Sabre Resources Ltd ACN 003 043 570 ("the Company") has adopted systems of control and accountability as the basis for the administration of corporate governance. Some of these policies and procedures are summarised below.
Principle 1 – Lay solid foundations for management and oversight
Responsibilities of the Board
The Board is responsible for the following matters:
- ensuring the Company’s conduct and activities are ethical and carried out for the benefit of all its stakeholders;
- development of corporate strategy, implementation of business plans and performance objectives;
- reviewing, ratifying and monitoring systems of risk management, codes of conduct, internal control system and legal and regulatory compliance;
- the appointment of the Company’s Managing Director, (or equivalent), Chief Financial Officer, Company Secretary and other senior executives;
- monitoring senior executives’ performance and implementation of strategy;
- determining appropriate remuneration policies;
- allocating resources and ensuring appropriate resources are available to management;
- approving and monitoring the annual budget, progress of major capital expenditure, capital management, and acquisitions and divestitures; and
- approving and monitoring financial and other reporting.
The Company recognises and respects the value of diversity at all levels of the organisation.
Due to the size and scale of the Company’s activities, most services are provided by a Services Provider under a Services Agreement. The Company has only two direct employees, one of whom is a woman.
When the level of activity permits, the Directors will ensure that women are fairly considered and the Company’s aim will be to promote a culture which embraces diversity through ongoing education, succession planning, director and employee selection and recognising that skills are not gender specific.
The Company recognises that the mining and exploration industry is intrinsically male dominated in many of the operational sectors and the pool of women with appropriate skills is limited in some instances. The Company also recognises that diversity extends to matters of age, disability, ethnicity, marital/family status, religious/cultural background and sexual orientation. Where possible, the Company will seek to identify suitable candidates for positions from a diverse pool.
As at the date of this report, the Company has no women appointed to the Board, or to senior management, and one employee in the organisation as a whole.
The Chairman is responsible for leadership of the Board and for the efficient organisation and conduct of the Board’s business. The Chairman facilitates the effective contribution of all directors and promotes constructive and respectful relations between directors and between the Board and management of the Company. The Chairman is responsible for briefing directors on issues arising at Board meetings and is ultimately responsible for communications with shareholders and arranging Board performance evaluation.
The Managing Director is responsible for running the affairs of the Company under authority delegated from the Board. In carrying out his responsibilities the Managing Director must report to the Board in a timely manner and ensure all reports to the Board present a true and fair view of the Company’s financial condition and operational results.
The Company Secretary is responsible for monitoring the extent that Board policy and procedures are followed, and coordinating the timely completion and despatch of Board agendas and briefing material and is accountable directly to the Board on all matters to do with the proper functioning of the Board. All directors are to have access to the Company Secretary.
The Chairman and/or the Managing Director are responsible for reviewing the performance of each executive at least once every calendar year. During the financial year ended 30 June 2015, an evaluation of the performance of the Board and its members was not formally undertaken. However, a general review of the Board and executives occurs on an on-going basis to ensure that structures suitable to the Company’s status as a listed entity are in place.
It is the policy of the Board to conduct evaluation of individual employees’ performance. The objective of this evaluation is to provide best practice corporate governance to the Company. During the financial year an evaluation of the performance of the individuals was not formally carried out. However, a general review of the individuals occurs on an on-going basis to ensure that structures suitable to the Company's status as a listed entity are in place.
Principle 2 - Structure the Board to add value
Composition of the Board
The Company will ensure that the Board will be of a size and composition that is conducive to making appropriate decisions and be large enough to incorporate a variety of perspectives and skills, and to represent the best interests of the Company as a whole rather than of individual shareholders or interest groups. It will not, however, be so large that effective decision-making is hindered.
The Company will regularly review whether each non-executive director is independent, and each non-executive director should provide to the Board all information that may be relevant to this assessment. If a director’s independence status changes this should be disclosed and explained to the market in a timely fashion.
