Region : 2023 Corporate Governance Statement

2023 Corporate Governance Statement

Supporting better communities through life's essentials.

2023 Corporate Governance Statement

2023 Corporate

Governance Statement

Region Group is an internally-managed real estate investment trust and is listed on the Australian Securities Exchange (ASX: RGN).

Region Group (RGN or the Group) is comprised of Region RE Limited (ACN 158 809

1. (Region RE or Company), the Responsible Entity to the Region Management Trust (ARSN 160 612 626) and the Region Retail Trust (ARSN 160 612 788) (each a Trust and, together, Trusts).

The securities of each Trust are stapled together.

The Group is subject to regulation from multiple sources, including:

• ASX Listing Rules;
• Corporations Act 2001 (Cth) (Act) - as a company, as a holder of an Australian Financial Services Licence and as registered managed investment schemes;
• Trusts' Constitutions; and
• Trusts' Compliance Plans.

The Board of Region RE (Board), together with Management, recognise the value to the business's stakeholders of establishing and maintaining best practice corporate governance systems.

The Group's governance systems are reviewed and monitored by the Board and reflect the requirements of the market regulators and the expectations of stapled security holders (security holders), market participants and other stakeholders. This corporate governance statement outlines the governance systems in effect during the period from 1 July 2022 to 30 June 2023 (Reporting Period) by reference to the 4TH edition of the ASX Corporate Governance Principles and Recommendations (Recommendations) and to the Act.

As at 30 June 2023, the Group was compliant with the Recommendations.

The Board and Committee charters and the Group's policies referred to in this statement can be found on Region Group's website: https://regiongroup.au/about-us/corporate-governance/.

This statement was approved by the Board on 11 September 2023.

2023 Corporate Governance Statement

Contents

PRINCIPLE 1	Lay solid foundations for management and oversight	4
PRINCIPLE 2	Structure the board to be effective and add value	9
PRINCIPLE 3	Instil a culture of acting lawfully, ethically and responsibly	14
PRINCIPLE 4	Safeguard the integrity of corporate reports	17
PRINCIPLE 5	Make timely and balanced disclosure	20
PRINCIPLE 6	Respect the rights of security holders	21
PRINCIPLE 7	Recognise and manage risk	23
PRINCIPLE 8	Remunerate fairly and responsibly	26

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2023 Corporate Governance Statement

2023 Corporate Governance Statement

Principle 1

Lay solid foundations for management and oversight

A listed entity should clearly delineate the respective roles and responsibilities of its board and management and regularly review their performance.

RECOMMENDATION 1.1

A listed entity should have and disclose a board charter setting out:

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.

business. Under the terms of the Board Charter, the CEO is accountable to the Board for the exercise of the delegated authority and, with the support of senior management, must provide succinct, clear, verifiable and high-quality reports and information to the Board that will enable the Board to effectively discharge its duties.

The Board is committed to the ongoing safety and wellbeing of the Group's stakeholders and undertakes appropriate due diligence to ensure Management is taking all reasonable steps to ensure health and safety at RGN's centres and for all RGN employees. Workplace health, safety and environment (WHSE) is a standing agenda item at each Board meeting. Refer to the Sustainability Report, which is available at https://regiongroup.au/ sustainability/for details of the Group's activities in

The qualifications and experience of the Directors of the Board, the number of Board meetings and Committee meetings held and the number of meetings attended by each Director in the Reporting Period are set out in the Directors' Report, starting on page 40 of RGN's 2023 Annual Report, which is available at https://regiongroup.au/investor-centre/reports-presentations/.

The Board Charter and Committee charters are available at https://regiongroup.au/about-us/corporate-governance/.

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The primary role of the Board is to represent the interests of security holders by managing delivery of the Group's corporate strategies, policies and performance. The Board has adopted a charter (Board Charter) that establishes and discloses the respective roles and responsibilities of the Board and of Management.

The responsibilities retained by the Board include:

•	reviewing strategic direction and approving
	corporate strategic initiatives;
•	reviewing budgets and monitoring financial
	performance, including approval of major capital
	expenditure, acquisitions and divestments;

• overseeing disclosure of material information;
• approving distributions calculated in accordance with the Trusts' Constitutions;
• considering any social, ethical and environmental impact of operations;
• approving the Group's statement of values and Code of Conduct to underpin the desired culture within the Group; and
• appointing the Chair and Committee Chairs.

