officer (or equivalent) and the chief financial officer (or equivalent) that the declaration provided in accordance with section 295A of the Corporations Act is founded on a system of risk management and internal control and that the system is operating effectively in all material respects in relation to the financial reporting risks.

Recommendation 7.4: Provide the information indicated in the ASX Corporate Governance Council’s Guide to reporting on Principle 7.

PRINCIPLE 8: REMUNERATE FAIRLY AND RESPONSIBLY

Recommendation 8.1: The Board should establish a remuneration committee.

Recommendation 8.2: Clearly distinguish the structure of non-executive Directors’ remuneration from that of executives.

Recommendation 8.3: Provide the information indicated in the ASX Corporate Governance Council’s Guide to Reporting on Principle 8

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