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Corporate Governance Statement
Approach to Corporate Governance
Manhattan Corporation Limited ABN 61 123 156 089 (Company) has established a corporate governance framework, the key features of which are set out in this statement. In establishing its corporate governance framework, the Company has referred to the recommendations set out in the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations 3rd edition (Principles & Recommendations). The Company has followed each recommendation where the Board has considered the recommendation to be an appropriate benchmark for its corporate governance practices. Where the Company's corporate governance practices follow a recommendation, the Board has made appropriate statements reporting on the adoption of the recommendation. In compliance with the 'if not, why not' reporting regime, where, after due consideration, the Company's corporate governance practices do not follow a recommendation, the Board has explained it reasons for not following the recommendation and disclosed what, if any, alternative practices the Company has adopted instead of those in the recommendation.
The following governance-related documents can be found on the Company's website at www.manhattancorp.com.au, under the section marked 'Corporate Governance':
Charters
Board
Audit and Risk Committee Nomination Committee Remuneration Committee Risk Committee
Policies and Procedures
Process for Performance Evaluations
Policy and Procedure for the Selection and (Re)Appointment of Directors Induction Program
Diversity Policy (summary) Code of Conduct (summary)
Policy on Continuous Disclosure (summary) Compliance Procedures (summary)
Shareholder Communication and Investor Relations Policy Securities Trading Policy
The Company reports below on whether it has followed each of the recommendations during the 2015/2015 financial year (Reporting Period). The information in this statement is current at 29 September 2015. This statement was approved by a resolution of the Board on 29 September 2015.
Principle 1 - Lay solid foundations for management and oversight
Recommendation 1.1
The Company has established the respective roles and responsibilities of its Board and management, and those matters expressly reserved to the Board and those delegated to management and has documented this in its Board Charter.
Recommendation 1.2
The Company undertakes appropriate checks before appointing a person, or putting forward to shareholders a candidate for election as a director and provides shareholders with all material information in its possession relevant to a decision on whether or not to elect or re-elect a director.
The checks which are undertaken, and the information provided to shareholders are set out in the Company's Policy and Procedure for the Selection and (Re)Appointment of Directors.
Recommendation 1.3
The Company has a written agreement with each director and senior executive setting out the terms of their appointment. The material terms of any employment, service or consultancy agreement the Company, or any of its child entities, has entered into with its Executive Chair, any of its directors, and any other person or entity who is related party of the Executive Chair or any of its directors has been disclosed in accordance with ASX Listing Rule 3.16.4 (taking into consideration the exclusions from disclosure outlined in that rule).
Recommendation 1.4
The Company Secretary is accountable directly to the Board, through the Chair, on all matters to do with the proper functioning of the Board as outlined in the Company's Board Charter. The Company's Secretary's role is also outlined in the employment/consultancy agreement between the Company Secretary and the Company.
Recommendation 1.5
The Company has a Diversity Policy. However, the Diversity Policy does not include requirements for the Board to set measurable objectives for achieving gender diversity and to assess annually both the objectives and the Company's progress in achieving them. Nor has the Board set measurable objectives for achieving gender diversity. Given the Company's stage of development and the small number of employees, the Board considers that it is not practical to set measurable objectives for achieving gender diversity at this time.
The Company has no direct employees at this time apart from the board and the Company Secretary which is comprised of 4 men and no women. The Company utilises consultants to fill the required Company activities at this stage of its development.
Recommendation 1.6
The Executive Chair is responsible for evaluation of the Board and, when deemed appropriate, Board committees and individual directors. The Senior Independent Director is responsible for evaluating the Executive Chair.
Evaluations include an interview process following a review of a performance questionnaire.
During the Reporting Period due to the reduced level of activity of the Company there was no evaluation of the Board, its committees, and individual directors undertaken. This is a departure from the Company's Corporate Governance policies, and the full reviews will be completed in the 2015/2016 financial period.