An Independent Director:
1. is a Non-Executive Director and;
2. is not a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial shareholder of the Company;
3. within the last three years has not been employed in an executive capacity by the Company or another group member, or been a Director after ceasing to hold any such employment;
4. within the last three years has not been a principal of a material professional adviser or a material consultant to the Company or another group member, or an employee materially associated with the service provided;
5. is not a material supplier or customer of the Company or another group member, or an officer of or otherwise associated directly or indirectly with a material supplier or customer;
6. has no material contractual relationship with the Company or other group member other than as a Director of the Company;
7. has not served on the Board for a period which could, or could reasonably be perceived to, materially interfere with the Director’s ability to act in the best interests of the Company; and is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the Director’s ability to act in the best interests of the Company; and
8. is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the Director’s ability to act in the best interests of the Company.
The Company’s non-executive directors are all independent and will endeavour to ensure that it has a majority of independent directors at all times, subject to the right of shareholders in general meeting to elect and remove directors.
The Company’s current non-executives are:
• Michael Scivolo was first appointed on 3 October 2006
• Jonathan Downes was first appointed on 13 December 2007
• Paul Mazzoni was first appointed on 25 February 2014
David Chapman was appointed Managing Director on 30 May 2015.
The Chairman should be a non-executive director who is independent and should not be the Chief Executive Officer of the Company. The Chairman’s other positions should not be such that they are likely to hinder the effective performance of his role of Chairman of the Company.
Independent decision- making
All directors - whether independent or not - should bring an independent judgment to bear on Board decisions. Non-executive directors are encouraged to confer regularly without management present. Their discussions are to be facilitated by the Chairman, if he is independent, or, if he is not independent, the deputy Chairman. Non-executive directors should inform the Chairman before accepting any new appointments as directors.
To facilitate independent decision making, the Board and any committees it convenes from time to time may seek advice from independent experts whenever it is considered appropriate. With the consent of the Chairman, individual directors may seek independent professional advice, at the expense of the Company, on any matter connected with the discharge of their responsibilities.
Procedure for selection of new directors
The Company believes it is not of a size to justify having a Nomination Committee. If any vacancies arise on the Board, all directors will be involved in the search and recruitment of a replacement. The Board believes corporate performance is enhanced when it has an appropriate mix of skills and experience.
Prior to the appointment of a director, appropriate checks will be undertaken to determine the suitability of any candidate, and the Board will provide security holders with all material information in its possession, which the Board considers relevant.
In support of their candidature for directorship or re-election, non-executive directors should provide the Board with details of other commitments and an indication of time available for the Company. Prior to appointment or being submitted for re-election non-executive directors should specifically acknowledge to the Company that they will have sufficient time to meet what is expected of them. Re-appointment of directors is not automatic. There are no written agreements with directors.
The Company has reviewed the skill set of its Board to determine where the skills lie and any relevant gaps in skill shortages. The Company monitors any perceived gaps in skills, as well as seeking to identify future suitable Board candidates for positions from a diverse pool.
Induction and education
The Board has an induction program to enable new directors to gain an understanding of:
o the Company’s financial, strategic, operational and risk management position;
o the rights, duties and responsibilities of the directors;
o the roles and responsibilities of senior executives; and
o the role of any Board committees in operation.
Directors will have reasonable access to continuing education to update and enhance their skills and knowledge, including education concerning key developments in the Company and in the industries in which the Company’s business is involved.
Access to information
The Board has the right to obtain all information from within the Company which it needs to effectively discharge its responsibilities.
Senior executives are required on request from the Board to supply the Board with information in a form and timeframe, and of a quality that enables the Board to discharge its duties effectively. Directors are entitled to request additional information where they consider such information necessary to make informed decisions.
Principle 3: Promote ethical and responsible decision-making
Code of conduct
The Board has adopted the Code of Conduct set out at Appendix A to promote ethical and responsible decision making by directors, management and employees. The Code embraces the values of honesty, integrity, enterprise, excellence, accountability, justice, independence and equality of stakeholder opportunity.
