Corporate Governance Statement
Global Health Limited and the Board are committed to achieving and demonstrating the highest standards of corporate governance. The Company’s corporate governance framework was reviewed in 2003 in light of the best practice recommendations released by the Australian Stock Exchange Corporate Governance Council in March 2003. The Board continues to review the framework and practices to ensure they meet the interests of shareholders. The Company and its controlled entities together are referred to as the Group in this statement.
The Board establishes an audit committee. Details of audit committee Directors’ qualifications and attendance at audit committee meetings are set out in the Directors’ Report contained in the Annual Report.
The audit committee has appropriate financial expertise and all members are financially literate and have an appropriate understanding of the industries in which the Group operates. The audit committee has authority, within the scope of its responsibilities, to seek any information it requires from any employee or external party.
It is the committee’s responsibility to ensure that an effective internal control framework exists within the Company. This includes internal controls to deal with both the effectiveness and efficiency of significant business processes. This includes the safeguarding of assets, the maintenance of proper accounting records and the reliability of financial information.
The audit committee is also responsible for the nomination of the external auditor and review of the adequacy of the scope and quality of the annual statutory audit and half year statutory review.
Board of Directors
The Board of Directors is responsible for the corporate governance of the Company. The Directors are responsible to the shareholders for the performance of the Company in both the short and the longer term and seek to balance sometimes competing objectives in the best interests of the Group as a whole. The Board is also responsible for setting the strategic direction and establishing the policies of the Group. The focus is to enhance the interests of shareholders and other key stakeholders and to ensure the Group is properly managed.
Day to day management of the Group’s affairs and the implementation of the corporate strategy and policy initiatives are formally delegated by the Board to the Managing Director and senior executives. A description of the Company’s main corporate governance practices is set out below.
The responsibilities of the Board include:
- Providing strategic guidance to the Company including contributing to the development of and approving the corporate strategy;
- Reviewing and approving business plans, the annual budget and financial plans including available resources and major capital expenditure initiatives;
- Overseeing and monitoring organisational performance and the achievement of the Group’s strategic goals and objectives and progress of major capital expenditures and other significant corporate projects including any acquisitions or divestments;
- Monitoring financial performance including approval of the annual and half-year financial reports and liaison with the Company’s auditors;
- Appointment, performance assessment and, if necessary, removal of the Managing Director;
- Ratifying the appointment and/or removal and contributing to the performance assessment for the members of the senior management team;
- Ensuring there are effective management processes in place and approving major corporate initiatives;
- Enhancing and protecting the reputation of the organisation;
- Overseeing the operation of the Group’s system for compliance and risk management reporting to shareholders.
The number of meetings of the company’s Board of Directors and of each Board committee held during the year, and the number of meetings attended by each Director is disclosed in the Directors’ Report.
It is the Company’s practice to allow its Executive Directors to accept appointments outside the Company with prior written approval of the Board.
Prior to appointment or being submitted to for re-election, each Non-executive Director is required to specifically acknowledge that they have and will continue to have the time available to discharge their responsibilities to the Company.
Communication to Shareholders
The Board aims to ensure that the shareholders, on behalf of whom they act, are informed of all information necessary to assess the performance of the Company.
Information is communicated to the shareholders through:
- the Annual Report which is distributed to all shareholders;
- the Annual General Meeting and other meetings so called to obtain approval for Board action as appropriate;
- regular release of media and market updates to the ASX; and
- the web site: www.global-health.com
The Company Secretary is the person responsible for communications with the Australian Stock Exchange (ASX). This role includes responsibility for ensuring compliance with the continuous disclosure requirements in the ASX Listing Rules and overseeing and coordinating information disclosure to the ASX, analysts, brokers, shareholders, the media and the public.
All information disclosed to the ASX is posted on the company’s website as soon as it is disclosed to the ASX. When analysts are briefed on aspects of the Group’s operations, the materials used in the presentation is released to the ASX and posted on the company’s website.
All shareholders receive a copy of the Company’s annual and half yearly reports. In addition, the Company seeks to provide opportunities for shareholders to participate through electronic means. Initiatives to facilitate this include making all Company announcements, media briefings, details of Company meetings, press releases and financial reports available on the Company’s website. The website also includes an option for shareholders to register their email address for direct email updates on Company matters.
