30 June 2014 Corporate Governance Statement SECTION 2: HOW MRL SATISFIES THE ASX’S RECOMMENDATIONS 2.1 Board and Management Responsibility: PRINCIPLE 1 - LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT RECOMMENDATION 1.1 – ROLES AND RESPONSIBILITIES OF BOARD AND MANAGEMENT 2.1.1 Board Responsibility The Board is responsible for guiding and monitoring the Company on behalf of shareholders. The Board has the  following overall responsibilities: •  establish the direction, strategies and financial objectives for the Company and monitoring the  implementation of those policies, strategies and financial objectives; and  •  monitoring compliance with regulatory requirements and confirming the culture for ethical behaviour and  standards.  1.  appointment, evaluation, rewarding and, if necessary, removal of the Managing Director and senior  management;  2.  review and approval of plans, new investments, major capital and operating expenditures, capital  management, acquisitions, divestitures and major funding activities exceeding the delegated authority of the  Managing Director;  3.  establishing appropriate levels of delegation to the Managing Director to allow him to manage the business  efficiently;  4.  monitoring actual performance against planned performance expectations;  5.  ensuring that the Company is appropriately positioned to manage significant business risks;  6.  overseeing the management of safety, occupational health and environmental matters;  7.  satisfying itself that the financial reporting of the Company fairly and accurately sets out the financial position  and financial performance of the Company;  8.  satisfying itself that there are appropriate reporting systems and controls in place to assure the Board  that proper operational, financial, compliance, and internal control processes are in place and functioning  appropriately;  9.  to ensure that appropriate internal and external audit arrangements are in place and operating effectively;  10. having a framework in place to help ensure that the Company acts legally and responsibly on all matters  consistent with the code of conduct; and  11. reporting to shareholders.  2.1.2 Management responsibility 2.2 Performance Review: The responsibility for the day-to-day operation and administration of the Company is delegated by the Board to  the Managing Director. Whilst there is a clear division between the responsibilities of the Board and management, the Board is  responsible for ensuring that management’s objectives and activities are aligned with the expectations and risks  identified by the Board. The Board has a number of mechanisms in place to ensure this is achieved including:  Senior executives (including the Managing Director) have formal job descriptions and letters of appointment  describing their term in office, duties, rights and responsibilities, and entitlements on termination. The Board has in place a process for evaluating the performance of the Managing Director and other senior executives. RECOMMENDATION 1.2 – EVALUATION OF PERFORMANCE OF MANAGEMENT •  approval and monitoring of a strategic plan; •  approval of annual budgets and monitoring actual performance against budget; and •  presentation at each Board meeting of financial, operations, and marketing information. Mineral Resources Limited Annual Report 2014  39 Corporate  Governance  Statement Functions reserved to the Board are:  For personal use only