The Board is responsible for ensuring that training on the Code of Conduct is provided to staff and officers of the Company.
The Board is responsible for making advisers, consultants and contractors aware of the Company’s expectations set out in the Code of Conduct.
Policy for trading in Company securities
The Board has adopted a policy on trading in the Company’s securities by directors, senior executives and employees set out in Appendix B.
The Board is responsible for ensuring that the policy is brought to the attention of all affected persons and for monitoring compliance with the policy.
Principle 4: Safeguard integrity in financial reporting
Audit and Risk Management
The Company believes it is not of a size to justify having a separate Audit and Risk Management Committee. Ultimate responsibility for the integrity of the Company’s financial reporting rests with the full Board. Given the small size of the Board, the directors believe an Audit and Risk Management Committee structure to be inefficient. All directors share responsibility for ensuring the integrity of the Company’s financial reporting and appropriate Board processes have been implemented to perform the following audit and risk management functions:
• external audit function:
o review the overall conduct of the external audit process including the independence of all parties to the process;
o review the performance of the external auditors;
o consider the reappointment and proposed fees of the external auditor; and
o where appropriate, seek tenders for the audit and where a change of external auditor is recommended, arrange submission to shareholders for shareholder approval;
• reviewing the quality and accuracy of published financial reports;
• reviewing the accounting function and ongoing application of appropriate accounting and business policies and procedures;
• reviewing and imposing variations to the risk management and internal control policies designed and implemented by Company management; and
• any other matters relevant to audit and risk management processes.
The Company’s Risk Management Policy ensures that the Board as a whole is responsible for the oversight of the Company’s risk management and control framework. The objectives of the Company’s Risk management strategy are to:
• identify risks to the Company;
• balance risk to reward;
• ensure regulatory compliance is achieved; and
• ensure senior executives, the Board and investors understand the risk profile of the Company.
The Board monitors risk through various arrangements including:
• regular Board meetings;
• share price monitoring;
• market monitoring; and
• regular review of financial position and operations.
The Company’s Risk Management Policy is considered adequate for addressing and managing risk. It is intended that the Board will annually review the following categories of risks affecting the Company as part of the Company’s systems and processes for managing material business risks:
• operational matters,
• financial reporting,
• sovereignty and
• market-related risks.
Principle 5: Make timely and balanced disclosure
The Board has adopted a Disclosure Policy for ensuring timely and accurate disclosure of price-sensitive information to shareholders through the ASX set out in Appendix C.
The Disclosure Policy ensures that:
• all investors have equal and timely access to material information concerning the Company including its financial position, performance, ownership and governance; and
• Company announcements are subjected to a vetting and authorisation process designed to ensure they:
o are released in a timely manner;
o are factual;
o do not omit material information; and
o are expressed in a clear and objective manner that allows investors to assess the impact of the information when making investment decisions.
The Company respects the rights of its shareholders and to facilitate the effective exercise of those rights the Company is committed to making it easy for shareholders to participate in shareholder meetings of the Company. The Company also makes available a telephone number and email address for shareholders to make enquiries of the Company.
Shareholders are given the opportunity to receive communications electronically.
The Company’s website includes the following:
• Corporate Governance policies, procedures, charters, programs, assessments, codes and frameworks;
• Names and biographical details of each of its directors and senior executives;
• Copies of annual, half yearly and quarterly reports;
• ASX announcements;
• Copies of notices of meetings of security holders;
• Media releases;
• Overview of the Company’s current business, structure and history;
• Details of upcoming meetings of security holders;
• Summary of the terms of the securities on issue;
• Historical market price information of the securities on issue;
• Contact details for the share registry and media enquiries;
• Share registry key security holder forms.
Principle 6: Respect the rights of shareholders
Communication with Shareholders
The Board is committed to open and accessible communication with holders of the Company’s shares and other securities. Disclosure of information and other communication will be made as appropriate by telephone, mail or email.
