King Code of Corporate Practice and
Conduct
The board of Avmin is committed to maintaining the standards of integrity,
accountability and openness advocating in the King Report on Corporate
Governance, The directors endorse and, for the period under review, have
applied the Code of Corporate Practice and Conduct set out in the King
Report. The board considers that Ken Maxwell' combined role as chairman
of the Company and its audit committe is in Avmin' best interest.
Board of directors
During the year ended 30 June 2001, the board met on seven occasions.
Avmin’s directorate presently consists of a non-executive chairman,
seven non-executive directors and three executive directors. The
expertise and diverse skills of the directors are detailed on page 4. The
chairman co-ordinates a range of activities ensuring that a strict policy
is adhered to with regard to decisions reserved for the directors and
promoting the overall effectiveness of corporate governance. Rick Menell,
the deputy chairman and chief executive officer, is responsible for the
attainment of the strategic objectives as set by the board. In terms of
the Company’s articles of association, the maximum term of office for
directors is three years and one-third of the directors retire by rotation
annually and, if eligible for re-election, their names are submitted for
election at the annual general meeting. The board has established a number
of committees on which the non-executive directors play an active role,
particularly in the capacity of chairman of the committee concerned. Ken
Maxwell and Brian Menell have consulting contracts with the Company. None
of the members of the board have service contracts with the Company. All
members have access to the advice of the Group company secretary and are
entitled to seek independent professional advice about the affairs of the
Company at the Company’s expense.
President’s committee
This committee is mandated to assist in setting the strategic direction of
the Group, implementing strategy and maintaining effective management on a
day-to-day basis. The senior vice presidents, whose names appear on page
5, form the nucleus of this committee and attend all meetings of
directors. The committee meets weekly. The committee members contribute a
diverse range of professional skills across the broad spectrum of the
Company’s activities.
Board committees
The directors of the Company appoint both executive and non-executive
members to various committees as detailed below. A list of the
participants in these committees can be found on page 5. Each committee
meets at defined times each year and provides the directorate with an
effective communication forum. The information provided to the board is
derived fromexternal sources and internally from minutes, plans and
reports of the activities of the respective committees.
Audit committee
The main responsibilities of this committee include the safeguarding of
the Company’s assets and shareholders’ investments, the maintenance of
high standards of records and systems of internal control as well as the
monitoring of standards of corporate governance. In addition, the
committee has an objective of ensuring that effective policies and
practices are adopted in the preparation of public financial information.
The committee also conducts reviews of audits of expenditure, major
business risks undertaken by both internal and external auditors and
examines their respective plans and reports to ensure effectiveness. The
external and internal auditors have unrestricted access to the audit
committee. The chairman, plus three other non-executives and one
executive director, comprise the committee. Three meetings were held
during the financial year.
Remuneration committee
The directors ensure appropriate levels of remuneration to senior
management of the Company through the remuneration committee. This
committee determines broad policy for individual remuneration and benefits
to maintain a compensation policy which is both competitive and equitable.
This committee comprises an executive director and three non-executive
directors, one of whom is the chairman of the Company. The vice president:
human resources, attends all meetings and has direct access to all members
of this committee. Three meetings were held during the year ended 30
June 2001.
Safety, health and environmental (SHE)committee
Safety and health matters are considered at every meeting of directors. A
SHE committee was established during the latter part of the financial
year. The chairman is a non-executive director and members comprise four
other directors, two of whom are non-executive.
Two meetings have been held to date. The
board’s primary focus on these topics is:
Safety.
Supervision and direction in reducing workplace accidents, fatalities and
occupational health and hygiene related incidents through the application
of regular measurement against the minimum of legislated or regulatory
requirements, reviews of accidents and current industry and international
best practices.
Health.
Recognition of and prevention of health issues critical to the Company’s
success. Areas of concern are the HIV/AIDS pandemic, occupational lung
diseases and noise induced hearing loss. Environment.
The prevention of occurring, continuing or re-occurring, and/or to
minimise and rectify existing pollution or degradation of the environment
in accordance with, at least, legislated requirements. The reader is
referred to the safety, health and environmental review, starting on page
31.
Internal audit
The Group internal audit department operates with full authority of
the directors. The head of this department reports directly to the
chairman of the audit committee. The internal audit department performs a
variety of activities that ultimately result in an examination and
evaluation of the effectiveness of all operating sectors of the Group’s
business. Through this process, significant business risks are highlighted
and the systems of operating and financial controls are monitored. All
issues are brought to the attention of the audit committee, the directors
and members of the executive committee and external auditors. Issues that
require corrective actions are discussed by senior management and acted
upon with urgency under the auspices of the audit committee.
Hedge committee
The committee, under the chairmanship of the senior vice president:
finance/chief financial officer, meets fortnightly (and more often as
necessary) with Standard Risk and Treasury Management Services
(Proprietary) Limited (SRTMS) to discuss market conditions, treasury
operations and existing and future hedging strategies. The primary focus
of the committee is the reduction of risk in commodities and currencies.
SRTMS implements decisions taken. SRTMS
does not perform an executive or decision-making role. Advice is also
sought from other outsiders on a continuous basis. The committee operates
within clearly defined parameters set by the board.
Risk management committee
The Group risk manager chairs the risk management committee. The members
of the committee comprise senior representatives from the Group’s
operations. The committee reports to the audit committee of the board of
directors. An independent formalised process of identifying, recording and
reviewing the management of major risk exposures is being applied.
Independent risk engineering consultants continue to grade each operation
againstinternational risk standards for fire, security, engineering,
commercial, crime, contingency planning and mining, and to monitor whether
practices meet the set criteria. The committee is also responsible for
ensuring that appropriate financial and insurance mechanisms
comprehensively protect the Group against catastrophe risk.
Code of ethics
The Company is committed to the highest standards of integrity, behaviour
and ethics in dealing with all its stakeholders. All directors and
employees are required to maintain the highest ethical standards to ensure
that the Company’s business practices are conducted in a reasonable
manner and to act in good faith and in the interests of the Company. The
Company operates a closed period prior to the publication of its interim
and final results. During this period directors, officers and designated
persons who may have access to price sensitive information, are precluded
from dealing in the shares, securities or financial instruments of the
Company. The closed period extends from the 15th of the month before the
end of a reporting period or the financial year until the day of
publication of the results. Where appropriate, dealing is also restricted
during sensitive periods where major transactions are being negotiated and
a public announcement is imminent.
The Company is committed to the highest standards of integrity, behaviour and ethics in dealing with all its stakeholders