Aguia Resources Ltd
ABN: 94 128 256 888
1. Responsibilities of the Board
Any engagement of external consultants for the preparation of any technical report must include in the terms of appointment a requirement that the consultant submit a draft of their report for consideration and comments by the Company with the final report only to be provided by the consultant when the draft has been approved by a director of the Company.
In carrying out the responsibilities and powers set out in this Charter, the Board:
- recognises its overriding responsibilities to act honestly, fairly, diligently and in accordance with the law in serving the interests of its shareholders; and
- recognises its duties and responsibilities to its employees, customers and the community.
In addition to the matters it is expressly required by law to approve, the specific responsibilities of the Board are outlined in the Matter Reserved for the Board Policy.
2. Composition of the Board
The composition of the Board is to be reviewed regularly to ensure the appropriate mix of skills and expertise is present to facilitate successful strategic direction.
- In appointing new members to the Board, consideration is given to the ability of the appointee to contribute to the ongoing effectiveness of the Board, to exercise sound business judgement, to commit the necessary time to fulfil the requirements of the role effectively and to contribute to the development of the strategic direction of the Company.
- The Board should comprise at least three Directors with the majority of the Board is comprised of non-executive Directors. Where practical, at least 50% of the Board will be independent. An independent Director is one who is independent of management and free from any business or other relationship, which could, or could reasonably be perceived to, materially interfere with, the exercise of independent judgement. Independent Directors should meet the definition of what constitutes independence as set out in Section 10 of the Board Charter.
- Directors must disclose their interests. The independence of the Directors should be regularly assessed by the Board in light of the interests disclosed by them.
- Directors are expected to bring their independent views and judgement to the Board and must declare immediately to the Board any potential or active conflicts of interest.
- Directors must declare immediately to the Board, and the Board will determine whether to declare to the market, any loss of independence.
- No member of the Board may serve for more than three years or past the third annual general meeting following their appointment, whichever is the longer, without being re-elected by the shareholders.
- Prior to the Board proposing re-election of non-executive Directors, their performance will be evaluated to ensure that they continue to contribute effectively to the Board.
- The Board should comprise Directors with a mix of qualifications, experience and expertise which will assist the Board in fulfilling its responsibilities, as well as assisting the Company in achieving growth and delivering value to shareholders.
3. The Role of the Chairman
- Where possible, the Chairman should be a non-executive Director and the Managing Director/Chief Executive Officer should not be the Chairman of the Company. However where the Board concludes that the same individual can perform both roles successfully and in the best interests of the Company, the dual role will be permitted.
- The Chairman must be able to commit the time to discharge the role effectively.
- The Chairman is responsible for the leadership of the Board, ensuring it is effective, setting the agenda of the Board, conducting the Board meetings and conducting the shareholder meetings. The Chair should facilitate the effective contribution of all Directors and promote constructive and respective relations between Directors and between the Board and management.
- The Chairman should facilitate the effective contribution of all Directors and promote constructive and respectful relations between Board members and management.
- In the event that the Chairman is absent from a meeting of the Board then the Board shall appoint a Chairman for that meeting.
4. Board Committees
Company, in discharging its stewardship it makes use of committees. To this end the Board has established an Audit and Risk Committee which carries out its duties in line with the Audit and Risk Committee Charter. The Board will establish the following additional separate committees when it deems appropriate:
- Remuneration Committee;
- Nomination Committee; and
- Such special purpose committees as deemed appropriate from time to time for specific purposes.
The Board does not currently have a separate Nomination Committee or Remuneration Committee. The Board, as a whole, serves as these Committees in accordance with Charter items 5 and 6. The Board does not believe any efficiency or other benefits would currently be gained by establishing a separate Nomination and Remuneration Committee.
5.1 Role of the Board
- Establishing remuneration policies and monitoring their implementation;
- establishing systems designed to enhance the performance of individual employees of the Company and of the Company as a whole;
- fairly and responsibly rewarding executives and other employees having regard to the performance of the Company, the performance of the executive or employee and the general pay environment; and
- establishing a system of performance appraisal for Directors and the Board as a whole.
