Full Press Release Details
Key to Disclosures Corporate Governance Council Principles and Recommendations
Rules 4.7.3 and 4.10.31
Corporate Governance Council Principles and Recommendations
Introduced 01/07/14 Amended 02/11/15
| Name of entity | ||
| Mesoblast Limited | ||
| ABN / ARBN | Financial year ended: | |
| 109 431 870 | 30 June 2017 |
Our corporate governance statement2 for the above period above can be found at:3
The Corporate Governance Statement is accurate and up to date as at 16 October 2017 and has been approved by the board.
The annexure includes a key to where our corporate governance disclosures can be located.
Date: 16 October 2017
Name of Director or Secretary authorising
lodgement: Charlie Harrison
1Under Listing Rule 4.7.3, an entity must lodge with ASX a completed Appendix 4G at the same time as it lodges its annual report with ASX.
Listing Rule 4.10.3 requires an entity that is included in the official list as an ASX Listing to include in its annual report either a corporate governance statement that meets the requirements of that rule or the URL of the page on its website where such a statement is located. The corporate governance statement must disclose the extent to which the entity has followed the recommendations set by the ASX Corporate Governance Council during the reporting period. If the entity has not followed a recommendation for any part of the reporting period, its corporate governance statement must separately identify that recommendation and the period during which it was not followed and state its reasons for not following the recommendation and what (if any) alternative governance practices it adopted in lieu of the recommendation during that period.
Under Listing Rule 4.7.4, if an entity chooses to include its corporate governance statement on its website rather than in its annual report, it must lodge a copy of the corporate governance statement with ASX at the same time as it lodges its annual report with ASX. The corporate governance statement must be current as at the effective date specified in that statement for the purposes of rule 4.10.3.
2"Corporate governance statement" is defined in Listing Rule 19.12 to mean the statement referred to in Listing Rule 4.10.3 which discloses the extent to which an entity has followed the recommendations set by the ASX Corporate Governance Council during a particular reporting period.
3Mark whichever option is correct and then complete the page number(s) of the annual report, or the URL of the web page, where the entity's corporate governance statement can be found. You can, if you wish, delete the option which is not applicable.
Throughout this form, where you are given two or more options to select, you can, if you wish, delete any option which is not applicable and just retain the option that is applicable. If you select an option that includes "OR" at the end of the selection and you delete the other options, you can also, if you wish, delete the "OR" at the end of the selection.
Key to Disclosures Corporate Governance Council Principles and Recommendations
ANNEXURE - KEY TO CORPORATE GOVERNANCE DISCLOSURES
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| PRINCIPLE 1 - LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT | |||
| 1.1 | A listed entity should disclose: (a) the respective roles and responsibilities of its board and management; and (b) those matters expressly reserved to the board and those delegated to management. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] and information about the respective roles and responsibilities of our board and management (including those matters expressly reserved to the board and those delegated to management): at [ insert location ] http://mesoblast.com/company/corporate-governance/role- and-composition-of-the-board | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
| 1.2 | A listed entity should: (a) undertake appropriate checks before appointing a person, or putting forward to security holders a candidate for election, as a director; and (b) 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. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
| 1.3 | A listed entity should have a written agreement with each director and senior executive setting out the terms of their appointment. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
| 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. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
4 If you have followed all of the Council's recommendations in full for the whole of the period above, you can, if you wish, delete this column from the form and re-format it.
