The Board of Directors of Cardno Limited is ultimately responsible for all corporate governance matters of the  consolidated entity and is accountable to the shareholders for the overall business performance of the company. Details  of the corporate governance policies of the company can be found in the Investor Centre of the company’s website,  www.cardno.com.au.  Cardno Limited is committed to implementing and maintaining sound corporate governance practices and has  considered the  ASX Corporate Governance Principles and Recommendations (Second Edition)  in the development of its  corporate governance. The Board has assessed the company’s current practice against these Principles and  Recommendations and notes that the company’s practices are consistent except where stated below.  The role of the Board and delegation to Senior Executives has been formalised. The most significant responsibilities of  the Board are:  The Board has delegated to Senior Executives responsibility for the implementation of the company’s strategic direction,  business plans and day-to-day management of the company’s operations. The performance of Senior Executives is evaluated by the Board through formal performance reviews undertaken on an  annual basis. The individual performance of each Senior Executive is reviewed against goals set in the previous year  and new objectives are established for the following financial year. The performance reviews were completed during the  year in accordance with the process agreed by the Board. The Board endorses a culture of continuous improvement and will therefore continue to refine and develop its role and  the delegation of responsibilities to management as the company develops.  The Board’s responsibilities and functions are also contained in the company’s Corporate Governance Policy which can  be accessed in the Investor Centre on the company’s website. To add value, the Board has been formed so that it has effective composition, size and commitment to adequately  discharge its responsibilities and duties. Collectively the Directors have a broad range of experience, expertise, skills,  qualifications and contacts relevant to the business. Details of the skills and experience of each Director are contained in  the Directors’ Report and on the company’s website. The Board currently comprises four Non-executive Directors including the Chairman, and four Executive Directors. The Board has adopted the following criteria to determine the independence of a Director as someone who must be a  Non-executive Director and:  is not a substantial shareholder of the company or an officer of, or otherwise associated directly with, a  substantial shareholder of the company;  within the last three years has not been employed in an executive capacity by the company or another group  member, or been a director after ceasing to hold any such employment;  within the last three years has not been a principal of a material professional adviser or a material consultant to  the company or another group member or an employee materially associated with the service provided;  is not a material supplier or customer of the company or another group member, or an officer of or otherwise  associated directly or indirectly with a material supplier or customer;  has no material contractual relationship with the company or other group member other than as a Director of the  company;  Page 21 of 80  Principle 2: Structure the Board to add value Principle 1: Lay solid foundation for management and oversight providing strategic guidance to the company including contributing to the development of and approving the  corporate strategy;  reviewing and approving business plans, the annual budget and financial plans including available resources and  major capital expenditure initiatives;  reviewing the operational and financial performance of the company’s activities;  reporting to shareholders and the market;  ensuring compliance with prudential regulations and standards;  ensuring adequate risk management processes are in place;  reviewing internal controls and internal and external audit reports;  monitoring and influencing the culture and reputation of the company;  monitoring board composition, director selection and board process and performance;  approving key executive appointments and ensuring executive succession planning;  reviewing the performance and remuneration of the Managing Director and Senior Executives;  ensuring that the Board as a whole has an appropriate understanding of each substantial segment of the  business; and  authorising and monitoring major investment and strategic commitments.  Corporate Governance Statement 