Corporate Governance

Management and Oversight
The company is governed on behalf of the shareholders by its Board of Directors through the management which the Board oversees. The Board is responsible for ensuring appropriate risk management, accountability, and control mechanisms. The Board also provides advice and input into development of corporate strategy, performance objectives, and appointment of senior executives. The Board monitors and reviews the performance of the company, financial reporting and implementation of strategy. The board approves material capital expenditure and large acquisitions.

The Board
At present, the Board comprises four members: John Thame, Ian Ferrier, Greg Wilkinson and Clive Rabie. Mr Thame is the Chairman of the Board and he together with Mr Ferrier are independent Non-Executive Directors. Greg Wilkinson was Chief Executive Officer until 22 February 2006 when he was appointed Deputy Chairman. Mr Rabie was appointed to the Board on 24 May 2005. Mr Rabie was Chief Operating Officer until 22 February 2006, when he was appointed Group Chief Executive Officer. Board of Directors are obliged to charter outlined in Directors’ Code of Conduct.

Directors are entitled to seek independent professional advice at the company’s expense to assist them in fulfilling their duties in order to comply with all applicable laws and regulations. There is no formal procedure for the Board to agree when to take independent advice at the expense of the company, but given the size of the Board there is no efficiency to be obtained in formalising this process. The independent Non-Executive Directors exercise their judgement to call for such advice when they deem appropriate.

The Audit Committee
The Audit Committee is established to ensure the maintenance of the highest standards of integrity in relation to financial reporting, risk management, legal and standards compliance and corporate governance.

The Audit Committee consists of John Thame and Ian Ferrier, independent Non-Executive Directors to ensure independent review of financial reporting over and above formal audit processes. The Audit Committee also meets informally to discuss matters including risk management and reporting. The terms of reference of the committee are to review and monitor all financial, risk management and compliance policies. Click Audit Committee Charter for the full copy of the PDF document.

Timely and Balanced Disclosure
The board remains conscious of the company’s disclosure obligations under the Corporations Act, the ASX Listing Rules and the ASIC guidance principles. All required disclosures are also made in accordance with the Continuous Disclosure policy which is accessible to the public on the company web site. Continuous Disclosure Policy sets out the procedure for identifying relevant price sensitive information and reporting such information to the company secretary for review to ensure that the company and its officers do not breach the Corporations Act or ASX Listing Rules. Trading Policy governs trading in company shares by Directors, Officers and Employees.

Rights of Shareholders
Given the size of the company, there is no formally documented communications strategy but the Board is conscious of the requirements of Principle 6 of the ASX Governance Principles and acts in accordance with them. The company communicates with shareholders through its ASX disclosures to the market. The company also communicates with shareholders through the posting of statutory notices to shareholders and at the general and special meetings of the company. The company keeps an archive of announcements and general company information on its web site which is accessible to the public.

Recognise and Manage Risk
As stated above in Management and Oversight, the Board is responsible for ensuring appropriate risk management, accountability, and control mechanisms. As stated above also in Integrity in Financial Reporting the Audit Committee meets to discuss matters regarding risk management and reporting. The efficiency that might be enjoyed by larger companies does not apply to the company and hence there are no additional committees formally established and chartered for risk management.

The Board is responsible for the company’s system of internal controls. It constantly monitors the operational and financial aspects of the company’s activities and, through the Audit Committee, considers the recommendations and advice of auditors and other external advisers on the operational and financial risks that face the company.

Encourage Enhanced Performance
The company recognises the need for regular evaluation of the Board, its committees, individual Directors and key executives. Generally the independent Non-Executive Directors monitor and review the ongoing performance of the Executive Directors and key executives as more fully set out in Remunerate Fairly and Responsibly below. The independent Non-Executive Directors are subject to the Constitution and their continuity of tenure is dependent on re-election by shareholders in accordance with the Constitution.

Remunerate Fairly and Responsibly
The company remunerates Directors and key executives in accordance with the aspirations set out in ASX Governing Principle 9. Accordingly the Board has adopted a remuneration policy designed to attract and maintain talented and motivated Directors and employees so as to encourage enhanced performance of the company. There is a clear relationship between performance and remuneration and a desire to strike the correct balance between the various components making up remuneration. The remuneration committee supervises the development and implementation of the company’s remuneration policy including the operation of option plans, and reviews the performance of the Executive Directors and senior executives.

Recognising the Legitimate Interests of Stakeholders
The company operates in accordance with appropriate laws, regulations, principles and ethics to fulfil its responsibilities. The company recognises and conducts its affairs consistent with the guidelines for a Code of Conduct set out in ASX Governance Principle 10. Employees are bound by a Human Resources Policy and Procedure Manual that regulates the ethical standards of their conduct in the business. The key relevant terms of the Manual deal with ethical business practices, conflict of interest and corporate opportunity.

The company is committed to training employees and maintaining employees’ relevant product expertise and undertakes trade practices training from time to time for relevant staff.