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| 1.5 | A listed entity should: (a) have a diversity policy which includes requirements for the board or a relevant committee of the board to set measurable objectives for achieving gender diversity and to assess annually both the objectives and the entity's progress in achieving them; (b) disclose that policy or a summary of it; and (c) disclose as at the end of each reporting period the measurable objectives for achieving gender diversity set by the board or a relevant committee of the board in accordance with the entity's diversity policy and its progress towards achieving them and either: (1) the respective proportions of men and women on the board, in senior executive positions and across the whole organisation (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. | the fact that we have a diversity policy that complies with paragraph (a): in our Corporate Governance Statement OR at [ insert location ] and a copy of our diversity policy or a summary of it: at [ insert location ] http://mesoblast.com/images/pdf/DiversityPolicy.pdf and the measurable objectives for achieving gender diversity set by the board or a relevant committee of the board in accordance with our diversity policy and our progress towards achieving them: in our Corporate Governance Statement OR at [ insert location ] and the information referred to in paragraphs (c)(1) or (2): in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| 1.7 | A listed entity should: (a) have and disclose a process for periodically evaluating the performance of its senior executives; and (b) disclose, in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance with that process. | the evaluation process referred to in paragraph (a): in our Corporate Governance Statement OR at [ insert location ] and the information referred to in paragraph (b): in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| PRINCIPLE 2 - STRUCTURE THE BOARD TO ADD VALUE | |||
| 2.1 | The board of a listed entity should: (a) have a nomination committee which: (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 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, independence and diversity to enable it to discharge its duties and responsibilities effectively. | [If the entity complies with paragraph (a):] the fact that we have a nomination committee that complies with paragraphs (1) and (2): in our Corporate Governance Statement OR at [ insert location ] and a copy of the charter of the committee: at [ insert location ] http://www.mesoblast.com/company/corporate-governance/board- committees-and-charters and the information referred to in paragraphs (4) and (5): in our Corporate Governance Statement OR at [ insert location ] [If the entity complies with paragraph (b):] the fact that we do not have a nomination committee and the processes we employ to address board succession issues and to ensure that the board has the appropriate balance of skills, knowledge, experience, independence and diversity to enable it to discharge its duties and responsibilities effectively: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
| 2.2 | A listed entity should have and disclose a board skills matrix setting out the mix of skills and diversity that the board currently has or is looking to achieve in its membership. | our board skills matrix: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| 2.3 | A listed entity should disclose: (a) the names of the directors considered by the board to be independent directors; (b) if a director has an interest, position, association or relationship of the type described in Box 2.3 but the board is of the opinion that it does not compromise the independence of the director, the nature of the interest, position, association or relationship in question and an explanation of why the board is of that opinion; and (c) the length of service of each director. | the names of the directors considered by the board to be independent directors: in our Corporate Governance Statement OR at [ insert location ] and, where applicable, the information referred to in paragraph (b): in our Corporate Governance Statement OR at [ insert location ] and the length of service of each director: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
| 2.4 | A majority of the board of a listed entity should be independent directors. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
| 2.5 | The chair of the board of a listed entity should be an independent director and, in particular, should not be the same person as the CEO of the entity. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
| 2.6 | A listed entity should have a program for inducting new directors and provide appropriate professional development opportunities for directors to develop and maintain the skills and knowledge needed to perform their role as directors effectively. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
| PRINCIPLE 3 - ACT ETHICALLY AND RESPONSIBLY | |||
| 3.1 | A listed entity should: (a) have a code of conduct for its directors, senior executives and employees; and (b) disclose that code or a summary of it. | our code of conduct or a summary of it: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| PRINCIPLE 4 - SAFEGUARD INTEGRITY IN CORPORATE REPORTING | |||
| 4.1 | The board of a listed entity should: (a) have an audit committee which: (1) has at least three members, all of whom are non- executive directors and a majority of whom are independent directors; and (2) is chaired by an independent director, who is not the chair of the board, and disclose: (3) the charter of the committee; (4) the relevant qualifications and experience of the members of the committee; and (5) in relation to each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or (b) if it does not have an audit committee, disclose that fact and the processes it employs that independently verify and safeguard the integrity of its corporate reporting, including the processes for the appointment and removal of the external auditor and the rotation of the audit engagement partner. | [If the entity complies with paragraph (a):] the fact that we have an audit committee that complies with paragraphs (1) and (2): in our Corporate Governance Statement OR at [ insert location ] and a copy of the charter of the committee: at [ insert location ] http://www.mesoblast.com/company/corporate-governance/board- committees-and-charters and the information referred to in paragraphs (4) and (5): in our Corporate Governance Statement OR at [ insert location ] [If the entity complies with paragraph (b):] the fact that we do not have an audit committee and the processes we employ that independently verify and safeguard the integrity of our corporate reporting, including the processes for the appointment and removal of the external auditor and the rotation of the audit engagement partner: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