The Board Charter sets out the particular responsibilities of the Chair and the process by which Directors can seek independent professional

respect of WHSE in the Reporting Period.

RECOMMENDATION 1.2

A listed entity should:

1. undertake appropriate checks before appointing a director or senior executive or putting someone forward 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.

• overseeing the integrity of financial reporting,

including external audit;

• appointing and evaluating the performance of

the Chief Executive Officer (CEO), Chief Financial

Officer (CFO), Chief Operating Officer (COO) and

the Company Secretary;

• overseeing remuneration and succession

planning for all Non-Executive Directors and

Executive Key Management Personnel (KMP);

• reviewing and monitoring corporate governance

policies and practices;

• overseeing the effectiveness of the risk

management system;

advice.

The Board has established the following standing Committees to assist with carrying out its responsibilities:

• Audit, Risk Management and Compliance Committee;
• Nomination Committee;
• Remuneration Committee; and
• Investment Committee.

Each Committee has its own charter which describes its delegated roles and responsibilities.

The Board has delegated to the CEO the day-today management and operation of the Group's

In accordance with the processes and procedures set out in the Group's Nomination Committee Charter, satisfactory confirmation as to any Director-candidate's character, experience, education and qualifications and lack of criminal record or bankruptcy history must be sought. Prior to an appointment, any Director-candidate must confirm that they consider they have adequate time to dedicate to the affairs of the Group.

Prior to the appointment of any employee, independent comprehensive background checks are undertaken including reference checks, assessment of experience, employment history, education, criminal record and bankruptcy history.

In accordance with Region RE's Constitution, the Board has determined that Mr Fleming will stand for re-election and Ms Milis will stand for election at the 2023 Annual General Meeting (AGM). Information about Mr Fleming's re-election and Ms Milis' election will be included in the Notice of Meeting for the Group's 2023 AGM.

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2023 Corporate Governance Statement

RECOMMENDATION 1.3

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

2023 Corporate Governance Statement

If the entity was in the S&P/ASX 300 Index at the commencement of the reporting period, the measurable objective for achieving gender diversity in the composition of its board should be to have not less than 30% of its directors of each gender within a specified period.

The terms of the appointment of each Non-	Director and Region RE's expectations of them.
Executive Director are set out in an appointment	Each Executive Director and senior Executive has
letter between Region RE and the Non-Executive	been appointed pursuant to a service agreement,
Director. The appointment letters are reviewed	and in the case of the two Executive Directors,
regularly to ensure they accurately reflect the	the terms of their service agreements have been
roles and responsibilities of each Non-Executive	disclosed to the market.

RECOMMENDATION 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.

Region Group's continued success depends largely on its staff, who must continually meet the high expectations of investors in the changing and competitive finance and property services industries. The Group depends, therefore, on the support of a body of competent, informed and motivated employees.

The Group's policies and processes support the creation of a working environment which promotes diversity, inclusion and belonging, including our Code of Conduct, Parental Leave Policy and Flexible Work Arrangements Policy.

In 2020, the Group set a 40:40:20 gender diversity measurable objective (40% male, 40% female and 20% any gender) in respect of leadership positions, Non-Executive Directors and total employees to

As at 30 June 2023, the Group's gender related statistics were as follows:

Female Board Directors1	37.5%
Female Non-Executive Directors2	50%
Female Executives in Leadership Positions3	33.33%
Female Executives in Senior Management4	43%
Female employees	60%

The Remuneration Committee closely monitors diversity and related activities and reports to the Board on the effectiveness of the Group's diversity- related initiatives.

Region RE's Company Secretary is accountable directly to the Board through the Chair on all matters to do with the proper functioning of the Board, and the decision to appoint or remove the Company Secretary rests with the Board. Details of the Board's delegation of authority to the Company Secretary are set out in the Board Charter.

While the Company Secretary reports directly to the Board, the Board has delegated certain functional reporting obligations to the CEO. Each Director is able to communicate directly with the Company Secretary and the Company Secretary may communicate directly with each Director.

achieve over time. As at 30 June 2023, the Group had achieved each of these measurable objectives with the exception of the measurable objective in respect of leadership positions (although the Group subsequently met that objective post the Reporting Period).