5.2 Responsibilities of the Board
The responsibilities of the Board with regards to remuneration are:
- keeping itself appraised of the latest developments, policies and trends regarding remuneration issues which affect the market in which the Company operates;
- in formulating systems on remuneration issues and policies, the Board will have regard to the overriding goal of ensuring that Directors and senior executives of the Company are motivated to pursue the long-term growth and success of the Company within an appropriate control framework and that there is a clear relationship between performance and remuneration;
- identifying and retaining such advisers and consultants in relation to remuneration issues as the Board considers necessary;
- establishing superannuation arrangements for the Company’s employees;
- determining a policy for the remuneration of the Managing Director and such other senior executives as it requires necessary. The Company will not permit the Managing Director or an Executive Director to have direct involvement in the determination of their remuneration;
- reviewing the total remuneration package of each executive, including where appropriate, non-cash components, bonuses, incentive schemes and shares or share options;
- reviewing the senior management performance assessment processes and results; assessing the Company’s recruitment, retention and termination policies and procedures for senior executives;
- establishing policies governing incentive schemes and requesting shareholder approval of such policies where necessary or appropriate;
- establishing policies for the remuneration of non-executive Directors of the Company;
- assessing the total quantum of remuneration to be paid to all Directors and communicating the basis for remuneration of Directors to shareholders;
- advising the Board on the allocation of the Directors’ total quantum of remuneration between the non-executive Directors (including the Chairman); and
- evaluating the time required of non-executive Directors to perform their duties.
Remuneration of executives
Incentive schemes for executives
Remuneration of non-executive Directors
The Board shall periodically review and consider the structure and balance of the Board and make recommendations regarding appointments, retirements and terms of office of directors. In particular, the Board shall:
- identify candidates after considering the necessary and desirable competencies of new Board members as highlighted by the Board skills matrix. This will ensure the appropriate mix of skills and experience after assessment of how the candidates can contribute to the strategic direction of the Company;
- approve and review induction procedures for new appointees of the Board to ensure that they can effectively discharge their responsibilities;
- assess and consider the time required to be committed by a non-executive director to properly fulfil their duty to the Company and advise the Board.
- consider and approve candidates for election or re-election to the Board at each annual shareholders’ meeting;
- review directorships in other public companies held by or offered to directors and senior executives of the Company;
- review succession plans for the Board with a view to maintaining an appropriate balance of skills and experience on the Board; and
- confirm the terms and conditions of appointment to, and removal and retirement from, the Board.
7. Board Meetings
There must be two Directors present at a meeting to constitute a quorum.
The Board will schedule at least 6 formal Board meetings a year and hold additional meetings, including by telephone conference calls, as may be required.
Non-executive Directors may confer at scheduled times without management being
The minutes of each Board meeting shall be prepared by the Company Secretary and circulated to Directors after each meeting for approval. Minutes of meetings should be approved within one month of the meeting.
The Company Secretary shall distribute supporting papers for each meeting of the Board as far in advance as practicable.
The Chief Financial Officer will generally be asked to attend the board meetings as an executive officer of the Company.
8. Access to Advice
All Directors have unrestricted access to company records and information except where the Board determines that such access would be adverse to the Company’s interests.
All Directors may consult management and employees as required to enable them to discharge their duties as Directors.
The Board, Board Committees or individual Directors may seek independent external professional advice as considered necessary at the expense of the Company, subject to prior consultation with the Chairman. A copy of any such advice received would be made available to all members of the Board.
9. The Board’s Relationship with Management
The Board shall delegate responsibility for the day-to-day operations and administration of the Company to the Managing Director/Chief Executive Officer. The specific responsibilities delegated to the Managing Director/Chief Executive Officer are outlined in the Matters Reserved for the Managing Director/Chief Executive Officer Policy.
In addition to formal reporting structures, members of the Board are encouraged to have direct communications with management and other employees within the Group to facilitate the carrying out of their duties as Directors.
10. Director independence
A Director is only to be regarded as independent if the Director is independent of management and free of any business or other relationship that could materially interfere with or could reasonably be perceived to materially interfere with the exercise of the Director’s unfettered and independent judgement. The Board assesses the independence of each director in light of interests disclosed by them.
In determining the independent status of a Director, the Board will consider the ASX Corporate Governance Principle and Recommendations guidance on relationships affecting the independent status of a Director which provide that an independent Director is a non-executive Director (i.e. is not a member of management) who:
- is not a substantial shareholder of the Company (as defined in section 9 of the Corporations Act);
- within the last 3 years has not been employed in an executive capacity by the Company;
- within the last 3 years has not been a material professional adviser or material consultant to the Company;
- is not a material supplier or customer of the Company;
- has no material contractual relationship with the Company other than as a Director of the Company.