| 4.2 | The board of a listed entity should, before it approves the entity's financial statements for a financial period, receive from its CEO and CFO a declaration that, in their opinion, the financial records of the entity have been properly maintained and that the financial statements comply with the appropriate accounting standards and give a true and fair view of the financial position and performance of the entity and that the opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| 4.3 | A listed entity that has an AGM should ensure that its external auditor attends its AGM and is available to answer questions from security holders relevant to the audit. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity that does not hold an annual general meeting and this recommendation is therefore not applicable |
| PRINCIPLE 5 - MAKE TIMELY AND BALANCED DISCLOSURE | |||
| 5.1 | A listed entity should: (a) have a written policy for complying with its continuous disclosure obligations under the Listing Rules; and (b) disclose that policy or a summary of it. | our continuous disclosure compliance policy or a summary of it: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
| PRINCIPLE 6 - RESPECT THE RIGHTS OF SECURITY HOLDERS | |||
| 6.1 | A listed entity should provide information about itself and its governance to investors via its website. | information about us and our governance on our website: at [ insert location ] http://mesoblast.com/company/corporate-governance | an explanation why that is so in our Corporate Governance Statement |
| 6.2 | A listed entity should design and implement an investor relations program to facilitate effective two-way communication with investors. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
| 6.3 | A listed entity should disclose the policies and processes it has in place to facilitate and encourage participation at meetings of security holders. | our policies and processes for facilitating and encouraging participation at meetings of security holders: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity that does not hold periodic meetings of security holders and this recommendation is therefore not applicable |
| 6.4 | A listed entity should give security holders the option to receive communications from, and send communications to, the entity and its security registry electronically. | the fact that we follow this recommendation: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| PRINCIPLE 7 - RECOGNISE AND MANAGE RISK | |||
| 7.1 | The board of a listed entity should: (a) have a committee or committees to oversee risk, each of which: (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 the period and the individual attendances of the members at those meetings; or (b) if it does not have a risk committee or committees that satisfy (a) above, disclose that fact and the processes it employs for overseeing the entity's risk management framework. | [If the entity complies with paragraph (a):] the fact that we have a committee or committees to oversee risk that comply with paragraphs (1) and (2): in our Corporate Governance Statement OR at [ insert location ] and a copy of the charter of the committee: at [ insert location ] http://www.mesoblast.com/company/corporate-governance/board- committees-and-charters and the information referred to in paragraphs (4) and (5): in our Corporate Governance Statement OR at [ insert location ] [If the entity complies with paragraph (b):] the fact that we do not have a risk committee or committees that satisfy (a) and the processes we employ for overseeing our risk management framework: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
| 7.2 | The board or a committee of the board should: (a) review the entity's risk management framework at least annually to satisfy itself that it continues to be sound; and (b) disclose, in relation to each reporting period, whether such a review has taken place. | the fact that board or a committee of the board reviews the entity's risk management framework at least annually to satisfy itself that it continues to be sound: in our Corporate Governance Statement OR at [ insert location ] and that such a review has taken place in the reporting period covered by this Appendix 4G: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| 7.3 | A listed entity should disclose: (a) if it has an internal audit function, how the function is structured and what role it performs; or (b) if it does not have an internal audit function, that fact and the processes it employs for evaluating and continually improving the effectiveness of its risk management and internal control processes. | [If the entity complies with paragraph (a):] how our internal audit function is structured and what role it performs: in our Corporate Governance Statement OR at [ insert location ] [If the entity complies with paragraph (b):] the fact that we do not have an internal audit function and the processes we employ for evaluating and continually improving the effectiveness of our risk management and internal control processes: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
| 7.4 | A listed entity should disclose whether it has any material exposure to economic, environmental and social sustainability risks and, if it does, how it manages or intends to manage those risks. | whether we have any material exposure to economic, environmental and social sustainability risks and, if we do, how we manage or intend to manage those risks: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| PRINCIPLE 8 - REMUNERATE FAIRLY AND RESPONSIBLY | |||