Recommendation 1.7
The Executive Chair is responsible for evaluating the performance of senior executives in accordance with the process disclosed in the Company's Process for Performance Evaluations.
As there were no senior executives employed during the reporting period there were no evaluations undertaken.
Principle 2 - Structure the board to add value
Recommendation 2.1
The Board has not established a separate Nomination Committee. Given the current size and composition of the Board, the Board believes that there would be no efficiencies gained by establishing a separate Nomination Committee. Accordingly, the Board performs the role of the Nomination Committee. Although the Board has not established a separate Nomination Committee, it has adopted a Nomination Committee Charter, which describes the role, composition, functions and responsibilities of the full Board in its capacity as the Nomination Committee. When the Board convenes as the Nomination Committee it carries out those functions which are delegated to it in the Company's Nomination Committee Charter. Items that are usually required to be discussed by a Nomination Committee are marked as separate agenda items at Board meetings when required. The Board deals with any conflicts of interest that may occur when convening in the capacity of the Nomination Committee by ensuring that the director with conflicting interests is not party to the relevant discussions.
Details of director attendance at meetings of the full Board, in its capacity as the Nomination Committee, during the Reporting Period, are set out in a table in the Directors' Report of the Company's 2015 Annual Report.
The Board has adopted a Nomination Committee Charter which describes the role, composition, functions and responsibilities of the Nomination Committee and is disclosed on the Company's website.
Recommendation 2.2
The Company has during the Reporting Period had a Board skills matrix setting out the mix of skills and diversity that the Board currently has or is looking to achieve in its membership. These include technical, legal, finance, corporate, accounting, corporate governance and human resource. Full details of each Director's member qualifications and expertise is included in the Company's 2015 Annual Report. These skill sets are regularly reviewed and training is undertaken to cover any additional required skills.
Recommendation 2.3
The sole independent director of the Company is Marcello Cardaci.
The Board considers the independence of directors having regard to the relationships listed in Box 2.3 of the Principles & Recommendations.
The length of service of each director is set out in the Directors' Report in the Company's 2015 Annual Report.
Recommendation 2.4
The Board does not have a majority of directors who are independent. The Board believes the current structure is appropriate given the Company's current size and activities. The existing Directors provide the necessary diversity of qualifications, skills and experience and bring quality and independent judgment to all relevant issues.
If the Company's activities increase in size, nature and scope the size of the Board will be reviewed.
The Board acknowledges the benefit that a majority of independent directors can bring to the Board, and will continue to monitor and review the composition of the Board.
Recommendation 2.5
The non-independent Chair of the Board is Alan Eggers. Mr Eggers is the Company's Executive Chair, also performing the function of the Chief Executive Officer of the Company. While the Board notes Recommendation 2.5, the existing structure is considered appropriate and provides a unified leadership structure. Mr Eggers is the largest shareholder of the Company, and has been a major force in the current growth and direction of the Company. His depth of knowledge of the uranium industry, his past position in growing a small exploration company into an ASX Top 200 company and his experience in growth strategies as presented to the Board has led to the conclusion that at this stage of the Company's development, he is able to bring quality and independent judgment to all relevant issues, and the Company benefits from his long standing experience of its operations and business relationships.
Recommendation 2.6
The Company has an induction program that it uses to when new directors join the Board and when new senior executives are appointed. The goal or the program is to assist new directors to participate fully and actively in Board decision-making at the earliest opportunity and to assist senior executives to participate fully and actively in management decision-making at the earliest opportunity. The Company's Induction Program is disclosed on the Company's website.
The Board regularly reviews whether the directors as a group have the skills, knowledge and familiarity with the Company and its operating environment required to fulfil their role on the Board and the Board committees effectively using a Board skills matrix. Where any gaps are identified, the Board considers what training or development should be undertaken to fill those gaps. In particular, the Board ensures that any director who does not have specialist accounting skills or knowledge has a sufficient understanding of accounting matters to fulfil his or her responsibilities in relation to the Company's financial statements. Directors also receive ongoing education on developments in accounting standards.