The assessment of whether a Director is considered independent (both from the perspective of the Company and the Director) is based on the following materiality thresholds:
- payments made by the Company to the Director or any of his associated entities for the provision of goods and/or services does not exceed 10% of the annual gross expenditure of the Company; or
- payments received by the Director for the provision of goods and/or services to the Company does not exceed 25% of the annual income or business turnover of the Director or his associated entities.
Matters Reserved for the Board
- In conjunction with management, establishing the goals (short, medium and long term) and strategy for the Company.
- Approving the strategic plans and major operating plans.
- Approving the annual operating budget.
- Reviewing and providing feedback on the performance of the Managing Director/Chief Executive Officer.
- Reviewing the performance of the Board, the individual directors and any Board committees at least annually.
- Reviewing and approving the full-year financial statements and directors’ report.
- Approving the annual report and notice of annual general meeting.
- Reviewing and approving the half-year financial statements.
- Reviewing the activities and performance of the Company in meeting its objectives, based on approved operating plans and budgets.
- Preparing for and participation in Board meetings.
- Setting guidelines for the Managing Director/Chief Executive Officer in regard the appointment of other senior executives and staff required by the Company.
- Endorsing the terms and conditions of senior executives (those staff reporting to the Managing Director/Chief Executive Officer).
- Determining the remuneration for Directors.
- Ensuring a high standard of corporate governance practice and regulatory compliance and promoting ethical and responsible decision making.
- Planning Board succession to ensure membership of the Board is skilled and appropriate for the Company’s needs.
- Establish and determine powers and functions of any Board committees and reviewing those powers and functions annually, or as circumstances demand.
- Maintain an appreciation of the risk profile of the Company and where appropriate, approval of risk management policies, internal control and codes of conduct.
- Being satisfied that procedures are in place so that the ASX is promptly and adequately informed of all material matters.
- Recommending to shareholders the appointment of the external auditors as an when their appointment or re-appointment is required to be approved by them.
- any changes to the capital of the Company, including capital restructures, capital returns, share buy backs and all new issues of securities in a Company. This includes the issue of shares or options provided in employment contracts.
- operational and capital expenditure outside the approved budget and delegated authority limits;
- mergers, acquisitions and disposals of businesses and/or equity investments and divestments;
- all borrowing and debt funding arrangements and or changes to existing borrowing facilities;
- significant property acquisitions and disposals; and
- all other regulatory filing and matters required by law.
4. Ad hoc
- Appointing and approving the terms and conditions of appointment of the Managing Director/Chief Executive Officer, Chief Financial Offer and Company Secretary.
- Establishing appropriate levels of delegation to the Managing Director/Chief Executive Officer to allow him to manage the Company’s operations effectively.
Matters Reserved for Managing Director/Chief Executive Officer
- Formulating and reviewing, with the Board, the strategy for the Company and developing actions and plans to implement the strategy. Reporting to the Board on the progress against those plans.
- Develop actions with the management team to implement the strategy.
- Develop annual operating plans and budgets (with the Chief Financial Officer) in accordance with strategies endorsed by the Board.
- Report to the Board regularly on the Company’s progress against the strategy.
- Negotiate terms and conditions of appointment of senior executives (reporting directly to the Managing Director/Chief Executive Officer) within guidelines set by the Board.
- Appoint senior executives endorsed by the Board and other staff members within guidelines set by the Board.
- Provide strong leadership to the management team and ensure all employees understand the strategy and operational plans and their part in their achievement.
- Ensure procedures and training are in place to provide a safe work environment.
- Ensure employees are educated on legal requirements and Company policies such that compliance is the culture and a high level of ethical behaviour is expected.
- Ensure all matters requiring review or approval by the Board are brought to the Board with adequate information and time to allow proper consideration of such matters.
- Advise the Board in a timely manner of any significant change in the risk profile of the Company together with actions taken or proposed.
- Provide, with the Chief Financial Officer, certification to the Board on the integrity of the financial statements annually and half-yearly.
- Ensure directors are continually informed on the business of the Company, the environments in which it operates and any changes in its obligations.
- Ensure effective communication with shareholders and the investment community in line with the Company’s shareholder communication policy.
- Identify business growth opportunities, evaluate these and present these to the Board for consideration and contribution.
- All other matters necessary for the day-to-day management of the Company and not reserved for the Board
- The Board has established levels of delegated expenditure authority for the Managing Director/Chief Executive Officer and Chief Financial Officer.
Last review: 1 September 2015
Review frequency: Annually or as required