| 8.1 | The board of a listed entity should: (a) have a remuneration committee which: (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 the period and the individual attendances of the members at those meetings; or (b) if it does not have a remuneration committee, disclose that fact and the processes it employs for setting the level and composition of remuneration for directors and senior executives and ensuring that such remuneration is appropriate and not excessive. | [If the entity complies with paragraph (a):] the fact that we have a remuneration committee that complies with paragraphs (1) and (2): in our Corporate Governance Statement OR at [ insert location ] and a copy of the charter of the committee: at [ insert location ] http://www.mesoblast.com/company/corporate- governance/board-committees-and-charters and the information referred to in paragraphs (4) and (5): in our Corporate Governance Statement OR at [ insert location ] [If the entity complies with paragraph (b):] the fact that we do not have a remuneration committee and the processes we employ for setting the level and composition of remuneration for directors and senior executives and ensuring that such remuneration is appropriate and not excessive: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
| 8.2 | A listed entity should separately disclose its policies and practices regarding the remuneration of non-executive directors and the remuneration of executive directors and other senior executives. | separately our remuneration policies and practices regarding the remuneration of non-executive directors and the remuneration of executive directors and other senior executives: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we are an externally managed entity and this recommendation is therefore not applicable |
Key to Disclosures Corporate Governance Council Principles and Recommendations
| Corporate Governance Council recommendation | We have followed the recommendation in full for the whole of the period above. We have disclosed | We have NOT followed the recommendation in full for the whole of the period above. We have disclosed 4 | |
| 8.3 | A listed entity which has an equity-based remuneration scheme should: (a) have a policy on whether participants are permitted to enter into transactions (whether through the use of derivatives or otherwise) which limit the economic risk of participating in the scheme; and (b) disclose that policy or a summary of it. | our policy on this issue or a summary of it: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement OR we do not have an equity-based remuneration scheme and this recommendation is therefore not applicable OR we are an externally managed entity and this recommendation is therefore not applicable |
| ADDITIONAL DISCLOSURES APPLICABLE TO EXTERNALLY MANAGED LISTED ENTITIES | |||
| - | Alternative to Recommendation 1.1 for externally managed listed entities: The responsible entity of an externally managed listed entity should disclose: (a) the arrangements between the responsible entity and the listed entity for managing the affairs of the listed entity; (b) the role and responsibility of the board of the responsible entity for overseeing those arrangements. | the information referred to in paragraphs (a) and (b): in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
| - | Alternative to Recommendations 8.1, 8.2 and 8.3 for externally managed listed entities: An externally managed listed entity should clearly disclose the terms governing the remuneration of the manager. | the terms governing our remuneration as manager of the entity: in our Corporate Governance Statement OR at [ insert location ] | an explanation why that is so in our Corporate Governance Statement |
Corporate Governance Statement
Mesoblast Limited (the Company or Mesoblast) and its Board of Directors (the Board) are committed to implementing and achieving an effective corporate governance framework to ensure that the Company is managed effectively and in an honest and ethical way.
A description of the Company and its controlled entities' (together, the Group) corporate governance practices are set out below. All of these practices, unless otherwise stated, were in practice for the entire year and are in compliance with the ASX Corporate Governance Principles and Recommendations, third edition (the ASXCGPR). The following report is structured to align with the principles set out in the ASXCGPR.
The information in this statement is current as at
16 October 2017 and has been approved by the Board. This statement includes cross references to the Company's charters, policies and codes, relevant copies or summaries of which are available in the Corporate Governance section of the Company's website, www.mesoblast.com. Further, this statement should be read in conjunction with the Directors' Report, the Remuneration Report and the Financial Report for the financial year ended 30 June 2017 as these reports also contain information required to be included by the ASXCGPR. The Directors' Report can be found at Part 1 on the Form 20-F contained within our Annual Report (principally Item 4.B and Item 5.A), the Remuneration Report can be found at Item 6 of the Form 20-F contained within the 2017 Annual Report, and the Financial Report can be found at Item 18 of Form 20-F contained within the 2017 Annual Report.
LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT
The Board of Directors is primarily responsible for setting the strategic direction and corporate governance of the Group, and for overseeing the management and operations of the Group. In particular, the principal roles and responsibilities of the Board are to:
Mesoblast Limited Corporate Governance Statement 2017 1
The Board operates in accordance with the broad principles set out in its charter, which provides a framework for its effective operation. The charter specifically addresses the following:
A summary of the charter is available at www.mesoblast.com.