Principle 3 - Act ethically and responsibly
Recommendation 3.1
The Company has established a Code of Conduct for its directors, senior executives and employees, which is disclosed on the Company's website.
Principle 4 - Safeguard integrity in corporate reporting
Recommendation 4.1
The Board has not established a separate Audit Committee. Given the current size and composition of the Board, the Board believes that there would be no efficiencies gained by establishing a separate Audit Committee. Accordingly, the Board performs the role of Audit and Risk Committee. Although the Board has not established a separate Audit and Risk Committee, it has adopted an Audit and Risk Committee Charter. When the Board convenes as the Audit and Risk Committee it carries out those functions which are delegated to it in the Company's Audit and Risk Committee Charter. Items that are usually required to be discussed by an Audit and Risk Committee are marked as separate agenda items at Board meetings when required. The Board deals with any conflicts of interest that may occur when convening in the capacity of the Audit and Risk Committee by ensuring that the director with conflicting interests is not party to the relevant discussions.
The Company has also established a Procedure for the Selection, Appointment and Rotation of its External Auditor. The Board is responsible for the initial appointment of the external auditor and the
appointment of a new external auditor when any vacancy arises. Candidates for the position of external auditor must demonstrate complete independence from the Company through the engagement period. The Board may otherwise select an external auditor based on criteria relevant to the Company's business and circumstances. The performance of the external auditor is reviewed on an annual basis by the Board.
During the Reporting period there were 2 full Board meetings with all board members in attendance, where it acted separately in its capacity as the Audit and Risk Committee.
The Board has adopted an Audit and Risk Committee Charter which describes the Audit and Risk Committee's role, composition, functions and responsibilities.
Recommendation 4.2
Before the Board approved the Company financial statements for the half year ended 31 December 2014 and the full-year ended 30 June 2015, it received from the Executive Chair and the Chief Financial Officer a declaration that, in their opinion, the financial records of the Company for the relevant financial period have been properly maintained and that the financial statements for the relevant financial period comply with the appropriate accounting standards and give a true and fair view of the financial position and performance of the Company and the consolidated entity and that the opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively (Declaration).
The Board did not obtain a Declaration before approving the Company's quarterly cash-flow reports for each of the quarters ending 30 September 2014, 31 December 2014, 31 March 2015 and 30 June 2015 as the cash-flow reports are not financial statements as defined in the Corporations Act 2001 (Cth).
Recommendation 4.3
Under section 250RA of the Corporations Act, the Company's auditor is required to attend the Company's annual general meeting at which the audit report is considered, and must arrange to be represented by a person who is a suitably qualified member of the audit team that conducted the audit and be in a position to answer questions about the audit. Each year, the Company writes to the Company's auditor to inform them of the date of the Company's annual general meeting. In accordance with section 250S of the Corporations Act, at the Company's annual general meeting where the Company's auditor or their representative is at the meeting, the Chair allows a reasonable opportunity for the members as a whole at the meeting to ask the auditor (or its representative) questions relevant to the conduct of the audit; the preparation and content of the auditor's report; the accounting policies adopted by the Company in relation to the preparation of the financial statements; and the independence of the auditor in relation to the conduct of the audit. The Chair also allows a reasonable opportunity for the auditor (or their representative) to answer written questions submitted to the auditor under section 250PA of the Corporations Act.
A representative of the Company's auditor, attended the Company's annual general meeting held on 28 November 2014.
Principle 5 - Make timely and balanced disclosure
Recommendation 5.1
The Company has established written policies and procedures for complying with its continuous disclosure obligations under the ASX Listing Rules. A summary of the Company's Policy on Continuous Disclosure and Compliance Procedures are disclosed on the Company's website.
Principle 6 - Respect the rights of security holders
Recommendation 6.1
The Company provides information about itself and its governance to investors via its website at www.manhattancorp.com.au as set out in its Shareholder Communication and Investor Relations Policy.