Composition of the Board
Each year one-third of directors and any director (excluding the Managing Director) who has held office for three years or three annual general meetings (whichever is longer) must retire from office. A retiring director is eligible to seek re-election if so minded.
The skills, experience and expertise relevant to the position of each director who is in office at the date of the Annual Report and his/her term of office is detailed in the Director’s Report contain in the Annual Report. The composition of the Board is determined in accordance with the following principles and guidelines:
- The Board should comprise at least three Directors and should maintain a majority of independent and Non-executive Directors;
- The Chairman must be an independent and Non-executive Director;
- The roles of Chief Executive Officer and Chairman must not be performed by the same individual;
- The Board should comprise Directors with an appropriate range of qualifications and expertise; and
- The Board shall meet regularly and have available all necessary information to participate in an informed discussion of all agenda items.
The Board seeks to ensure that:
- At any point in time, its membership represents an appropriate balance between Directors with experience and knowledge of the Group and Directors with an external or fresh perspective.
- The size of the Board is conducive to effective discussion and efficient decision-making. As Global Health Ltd has a relatively small Board, the full Board acts as a nomination committee and reviews Board memberships including an assessment of necessary and desirable competencies, particularly in consideration of appointments and removals.
The Managing Director and Chief Financial Officer have to make the following certifications to the Board:
- That the company’s financial reports are complete and present a true and fair view, in all material respects, of the financial condition and operational results of the Company and Group and are in accordance with relevant accounting standards.
- That the above statement is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the Board and that the Company’s risk management and internal compliance and control is operating efficiently and effectively in all material respects
The Board has adopted specific principles in relation to Directors’ independence. These state that to be deemed independent, a director must be a non-Executive and:
- Not be a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial shareholder of the Company.
- Within the last three years, not have been employed in an executive capacity by the Company or any other Group member or been a Director after ceasing to hold any such employment.
- Within the last three years not have been a principal of a material professional advisor or a material consultant to the Company or any other Group member, or an employee materially associated with the service provided.
- Not be a material supplier or customer of the Company or any other Group member, or an officer of or otherwise associated directly or indirectly with a material supplier or customer.
- Must have no material contractual relationship with the Company or a controlled entity other than as a director of the Group.
- Not have been 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.
- Be 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.
Independent Professional Advice
Each Director is entitled to seek independent professional advice at the expense of the Company in carrying out his duties as a Director. Prior to obtaining such advice, if at the expense of the Company, the Chairman will be advised of the matter and an estimate of the cost.
The Board does not have a separate remuneration committee due to the small number of Board members. Consequently the issue of remuneration is under the control of the Board which has the responsibility of reviewing and approving remuneration of the Executive team and other executives of the group. Remuneration levels will be competitively set to attract the most qualified and experienced Directors and senior executives. Where necessary the Board will obtain independent advice on the appropriateness of remuneration packages and obtain any necessary shareholder approvals. The amount of remuneration for all Directors is detailed in section the Directors’ Report.
Payment of equity-based executive remuneration is made in accordance with thresholds set in plans approved by shareholders. The Board expects that the remuneration structure implemented will result in the Company being able to attract and retain the best executives to run the Company. It will also provide executives with the necessary incentives to work to grow long term shareholder value.
Monitoring of the Board’s Performance
The Board has adopted a code of conduct for Directors in keeping with the Company’s desire to remain a good corporate citizen and appropriately balance, protect and preserve all stakeholders’ interests.
In order to ensure that the Board continues to discharge its responsibilities in an appropriate manner, the Chairman reviews the performance of all Directors annually.
Directors are subject to the Corporations Act 2001 relative to restrictions applying to acquiring and disposing of securities of the Company, if they are in possession of information which is not generally available, and which, if generally available, a reasonable person would expect to have a material effect on the price of the securities of the Company. The Company’s policy restricts Directors and employees from acting on material information until it has been released to the market and adequate time has been given for this to be reflected in the security’s prices.
Chairman and Chief Executive Officer (CEO)
The Chairman is responsible for leading the Board, ensuring Directors are properly briefed in all matters relevant to their role and responsibilities, facilitating Board discussions and managing the Board’s relationship with the Company’s senior executives.
The CEO is responsible for implementing Group strategies and policies. The Board charter specifies that these are separate roles to be undertaken by separate people.