Corporate Governance

The roles of board and management

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The Board has adopted a charter which establishes the relationship between the Board and management and describes their functions and responsibilities. The Board’s responsibilities, as set out in the Board Charter, include:

• working with management to establish ThinkSmart’s strategic direction;
• monitoring management and financial performance;
• monitoring compliance and risk management;
• reviewing procedures in place for appointment of senior management and monitoring of its performance and for succession planning; and
• ensuring effective disclosure policies and procedures.

Matters which are specifically reserved for the Board or its committees under the Board Charter include:

• appointment of a chair;
• appointment and removal of the CEO;
• appointment of directors to fill a vacancy or as additional directors;
• 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.

Board Committees

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ThinkSmart has two Board committees, which serve to support the functions of the Board and make recommendations to the Directors on issues relating to their areas of responsibility.

Nomination and Remuneration Committee

The objective of the Nomination and Remuneration Committee is to help the Board ensure that ThinkSmart has a Board of an effective composition, size and the commitment to adequately discharge its responsibilities and duties, and to determine and review the compensation arrangements for the Directors and senior management team.

The members of the Nomination and Remuneration Committee are Peter Mansell (Chair), Ned Montarello, Steven Penglis and David Griffiths.

The Nomination and Remuneration Committee is responsible for reviewing the Board’s and its Committees’ performance. On an annual basis:

• Directors will provide written feedback in relation to the Board and its Committees against an agreed set of criteria and each Committee will do the same regarding its own performance;
• Feedback will be collected by the chair of the Board, or an external facilitator, and discussed by the Board, with consideration being given as to whether any steps should be taken to improve performance of the Board or its Committees;
• The CEO will also provide feedback from senior management in connection with any issues that may be relevant in the context of the Board performance review; and
• Where appropriate to facilitate the review process, assistance may be obtained from third party advisers.

Audit and Risk Committee

The Audit and Risk Committee provides advice and assistance to the Board in fulfilling the Board’s responsibilities relating to ThinkSmart’s financial statements, financial and market reporting processes, internal accounting and financial control systems, audit, risk management and such other matters as the Board may request from time to time.

The current members of the Audit and Risk Committee are David Griffiths (Chair), Peter Mansell and Steven Penglis.

Corporate Governance Policies

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Guidelines for Dealing in Securities

ThinkSmart’s Guidelines for Dealing in Securities explain and reinforce the Corporations Act 2001 requirements relating to insider trading. The Guidelines are summarised below.

The Guidelines apply to all directors and employees of the ThinkSmart group, and their associates (“Relevant Persons”).

The Guidelines expressly prohibit Relevant Persons buying or selling ThinkSmart securities where the Relevant Person or ThinkSmart is in possession of price sensitive or ‘inside’ information.

The Guidelines establish a ‘window period’, where, generally, Relevant Persons may buy or sell ThinkSmart’s securities on ASX in the period from 31 days from the day following:

• the announcement of half-yearly results;
• the announcement of annual results; or
• the holding of the annual general meeting,

provided they are not in possession of inside information. Outside the window period, Relevant Persons must receive clearance for any proposed dealing in ThinkSmart’s securities on ASX as follows:

• a director must receive approval from the Chair of the Board;
• the Chair must receive approval from the Board or the most senior director;
• executives and senior management must receive approval from the CEO; and
• all other Relevant persons must receive approval from the Company Secretary.

The Guidelines also prohibit short term dealing (buying and selling within 3 months) in ThinkSmart securities by Relevant Persons.

Disclosure Policy

ThinkSmart understands its obligations under the ASX Listing Rules and Corporations Act 2001 to keep the market fully informed of information which may have a material effect on the price or value of ThinkSmart’s securities. ThinkSmart has adopted a Disclosure Policy which sets out its policy to strictly comply with the continuous disclosure requirements. ThinkSmart’s Disclosure Policy is summarised below.

Procedures for considering continuous disclosure obligations at Board and management meetings

It is a standing agenda item at all Board meetings to consider whether any matters reported to or discussed at a Board meeting should be disclosed to the market pursuant to ThinkSmart’s continuous disclosure obligations. Continuous disclosure is also a standing agenda item at senior management meetings for the purpose of monitoring compliance with ThinkSmart’s obligations.

Process for reporting information

If management becomes aware of any information at any time that should be considered for release to the market, it must be reported immediately to the CEO, or the Group CFO / Company Secretary.

Operating and divisional heads and group functional heads must ensure they have appropriate procedures in place within their areas of responsibility to ensure that all relevant information is reported to them so it can be dealt with in accordance with the Disclosure Policy.

Procedures for dealing with infringement notices

Any infringement notices or statements of reasons issued by ASIC must be reported immediately to ThinkSmart’s Market Disclosure Committee for review and determination of the appropriate response.

Financial markets communications

ThinkSmart has authorised spokespersons who may speak on its behalf to major investors and analysts.

ThinkSmart imposes a ‘blackout period’ between the end of reporting periods and the announcement of financial results. In the blackout period it is ThinkSmart’s policy not to hold one-on-one briefings with institutional investors, individual investors, or analysts to discuss financial information concerning ThinkSmart, and it will not hold any open briefings to discuss anything other than information which has been announced to ASX. Any deviation from the policy must be approved by the CEO and any briefings will be subject to there being no discussion of information in breach of ThinkSmart’s continuous disclosure obligations.

If ThinkSmart holds open briefing sessions, it will not disclose any information in these sessions which may have a material effect on the price or value of ThinkSmart’s securities unless such information has already been announced to ASX. ThinkSmart will advise the market in advance of open briefings via the ASX and ThinkSmart’s website and will review the matters discussed at any briefing session following the briefing. The Group CFO will maintain a record of analysts’ earnings forecasts and monitor ThinkSmart’s own internal forecasts.

The Group CFO will also monitor ThinkSmart’s share price to assess whether a false market for ThinkSmart’s securities may exist at any point in time.

Media communications

ThinkSmart also has a media relations policy to assist its managers in dealings with the media. This policy specifies authorised persons who may deal with the media and procedures for responding to media inquiries.

Responsibility for communication with ASX

The Company Secretary has the primary responsibility for all communication with the ASX in relation to Listing Rule matters including lodging announcements with ASX. The Company Secretary is also responsible for ensuring senior management is aware of the Disclosure Policy and that the Disclosure Policy is updated.

Shareholder communications

The Board aims to ensure that shareholders are informed of all major developments affecting ThinkSmart. Under ThinkSmart’s shareholder communications strategy:

• Information is communicated to shareholders through ASX announcements, the annual report, annual general meeting and half year and full year results announcements.
• Shareholders are able to access information, including media releases, key policies and the terms of reference of the Board Committees through ThinkSmart’s website. All relevant ASX announcements will be posted on ThinkSmart’s website as soon as they have been released to ASX.
• ThinkSmart encourages participation of shareholders at its annual general meeting. The external auditor will attend the annual general meeting and be available to answer shareholder questions about the conduct of the audit and the preparation and content of the auditor’s report.

Code of Conduct

ThinkSmart has developed a Code of Conduct which states ThinkSmart’s and its employees’ commitment to the conduct of its business with employees, customers, funders, retailers and other external parties.

The Code is directed at maintaining high ethical standards and integrity. Employees are expected to adhere to ThinkSmart’s policies, perform their duties diligently, properly use company resources, protect confidential information and avoid conflicts of interest.

The Code sets out the reporting lines where there is a potential breach of the Code, ThinkSmart’s commitment to the Code and the consequences of breaching the Code. The Code is acknowledged by all employees.

Board charter and relationship with management

Risk Management Policy