corporate governance - board of directors
Board Membership, Composition and Nomination
The Board consists of one Executive Director, being the Managing Director and five Non-Executive Directors, including the Chairman. For current board members, see our Director Biographies
The role of the Board in relation to nomination and membership is to:
- review the size and composition of the Board;
- review the range of skills available and determine the appropriate balance of skills required for future board membership; and
- review and consider the succession planning of the Managing Director, the Chief Financial Officer, the Company Secretary and succession of Directors generally.
Identification of potential Board candidates includes consideration of the skills, experience, personal attributes and capability to devote the necessary time and commitment to the role.
Non-Executive Directors are expected to review their membership of the Board from time to time, taking into account their length of service, age, qualifications and experience, together with other criteria considered desirable for composition of a balanced Board and the overall interests of the Company.
The relevant provisions in the Company’s Constitution and the Corporations Act 2001 determine the terms and conditions relating to the appointment and termination of directors.
All Directors, with the exception of the Managing Director are subject to re-election by rotation every three years.
Director Independence
The majority of the Board of Directors of iiNet Limited, including the Chairman are required to be independent of management and free of any business or other relationship that could materially interfere with or could reasonably be perceived to materially interfere with the exercise of the Director’s unfettered and independent judgement. In considering whether a Director is independent, the Board considers:
(a) the criteria for assessing the independence of a Director in the ASX Corporate Governance Council’s “Principles of Good Corporate Governance and Best Practice Recommendations”;
(b) any information, facts or circumstances that the Board considers relevant; and
(c) any materiality thresholds, standards or guidelines that the Board may adopt from time to time.
In the context of director independence, “materiality” is considered from both the Company and individual director perspective. The determination of materiality requires consideration of both quantitative and qualitative elements. An item is presumed to be quantitatively immaterial if it is equal or less than 5% of the appropriate base amount.
In accordance with the established criteria of independence above, and the materiality thresholds set, the following directors of iiNet Limited are considered to be independent:
P.C. Harley - Chairman, Non-Executive Director
K.N. Goodall - Deputy Chairman, Non-Executive Director
P.R. James - Non-Executive Director
Conflicts of Interest
In accordance with the Corporations Act 2001 and the Company’s constitution, Directors must keep the Board advised, on an ongoing basis, of any interest that could potentially conflict with those of the Company. Where the Board believes a significant conflict exists, the Director concerned does not receive the relevant Board papers and is not present at the Board meeting whilst the item is considered.
Role of the Chairman
The Chairman is appointed by the Board and is required to be a non-executive director who satisfies the criteria for independence.
The Chairman is responsible for:
- leadership and effective performance of the Board;
- setting the agenda for Board meetings, in consultation with the Managing Director and Company Secretary;
- overseeing the provision of information by management to the Board, and ensuring the adequacy of that information; and
- arranging regular evaluation of the performance of the Board, Board Committees and all Directors.
Responsibilities and Functions of the Board
The Board considers that the essential responsibilities of the Directors are to oversee the Company’s business operations and its management for the benefit of its shareholders, employees and other stakeholders and to protect and enhance shareholder value.
The primary responsibilities of the Board include the following:
- charting the direction, strategies and financial objectives for the Company and monitoring the implementation of those policies, strategies and financial objectives;
- monitoring compliance with regulatory requirements and ethical standards;
- to oversee the Company’s control and accountability systems;
- to appoint the Managing Director, the Company Secretary and ratify the appointment of the Chief Financial Officer. To set criteria for, and evaluate at least annually, their performance;
- to monitor and assess management’s performance in carrying out any strategies, meeting any objectives and observing any budgets approved by the Board, and to ensure that sufficient resources are available to management for those purposes;
- to approve and monitor financial and other reporting;
- to monitor the Company’s continuous disclosure policy and procedures, and in particular to ensure the Company’s Market Disclosure Policy is complied with, and adequately reviewed and updated;
- to ensure that appropriate internal and external audit arrangements are in place and operating effectively;
- to issue any shares or other securities of the Company;
- to approve the strategic plan, performance objectives and the budget;
- to approve the remuneration and conditions of service including financial incentives for any Executive Directors;
- to approve significant changes to organisational structure and the appointment of such senior officers as the Board may determine;
- to approve the acquisition, establishment, disposal or cessation of any significant business of the Company;
- to approve any public statements which reflect significant issues of the Company’s policy or strategy;
- to approve any changes to the discretions delegated from the Board; and
- to review on a regular and continuing basis the executive succession planning, in particular for the Managing Director and executive development activities.
The Board has adopted a charter and operating principles that detail the role and responsibilities of the Board and its members.
The Board delegates responsibility for day-to-day management of the Company to the Managing Director.
The Board has also established Committees to assist in the carrying out its responsibilities in an effective and efficient manner. The Committees currently formed by the Board are: Audit Committee and Remuneration Committee. For each Committee the Board adopts a formal Charter which sets out the matters relevant to the composition, responsibilities and administration of the Committee.
Independent Professional Advice and Access to Company Information
Each Director has the right of access to all relevant Company information and to the Company’s executives and, subject to prior consultation with the Chairman, may seek independent professional advice at the Company’s expense. A copy of advice received by the Director is made available to all other members of the Board.
Performance Evaluation
The performance of all Directors, the Board as a whole and the Managing Director will be reviewed at least annually by the Board. Within a structured format, individual Director performance reviews are conducted by the Chairman, whilst the Chairman is reviewed by the Deputy Chairman. In confidence feedback on the performance of each individual Director performance is sought from all Directors of the Board.
The Board also seeks feedback from the Chief Financial Officer, Company Secretary and selected executives on the performance of the Board as a whole.
The Chairman provides feedback to the Board and each individual Director following completion of the Board performance evaluation.
