Corporate Governance Statement
LawFinance Limited (ACN 088 749 008)
The board of the Company ("Board") recognises the importance of establishing a comprehensive system of control and accountability as the basis for the administration of corporate governance.
To the extent relevant and practical, the Company has adopted a corporate governance framework that is consistent with The Corporate Governance Principles and Recommendations (4th Edition) as published by ASX Corporate Governance Council ("Recommendations").
The Board has adopted the following suite of corporate governance policies and procedures which are available on the Company's website at https://www.lawfinance.com.au/investor-centre/governance/.
- Code of Conduct
- Audit and Risk Committee Charter
- Remuneration and Nomination Committee Charter
- Continuous Disclosure Policy
- Securities Trading Policy
- Complaints Policy
- Conflicts Management Policy
- Privacy Policy
The Board is committed to administering the policies and procedures with openness and integrity, pursuing the true spirit of corporate governance commensurate with the Company's needs.
The Company is pleased to report that its practices are largely consistent with the Recommendations of the ASX Corporate Governance Council and sets out below its compliance and departures from the Recommendations for the year ended 31 December 2020.
In the context of the Company's nature, scale and operations, the Board considers that the current corporate governance regime is an efficient, practical and cost-effective method of directing and managing the Company. As the Company's activities develop in size, nature and scope, the implementation of additional corporate governance policies and structures will be reviewed and considered.
PRINCIPLES AND RECOMMENDATIONS | COMPLY | EXPLANATION | |||
(YES/NO) | |||||
Principle 1: Lay solid foundations for management and oversight | |||||
Recommendation 1.1 | The Board is responsible for the corporate | ||||
A listed entity should have and disclose a board | governance of the Company. | ||||
charter setting out: | |||||
(a) | the respective roles and responsibilities of | YES | The Company has adopted a Board Charter which | ||
its board and management; and | sets out, amongst other things, the specific | ||||
(b) | those matters expressly reserved to the | YES | responsibilities of the Board, the roles and | ||
board and those delegated to | responsibilities of the Chairman, Board and | ||||
management. | management, as well as the matters expressly | ||||
reserved for the decision of the Board and those | |||||
delegated to management. | |||||
A copy of the Company's Board Charter is available | |||||
on the Company's website: | |||||
https://www.lawfinance.com.au/investor- | |||||
centre/governance/ | |||||
The Company is committed to the circulation of | |||||
relevant materials to Directors in a timely manner to | |||||
facilitate Directors' participation in Board discussions | |||||
on a fully informed basis. | |||||
It is expected that the division of responsibility of the | |||||
Board and senior executives will vary with the | |||||
evolution of the Company. | |||||
PRINCIPLES AND RECOMMENDATIONS | COMPLY | EXPLANATION | |||||||
(YES/NO) | |||||||||
The Company intends to regularly review the balance | |||||||||
of responsibilities between the Board and | |||||||||
management to ensure that the division of functions | |||||||||
remains appropriate to the needs of the Company. | |||||||||
Recommendation 1.2 | The Remuneration and Nomination Committee's role | ||||||||
A listed entity should: | includes identifying and recommending candidates | ||||||||
(a) | undertake appropriate checks before | YES | for the Board to the Board. These recommendations | ||||||
will occur after considering the necessary and | |||||||||
appointing a director or senior executive, | |||||||||
desirable competencies of new Board members, the | |||||||||
or putting someone forward for election, | |||||||||
range of and depth of skills and the diversity of the | |||||||||
as a Director; and | |||||||||
YES | Board, and making appropriate checks as to the | ||||||||
(b) | provide security holders with all material | ||||||||
character, experience, education, criminal record and | |||||||||
information relevant to a decision on | |||||||||
bankruptcy history of the candidate being put | |||||||||
whether or not to elect or re-elect a | |||||||||
forward. In the absence of the Committee | |||||||||
Director. | |||||||||
undertaking this role, it may be undertaken by the | |||||||||
Board. | |||||||||
All material information relevant to a decision on | |||||||||
whether to elect or re-elect a Director will be provided | |||||||||
to security holders in any notice of meeting pursuant | |||||||||
to which the resolution to elect or re-elect such | |||||||||
Director will be voted on. | |||||||||
Recommendation 1.3 | Each Director and senior executive of the Company | ||||||||
A listed entity should have a written agreement | YES | is party to a written agreement with the Company | |||||||
with each Director and senior executive setting | which sets out the terms and conditions of that | ||||||||
out the terms of their appointment. | Director's or senior executive's appointment. | ||||||||
Recommendation 1.4 | |||||||||
The company secretary of a listed entity should | YES | The Board Charter outlines the role, responsibility | |||||||
be accountable directly to the board, through the | and accountability of the Company Secretary. The | ||||||||
chair, on all matters to do with the proper | Company Secretary is accountable directly to the | ||||||||
functioning of the board. | Board, through the Chair, on all matters relating to | ||||||||
