1. ROLE OF THE BOARD AND MANAGEMENT

The Board represents shareholders’ interests in continuing a successful business, which seeks to optimise medium to long-term financial gains for shareholders. By not focusing on short-term gains for shareholders, the Board believes that this will ultimately result in the interests of all stakeholders being appropriately addressed when making business decisions.

The Board is responsible for ensuring that the Group is managed in such a way to best achieve this desired result. Given the current size and operations of the business, the Board currently undertakes an active, not passive role.

The Board is responsible for evaluating and setting the strategic directions for the Group, establishing goals for management and monitoring the achievement of these goals. The Chief Executive Officer / Managing Director is responsible to the Board for the day-to-day management of the Group.

The Board has sole responsibility for the following:

  • Appointing and removing the Chief Executive Officer / Managing Director and any other executives and approving their remuneration;
  • Appointing and removing the Company Secretary / Chief Financial Officer and approving their remuneration;
  • Determining the strategic direction of the Group and measuring performance of management against approved strategies;
  • Review of the adequacy of resources for management to properly carry out approved strategies and business plans;
  • Adopting operating and capital expenditure budgets at the commencement of each financial year and monitoring the progress by both financial and non-financial key performance indicators;
  • Monitoring the Group’s medium term capital and cash flow requirements;
  • Approving and monitoring financial and other reporting to regulatory bodies, shareholders and other organisations;
  • Determining that satisfactory arrangements are in place for auditing the Group’s financial affairs;
  • Review and ratify systems of risk management and internal compliance and control, codes of conduct and compliance with legislative requirements; and
  • Ensuring that policies and compliance systems consistent with the Group’s objectives and best practice are in place and that the Company and its officers act legally, ethically and responsibly on all matters.

The Board’s role and the Group’s corporate governance practices are being continually reviewed and improved as required.

2. COMPOSITION OF THE BOARD AND NEW APPOINTMENTS

The Company currently has the following Board members:

  • Mr Cliff Lawrenson – Independent Non-Executive Chairman
  • Mr James Cullen – CEO & Managing Director
  • Mr Ken Hall – Executive Director
  • Mr Stuart Foster – Independent Non-Executive Director
  • Mr Linton Putland – Independent Non-Executive Director

The Company’s Constitution provides that the number of directors shall not be less than three and not more than ten. There is no requirement for any share holding qualification.

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 the Board duties and physical ability to undertake the Board duties and responsibilities.

Prior to appointing a person as a director, the Company will undertake appropriate checks, such as criminal record, bankruptcy and education checks and obtain character references.

Directors are initially appointed by the full Board subject to election by shareholders at the next annual general meeting. Under the Company’s Constitution the tenure of directors (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 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, the Board may revoke any appointment.

Letters of appointment for each new appointment to the Board set the key terms and conditions of the appointment, including duties, rights and responsibilities, the time commitment envisaged and the Board’s expectations regarding their involvement with committee work.

The Chairman and Chief Executive Officer with assistance from the Company Secretary will provide an induction for new directors appointed to the Board. These induction programs will include:

  • an overview of the culture and values of the Company;
  • Board meeting arrangements; and
  • director interaction with each other, senior management and other stakeholders.

The Company Secretary has a direct line of reporting to the Chairman and is responsible for:

  • advising and supporting the Chairman and the Board and its committees to manage the day to day governance framework of the company;
  • assisting with Board effectiveness by monitoring whether applicable Board and committee policies, procedures  and  charters  are  followed  and  coordinating  timely  completion  and despatch of Board agendas and papers;  and
  • assisting with all matters to do with the proper functioning of the Board including advising on governance matters and assisting with induction and professional development of Directors.
3. COMMITTEES OF THE BOARD

The Board from time to time establishes committees to assist it in carrying out its responsibilities, and adopts charters setting out matters relevant to the composition, responsibilities and administration of such committees, and other matters that the Board may consider appropriate.

The Board has established an Audit and Risk Management Committee. The Board is of the opinion that the Company is not of a sufficient size to warrant a Nomination and Remuneration committee.

Minutes of all standing committee meetings are provided to all Directors and the proceedings of each meeting are reported by the Chair on the committee at the next Board meeting.

4. CONFLICTS OF INTEREST

In accordance with the Corporations Act 2001 and the Company’s Constitution, Directors must keep the Board advised, on an ongoing basis, of any interest that could potentially conflict with those of the Company.  Where the Board believes that a significant conflict exists, the Director concerned does not receive the relevant board papers and is not present at the meeting whilst the item is considered.

5. INDEPENDENT PROFESSIONAL ADVICE

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. The engagement of an outside adviser is subject to prior approval of the Chairman and this will not be withheld unreasonably. If appropriate, any advice so received will be made available to all Board members.

6. BOARD PERFORMANCE EVALUATION

The assessment of the Board’s overall performance and its succession plan is conducted by the Chairman and directors on a regular basis including assessment of the composition and skill mix of the directors of the Company.

Arrangements put in place by the Board to monitor the performance of the Group’s executives include:

  • a review by the Board of the Group’s financial performance; and
  • annual performance appraisal meetings incorporating analysis of key performance indicators with each individual to ensure that the level of reward is aligned with respective responsibilities and individual contributions made to the success of the Company.