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Recommendation
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Complies
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Reference/explanation
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Principle 1 – Lay solid foundations for management and oversight
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1.1
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Companies should establish the functions reserved to the board and those delegated to senior executives and disclose those functions.
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Yes
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The Board is responsible for the overall corporate governance of the Company.
The Board has established a statement of Board functions.
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1.2
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Companies should disclose the process for evaluating the performance of senior executives.
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Yes
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The Board and CEO conduct performance appraisals annually. The Board assesses the performance of the CEO against specified operating and growth objectives. CEO assesses other senior executives’ performance against business unit operating and growth objectives.
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1.3
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Companies should provide the information indicated in the guide to reporting on Principle 1.
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Yes
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Disclosed in the Directors’ Report.
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Principle 2 - Structure the board to add value
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2.1
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A majority of the board should be independent directors.
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No
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During the year, and as at the date of this report, the board has had, at any one time, an Executive Chairman, one executive director and two non-executive directors.
Of the non-executive directors Mr. Tim Lebbon is not considered to be independent by the Board under the definitions provided in the Council's recommendations as he has significant entitlements to the Company’s issued share capital and has advanced funds to the Company (through a related party).
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2.2
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The chair should be an independent director.
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No
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The Board is responsible for the overall corporate governance of the Company.
The Board has established a statement of Board functions.
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2.3
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The roles of chair and chief executive officer should not be exercised by the same individual.
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Yes
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Until 1 January 2009 the CEO was Mr. Michael So; from 7 January to the date of this report it was Mr. Peter Saunders
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2.4
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The board should establish a nomination committee.
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No
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As noted above and subject to the provisions of the Company’s Constitution, the issues of board composition, independence and selection criteria for potential appointees are now deliberated within the Board of Directors meetings. Accordingly, there is not a separate functioning Nomination Committee.
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2.5
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Companies should disclose the process for evaluating the performance of the board, its committees and individual directors.
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Yes
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The Company conducts this on an annual basis. The Company has not adopted a formal policy for the performance evaluation but follows the following principles:
• Within the tight knit framework of m2m, it is not feasible to separately identify quantitative measures the contribution of any one director or external consultant to the operating performance.
• The Board and its key advisers provide the best combination of experience and skills to make a significant contribution to achieving the Company’s short and long term goals.
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2.6
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Companies should provide the information indicated in the guide to reporting on Principle 2.
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Yes
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Disclosed in the Directors’ Report. |
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Principle 3 - Promote ethical and responsible decision-making
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3.1
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Companies should establish a code of conduct and disclose the code or a summary of the code as to:
• the practices necessary to maintain confidence in the company's integrity.
• the practices necessary to take into account their legal obligations and the reasonable expectations of their stakeholders.
• the responsibility and accountability of individuals for reporting and investigating reports of unethical practices.
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Yes
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The Board has adopted a code of conduct.
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3.2
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Companies should establish a policy concerning trading in company securities by directors, senior executives and employees, and disclose the policy or a summary of that policy.
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Yes
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The Board has adopted a policy in regard to trading in securities.
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3.3
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Companies should provide the information indicated in the guide to reporting on Principle 3
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Yes
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Disclosed in the Directors’ Report.
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Principle 4 – Safeguard integrity in financial reporting
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4.1
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The board should establish an audit committee.
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Yes
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The Board has established an audit committee.
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4.2
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The audit committee should be structured so that it consists of:
• only of non-executive directors
• at least three members
• a majority of independent directors
• an independent chair, who is not chair of the board
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No
Yes
No
Yes
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The Board has adopted a policy in regard to trading in securities.
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4.3
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The audit committee should have a formal charter.
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No
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The Board has not adopted an audit committee charter but operates under agreed terms of reference as set out in the Directors’ Report.
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4.4
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Companies should provide the information indicated in the Guide to reporting on Principle 4.
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Yes
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The Committee has met twice during the year and has operated within the Board structure in the course of regular Board of Directors meetings.
Allowing for the size and stage of development of the Company it is not likely that the composition of the Board will change in the near future.
Other disclosures are in the Directors’ Report.
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Principle 5 – Make timely and balanced disclosure
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5.1
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Companies should establish written policies designed to ensure compliance with ASX listing rule disclosure requirements and to ensure accountability at a senior executive level for that compliance and disclose those policies or a summary of those policies.
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Yes
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The Company has adopted a continuous disclosure statement.
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5.2
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Companies should provide the information indicated in the guide to reporting on Principle 5.
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Yes
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Disclosed in the Directors’ Report.
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Principle 6 – Respect the rights of shareholders
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6.1
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Companies should design a communications policy for promoting effective communication with shareholders and encouraging their participation at general meetings and disclose their policy or a summary of that policy.
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Yes
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The Company has adopted a Shareholders Communications Statement.
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6.2
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Companies should provide the information indicated in the guide to reporting on Principle 6.
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Yes
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Disclosed in the Directors’ Report.
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Principle 7 – Recognise and manage risk
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7.1
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Companies should establish policies for the oversight and management of material business risks and disclose a summary of those policies.
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Yes
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The Company has adopted a risk management statement.
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7.2
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The board should require management to design and implement the risk management and internal control system to manage the company’s material business risks and report to it on whether those risks are being managed effectively. The board should disclose that management has reported to it as to the effectiveness of the company’s management of its material business risks
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No
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The Company has identified key risks within the business. In the ordinary course of business, management monitors and manages these risks on a regular basis.
The Company will commence a risk management framework and risk register that will report the likelihood and consequence of risks within the business.
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7.3
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The board should disclose whether it has received assurance from the chief executive officer and the chief financial officer [or equivalent] that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks.
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Yes
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The Chief Executive Officer has provided this statement to the Board of Directors by reference to the size of the company, the number of employees and the materiality of risk.
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7.4
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Companies should provide the information indicated in the guide to reporting on Principle 7.
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Yes
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Disclosed in the Directors’ Report.
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Principle 8 – Remunerate fairly and responsibly
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8.1
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The board should establish a remuneration committee.
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No
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The Board has not established a remuneration committee.
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8.2
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Companies should clearly distinguish the structure of non-executive directors' remuneration from that of executive directors and senior executives.
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Yes
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The Company complies with the guidelines for non-executive director remunerations packages.
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8.3
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Companies should provide the information indicated in the Guide to reporting on Principle 8.
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Yes
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Disclosed in the Directors’ Report.
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