the proper functioning of the Board. The Chairman | |||||||||
and the Company Secretary co-ordinate the Board | |||||||||
agenda. | |||||||||
A copy of the Company's Board Charter is available | |||||||||
on the Company's website: | |||||||||
https://www.lawfinance.com.au/investor- | |||||||||
centre/governance/ | |||||||||
Recommendation 1.5 | Given its current size and stage of development, the | ||||||||
A listed entity should: | Company has not found it necessary to create a | ||||||||
(a) | have and disclose a diversity policy; | NO | formal diversity policy or to annually report on | ||||||
measurable objectives with respect to achieving | |||||||||
(b) | through its board or a committee of the | NO | |||||||
gender diversity or diversity generally. However, the | |||||||||
board set measurable objectives for | Company has and continues to remain committed to | ||||||||
achieving gender diversity in the | |||||||||
ideals of diversity throughout its business practices. | |||||||||
composition of its board, senior | |||||||||
executives and workforce generally; and | |||||||||
(c) | disclose in relation to each reporting | NO | As the Company continues to grow, the Board | ||||||
period: | intends to review its practices and, if deemed | ||||||||
1) the measurable objectives set for | necessary in the future, the Board may consider | ||||||||
that period to achieve gender | adopting a formal diversity policy. | ||||||||
diversity; | |||||||||
2) the entity's progress towards | |||||||||
achieving those objectives; and | |||||||||
3) either: |
PRINCIPLES AND RECOMMENDATIONS | COMPLY | EXPLANATION | |||||||
(YES/NO) | |||||||||
(A) the respective proportions of | |||||||||
men and women on the board, in | |||||||||
senior executive positions and | |||||||||
across the whole workforce | |||||||||
(including how the entity has | |||||||||
defined "senior executive" for these | |||||||||
purposes); or | |||||||||
(B) 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. | |||||||||
Recommendation 1.6 | The performance of the Board as a group | ||||||||
A listed entity should: | and of individual Directors is to be assessed | ||||||||
(a) | have and disclose a process for | YES | each year through a process as determined | ||||||
periodically evaluating the performance of | by the Board at its discretion. | ||||||||
the board, its committees and individual | |||||||||
Directors; and | YES | In particular, all Directors seeking re-election | |||||||
(b) | disclose for each reporting period, | ||||||||
whether a performance evaluation has | at an annual general meeting will be subject | ||||||||
been undertaken in the reporting period in | to a formal performance appraisal to | ||||||||
accordance with that process during or in | |||||||||
determine whether the Board (with the | |||||||||
respect of that period. | |||||||||
Director absenting themselves) recommend | |||||||||
their re-election to shareholders. | |||||||||
The Company did not undertake an evaluation of the | |||||||||
performance of the Board, its committees and | |||||||||
individual directors during the financial year ended 31 | |||||||||
December 2020. | |||||||||
Recommendation 1.7 | The Board and senior management team will | ||||||||
A listed entity should: | |||||||||
regularly review the performance of its senior | |||||||||
(a) | have and disclose a process for | YES | |||||||
executives and address any issues that may emerge | |||||||||
periodically evaluating the performance of | through a process as determined by the Board or | ||||||||
its senior executives at least once every | YES | senior management team, at their discretion. | |||||||
reporting period; and | |||||||||
(b) | disclose in relation to each reporting | The Company undertook an evaluation of the | |||||||
period, whether a performance evaluation | performance of its senior executives during the | ||||||||
has been undertaken in the reporting | financial year ended 31 December 2020. | ||||||||
period in accordance with that process | |||||||||
during or in respect of that period. | |||||||||
PRINCIPLES AND RECOMMENDATIONS | COMPLY | EXPLANATION | ||||||||
(YES/NO) | ||||||||||
Principle 2: Structure the board to be effective and add value | ||||||||||
Recommendation 2.1 | The Company has a remuneration and nomination | |||||||||
The board of a listed entity should: | committee (Remuneration and Nomination | |||||||||
(a) | have a nomination committee which: | Committee), which currently does not have at least | ||||||||
three members, a majority of whom are independent | ||||||||||
(i) | has at least three members, a | NO | ||||||||
directors. Considering the size of the Company and | ||||||||||
majority of whom are independent | that the full board comprises four directors, the | |||||||||
Directors; and | ||||||||||
NO | Company considers that it is not appropriate to | |||||||||
(ii) | is chaired by an independent | |||||||||
strictly follow the Principles and Recommendations. | ||||||||||
Director, | ||||||||||
and disclose: | YES | |||||||||
(iii) | the charter of the committee; | A copy of the Company's Remuneration and | ||||||||
(iv) | the members of the committee; | NO | Nomination Committee Charter is available on the | |||||||
and | Company's website: | |||||||||
(v) | as at the end of each reporting | NO | https://www.lawfinance.com.au/investor- | |||||||
period, the number of times the | centre/governance/ | |||||||||
committee met throughout the | ||||||||||
period and the individual | ||||||||||
attendances of the members at | ||||||||||
those meetings; or | ||||||||||
(b) | if it does not have a nomination | |||||||||
committee, disclose that fact and the | N/A | |||||||||
processes it employs to address board | ||||||||||