The Group's Diversity and Inclusion Policy is available at https://regiongroup.au/about-us/corporate-governance/.

The Group is not a "relevant employer" under the Workplace Gender Equality Act.

RECOMMENDATION 1.5

A listed entity should:

1. have and disclose a diversity policy;
2. through its board or a committee of the board set measurable objectives for achieving gender diversity in the composition of its board, senior executives and workforce generally; and
3. disclose in relation to each reporting period:
4. 1. The measurable objectives set for that period to achieve gender diversity;
   2. the entity's progress towards achieving those objectives; and
   3. either:
   4. 1. 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
      2. 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.

In respect of the measurable objective of the Board comprising 30% of female Directors as set out in Recommendation 1.5, the Group achieved this objective on 8 December 2022, with the appointment of Antoinette Milis (and remained in compliance with the objective for the balance of the Reporting Period). The Group did not meet the objective for the period 1 July 2022 to 7 December 2022, with the Board comprising 28.5% of female Directors during that time.

1. Percentage of all Board Directors.
2. Percentage of Non-Executive Board Directors.
3. Leadership positions means the Chief Operating Officer, Chief Investment Officer, General Counsel/Company Secretary, Head of Human Resources, Chief Financial Officer and Chief Executive Officer
4. Senior Management means the Chief Executive Officer, his direct or functional reports and certain of their reports who have responsibility for an area and/or report regularly to the Board or a Committee of the Board on the performance of that area.

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2023 Corporate Governance Statement

RECOMMENDATION 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 for each reporting period whether a performance evaluation has been undertaken in accordance with that process during or in respect of that period.

2023 Corporate Governance Statement

Principle 2

Structure the board to be effective and add value

The board of a listed entity should be of an appropriate size and collectively have the skills, commitment and knowledge of the entity and the industry in which it operates, to enable it to discharge its duties effectively and to add value.

Each year consideration is given to the form of the Board performance evaluation, including whether an external facilitator should be used in the process.

For the Reporting Period, the Nomination Committee recommended that the evaluation of the Board, including the Board's Committees, be conducted by way of confidential questionnaire. The questionnaire included questions on those areas identified for improvement in previous cycles as well as areas appropriate for examination during this Reporting Period.

During this Reporting Period, the results of the performance questionnaires were considered by the Board and the Board Committees, with each Director (Non-Executive and Executive) having completed the Board and Board Committee performance questionnaires.

Individual Director performance was also evaluated during the Reporting Period.

RECOMMENDATION 2.1

The board of a listed entity should:

1. have a nomination committee which:
2. 1. has at least three members, a majority of whom are independent directors; and
   2. is chaired by an independent director,

and disclose:

(3)	the charter of the committee;
(4)	the members of the committee; and
(5) as at the end of each reporting period, the number of times the committee met throughout

RECOMMENDATION 1.7

A listed entity should:

1. have and disclose a process for evaluating the performance of its senior executives at least once every reporting period; and
2. disclose for each reporting period whether a performance evaluation has been undertaken in accordance with that process during or in respect of that period.

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 processes it employs to

address board succession issues and to ensure that the board has the appropriate balance of

skills, knowledge, experience and independence and diversity to enable it to discharge its duties

and responsibilities effectively.

The Remuneration Committee assessed the	The Remuneration Committee, together with
performance of each senior Executive against	the Board, reported the findings to the relevant
agreed formal financial and operational objectives	Executives.
and key performance indicators, in addition to
agreed personal objectives for the Reporting Period.

The Board has established a Nomination Committee. During the Reporting Period, the Nomination Committee comprised at least three Non-Executive Directors, all of whom were Independent Directors. The Nomination Committee was chaired by an Independent Director. The responsibilities of the Nomination Committee

are set out in a Board-approved Nomination Committee Charter and include making recommendations to the Board in relation to:

• succession planning for the Board and Chair;
• succession planning for the CEO;

• developing and implementing plans for identifying, assessing and enhancing Director competencies;
• ensuring an effective Director induction process is in place;
• appointment and re-election of Directors;
• overseeing the recruitment of new Directors in accordance with the policy and procedure for selection and appointment of new Directors; and
• evaluating the performance of the Board, its Committees and individual Directors against appropriate measures.

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