Corporate Governance Statement

The Board of Directors of Synergy Metals Limited is responsible for the corporate governance of the Group. The Board guides and monitors the business and affairs of Synergy Metals Limited on behalf of the shareholders by whom they are elected and to whom they are accountable.

The tables below summarise the Company’s compliance with the ASX Corporate Governance Council’s Revised Principles and Recommendations.

Principle 1 – Lay Solid Foundations for Management and Oversight

Principles & Recommendations	Compliance	Comply
1.1 Establish the functions reserved to the Board of directors (Board) of Synergy Metals Limited (Company) and those delegated to manage and disclose those functions	The Board is responsible for the overall corporate governance of the Company. The Board has adopted a Board charter that formalises its roles and responsibilities and defines the matters that are reserved for the Board and specific matters that are delegated to management. On appointment of a Director, the Company issues a letter of appointment setting out the terms and conditions of appointment to the Board.	Compliant
1.2 Disclose the process for evaluating the performance of senior executives	The Board does not employ full time executives to the Company but uses the services of consultants. Consultants are provided with instructions to carry out their designated functions and report to the Board. There is no review of the consultants performance, nor is there any review of the Board’s performance.	Does not comply. However the Board will undertake a self assessment of its performance in the 2010 financial year.
1.3 Provide the information indicated in Guide to reporting on Principle 1	A summary of the Board’s functions and resonsibilites has been disclosed on the Company’s website and is summarised in this Corporate Governance Statement.	Complies

Principle 2 – Structure the Board to Add Value

Principles & Recommendations	Compliance	Comply
2.1 A majority of the Board should be independent directors	The majority of the Board’s directors are not independent as a majority of the Board are either a substantial shareholder or are executive directors of the Company. Mr Michael Sadler is an independent non-executive director. Mr Peter Malkin is an executive director. Mr Kit Foo Chye is an independent non-executive director. Mr Freddie Heng and Mr Poh Kiat are non-executive directors, but not independent due to the size of their shareholding in the Company.	Does not comply however the skills and experience of both the independent and non-independent directors allow the Board to act in the best interests of shareholders.
2.2 The chair should be an independent director	Mr Michael Sadler is an independent non-executive director of the Board.	Complies.
2.3 The roles of chair and chief executive officer should not be exercised by the same individual	Michael Sadler is the chairman and Peter Malkin the operations director. The Board takes on the day to day function of a chief executive officer.	Does not comply as the company has not appointed a chief executive officer. The company will consider this position once it has secured future viability of its exploration assets.
2.4 The Board should establish a nomination committee	Given the size of the Board, it was determined that the Board will execute the functions of a nomination committee and that a separate nomination committee is unnecessary.	Does not comply for reasons given under 2.6 below.
2.5 Disclose the process for evaluating the performance of the Board, its committees and individual directors.	The Company did not conduct a performance evaluation of the Board,and has not adopted a performance evaluation policy.	Does not comply. Refer 1.2 above.
2.6 Provide the information indicated in the Guide to reporting on Principle 2	This information has been disclosed (where applicable) in the Directors’ Report attached to this Corporate Governance Statement. Mr Michael Sadler is an independent director of the Company. A director is considered independent when he substantially satisfies the test for independence as set out in the ASX Corporate Goverenance Recommendations. Members of the Board are able to take independent professional advice at the expense of the Company. The Board carries out the functions of a nomination committee. In accordance with the information suggested in Guide to Reporting on Principle 2, the Company has disclosed full details of its Directors in the Director’s Report attached to this Corporate Governance Statement. Other disclosure material as suggested in Guide to Reporting on Principle 2 has been made available on the Company’s website.	Does not comply. Given the size of the Board, the Directors determined that it will execute the functions of a nomination committee and that a separate nomination committee is unnecessary. In addition, the Board does not consist of a majority of independent directors however the skills and experience of both the independent and non-independent directors allows the Board to act in the best interests of shareholders.

