Corporate Governance and Constitution

CORPORATE GOVERNANCE STATEMENT

The Board has been working on the establishment of corporate governance policies and procedures. The Directors have adopted the following Charters and Policies together with the companies Constitution:

 
 
 


Role of the Board and Delegation to Management

The Board’s role is to:
• represent and serve the interests of shareholders by overseeing and appraising the Company’s strategies, policies and performance. This includes   overseeing the financial and human resources the Company has in place to meet its objectives and reviewing management performance;
• protect and optimize Company performance and build sustainable value for shareholders in accordance with any duties and obligations imposed on the   Board by law and the Company’s constitution and within a framework of prudent and effective controls that enable risk to be assessed and managed;
• set, review and ensure compliance with the Company’s values and governance framework (including establishing and observing high ethical standards);   and
• ensure shareholders are kept informed of the Company’s performance and major developments affecting its state of affairs.

Board key responsibilities
The responsibilities/functions of the Board include:
• selecting, appointing and evaluating from time to time the performance of, determining the remuneration of, and planning succession of, the Chief   Executive Officer (CEO) and the CEO’s direct reports;
• contributing to and approving management development of corporate strategy, including setting performance objectives and approving operating   budgets;
• reviewing, ratifying and monitoring systems of risk management and internal control and ethical and legal compliance. This includes reviewing   procedures to identify the main risks associated with the Company’s businesses and the implementation of appropriate systems to manage these risks;
• monitoring corporate performance and implementation of strategy and policy;
• approving major capital expenditure, acquisitions and divestitures, and monitoring capital management;
• monitoring and reviewing management processes aimed at ensuring the integrity of financial and other reporting;
• developing and reviewing corporate governance principles and policies;
• promoting diversity within all levels of the Company, including establishing a  Diversity Policy encompassing the Board and  all levels of the Company and;performing such other functions as are prescribed by law or are assigned to the Board.

Reserved authorities
Matters which are specifically reserved for the Board or its committees include:
• appointment of a chair;
• appointment and removal of the CEO;
• appointment of directors to fill a vacancy or as additional Director;
• establishment of Board committees, their membership and delegated authorities;
• approval of dividends;
• approval of major capital expenditure, acquisitions and divestitures in excess of authority levels delegated to management;
• calling of meetings of shareholders; and
• any other specific matters nominated by the Board from time to time.

Relationship with management
• Directors may delegate their powers as they consider it appropriate. However, ultimate responsibility for strategy and control rests with the   directors.
• Management must supply the Board with information in a form, time-frame and quality that will enable the Board to discharge its duties effectively.
• Directors are entitled to request additional information at any time when they consider it appropriate.

Role of the CEO
• The management function is conducted by, or under the supervision of, the CEO as directed by the Board (and by other officers to whom the   management function is properly delegated by the CEO).
• The Board approves corporate objectives for the CEO to satisfy and, jointly with the CEO, develops the duties and responsibilities of the CEO.
• The CEO is responsible for implementing strategic objectives, plans and budgets approved by the Board.

Delegation to Committees
• The Board from time to time establishes Committees to streamline the discharge of its responsibilities.
• Each standing Committee adopts a formal charter setting out the matters relevant to the composition, responsibilities and administration of the   Committee.
• The Board may also delegate specific functions to ad hoc Committees on an ‘as needs’ basis.
• The powers delegated to these Committees are set out in Board resolutions.
• The Board will, at least once in each year, review the membership and charter of each Committee to determine its adequacy for current   circumstances.

Structure and Composition of the Board
The Company’s constitution provides for the Board to determine a number of directors that is not less than three and not more than 12.
It is intended that the Board should comprise a majority of independent non executive directors and comprise directors with a broad range of skills, expertise and experience from a diverse range of backgrounds appropriate to the needs of the Company and take account of the desire for gender diversity.
The skills, experience and expertise relevant to the position of each director who is in office at the date of the annual report and their term of office are detailed in the directors’ report.

Mr Rob Thomson and Mrs Fiona Robertson are considered independent directors.
When determining whether a non-executive director is independent the director must not fail any one of the following materiality thresholds:
• less than 5% of company shares are held by the director and any entity or individual directly or indirectly associated with the director; and
• no material sales are made to or material purchases made from any entity or individual directly or indirectly associated with the director.
The overriding consideration is that the director must be independent of management and free of any business or other relationship that could materially interfere with, or could reasonably be perceived to interfere with, the exercise of their unfettered and independent judgment.

Under the Board’s Charter, the role Chairman who is elected by the Board will be held by an independent, non-executive director.  
Retirement and rotation of directors is governed by the Corporations Act 2001 and the Constitution of the Company.
The Board has established a Remuneration and Nomination Committee (see section below).

Independent Professional Advice
Independent directors have the right to seek independent professional advice in the furtherance of their duties as directors at the company’s expense. Written approval must be obtained from the Chairman prior to incurring any expense on behalf of the company.