Recommendation 6.2
The Company has designed and implemented an investor relations program to facilitate effective two- way communication with investors. The program is set out in the Company's Shareholder Communication and Investor Relations Policy.
Recommendation 6.3
The Company has in place a Shareholder Communication and Investor Relations Policy which outlines the policies and processes that it has in place to facilitate and encourage participation at meetings of shareholders.
Recommendation 6.4
Shareholders are given the option to receive communications from, and send communications to, the Company and its share registry electronically via the Company's website.
Principle 7 - Recognise and manage risk
Recommendation 7.1
The Board has not established a separate Risk Committee. Given the current size and composition of the Board, the Board believes that there would be no efficiencies gained by establishing a separate Risk Committee. Accordingly, as noted above the Board performs the role of an Audit and Risk Committee. Although the Board has not established a separate Audit and Risk Committee, it has adopted an Audit and Risk Committee Charter. When the Board convenes as the Audit and Risk Committee it carries out those functions which are delegated to it in the Company's Audit and Risk Committee Charter. Items that are usually required to be discussed by an Audit and Risk Committee are marked as separate agenda items at Board meetings when required. The Board deals with any conflicts of interest that may occur when convening in the capacity of the Audit and Risk Committee by ensuring that the director with conflicting interests is not party to the relevant discussions.
During the Reporting period there were 2 full Board meetings with all board members in attendance, where it acted separately in its capacity as the Audit and Risk Committee.
Recommendation 7.2
The Board reviews the Company's risk management framework bi-annually to satisfy itself that it continues to be sound, to determine whether there have been any changes in the material business risks the Company faces and to ensure that the Company is operating within the risk appetite set by the Board. The Board carried out these reviews during the Reporting Period.
Recommendation 7.3
The Company does not have an internal audit function. To evaluate and continually improve the effectiveness of the Company's risk management and internal control processes, the Board relies on ongoing reporting and discussion of the management of material business risks as outlined in the Company's Risk Management Policy.
Recommendation 7.4
Manhattan operates in the mineral resource and energy sectors where there are a number of risk factors inherent to the Company's operations. The Company mitigates its risk factors primarily by ensuring it has a suitably qualified and experienced Board of Directors with a range of professional qualifications appropriate to the industry and business sector in which it operates.
Recognition of these risk factors and subsequent effective management, control and reporting of risk are an essential part of the Company's day to day operations to minimise potential losses and create medium to long term shareholder wealth. The Board is responsible for the oversight, adequacy and implementation of the Company's risk management and control framework. Responsibility for internal control and risk management is delegated to the appropriate level of management within the Company with the Executive Chairman and Company Secretary having ultimate responsibility to the Board for the identification of risk, risk management and internal control framework.
Areas of strategic, operational, legal, reporting, compliance, business and financial risks are identified, assessed and continually monitored by executive management to assist the Company to achieve its business objectives. These areas of risk are highlighted in the Business Plan presented to the Board by the Executive Chairman on a regular basis. Arrangements put in place by the Board to monitor risk management include monthly reporting by executive management to the Board in respect of operations and the financial position of the Company and ensuring all legal, reporting and compliance matters and obligations are met.
The main operational risks for Manhattan in the industry and business sector in which it operates have been identified as:
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Sovereign risk, legislation and political issues;
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Government policies and changes to those policies;
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Financial and equity markets stability;
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Fluctuating commodity prices and demand;
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Fluctuating exchange rates;
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Compliance with licence and permit conditions;
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Land access, environmental and Native Title issues;
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Availability of specialist drilling, laboratory, exploration support and transport services;
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Availability of specialist airborne geophysical survey contractors and consultants;
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Availability of suitably experienced and qualified professionals, personnel and consultants;
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Increasing costs of operations;
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Availability of capital and debt facilities; and
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Retention of key executives and staff.