Principle 3 – Promote Ethical and Responsible Decision Making

Principles & Recommendations	Compliance	Comply
3.1 Establish a code of conduct and disclose the code or a summary of the code.	The Board has adopted a code of conduct that is contained within the Board charter. The code establishes a clear set of values that emphasise a culture encompassing strong corporate governance, sound business practices and good ethical conduct. The code of conduct is encompassed within the Board Charter and is available on the Company’s website.	Complies.
3.2 Establish a policy concerning trading in Company securities by directors, senior executives and employees and disclose the policy or a summary of that policy.	The Company has adopted a securities trading policy that applies to trading in shares in the Company by any director or employee of the Company. This policy is available on the Company’s website.	Complies.
3.3 Provide the information indicated in Guide to reporting on Principle 3.	The code of conduct and securities trading policy are available on the Company’s website. The securities trading policy is summarised in this Corporate Governance Statement.	Complies.

Principle 4 – Safeguard Integrity in Financial Reporting

Principles & Recommendations	Compliance	Comply
4.1 The Board should establish an audit committee	An audit committee has not been established by the Board.	Does not comply. Given the size of the Board, the Directors determined that it will execute the functions of an audit committee and that a separate audit committee is unnecessary.
4.2 The audit committee should be structured so that it consists of only non-executive directors, a majority of independent directors, is chaired by an independent chair who is not chair of the Board and have at least 3 members.	An audit committee has not been established by the Board.	Does not comply, for reasons given in 4.1 above.
4.3 The audit committee should have a formal charter	An audit committee has not been established by the Board. The functions of an audit committee are reserved for the Board and operate under the Board Charter	Does not comply, for reasons given in 4.1 above.
4.4 Provide the information indicated in Guide to reporting on Principle 4	The functions associated with safeguarding the integrity in financial reporting are carried out by the Baord; is encompassed within the Board Charter which is available on the Company’s website and summarised in this Corporate Governance Statement.	Does not comply, for reasons given in 4.1 above.

Principle 5 – Make Timely and Balanced Disclosure

Principles & Recommendations	Compliance	Comply
5.1 Establish written policies designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior executive level for that compliance and disclose those policies or a summary of those policies	The Company has adopted a continuous disclosure policy, to ensure that it complies with the continuous disclosure regime under the ASX Listing Rules and the Corporations Act 2001. This policy is available on the Company’s website.	Complies
5.2 Provide the information indicated in the Guide to reporting on Principle 5	The Company’s continuous disclosure policy is available on the Company’s website.	Complies

Principle 6 – Respect the Rights of Shareholders

Principles & Recommendations	Compliance	Comply
6.1 Design a communications policy for promoting effective communication with shareholders and encouraging their participation at general meetings and disclose that policy or a summary of that policy.	The Company has adopted a shareholder communications policy. The Company uses its website www.synergymetals.com.au, annual report, market announcements and media disclosures to communicate with its shareholders, as well as encourage participation at general meetings. This policy is available on the Company’s website.	Complies.
6.2 Provide the information indicated in the Guide to reporting on Principle 6	The Company’s shareholder communications policy is available on the Company’s website.	Complies.

Principle 7 – Recognise and Manage Risk

Principles & Recommendations	Compliance	Comply
7.1 Establish policies for the oversight and management of material business risks and disclose a summary of these policies	The Company has not adopted a risk management statement.	Does not comply. However ultimate responsibility for risk oversight and risk management rests with the Board and operates under the Board Charter.
7.2 The Board should require management to design and implement the risk management and internal control system to manage the Company’s material business risks and report to it on whether those risks are being managed effectively. The Board should disclose that management has reported to it as to the effectiveness of the Company’s management of its material business risks.	The Company has identified key risks within the business. In the ordinary course of business, management monitor and manage these risks. Key operational and financial risks are presented to and reviewed by the Board at each Board meeting.	Complies
7.3 The Board should disclose whether it has received assurance from the chief executive officer and chief financial officer that the declaration provided in accordance with section 295A of the Corporations Act 2001 is founded on a sound system of risk management and internal control and that the system is operating efficiently and effectively in all material respects in relation to the financial reporting risks.	The Board as a whole has made a declaration under section 295A of the Corporations Act 2001 that the financial accounting system is founded on a sound system of risk management and internal control and that the system is operating efficiently and effectively in all material respects in relation to the financial reporting risks.	Complies
7.4 Provide the information indicated in Guide to reporting on Principle 7	The Board has not adopted an audit and risk charter, however has identified key risks within the business.	Complies

