Troy Resources : Corporate Governance Statement

PRINCIPLE

COMPLIED

COMMENT

1 - 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.

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

The Board has adopted a formal Board Charter (disclosed on the Company's website) which sets out those matters reserved for the Board and those delegated to management.

The Board's functions include: developing and setting the Company's strategic direction in conjunction with management, overall review of performance against targets and objectives, ensuring the Company has adequate systems and internal controls together with appropriate monitoring of compliance activities, approval and compliance with policies including health, safety and environment; and reporting to shareholders on the direction and performance of the Company.

The Managing Director/CEO, supported by members of senior management, is responsible for day-to-day management of the Company's affairs and the implementation of strategy and policy initiatives.

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.

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The Company did not make any new appointments to the Board during 2016, however made an appointment post financial year end. As part of the recruitment process for the new Non-Executive Director, appropriate checks were undertaken, including checks as to his character, experience and education.

Directors' biographical details, including their relevant qualifications and experience and the skills they bring to the Board are detailed on the Company website and within the Annual Report. Details of any other listed company directorships currently held are also provided within the Annual Report.

1.3

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



Written agreements are in place with each Director and Senior Executive setting out the terms of their appointment. Key terms of agreements with Senior Executives are included in the Annual Report.

1.4

The company secretary of a listed entity should be accountable directly to the board, through the chair, on all matters to do with the proper functioning of the board.



The Company Secretary, Ms Stacey Apostolou, is accountable directly to the Board, through the Chairman, on all matters to do with the proper functioning of the Board and a reporting function to the Managing Director in relation to management matters.

The Company Secretary has a direct line of communication with the Chairman and all Directors, and is responsible for supporting the proper functioning of the Board, which includes, but is not limited to, providing advice on governance and procedural issues, and the preparation of Board papers and minutes.

1.5

A listed entity should:

(a) 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;



The Board has adopted a Diversity Policy which outlines the Company's commitment to ensuring a diverse mix of skills and talent exists amongst its Directors, officers and employees, to enhance Company performance. The Diversity Policy addresses equal opportunities in the hiring, training and career advancement of Directors, officers and employees. The Board will proactively monitor the Company's performance in meeting the standards and policies outlined in this Policy.

PROPORTION OF WOMEN

Board

0 out of 4 (0%)

Senior Management 1

1 out of 3 (33%)

Other

39 out of 411 (9.5%)

PRINCIPLE

COMPLIED

COMMENT

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

2. 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:

3. 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

4. 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.

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X

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n/a

A copy of the Diversity Policy is on the Company's website.

Measurable objectives in relation to the Diversity Policy have not been established by the Board, however the Company makes its appointment decisions based on merit, by assessing whether a person's skills and experience are appropriate for particular roles. It does not discriminate based on gender, age, ethnicity or cultural background.

The Group workforce gender profile as at 30 June 2016 is set out in the following table:

1 Senior Management in this section excludes the Managing Director/CEO and Executive Director (both of whom are included within Board) and includes the Chief Financial Officer, Vice President Exploration and Business Development and Company Secretary.

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.

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The Board, with the assistance of the Nomination and Remuneration Committee, regularly monitors its performance and the performance of the Directors and Board Committees throughout the year. This may occur through an internal review led by the Chairman, or be performed with the assistance of external advisers as considered appropriate.

The Chairman is responsible for evaluation of the Board and its members as well as the various Committees. With the previous Chairman, Mr David Dix taking medical leave of absence early in the financial year, Mr Grimwade assumed the role of acting Chairman and then was later appointed to this role following Mr Dix's death in February. Mr Grimwade, as acting Chairman, and the Board regularly discussed the Board composition during the year, considering issues or concerns as they arose. It was recognised that an independent non-executive director was required and an external consultant was appointed to assist with this search. Otherwise the process for evaluation has remained in-house and informal during the year, with no formal reviews of the Board, its Committees or any individual Directors being undertaken.

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.

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The performance of the Managing Director/CEO is evaluated by the Nomination and Remuneration Committee. The Managing Director/CEO prepares a self-evaluation on his performance in the first instance which is then reviewed and discussed with the Nomination and Remuneration Committee. The Managing Director/CEO reviews the performance of senior executives through a similar self-evaluation process.

No performance evaluation was undertaken in relation to the year ended 30 June 2016.