The Company’s website will also be used to provide additional relevant information to security holders. The Board considers the following to be appropriate features for the Company’s website:
o placing the full text of notices of meeting and explanatory material on the website;
o providing information about the last three years’ press releases or announcements plus at least three years of financial data on the website; and
o providing information updates to security holders on request by email.
The Company is committed to improving shareholder participation in general meetings. In order to achieve that objective, the Company has adopted guidelines of the ASX Corporate Governance Council for improving shareholder participation through the design and content of notices and through the conduct of the meeting itself.
The external auditor is invited to attend every AGM for the purpose of answering questions from security holders relevant to the audit.
Principle 7: Recognise and manage risk
Creation and implementation of Company risk management policies
It is the responsibility of the Managing Director to create, maintain and implement risk management and internal control policies for the Company, subject to review by the Board.
The Managing Director must report to the Board on an annual basis regarding the design, implementation and progress of the risk management policies and internal control systems.
Audit and Risk Management
As referenced with respect to Principle 4, the Board has not established an Audit and Risk Management Committee for the reasons given above.
Due to the nature and size of the Company's operations, and the Company’s ability to derive substantially all of the benefits of an independent internal audit function, the expense of an independent internal auditor is not considered to be appropriate.
The Company has considered its economic, environmental and social sustainability risks by way of internal review and has concluded that it is not subject to material economic, environmental and social sustainability risks.
Review by the Board
The Board will review the effectiveness of implementation of the risk management system and internal control system at least annually.
When reviewing risk management policies and internal control system the Board should take into account the Company’s legal obligations and should also consider the reasonable expectations of the Company’s stakeholders, including security holders, employees, customers, suppliers, creditors, consumers and the community.
The Managing Director is required annually to state in writing to the Board that the Company has a sound system of risk management, that internal compliance and control systems are in place to ensure the implementation of Board policies, and that those systems are operating efficiently and effectively in all material respects.
Verification of financial reports
The Managing Director and Chief Financial Officer are required by the Company to state the following in writing prior to the Board making a solvency declaration pursuant to section 295(4) of the Corporations Act:
o that the Company’s financial reports contain a true and fair view, in all material respects, of the financial condition and operating performance of the Company and comply with relevant accounting standards; and
o that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system of risk management and that the system is operating effectively in all material respects in relation to financial reporting risks.
Principle 8: Remunerate fairly and responsibly
Director and senior executive remuneration policies
The Company’s remuneration policy is structured for the purpose of:
- motivating senior executives to pursue the long-term growth and success of the Company; and
- demonstrating a clear relationship between senior executives’ performance and remuneration.
The Board’s responsibility is to set the level and structure of remuneration for officers (including but not limited to directors and secretaries) and executives, for the purpose of balancing the Company’s competing interests of:
- attracting and retaining senior executives and directors; and
- not paying excessive remuneration.
Executive directors’ remuneration is structured to reflect short and long-term performance objectives appropriate to the Company’s circumstances and goals.
Executive directors’ and senior executives’ remuneration packages involve a balance between fixed and incentive-based pay, reflecting short and long-term performance objectives appropriate to the Company’s circumstances and goals.
Non-executive directors’ remuneration is formulated with regard to the following guidelines:
- non-executive directors are normally remunerated by way of fees, in the form of cash, non-cash benefits, superannuation contributions or equity, usually without participating in schemes designed for the remuneration of executives;
- non-executive directors are not provided with retirement benefits other than superannuation.
Executives and non-executive directors are prohibited from entering into transactions or arrangements which limit the economic risk of participating in unvested entitlements.
No director is involved in setting their own remuneration or terms and conditions, but if such a case were to arise, the relevant director would be required to absent himself from the full Board discussion.
The Company believes it is not of a size to justify having a Remuneration Committee and that it has Board processes in place which raise the issues that would otherwise be considered by a committee.