Principle 8 – Remunerate Fairly and Responsibly

Principles & Recommendations	Compliance	Comply
8.1 The Board should establish a remuneration committee	The Board has not established a remuneration committee and has not adopted a remuneration charter.	Does not comply. Given the size of the Board, the Directors have determined that it will execute the functions of a remuneration committee and that a separate remuneration committee is unnecessary.
8.2 Clearly distinguish the structure of non-executive directors’ remuneration from that of executive directors and senior executives.	The Company complies with the guidelines for executive remuneration packages and non-executive director remuneration.	Complies.
8.3 Provide the information indicated in the Guide to reporting on Principle 8	The Board has not adopted a remuneration committee charter. The Company does not have any schemes for retirement benefits other than superannuation for non-executive directors.	Does not comply. Given the size of the Board, the Board has determined that it will execute the functions of a remuneration committee and that a separate remuneration committee is unnecessary. With respect to this compliance issue, the Board will review its position annually.

Synergy Metals Limited’s corporate governance practices were in place for the financial year ended 30 June 2009 and to the date of signing the Directors’ Report.

Various corporate governance practices are discussed within this statement. For further information on corporate governance policies adopted by Synergy Metals Limited, refer to our website

Board functions

The role of the Board of Synergy Metals Limited is as follows:

Representing and serving the interests of shareholders by overseeing and appraising the strategies, policies and performance of the Company. This includes over viewing the financial and human resources the Company has in place to meet its objectives and the review of management performance.
Protecting and optimising Company performance and building sustainable value for shareholders in accordance with any duties and obligations imposed on the Board by law and the Company’s constitution and within a framework of prudent and effective controls that enable risk to be assessed and managed.
Responsible for the overall Corporate Governance of Synergy Metals Limited and its controlled entities, including monitoring the strategic direction of the Company and those entities, formulating goals for management and monitoring the achievement of those goals.
Setting, reviewing and ensuring compliance with the Company’s values (including the establishment and observance of high ethical standards).
Ensuring shareholders are kept informed of the Company’s performance and major developments affecting its state of affairs.

Responsibilities/functions of the Board include:

selecting, appointing and evaluating from time to time the performance of, determining the remuneration of, and planning for the successor of, the Chief Executive Officer (CEO);
reviewing procedures in place for appointment of senior management and monitoring of its performance, and for succession planning. This includes ratifying the appointment and the removal of the Chief Financial Officer and the Company Secretary;
input into and final approval of management development of corporate strategy, including setting performance objectives and approving operating budgets;
reviewing and guiding systems of risk management and internal control and ethical and legal compliance. This includes reviewing procedures in place to identify the main risks associated with the Company’s businesses and the implementation of appropriate systems to manage these risks;
monitoring corporate performance and implementation of strategy and policy;
approving major capital expenditure, acquisitions and divestitures, and monitoring capital management;
monitoring and reviewing management processes in place aimed at ensuring the integrity of financial and other reporting;
monitoring and reviewing policies and processes in place relating to occupational health and safety, compliance with laws, and the maintenance of high ethical standards; and
performing such other functions as are prescribed by law or are assigned to the Board.

In carrying out its responsibilities and functions, the Board may delegate any of its powers to a Board committee, a Director, employee or other person subject to ultimate responsibility of the Directors under the Corporations Act 2001.
Matters which are specifically reserved for the Board or its committees include the following:

appointment of a Chair;
appointment and removal of a CEO;
appointment of Directors to fill a vacancy or as additional Director;
establishment of Board committees, their membership and delegated authorities;
approval of dividends;
development and review of corporate governance principles and policies;
approval of major capital expenditure, acquisitions and divestitures in excess of authority levels delegated to management;
calling of meetings of shareholders; and
any other specific matters nominated by the Board from time to time.

Corporate Governance Statement » Synergy Metals Limited » Corporate Governance

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