PRINCIPLE

COMPLIED

COMMENT

2 - Structure the Board to Add Value

2.1

The board of a listed entity should:

1. have a nomination committee which:

2. has at least three members, a majority of whom are independent directors; and

3. is chaired by an independent director, and disclose:

4. the charter of the committee;

5. the members of the committee; and

6. as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or

7. if it does not have a nomination committee, disclose the fact and the processes it employs to address board succession issues and to ensure that the board has the appropriate skills, knowledge, experience, independence and diversity to enable it to discharge its duties and responsibilities effectively.

x

With Mr Dix taking a leave of absence early in the reporting period, the composition of the Nomination and Remuneration Committee was restructured to comprise Mr Jones, Mr Grimwade and Mr Monti with Mr Jones acting as Chairman of the Committee. Mr Jones and Mr Monti are not considered to be independent. Mr Monti resigned in late June and until Mr Southam's appointment on 29 July, the Committee comprised only two members. Mr Grimwade was appointed as Chair of the Nomination and Remuneration Committee from 29 September and thereafter the Company is in compliance with the recommendation in that the Chair is independent and the Committee comprises at least three members, a majority of whom are independent.

A copy of the Nomination and Remuneration Committee Charter is available on the Company's website. Details of each member's attendance at Committee meetings are included within the 2016 Annual Report.

The Committee met twice during the reporting period, with those members appointed at the time attending each of the meetings.

N/a

2.2

A listed entity should have and disclose a board skills matrix setting out the mix of skills and diversity that the board currently has or is looking to achieve in its membership.



The Board is structured to facilitate the effective discharge of its duties and to add value through its deliberations. It seeks to achieve a Board composition with a balance of diverse attributes relevant to the Company's operations and markets, including skill sets, background and industry experience. In addition to those general skills expected for Board membership, the following skills have also been identified as being necessary: experience in operational management, exploration and geology, mining engineering, project delivery, finance, corporate governance and equity capital markets.

A profile of each Director setting out their skills, experience and period of office is set out in the Directors' Report of the 2016 Annual Report.

NAME

POSITION

INDEPENDENCE POSITION

APPOINTMENT DATE

Mr Fred Grimwade

Non-Executive Chairman

Independent

25 November 2010

Mr Martin Purvis

Managing Director

Not Independent

1 September 2014

Mr Ken Nilsson

Executive Director

Not Independent

8 May 1998

Mr John Jones

Non-Executive Director

Not Independent

27 July 1988

Mr Richard Monti

Non-Executive Director

Not Independent

29 August 2013 until 27 June 2016

Mr David Dix (1)

Non-Executive Director

Independent

28 January 2010 until 1 February 2016

Mr David Southam

Non-Executive Director

Independent

29 July 2016

PRINCIPLE

COMPLIED

COMMENT

2.3

A listed entity should disclose:

1. the names of the directors considered by the board to be independent directors;

2. if a director has an interest, position, association or relationship of the type described in Box 2.3 but the board is of the opinion that it does not compromise the independence of the director, the nature of the interest, position, association or relationship in question and an explanation of why the board is of that opinion; and

3. the length of service of each director.

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The position of each director and as to whether or not they are considered to be independent is set out below:

(1) Mr Dix took a medical leave of absence with effect from 14 July 2015 and passed away on 1 February 2016.

2.4

A majority of the board of a listed entity should be independent directors.

x

The Board did not comprise a majority of independent directors.

2.5

The chair of the board of a listed entity should be an independent director and, in particular, should not be the same person as the CEO of the entity.



Mr Grimwade, an independent non-executive Director, performed the role of Acting Chairman until his appointment to that role on 1 March 2016. He does not perform the role of CEO.

2.6

A listed entity should have a program for inducting new directors and provide appropriate professional development opportunities for directors to develop and maintain the skills and knowledge needed to perform their role as directors effectively.



The Company has procedures in place to provide new Directors with any information they may request and provide direct access to the Company Secretary and Senior Management available to any new appointee. The Nomination and Remuneration Committee reviews the skills and experience of prospective Directors in order to ensure appropriate development opportunities. Existing Directors are encouraged to participate in appropriate professional development to develop and maintain the skills and knowledge needed to perform their role as a Director. Subject to seeking prior consent, all Directors have the right to seek independent professional advice concerning any aspect of the Company's operations or undertakings.

Each new Director is inducted into the Company's policies and processes on engagement.