Guidelines

Principle 1: Foundations of management and oversight
Recommendations:

• The board should have a formal statement or board charter which clearly defines the roles and responsibilities of the board and individual directors and the matters which are delegated to management. This also applies to any committees established by the board.
• The board handbook should be available to facilitate board operations and induction and self-evaluation processes.
• Appropriate induction processes should be developed for new members in relation to their board and committee functions and for senior executives to allow them to participate fully and actively in management decision-making at the earliest opportunity.
• Establish and maintain a register of committees and their functions.
• The process for performance evaluation of the chief executive officer and the senior executives should be disclosed.

Principle 2: Structure of the Board to add value
Recommendations:

• A majority of the board should be independent directors.
• The board should develop and implement a plan for identifying and enhancing director competencies.
• Disclose the process for performance evaluation of the board, committees and individual directors.
• The board and committees regularly review their information needs (quality, quantity and timeliness) to ensure the information they receive is appropriate for the effective discharge of their duties.
• Develop and implement appropriate, formal self-evaluation processes for the board and committees.

Principle 3: Promote ethical and responsible decision making
Recommendations:

• Establish and disclose a code of conduct for directors, the chief executive officer and senior executives outlining the practices necessary to maintain confidence in the company’s integrity and to guide compliance with legal and other obligations to stakeholders.
• Establish and disclose the policy for trading securities by directors, officers and employees.
• Establish the code of conduct in line with the best practice guide provided in the Office of Government Owned Corporations’ Code of Conduct and Conflict of Interest Best Practice Guide for Government Owned Corporations.

Principle 4: Safeguard integrity in financial reporting
Recommendations:

• The board should establish an audit committee.
• The chief executive officer and chief financial officer (or equivalent) state in writing that the financial reports present a true and fair view and are in accordance with accounting standards.

Principle 5: Make timely and balanced disclosures
Recommendations:

• Establish written policies and procedures to ensure compliance with disclosure requirements (including those in the GOC Act) and generally ensure the accountability of senior management for compliance.

Principle 6: Respect the rights of shareholders
Recommendations:

• Design and disclose a communication strategy to promote effective communication with shareholding Ministers.

Principle 7: Recognise and manage risk
Recommendations:

• Establish policies on risk management and oversight.
• Require management to design and implement a risk management and internal control system to manage Stanwell’s material business risks.
• Ensure the integration and alignment of the risk management system with corporate and operational objectives.Ensure clear communication throughout Stanwell of the board and senior management's position on risk.
• Ensure a common risk management terminology across the company.
• Ensure risk management is undertaken as part of normal business practice and not as a separate task at set times.
• Ensure information systems for reporting on risk are integrated to enable aggregation and reporting at a corporate level.
• Undertake a risk assessment to identify any high-risk fraud areas and develop strategies to mitigate any significant fraud risks.
• Implement policies and procedures which include:
  • Employee responsibilities in relation to fraud prevention and identification;
  • responsibility for fraud investigation once a fraud has been identified;
  • processes for reporting on fraud related matters to management;
  • reporting and recording processes to be followed to record allegations of fraud;
  • requirements for staff training to be conducted on fraud prevention and identification; and
  • a reference to Stanwell's code of conduct for ethical behaviour.
• Implement a fraud control plan for ongoing monitoring and coordination of fraud control activities which identifies fraud risk, incorporates control strategies, action plans and a timetable for implementation, and sets out responsibilities and accountabilities for fraud control at all levels of the company.
• Management reports to the board as to the effectiveness of the Stanwell’s management of its material business risks, allowing the board to assess the effectiveness of the implementation of the company’s risk management and internal control systems annually.
• The chief executive officer and the chief financial officer (or equivalent) state to the board that the statement given under the recommendations applying to Principle 4 is founded on a sound system of risk management and internal compliance and control which implements board policies; and the risk management and control system is operating efficiently and effectively in all material respects.

Principle 8: Remunerate fairly and responsibly
Recommendations:

• Disclose the remuneration policies to show the broad structure and objectives of the policies and the link between remuneration of the chief executive officer and senior executives and corporate performance.
• The board should establish a remuneration committee.