The company's constitution provides that the number of directors shall not be less than three and not more than nine. There is no requirement for any share holding qualification.
As and if the company's activities increase in size, nature and scope the size of the board will be reviewed periodically and the optimum number of directors required to supervise adequately the company's constitution determined within the limitations imposed by the constitution and as circumstances demand.
The membership of the board, its activities and composition, is subject to periodic review. The criteria for determining the identification and appointment of a suitable candidate for the board shall include quality of the individual, background of experience and achievement, compatibility with other board members, credibility within the company's scope of activities, intellectual ability to contribute to board's duties and physical ability to undertake board's duties and responsibilities.
Directors are initially appointed by the full board subject to election by shareholders at the next general meeting. Under the company's constitution the tenure of a director (other than managing director, and only one managing director where the position is jointly held) is subject to reappointment by shareholders not later than the third anniversary following his or her last appointment. Subject to the requirements of the Corporations Act 2001, the board does not subscribe to the principle of retirement age and there is no maximum period of service as a director. A managing director may be appointed for any period and on any terms the directors think fit and, subject to the terms of any agreement entered into, may revoke any appointment.
The board considers that the company is not currently of a size, nor are its affairs of such complexity to justify the formation of separate or special committees (other than an audit committee) at this time. The board as a whole is able to address the governance aspects of the full scope of the company's activities and to ensure that it adheres to appropriate ethical standards.
The board's primary role is the protection and enhancement of long term shareholder value.
To fulfil this role, the board is responsible for oversight of the management and the overall corporate governance of the company including its strategic direction, establishing goals for management and monitoring the achievement of these goals.
Directors are required to take into consideration any potential conflicts of interest when accepting appointments to other boards.
The board has determined that individual 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 exception of expenses for legal advice in relation to director's rights and duties, the engagement of an outside adviser is subject to prior approval of the chairman and this will not be withheld unreasonably.
Directors consider, on an ongoing basis, how management information is presented to them and whether such information is sufficient to enable them to discharge their duties as directors of the company. Such information must be sufficient to enable the directors to determine appropriate operating and financial strategies from time to time in light of changing circumstances and economic conditions. The directors recognise that mineral exploration is an inherently risky business and that operational strategies adopted should, notwithstanding, be directed towards improving or maintaining the net worth of the company.
As the company's activities develop in size, nature and scope, the size of the board and the implementation of any additional formal corporate governance committees will be given further consideration.
The following table sets out the company's present position with regard to adoption of these principles.
| |
Principle |
Status |
Reference/Comment |
| 1. |
Lay solid foundations for management and oversight |
|
|
| 1.1 |
Formalise and disclose the functions reserved to the board and those delegated to management |
N/A |
The company has not adopted this recommendation to formalise and disclose the functions reserved to the board and those delegated to management. The company has a small board, comprising five directors, four of whom are non executive (including the chairman).
The company considers the expense of sourcing additional directors at this stage of its development is unwarranted. The roles and functions within the company must remain flexible in order for it to best function within its level of available resources.
The full board currently meets every month. In addition, strategy meetings and any extraordinary meetings are held at such other times as may be necessary to address any specific significant matters that may arise.
The board believes the alignment of the interests of directors with those of shareholders as being the most efficient way to ensure shareholders interests are protected. |
| 2. |
Structure the board to add value |
|
|
| 2.1 |
A majority of board members should be independent directors |
N/A |
Given the company?s background, the nature and size of its business and the current stage of its development, the board comprises five directors, four of whom are non executive (including the independent chairman). The board believes that this is both appropriate and acceptable at this stage of the company?s development. |
| 2.2 |
The chairperson should be an independent director |
A |
|
| 2.3 |
The roles of chairperson and chief executive officer should not be exercised by the same individual |
A |
The positions of chairman and managing director are held by separate persons. |
| 2.4 |
The board should establish a nomination committee |
N/A |
The board has no formal nomination committee. Acting in its ordinary capacity from time to time as required, the board carries out the process of determining the need for, screening and appointing new directors. In view of the size and resources available to the company, it is not considered that a separate nomination committee would add any substance to this process. |
| 2.5 |
Provide the information indicated in guide to reporting on principle 2 |
A
(in part) |
The skills and experience of directors are set out in the company?s annual report and on its website. |
| 3. |
Promote ethical and responsible decision making |
|
|
| 3.1 |
Establish a code of conduct to guide the 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 responsibility and accountability of individuals for reporting or investigating reports of unethical practices |
A |
The company has formulated a code of conduct which can be viewed on the company?s website. |
| 3.2 |
Disclose the policy concerning trading in company securities by directors, officers and employees |
A |
The company has formulated a securities trading policy which can be viewed on its website. |
| 3.3 |
Provide the information indicated in guide to reporting on principle 3 |
A |