BOARD SUB-COMMITTEES
The Board has delegated specific authority to three sub-committees. These committees are the Audit and Risk Committee, the Nomination and Remuneration Committee and the Science and Technology Committee.
The Board established the Science and Technology Committee to have oversight of matters pertaining to the Company's strategic direction and investment in research and development and technology. This committee's responsibilities are to:
The Science and Technology Committee must comprise of at least two independent Directors and the Company's Chief Scientific Officer (or equivalent).
The following Directors are the members of the Science and Technology Committee:
| Name | Position held during the year | |
| Silviu Itescu | Executive member | |
| Eric Rose | Independent Chair | |
| Ben-Zion Weiner | Independent member | |
| William Burns | Independent member |
The charter of the Science and Technology Committee is available at www.mesoblast.com.
Further details on the Nomination and Remuneration Committee and Audit and Risk Committee are at Principle 2 and Principle 4 of this statement, respectively.
Day to day management of the Group's operations and the implementation of the corporate strategy and policy initiatives are delegated by the Board to the Chief Executive and the executive team.
Specific limits of authority delegated to the Chief Executive and senior executive team are outlined in a formal delegation of authority policy, which has been approved by the Board.
DIRECTOR SELECTION AND APPOINTMENT
The Company conducts appropriate checks before it appoints a person or puts forward to shareholders a new candidate for election as a Director. These include checks as to the person's character, experience, education, criminal record, bankruptcy history, probity and any other relevant matters.
The Company also provides shareholders with all material information in its possession relevant to a decision on whether or not to elect or re-elect a Director in the notice of meeting provided to shareholders. This includes information relevant for shareholders to be able to assess the Director's skills and competencies, industry experience, time commitments and other relevant information in their consideration of that election. Directors eligible for election are also invited to address the meeting and provide details of the relevant qualifications, experience and skills they will bring to the Board.
Formal letters of appointment are issued to all incoming new Directors setting out the Company's expectations, their responsibilities and rights and the terms and conditions of their engagement.
The Company Secretary is accountable directly to the Board, through the Chair, on all matters to do with the proper functioning of the Board. The Company Secretary assists the Board in its effectiveness by ensuring that Board policy and procedures are followed and coordinating the timely completion and dispatch of the Board agenda and supporting papers. The Directors have direct access to the Company Secretary and regularly communicate through email, by telephone and in in-person meetings.
The Group values diversity and recognizes the benefits it can bring to the organization's ability to achieve its goals. Diversity can lead to a competitive advantage through broadening the talent pool for recruitment of high quality employees, by encouraging innovation and improving a corporation's image and reputation. Accordingly, the Group is committed to promoting diversity within the organization and has adopted a formal policy outlining the Group's diversity objectives. It includes requirements for the Board to establish measurable objectives for achieving
2 Mesoblast Limited Corporate Governance Statement 2017
diversity and for the Board to annually assess the objectives, and the Group's progress in achieving these objectives. A copy of the diversity policy is available at www.mesoblast.com.
With respect to gender diversity, the Group has set the following objectives:
The following table reports the Group's progress towards achieving its gender diversity objectives for points one and two above. In regards to point three, the Group did ensure that an equal opportunity existed for gender participation in all levels of professional development programs during the year. For completeness, as at 30 June 2017 the Company had 75 employees, of which 41 (55%) were female.
| Category | Number of women As at 30 June 2017 | Number of women As at 30 June 2016 | Increase/ (Decrease) |
| - on the Board of Directors* | - | - | - |
| - Senior executive positions** | 3 | 4 | (1) |
The Board has delegated the responsibility for reviewing and reporting on diversity, specifically gender diversity, to the Nomination and Remuneration Committee.
