Delegation of the Board of Directors' Powers and Reliance on Information Supplies
Purpose
In order better to direct the Company’s affairs, the Board recognises that it is necessary to:-
- delegate some of its powers to committees, officers and employees of the Company; and/or
- rely on reports generated by or the advice of officers and employees of the Company and external advisers.
The purpose of this policy is to set out the:-
- circumstances in which the Board may delegate some of its powers;
- responsibility attaching to the Board for the actions of its delegate(s); and
- circumstances in which a director may rely on information supplied by another.
Policy
Delegation
The Board may delegate some of its powers to:-
- a committee of directors;
- a director; or
- an officer or employee of the Company;
provided that the Board believes:-
- on reasonable grounds that the delegate will exercise the power in conformity with the duties imposed on the Board; and
- in good faith that the delegate is reliable and competent in relation to the power delegated.
Liability for Delegate
Where the Board delegates part of its powers to another committee, officer or employee, it shall be liable for the exercise by that committee, officer or employee of that power.
Reliance on Information
A director shall only be entitled to rely on information, professional or expert advice supplied to him or her where the:-
- information is provided by:
- an employee of the Company who the director believes on reasonable grounds to be reliable and competent in relation to the matters concerned;
- a professional adviser or expert in relation to matters that the director believes on reasonable grounds fall within the person’s expert or professional competence;
- another director or officer in relation to matters within that director’s or officer’s authority; or
- a committee of directors on which the director did not serve in relation to a matter within the committee’s authority; and
- reliance was made:
- in good faith; and
- after making an independent assessment of the information or advice.
Boards Committees
The Board has established the following working committees:
Audit and Risk Management Committee
The role of the Audit and Risk Management Committee is to advise on the establishment and maintenance of a framework of internal control and to give the Board additional assurance regarding the quality and reliability of financial information prepared for use by the Board.
The Audit and Risk Management Committee must be made up of non-executive directors, chaired by a non-executive director and meet not less than four times each year.
The internal and external auditors, the Chief Executive Officer, the Chief Financial Officer and other executives as the Audit and Risk Management Committee considers appropriate may be invited to Audit and Risk Management Committee meetings.
The responsibilities of the Audit and Risk Management Committee include:
- ensuring appropriate steps are taken to identify and minimise significant risks associated with the Company’s operations;
- ensuring that management is setting an appropriate “control culture” to generate organisational adherence to Company policies;
- nominating the external auditors;
- reviewing the assistance provided by the Company’s officers and employees to the external auditor;
- liaising with the external auditors and ensuring that the Annual and Half Year statutory audit/review is conducted in an effective manner;
- monitoring the procedures in place to ensure compliance with the Corporations Law, Stock Exchange Listing Rules and any matters outstanding with the auditors, the Australian Taxation Office, the Australian Securities & Investments Commission, the Australian Stock Exchange, the Australian Competition & Consumer Commission, the Environment Protection Agency, state based OHS&W regulatory agencies, and insurers and financial institutions;
- ensuring that the Company has in place adequate procedures to keep the Board informed of any matters material to the discharge by the Directors of their duties and obligations; and
- improving the quality of the accounting function.
The Audit and Risk Management Committee reviews the performance of the external auditors on an annual basis and meets with them to:
- discuss the external audit plan;
- discuss any significant issues that may be foreseen;
- discuss the impact of any proposed changes in accounting policies on the financial report;
- review the fees proposed for the audit work to be performed;
- review the pro-forma Half Year and Preliminary Final Report prior to lodgment of those documents with the Australian Stock Exchange, and any significant adjustments required as a result of the audit/review;
- make necessary recommendations to the Board for the approval of these documents; and
- review the results and findings of both internal and external audit, the adequacy of accounting and financial controls, and to monitor the implementation of any recommendations made.
Remuneration Committee
The Remuneration Committee comprises all members of the Board. The role of the Remuneration Committee is to review remuneration packages and policies applicable to the chief executive officer, senior executives and directors themselves. Where considered necessary, the Remuneration Committee obtains independent advice on the appropriateness of remuneration packages. The Remuneration Committee considers the various matters as they arise during the course of regular Board meetings.
Nominations Committee
No separate nomination committee has been established, however the full Board undertakes the functions of such a committee being the identification, appointment and review of Board membership and performance.
Responsibility
It is the responsibility of the Board and each director to ensure that they do not:-
- delegate part of their powers to any committee, officer or employee of the Company; nor
- rely on any information provided to them by any:
- committee, officer, or employee of the Company; or
- external expert or professional adviser;
without satisfying themselves in accordance with this policy that the delegation and reliance on information is reasonable, appropriate, and does not unnecessarily expose the Company to risk.