succession issues and to ensure that the | ||||||||||
board has the appropriate balance of | ||||||||||
skills, experience, independence and | ||||||||||
knowledge of the entity to enable it to | ||||||||||
discharge its duties and responsibilities | ||||||||||
effectively. | ||||||||||
Recommendation 2.2 | NO | The Board strives to ensure that it is comprised of | ||||||||
A listed entity should have and disclose a board | directors with a blend of skills, experience and | |||||||||
skill matrix setting out the mix of skills and | attributes appropriate for the Company and its | |||||||||
diversity that the board currently has or is looking | business. | |||||||||
to achieve in its membership. | ||||||||||
However, the Board is of the belief that a Board Skills | ||||||||||
Matrix is not required given the stage of development | ||||||||||
of the business. The Board will continue to monitor | ||||||||||
whether it will be appropriate for the company to | ||||||||||
adopt a Board Skills Matrix as the Company | ||||||||||
continues to develop. | ||||||||||
Recommendation 2.3 | NO | Given its current size and stage of development, the | ||||||||
A listed entity should disclose: | Company has not found it necessary to disclose the | |||||||||
(a) | the names of the Directors considered by | names of directors considered by the Board to be | ||||||||
independent Directors. However, the Company has | ||||||||||
the board to be independent Directors; | ||||||||||
disclosed details of each director, including their | ||||||||||
(b) | if a Director has an interest, position, | |||||||||
length of service, in the 2020 Annual Report | ||||||||||
association or relationship of the type | ||||||||||
described in Box 2.3 of the ASX | ||||||||||
Corporate Governance Principles and | As the Company continues to grow, the Board will | |||||||||
Recommendation (3rd Edition), but the | consider whether it is appropriate to appoint | |||||||||
board is of the opinion that it does not | additional independent director/s to the Board. | |||||||||
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 | ||||||||||
(c) | the length of service of each Director | |||||||||
PRINCIPLES AND RECOMMENDATIONS | COMPLY | EXPLANATION | ||||
(YES/NO) | ||||||
Recommendation 2.4 | NO | Given its current size and stage of development, the | ||||
A majority of the board of a listed entity should | Company has not found it necessary for the Board to | |||||
be Independent Directors. | comprise of a majority of independent directors. | |||||
As the Company continues to grow, the Board will | ||||||
consider whether it is appropriate to appoint | ||||||
additional independent director/s to the Board. | ||||||
Recommendation 2.5 | YES | The Board's current Chairman, Mr Tim Storey is a | ||||
The chair of the board of a listed entity should be | non-executive Director. Mr Storey satisfies the ASX | |||||
an Independent Director and, in particular, | Corporate Governance Principles and | |||||
should not be the same person as the CEO of | Recommendations definition of an independent | |||||
the entity. | director because he was not an executive of the | |||||
Company within the last three years. Mr Storey | ||||||
brings an independent judgement to bear on issues | ||||||
before the Board. | ||||||
Mr Daniel Kleijn is the Chief Executive Officer of the | ||||||
Company. | ||||||
Recommendation 2.6 | YES | Each new Director of the Company will, upon | ||||
A listed entity should have a program for | appointment, participate in an induction program. | |||||
inducting new Directors and for periodically | This will include meeting with members of the | |||||
reviewing whether there is a need for existing | existing Board, Company Secretary, management | |||||
directors to undertake professional development | and other relevant executives to familiarise | |||||
to maintain the skills and knowledge needed to | themselves with the Company, its procedures and | |||||
perform their role as a Director effectively. | prudential requirements, and Board practices and | |||||
procedures. | ||||||
All Directors are encouraged to undergo continual | ||||||
professional development and, subject to prior | ||||||
approval by the Chairman, all Directors may have | ||||||
access to various resources and professional | ||||||
development training to address any skills gaps. | ||||||
Principle 3: Instil a Culture of acting Lawfully, Ethically and Responsibly | ||||||
Recommendation 3.1 | NO | The Company does not currently have a formal | ||||
A listed entity should articulate and disclose its | statement of values. | |||||
values | ||||||
Recommendation 3.2 | YES | The Board is committed to the establishment and | ||||
A listed entity should: | maintenance of appropriate ethical standards in | |||||
(a) | have and disclose a code of conduct for | order to instil confidence in both clients and the | ||||
community in the way the Company conducts its | ||||||
its Directors, senior executives and | ||||||
business. | ||||||
employees; and | ||||||
(b) | ensure that the board or a committee of | |||||
the board is informed of any material | The Company has adopted a Code of Conduct which | |||||
breaches of that code. | applies to Directors, employees and contractors of | |||||
the Company. A copy of the Company's Code of | ||||||
Conduct is available on the Company's website: | ||||||
https://www.lawfinance.com.au/investor- | ||||||
centre/governance/ | ||||||
The Board is informed of any material breaches of | ||||||
the Code of Conduct. | ||||||
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Lawfinance Ltd. published this content on 31 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 April 2021 13:15:07 UTC.