Fitzroy River : Corporate Governance Statement - 18 October 2017

Principle 1 Recommendations:

Lay Solid Foundations for Management and Oversight

1.1

A listed entity should disclose:

1. the respective roles and responsibilities of its board and management; and

2. those matters expressly reserved to the board and those delegated to management.

1. There was no formalisation and disclosure of separate functions between the Board and management during the reporting period given that the Company only has 3 Directors, no executives and no management. As a result, and given the size of the Company the Board undertakes all roles normally delegated to management.

2. The Board leads and oversees the management and direction of the Company. The Company's Constitution (Rule 9.1) provides (in a manner similar to most listed companies), subject to the Corporations Act, the ASX Listing Rules and the Constitution, the business of the Company shall be managed by, or under the direction of, the Directors. Each of the Company's 3 Directors puts in considerable personal effort in running the Company well and efficiently, in working on seeking out appropriate various corporate transactions and overseeing the strategic direction of the Company.

Given the above, any further formalisation of separate functions is deemed by the Board, at this stage, to be unnecessary during this period for the Company.

Specifically, the Board:

• defines and sets its business objectives and subsequently monitors performance and achievements of those objectives;

• oversees the reporting on matters of compliance with corporate policies and laws, takes responsibility for risk management processes and periodically reviews the needs for any executive management to complement the Board skill set and status of operations of the Company;

• monitors and approves financial performance and budgets;

• reports to shareholders; and

• periodically reviews the processes and procedures of its oversight function.

1.2

A listed entity should:

1. undertake appropriate checks before appointing a person, or putting forward to security holders a candidate for election, as a director; and

2. 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.

1. Prior to the nomination of prospective non-executive directors for election or re-election, the Board aims to obtain from the prospective candidate:

   • details of other commitments of the prospective candidate and an indication of the time involved; and

   • an acknowledgement that the prospective candidate will have sufficient time to meet the requirements of non-executive directors of the Company.

2. When a candidate is placed before shareholders for election or re-election as a director, the names of candidates submitted is accompanied by, or a cross reference to, the following information to enable shareholders to make an informed decision in relation to that vote:

   • biographical details, including competencies and qualifications and information sufficient to enable an assessment of the independence of the candidate;

   • details of any relationships that exist between the candidate and the Company or between the candidate and any director of the company;

   • directorships held;

   • particulars of other positions which involve significant time commitments or actual or potential conflicts;

   • the term of office currently served by and directors subject to re-election; and any other particulars required by law.

Appropriate checks will be undertaken prior to the appointment of any new directors to the Board.

1.3

A listed entity should have a written agreement with each director and senior executive setting out the terms of their appointment.

The Company has a written agreement with each of its directors setting out the terms of their appointment.

1.4

The company secretary of a listed entity should be accountable directly to the board, through the chair,

The Secretary, who is also a director, is accountable to the Board through the Chairman on all governance matters and on all matters to do with the proper functioning of the Board. The Secretary is generally

on all matters to do with the proper functioning of the board.

responsible for carrying out the administrative and legislative requirements of the Board. The Secretary holds primary responsibility for ensuring that the Board processes, procedures and policies run efficiently and effectively.

1.5

A listed entity should:

1. 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;

2. disclose that policy or a summary of it; and

3. 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:

4. 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

5. 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.

(a) While the Company has only 3 directors and no employees, the Board nevertheless has implemented and maintains a Diversity Policy in line with the ASX's Corporate Governance guidelines. The Board believes in the promotion of diversity and that seeking diversity on all levels generally is good practice.

(b) A copy of the Company's Diversity Policy is available on the Company's website and a summary is included in this Corporate Governance Statement

(c) While the Company does not currently have any employees, at the appropriate time the Board will ensure the principles under the Diversity Policy are implemented in seeking to attract and retain people by promoting an environment where employees are treated with fairness and respect and have equal access to opportunities as they arise. Diversity within the workforce includes, but is not limited to such factors as religion, ethnicity, culture, language, gender, disability and age.

The recommendations of the Corporate Governance Council relating to reporting require a Board to set measurable objectives for achieving diversity within the organisation, and to report against them on an annual basis. The Company has implemented measurable objectives as follows:

Measurable Objective Objective Comment Satisfied

Adoption and promotion of a Formal Yes The Company has adopted a formal Diversity Policy. diversity policy which has been made publicly available via the Company's website

at http://fitzroyriver.net.au/.

To ensure Company policies are Yes The Company's selection, remuneration and consistent with and aligned with the promotion practices are merit based and as goals of the Diversity Policy. such are consistent with the goals of the

Company's Diversity Policy.

To provide flexible work and salary Yes The Company will, where considered arrangements to accommodate family reasonable, and without prejudice, commitments, study and self- accommodate requests for flexible working

improvement goals, cultural traditions arrangements. and other personal choices of current

and potential employees.

To implement clear and transparent Yes The Company will grant reward and policies governing reward and promotion based solely on merit and recognition practices. responsibility as part of any annual and

ongoing review processes.

1. The Company, in keeping with the Recommendations provides the following information regarding the proportion of gender diversity in the organisation as at 30 June 2017:

2. The entity is not a "relevant employer".

Male Female Total Proportion

female

Board 2 1 3 33.3%

1.6

A listed entity should:

1. have and disclose a process for periodically evaluating the performance of the board, its committees and individual directors; and

2. disclose, in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance with that process.

1. The Company does not have a formal process for periodically evaluating Board performance. Given the nature and size of the Company and its business, the Board is of the view that there is presently an adequate and broad mix of skills and that given their experience, each of the Directors are aware of and capable of acting in the best interests of the Company's stakeholders. At all times during the year there was a majority of independent Directors. The composition of the Board is determined so as to provide the Company with a broad base of industry, business, technical, administrative, financial, corporate and legal skills and experience considered necessary to represent stakeholders and fulfil the business objectives of the Company. Directors are expected to bring independent views and judgement to the Board's deliberations.

2. There was no formal board performance evaluation during the period. The last evaluation was done in the latter half of the 2014 financial year as disclosed previously.

1.7

A listed entity should:

1. have and disclose a process for periodically evaluating the performance of its senior executives; and

2. disclose, in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance with that process.

(a) and (b) The Company does not currently have a formal process for evaluating the performance of senior executives as there are no senior executives employed at this time. A process will be implemented if, and when, a senior executive is employed by the Company.