These risks areas identified by the Company's Board are provided here to assist shareholders better understand the nature of the risks faced by the Company, and other companies, in the industry sector in which it operates. They are not necessarily an exhaustive list.
Principle 8 - Remunerate fairly and responsibly
Recommendation 8.1
The Board has not established a separate Remuneration Committee. Given the current size and composition of the Company, the Board believes that there would be no efficiencies gained by establishing a separate Remuneration Committee. Accordingly, the Board performs the role of Remuneration Committee. Although the Board has not established a separate Remuneration Committee, it has adopted a Remuneration Committee Charter, which describes the role, composition, functions and responsibilities of the full Board in its capacity as the Remuneration Committee. When the Board convenes as the Remuneration Committee it carries out those functions which are delegated to it in the Company's Remuneration Committee Charter. Items that are usually required to be discussed by a Remuneration Committee are marked as separate agenda items at Board meetings when required. The Board deals with any conflicts of interest that may occur when convening in the capacity of the Remuneration Committee by ensuring that the director with conflicting interests is not party to the relevant discussions.
The Board has adopted a Remuneration Committee Charter which describes the role, composition, functions and responsibilities of the Remuneration Committee.
Recommendation 8.2
Details of remuneration, including the Company's policy on remuneration, are contained in the 'Remuneration Report' which forms of part of the Directors' Report of the Company's 2015 Annual Report.
Recommendation 8.3
The Company's Remuneration Committee Charter includes a statement of the Company's policy on prohibiting recipients of equity based remuneration from entering into transactions (whether through the use of derivatives or otherwise) which limit the economic risk of participating in unvested entitlements.
Rules 4.7.3 and 4.10.31
Appendix 4G
Key to Disclosures
Corporate Governance Council Principles and Recommendations
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Name of entity:
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Manhattan Corporation Limited
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ABN / ARBN:
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Financial year ended:
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61 123 156 089
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30 June 2015
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Our corporate governance statement2for the above period above can be found at:3
The Corporate Governance Statement is accurate and up to date as at [insert effective date of statement] and has been approved by the board.
The annexure includes a key to where our corporate governance disclosures can be located.
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Date:
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29 September 2015
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Name of Director or Secretary authorising lodgement:
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Sam Middlemas
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1 Under Listing Rule 4.7.3, an entity must lodge with ASX a completed Appendix 4G at the same time as it lodges its annual report with ASX.
Listing Rule 4.10.3 requires an entity that is included in the official list as an ASX Listing to include in its annual report either a corporate governance statement that meets the requirements of that rule or the URL of the page on its website where such a statement is located. The corporate governance statement must disclose the extent to which the entity has followed the recommendations set by the ASX Corporate Governance Council during the reporting period. If the entity has not followed a recommendation for any part of the reporting period, its corporate governance statement must separately identify that recommendation and the period during which it was not followed and state its reasons for not following the recommendation and what (if any) alternative governance practices it adopted in lieu of the recommendation during that period.
Under Listing Rule 4.7.4, if an entity chooses to include its corporate governance statement on its website rather than in its annual report, it must lodge a copy of the corporate governance statement with ASX at the same time as it lodges its annual report with ASX. The corporate governance statement must be current as at the effective date specified in that statement for the purposes of rule 4.10.3.
2 'Corporate governance statement' is defined in Listing Rule 19.12 to mean the statement referred to in Listing Rule 4.10.3 which discloses the extent to which an entity has followed the recommendations set by the ASX Corporate Governance Council during a particular reporting period.
3 Mark whichever option is correct and then complete the page number(s) of the annual report, or the URL of the web page, where the entity's corporate governance statement can be found. You can, if you wish, delete the option which is not applicable.
Throughout this form, where you are given two or more options to select, you can, if you wish, delete any option which is not applicable and just retain the option that is applicable. If you select an option that includes 'OR' at the end of the selection and you delete the other options, you can also, if you wish, delete the 'OR' at the end of the selection.
