Board Charter

Corporate Governance Framework
Document No. 2

BCD RESOURCES NL (“BCD”)

BOARD CHARTER

 

1. INTRODUCTION

1.1 Derivation

The powers, duties and responsibilities of the Board are prescribed by the Corporations Act and the Constitution of the company.  The standards and conduct adopted by the Board will also reflect the standards of  corporate governance practice recommended by ASX Corporate Governance Council adapted as necessary to the circumstances of BCD.

1.2  General

In carrying out its responsibilities and powers as set out in this Charter, both for the Company, and where appropriate for it and its subsidiaries (the Group), the Board will at all times recognise its overriding responsibility to act honestly, with integrity, diligently and in accordance with the law in serving the interest of BCD's shareholders, as well as its employees, and the community.  It will promote and maintain an environment within BCD that will establish these basic principles as guidelines for all of its employees and representatives at all times.

2. PURPOSE AND ROLE OF THE BOARD

2.1 Responsibilities of the Board

The Board is responsible for:

   - charting the direction, policies, strategies and financial objectives for BCD and monitoring the       implementation of those policies, strategies and financial objectives;

   - monitoring compliance with regulatory requirements and ethical standards; and

   - appointing and reviewing the performance of the Managing Director.

2.2 Performance of Responsibilities of the Board

In performing the responsibilities set out above the Board should act at all times:

   - in a manner designed to create and continue to build sustainable value for shareholders; and

   - in accordance with the duties and obligations imposed upon them by the constitution and the law.

3. POWERS OF THE BOARD

In addition to matters expressly required by law to be approved by the Board, powers specifically reserved for the Board are as follows:

   - appointment and termination of the Managing Director and determination of his or her terms and      conditions (including remuneration);

   - approval of appointment and termination of direct reports to the Managing Director;

   - any matters in excess of powers that it may have from time to time delegated to the Managing      Director and senior management; and

   - approvals of each of the following:

- the strategic plan, annually;

- the budget, annually;

- the remuneration and conditions of service including any financial incentives for any   executive directors, the Company Secretary and all other direct reports to the   Managing Director, annually;

- the balance of responsibilities between the chairman, Managing Director and other   directors, annually;

- significant changes to organisational structure and the appointment of such senior   officers as the Board may determine;

- the acquisition, establishment, disposal or cessation of any significant asset of BCD;

- the issue of any shares, options, equity instruments or other securities;

- any public statements which reflect significant issues of BCD policy or strategy; and

- any change to the powers delegated from the Board.

4. SPECIFIC RESPONSIBILITIES

4.1 The Board has specific responsibility to:

   - monitor and assess management's performance in achieving any strategies and budgets approved      by the Board;

   - set criteria for, and evaluate at least annually, the performance of the Managing Director; and

   - review on a regular and continuing basis:

- executive succession planning (and in particular the Managing Director); and

- executive development activities.

4.2 The main functions of the Board in carrying out its role are as follows:

   - setting objectives, policies and strategies, and monitoring the performance of executive      management;

   - keeping under review the general progress and longterm development of the Group in the light of      the political, economic and social environments in which it operates;

   - defining the powers to be reserved to the Board;

   - controlling and monitoring the financial state (including joint venture assets) and performance of the      BCD Group (including investment and finance plans), determining the desired financial ratios      and approving the budget;

   - deciding on major changes in organisation and the shape of the BCD Group, including entry into      new mining leases and departure from those which are no longer appropriate;

   - approving major expenditures and transactions including, for example, acquisitions, disposals, joint      ventures and significant supply arrangements;

   - assisting the Managing Director in the discharge of his/her responsibilities;

   - determining the ethos of the company and monitoring the Group adherence to appropriate      standards and values and that proper policies are developed and followed in relation to:

- compliance with laws,

- safety, health and environmental matters, 

- corporate governance, and

- the reputation of the company;

   - reviewing and ratifying systems of risk management and internal compliance and control, and legal      compliance;

   - determining that the company accounts are true and fair;

   - determining that satisfactory arrangements are in place for auditing the company’s financial affairs,      including selecting and recommending any changes to Auditors as required at general meetings,      and that the scope of the internal audit is adequate;

   - giving approval or support as appropriate to the most senior appointments in the Group and      ensuring that adequate career development, succession and remuneration arrangements exist for      them;

   - reviewing the Board’s structure and performance from time to time and making decisions on new      appointments to the Board;

   - delegating clear responsibility and authority to the Managing Director and where appropriate any      Board Committee or Directors, and monitoring and reviewing regularly the performance of its      committees and the Managing Director and others who hold delegated powers.

4.3 In relation to its corporate governance responsibilities under paragraph 4.2(h)(iii), the Board will:

   - monitor changes in corporate governance practices and regulatory requirements;

   - monitor BCD's code of ethics and ethical culture;

   - oversee preparation of the corporate governance statement in the annual report of BCD;

   - determine whether any disclosed interest of a director is material and the steps appropriate to      management of material conflicts of interest, including whether specific corporate information      (including extracts of Board minutes) should be withheld from the relevant director.  All decisions      relating to material conflicts of interest will be minuted.

5. MEETINGS

5.1 Board and Committee Papers

The Board and Committee papers should where possible be provided to directors at least 5 business days prior to the relevant meeting.

5.2 Private Meetings of Non-Executive Directors

The non-executive directors should meet at least once each year for private discussion of management issues.

5.3 Papers taken as read

The meeting process will be conducted on the assumption that all Board members have considered papers distributed on reasonable notice before the meeting.

5.4Meeting Confidentiality

The proceedings at Board meetings and individual Director's contributions are confidential and are not to be discussed with other parties except to the extent required by law.

6. BOARD COMMITIEES

6.1 Establishment of Committees

The Board may from time to time establish Committees to assist it in carrying out its responsibilities and shall adopt Charters setting out matters relevant to the composition, responsibilities and administration of such committees and other matters that the Board may consider appropriate.

6.2 Initial Committees Established

The Board shall as a minimum establish the following Committees:

Audit and Risk Management Committee; and

Remuneration and Appointments Committee.

7. SELF ASSESSMENT

7.1 Annual Performance Evaluation

The Board shall undertake an annual performance evaluation of itself that:

   - compares the performance of the Board with the requirements of its Charter;

   - sets forth the goals and objectives of the Board for the upcoming year; and

   - effects any improvement to the Board Charter deemed necessary or desirable.

7.2 Form of Performance Evaluation

The performance evaluation shall be in a manner as the Board deems appropriate.

7.3 Balance of Responsibilities

The Board of Directors should regularly review the balance of responsibilities between the Chairman, Managing Director and individual directors as appropriate.