Board Performance Evaluation
The Board expects to commence a formal process of annual performance evaluation during 2013. Notwithstanding the absence of a formal evaluation process to date, there has been regular discussion and adoption of initiatives to improve the functioning of the Board and its Committees including approval of formal Board and Committee Charters.

Ethical Standards
The Board acknowledges and emphasises the importance of all directors and employees maintaining the highest standards of corporate governance practice and ethical conduct.
A code of conduct has been developed requiring directors and employees to:
• act honestly and in good faith;
• exercise due care and diligence in fulfilling the functions of office;
• avoid conflicts and make full disclosure of any possible conflict of interest;
• comply with the law;
• encourage the reporting and investigating of unlawful and unethical behaviour; and
• directors are obliged to be independent in judgment and ensure all reasonable steps are taken to ensure due care is taken by the Board in   making sound decisions.
The Company’s policy is to recruit and retain people on the basis of their skills, experience and performance, regardless of factors such as age, gender, cultural, ethnic or religious background, nationality, race or physical ability.

Integrity in Financial Reporting
The Board is committed to ensuring the Company’s financial reports present a true and fair view of the Company’s postion and comply with relevant accounting standards. To assist the Board with the discharge of its responsibilities for financial reporting and to ensure that appropriate internal controls are in place, the Board has etablished an Audit, Business Risk and Compliance Committee comprised solely of independent, non-executive directors and chaired by an independent director who is not Chairman of the Board.  The names and qualifications of those appointed to the audit committee are included in the directors’ report.

The key responsibilities and functions of the Audit Business Risk and Compliance Committee, as set out in its charter, are:
• oversee the Company’s relationship with the external auditor and the external audit function generally;
• oversee the internal audit function;
• oversee the preparation of the financial statements and reports;
• oversee the Company’s financial controls and systems; and
• oversee the process of identification and management of business and financial risks.

Shareholder Rights
The Company endeavors to keep shareholders informed of its progress through shareholder periodic shareholder updates and presentations, and posting of information to the Company’s website at www.oneasiaresources.com.
Shareholders are entitled to vote on significant matters impacting on the business, which include the election and remuneration of directors, changes to the constitution and receipt of annual financial statements. Shareholders are strongly encouraged to attend and participate in the Annual General Meetings of One Asia Resources Limited, to lodge questions to be responded to by the Board, and are able to appoint proxies.

Risk Management
The Board considers identification and management of key risks associated with the business as vital to the health of the company and to maximization of shareholder wealth.
During the year, the company conducted an initial assessment of the business’ risk profile considering all aspects of the business from operational through to strategic level risks. It is intended that a risk assessment be conducted on at least an annual basis and reviewed by the Audit, Business Risk and Compliance Committee and the Board, with ongoing monitoring of key risks and risk mitigation initiatives as required.
During the upcoming year, the Company plans to establish a policy framework and system for the oversight and management of material business risks.  In addition, the Chief Financial Officer has been delegated the task of implementing internal controls to identify and manage risks for which the Board provides oversight. The adequacy and effectiveness of these controls will be monitored and reviewed regularly.

Remuneration Policies
A formal remuneration policy, setting out the key principles by which remuneration is awarded for all staff, including key management personnel,  has been developed by the Remuneration and Nomination Committee and approved  by the Board. The policy is being designed to attract high calibre executives and reward them for their performance, resulting in long-term growth in shareholder value.
Under existing arrangements, executives may receive a base salary, superannuation, fringe benefits, performance incentives and retirement benefits.
Executives are also entitled to participate in any employee share and option arrangements. The total amount of remuneration for all key management personnel for the company is detailed in the notes to the financial statements. All remuneration paid to executives is valued at the cost to the company and expensed. Options provided to executives are valued using the Black Scholes Option Pricing Model.
The Remuneration and Nomination Committee will review executive packages annually by reference to company performance, executive performance, comparable information from industry sectors, other companies and independent advice.
The payment of bonuses, options and other incentive payments are to be reviewed by the Remuneration and Nomination Committee annually as part of the review of executive remuneration, and a recommendation will be put to the Board for approval. The Board can exercise its discretion in relation to approving incentives, bonuses and options and can recommend changes to the committee’s recommendations. Any changes must be justified by reference to measurable performance criteria.
The Board expects that the remuneration structure implemented will result in the company being able to attract and retain the best executives to manage the consolidated group. It will also provide executives with the necessary incentives to grow long-term shareholder value.

Remuneration and Nomination Committee

The Remuneration and Nomination Committee assists the Board in the areas of:
a) Board structure and performance;
b) senior management structure and performance;
c) the formulation and implementation of remuneration and employment policies;
d) formulation and oversight of the company’s employee long-term incentive plans.
Under the terms of its charter, the Remuneration and Nomination Committee consists of only non-executive directors, a majority of independent directors and has an independent director as chair. The names of the members of the Remuneration and Nomination committee are detailed in the Directors’ Report.
There are no schemes for retirement benefits other than statutory superannuation for non-executive directors.