Page 1
ANNEXURE - KEY TO CORPORATE GOVERNANCE DISCLOSURES
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Corporate Governance Council recommendation
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We have followed the recommendation in full for the whole of the period above. We have disclosed …
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We have NOT followed the recommendation in full for the whole of the period above. We have disclosed …4
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PRINCIPLE 1 - LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT
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1.1
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A listed entity should disclose:
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the respective roles and responsibilities of its board and management; and
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those matters expressly reserved to the board and those delegated to management.
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… the fact that we follow this recommendation:
☒ in our Corporate Governance Statement OR
… and information about the respective roles and responsibilities of our board and management (including those matters expressly reserved to the board and those delegated to management):
☒ at www.manhattancorp.com.au
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1.2
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A listed entity should:
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undertake appropriate checks before appointing a person, or putting forward to security holders a candidate for election, as a director; and
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provide security holders with all material information in its possession relevant to a decision on whether or not to elect or re-elect a director.
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… the fact that we follow this recommendation:
☒ in our Corporate Governance Statement OR
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1.3
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A listed entity should have a written agreement with each director and senior executive setting out the terms of their appointment.
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… the fact that we follow this recommendation:
☒ in our Corporate Governance Statement OR
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1.4
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The company secretary of a listed entity should be accountable directly to the board, through the chair, on all matters to do with the proper functioning of the board.
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… the fact that we follow this recommendation:
☒ in our Corporate Governance Statement OR
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4 If you have followed all of the Council's recommendations in full for the whole of the period above, you can, if you wish, delete this column from the form and re-format it.
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Corporate Governance Council recommendation
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We have followed the recommendation in full for the whole of the period above. We have disclosed …
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We have NOT followed the recommendation in full for the whole of the period above. We have disclosed …4
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1.5
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A listed entity should:
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have a diversity policy which includes requirements for the board or a relevant committee of the board to set measurable objectives for achieving gender diversity and to assess annually both the objectives and the entity's progress in achieving them;
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disclose that policy or a summary of it; and
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disclose as at the end of each reporting period the measurable objectives for achieving gender diversity set by the board or a relevant committee of the board in accordance with the entity's diversity policy and its progress towards achieving them and either:
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the respective proportions of men and women on the board, in senior executive positions and across the whole organisation (including how the entity has defined 'senior executive' for these purposes); or
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if the entity is a 'relevant employer' under the Workplace Gender Equality Act, the entity's most recent 'Gender Equality Indicators', as defined in and published under that Act.
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… the fact that we have a diversity policy that complies with paragraph (a):
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in our Corporate Governance Statement OR
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at [insert location]
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at [insert location]
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in our Corporate Governance Statement OR
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at [insert location]
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in our Corporate Governance Statement OR
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at [insert location]
… and a copy of our diversity policy or a summary of it:
… and the measurable objectives for achieving gender diversity set by the board or a relevant committee of the board in accordance with our diversity policy and our progress towards achieving them:
… and the information referred to in paragraphs (c)(1) or (2):
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☒ an explanation why that is so in our Corporate Governance Statement OR
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1.6
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A listed entity should:
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have and disclose a process for periodically evaluating the performance of the board, its committees and individual directors; and
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disclose, in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance with that process.
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… the evaluation process referred to in paragraph (a):
☒ in our Corporate Governance Statement OR
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at [insert location]
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at [insert location]
… and the information referred to in paragraph (b):
☒ in our Corporate Governance Statement OR
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Corporate Governance Council recommendation
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We have followed the recommendation in full for the whole of the period above. We have disclosed …
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We have NOT followed the recommendation in full for the whole of the period above. We have disclosed …4
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1.7
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A listed entity should:
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have and disclose a process for periodically evaluating the performance of its senior executives; and
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disclose, in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance with that process.
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… the evaluation process referred to in paragraph (a):
☒ in our Corporate Governance Statement OR
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at [insert location]
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at [insert location]
… and the information referred to in paragraph (b):
☒ in our Corporate Governance Statement OR
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