Appendix A – Code of Conduct
This Code of Conduct sets out the standards with which the Board, management and employees of the Company are encouraged to comply when dealing with each other, the Company’s shareholders and the broader community.
Responsibility to shareholders
The Company aims:
o to increase shareholder value within an appropriate framework which safeguards the rights and interests of shareholders; and
o to comply, with openness and integrity, the systems of control and accountability which the Company has in place as part of its corporate governance.
Responsibility to clients, employees, suppliers, creditors, customers and consumers
The Company will comply with all legislative and common law requirements which affect its business.
The Company will employ the best available staff with the skills required to carry out the role for which they are employed. The Company will ensure a safe workplace and maintain proper occupational health and safety practices.
Responsibility to the community
The Company recognises, considers and respects environmental, native title and cultural heritage issues which may arise in relation to the Company’s activities and will comply with all applicable legal requirements.
Responsibility to the individual
The Company recognises and respects the rights of individuals and will comply with applicable laws regarding privacy and confidential information.
Obligations relative to fair trading and dealing
The Company will deal with others in a way that is fair and will not engage in deceptive practices.
Business courtesies, bribes, facilitation payments, inducements and commissions
Corrupt practices are unacceptable to the Company. It is prohibited for the Company or its directors, managers or employees to directly or indirectly offer, pay, solicit or accept bribes or any other corrupt arrangements.
Conflicts of interest
The Board, management and employees must report any situations where there is a real or apparent conflict of interest between them as individuals and the interests of the Company. Where a real or apparent conflict of interest arises, the matter must be brought to the attention of the Chairman in the case of a Board member, the Managing Director in the case of a member of management and a supervisor in the case of an employee, so that it may be considered and dealt with in an appropriate manner.
Compliance with the Code of Conduct
Any breach of compliance with this Code of Conduct is to be reported directly to the Chairman.
Periodic review of Code
The Company will monitor compliance with this Code of Conduct periodically by liaising with the Board, management and staff. Suggestions for improvements or amendments to this Code of Conduct can be made at any time to the Chairman.
Appendix B – Policy for trading in Company securities
The Company recognises and enforces legal and ethical restrictions on trading in its securities by relevant persons within and external to the Company. The terms of this securities dealing policy apply to the Company’s directors, senior executives, employees and consultants (Relevant Persons).
This policy will be communicated to all Relevant Persons and will be placed on the Company website.
Trading by Relevant Persons in the Company’s securities is subject to the following limitations:
o No trading in Company securities shall take place during the two weeks preceding release of each quarterly report, half-yearly financial report, and annual financial report of the Company.
o No trading in the Company’s securities shall take place, directly or indirectly, where it is known, or ought reasonably to have been known by the person intending to trade, that information exists which has not been released to the ASX and where that information is of a type that could reasonably be expected to encourage buying or selling were that information known by others.
o No trading shall take place in Company securities unless prior notice is given [and approval is obtained] from the Chairman.
During a period specified in the previous paragraph, Relevant Persons may, after obtaining the Chairman’s consent, trade the Company’s securities to the extent reasonably necessary to avoid or ameliorate documented hardship and suffering or as required by other extenuating circumstances.
Directors’ trading and disclosures
Within twenty four hours of a director being appointed to the Board, resigning or being removed from the Board, or trading in the Company’s securities, full details of the director’s notifiable interests in the Company’s securities and changes in such interest must be advised to the Company Secretary so that a record is kept within the Company and so that necessary ASX notifications will occur.
All directors must notify the Company Secretary of any margin loan or similar funding arrangement entered into in relation to the Company’s securities and any variations to such arrangements, including the number of securities involved, the circumstances in which the lender can make margin calls, and the right of the lender to dispose of securities.
Appendix C - Disclosure Policy
The Company recognises its obligations pursuant to the continuous disclosure rules of the ASX Listing Rules and the Corporations Act to keep the market fully informed of information which may have a material effect on the price or value of the Company’s securities.