The company has established an audit committee which comprises two non executive directors. The charter for this committee is disclosed on the company?s website. Sourcing alternative or additional directors to strictly comply with this principle is considered expensive with costs outweighing potential benefits. In addition, the board as a whole addresses the governance aspects of the full scope of the company?s activities to ensure that it adheres to appropriate ethical standards. All matters which might properly be dealt with by special committees are subject to regular scrutiny at full board meetings. |
| 4. |
Safeguard integrity in financial reporting |
|
|
| 4.1 |
Require the chief executive officer (or equivalent) and the 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 |
A |
|
| 4.2 |
The board should establish an audit committee |
A |
|
| 4.3 |
Structure the audit committee so that it consists of:
Only non executive directors
A majority of independent directors
An independent chairperson who is not the chairperson of the board
At least three members |
A
(in part) |
|
| 4.4 |
The audit committee should have a formal charter |
A |
|
| 4.5 |
Provide the information indicated in guide to reporting on Principle 4 |
A |
|
| 5. |
Make timely and balanced disclosure |
|
|
| 5.1 |
Establish written policies and procedures designed to ensure compliance with ASX listing rule disclosure requirements and to ensure accountability at a senior management level for that compliance |
N/A |
The company has instigated internal procedures designed to provide reasonable assurance as to the effectiveness and efficiency of operations, the reliability of financial reporting and compliance with relevant laws and regulations. The board is acutely aware of the continuous disclosure regime and there are strong informal systems in place to ensure compliance, underpinned by experience. |
| 5.2 |
Provide the information indicated in guide to reporting on principle 5 |
N/A |
The board receives monthly reports on the financial position of the company with performance being measured against approved budgets. |
| 6. |
Respect the rights of shareholders |
|
|
| 6.1 |
Design and disclose a communications strategy to promote effective communication with shareholders and encourage effective participation at general meetings |
A |
In line with adherence to continuous disclosure requirements of ASX all shareholders are kept informed of major developments affecting the company. This disclosure is through regular shareholder communications including the Annual Report, Quarterly Reports, the company website and the distribution of specific releases covering major transactions or events. |
| 6.2 |
Request the external auditor to attend the annual general meeting and be available to answer shareholder questions about the audit and the preparation and content of the auditor?s report |
A |
Shareholders are encouraged to exercise their right to vote, either by attending meetings, or by lodging a proxy. The company?s auditors attend all shareholders? meetings. |
| 7. |
Recognise and manage risk |
|
|
| 7.1 |
The board or appropriate board committee should establish policies on risk oversight and management |
N/A |
While the company does not have formalised policies on risk management the board recognises its responsibility for identifying areas of significant business risk and for ensuring that arrangements are in place for adequately managing these risks. This issue is regularly reviewed at board meetings and risk management culture is encouraged amongst employees and contractors. |
| 7.2 |
The chief executive officer (or equivalent) and the chief financial officer (or equivalent) should state to the board in writing that:
7.2.1 the statement given in accordance with best practice recommendation 4.1 (the integrity of financial statements) is founded on a sound system of risk management and internal compliance and control which implements the polices adopted by the board
7.2.2 the company?s risk management and internal compliance and control system is operating efficiently and effectively in all material respects |
A |
Determined areas of risk which are regularly considered include:
performance and funding of exploration activities
budget control and asset protection
status of mineral tenements
land access and native title considerations
compliance with government laws and regulations
safety and the environment
continuous disclosure obligations |
| 7.3 |
Provide information indicated in guide to reporting on principle 7 |
N/A |
|
| 8. |
Encourage enhanced Performance |
|
|
| 8.1 |
Disclose the process for performance evaluation of the board, its committees and individual directors, and key executives |
N/A |
The company does not consider it appropriate to have a sub committee of the board to consider remuneration matters.
The remuneration of executive and non executive directors is reviewed by the board with the exclusion of the director concerned. The remuneration of management and employees is reviewed by the board and approved by the chairman.
Acting in its ordinary capacity, the board from time to time carries out the process of considering and determining performance issues including the identification of matters that may have a material effect on the price of the company?s securities. Whenever relevant, any such matters are reported to ASX. |
| 9. |
Remunerate fairly and responsibly |
|
|
| 9.1 |
Provide disclosure in relation to the company?s remuneration policies and benefits to these policies and (ii) the link between remuneration paid to directors and key executives and corporate performance. |
A |
The company discloses remuneration related information in its annual report to shareholders in accordance with the Corporations Act 2001.
Remuneration levels are determined by the board on an individual basis, the size of the company making individual assessment more appropriate than formal remuneration policies. In doing so, the board seeks to retain professional services as it requires, at reasonable market rates, and seeks external advice and market comparisons where necessary. |
| 9.2 |
The board should establish a remuneration committee |
N/A |
|
| 9.3 |
Clearly distinguish the structure of non executive directors remuneration from that of executives |
A |
|
| 9.4 |
Ensure that payment of equity based executive remuneration is made in accordance with thresholds set in plans approved by shareholders |
A |
|
| 9.5 |
Provide information indicated in ASX guide to reporting on principle 9 |
A
(in part) |
|
| 10. |
Recognise legitimate interests of stakeholders |
|
|
| 10.1 |
Establish and disclose a code of conduct to guide compliance with legal and other obligations to legitimate stakeholders |
A |
The company?s code of conduct is set out in the company?s website.
The board continues to review existing procedures over time to ensure adequate processes are in place.
All directors, employees and contractors are expected to act with the utmost integrity and objectivity in their dealings with other parties, striving at all times to enhance the reputation and performance of the company. |
| |
A = Adopted
N/A = Not Adopted |
|
|