BOARD PERFORMANCE EVALUATION
The performance of the Board is reviewed periodically. A copy of the Group's performance evaluation process for the Board, its committees, individual Directors and senior management is available at www.mesoblast.com. A Board evaluation process including an evaluation of individual non-executives and the Board committees was undertaken during the 2016 financial year. This review encompassed feedback on the Chair and individual non-executive Directors as well as consideration of Board succession planning, diversity and breadth and sufficiency of skills represented on the Board. At that time, the results confirmed that the Board continues to function in an appropriate manner. Detailed results of the review were reported back to the Board. Our next review is scheduled to be finalized by November 2017 with a similar scope of topics as previously covered.
The Board also carries out informal performance monitoring sessions at each in-person meeting of the Board. In addition, Directors are encouraged to raise any issues of concern regarding the performance of the Board, Board committees or individual Directors with the Chair, or if the concern relates to the Chair, with the Chair of the Audit and Risk Committee.
SENIOR EXECUTIVE PERFORMANCE EVALUATION
The process for assessing performance of the Chief Executive and the senior executive team is described in the Remuneration Report. A performance evaluation for senior executives, which accords with the process described in the Remuneration Report, was undertaken during the 2017 financial year.
STRUCTURE THE BOARD TO ADD VALUE
NOMINATION AND REMUNERATION COMMITTEE
The Board has established a Nomination and Remuneration Committee to assist it in the discharge of its responsibilities. The main responsibilities of the committee are to:
The Nomination and Remuneration Committee operates in accordance with its charter which sets out its roles and responsibilities, composition, structure and membership requirements. A summary of the Nomination and Remuneration Committee is available at www.mesoblast.com.
The following three independent Directors are the members of the Nomination and Remuneration Committee:
| Name | Position held during the year | |
| Donal O'Dwyer | Independent Chair | |
| Michael Spooner | Independent member | |
| Brian Jamieson | Independent member |
Mesoblast Limited Corporate Governance Statement 2017 3
The details of the meetings attended by each member of the Nomination and Remuneration Committee during the 2017 financial year are set out in Item 6.A of Form 20-F contained within our Annual Report.
The Company has developed a skills matrix setting out the mix of skills and diversity that the Board currently has or is looking to achieve in its membership. The skills matrix helps to identify any gaps in the collective skills of the Board that can then be addressed through professional development initiatives for Directors and in Board succession planning.
The skills and experience the Board has, and is looking to continue in its membership are in the areas of, but not limited to:
-substantial experience in senior executive roles for businesses across multiple global locations;
Each of these skills is well represented on our Board.
INDEPENDENT DIRECTORS
With the exception of our Chief Executive, the Board comprises of independent Directors, namely Mr Brian Jamieson, Mr William Burns, Mr Donal O'Dwyer, Dr Eric Rose, Mr Michael Spooner and Dr Ben-Zion Weiner.
A Director is considered independent if he is a non- executive Director and he is free of any interest, position, association or relationship that might influence, or reasonably be perceived to influence, in a material respect his capacity to bring an independent judgement to bear on issues before the Board. The Board considers the factors set out in the ASXCGPR
and outlined below when assessing the independence of each non-executive Director, being whether the Director:
The Board at least annually assesses independence of its non-executive Directors. To enable this assessment of independence, the Company maintains a conflicts of interest register, and the Directors must provide all information that may be relevant to the assessment.
As part of its annual assessment of independence for 2017, the Board gave specific consideration to:
With respect to Mr Spooner's former role as Executive Chair and his continuation on the Board, the Board maintains the view that he remains an independent Director on the basis that the Group has significantly expanded its operations since he held an executive role more than nine years ago. With respect to Mr Spooner and Mr O'Dwyer's tenure on the Board, the Board considers each of these Directors to be independent Directors on the basis that each continues to bring valuable expertise, independent judgement and has not formed associations with management or others that might compromise their ability to fulfil their role as an independent Director.
4 Mesoblast Limited Corporate Governance Statement 2017
The Chair is responsible for leading the Board and for the efficient organization and conduct of the Board. The role of the Chair more specifically is to ensure Directors are properly briefed in all matters relevant to their role and responsibilities, to facilitate Board discussions and to manage the Board's relationship with the Chief Executive and executive team. In accepting the position, the Chair has acknowledged that it will require a significant time commitment and has confirmed that other positions held will not hinder his effective performance in the role of Chair. The Chair of the Board, Mr Brian Jamieson, is considered an independent Director.