Subject to certain exceptions (in ASX Listing Rule 3.1A), the Company is required to immediately release to the market information that a reasonable person would expect to have a material effect on the price or value of the Company’s securities.
Responsibilities of directors officers and employees
The Board as a whole is primarily responsible for ensuring that the Company complies with its disclosure obligations and for deciding what information will be disclosed. Subject to delegation, the Board is also responsible for authorising all ASX announcements and responses of the Company to ASX queries.
Every director, officer and employee of the Company is to be informed of the requirements of this policy and must advise the Managing Director, Chairman or Company Secretary as soon as possible (and prior to disclosure to anyone else) of matters which they believe may be required to be disclosed.
Authorised Disclosure Officer
The Board has delegated its primary responsibilities to communicate with ASX to the following Authorised Disclosure Officer:
o the Company Secretary or
o in the absence of the Company Secretary, the Managing Director is authorised to act in that capacity by the Board.
Responsibilities of Authorised Disclosure Officer
Subject to Board intervention on a particular matter, the Authorised Disclosure Officer is responsible for the following:
o monitoring information required to be disclosed to ASX and coordinating the Company’s compliance with its disclosure obligations;
o ASX communication on behalf of the Company, authorising Company announcements and lodging documents with ASX;
o requesting a trading halt in order to prevent or correct a false market;
o providing education on these disclosure policies to the Company’s directors, officers and employees; and
o ensuring there are vetting and authorisation processes designed to ensure that Company announcements:
o are made in a timely manner;
o are factual;
o do not omit material information; and
o are expressed in a clear and objective manner that allows investors to assess the impact of the information when making investment decisions.
An Authorised Disclosure Officer, who is responsible for providing contact details and other information to ASX to ensure such availability, must be available to communicate with the ASX at all reasonable times.
Measures to avoid a false market
In the event that ASX requests information from the Company in order to correct or prevent a false market in the Company’s securities, the Company will comply with that request. The extent of information to be provided by the Company will depend on the circumstances of the ASX request.
If the Company is unable to give sufficient information to the ASX to correct or prevent a false market, the Company will request a trading halt.
If the full Board is available to consider the decision of whether to call a trading halt, only they may authorise it, but otherwise, the Authorised Disclosure Officer may do so.
Company announcements of price sensitive information are subjected to the following vetting and authorisation process to ensure their clarity, timely release, factual accuracy and inclusion of all material information:
o The Authorised Disclosure Officer must prepare ASX announcements when required to fulfil the Company’s disclosure obligations.
o Proposed announcements must be approved by the Managing Director or in his absence, urgent announcements may be approved by any other person expressly authorised by the Board.
o Announcements must first be released to the ASX Announcements Platform before being disclosed to any other private or public party (such as the media). After release of the announcement, it must be displayed on the Company’s website, following which the Company can then release such information to media and other information outlets.
o Wherever practical, all announcements must be provided to the directors, Managing Director and Company Secretary prior to release to the market for approval and comment.
Confidentiality and unauthorised disclosure
The Company must safeguard the confidentiality of information which a reasonable person would expect to have a material effect on the price or value of the Company’s securities. If such information is inadvertently disclosed, the Authorised Disclosure Officer must be informed of the same and must refer it to the Chairman and Managing Director as soon as possible.
External communications and media relations
The Chairman, Managing Director and Company Secretary are authorised to communicate on behalf of the Company with the media, government and regulatory authorities, stock brokers, analysts and other interested parties or the public at large. No other person may do so unless specifically authorised by the Chairman or the Managing Director.
All requests for information from the Company must be referred to the Authorised Disclosure Officer for provision to the Chairman and the Managing Director.
Breach of Disclosure Policy
Serious breaches of the Company’s Disclosure Policy may be treated with disciplinary action, including dismissal, at the discretion of the Board. Where the breach is alleged against a member of the Board, that director will be excluded from the Board’s consideration of the breach.