Corporate Governance

Apex Energy is an Australian unlisted public company whose corporate activities and responsibilities are largely controlled by requirements of the Corporations Act. Whilst Apex Energy is not bound by any ASX Listing Rules, Apex Energy is cognizant of the benefits to shareholders and the wider investment community intended by those Rules, and so, wherever practical, Apex Energy has adopted those principles and processes as "best practice". In particular, the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations, in relation to corporate governance practices, have been adopted by Apex Energy, where they are appropriate for the size and nature of Apex Energy's activities.

The following Corporate Governance Statement summarises the main corporate governance practices that have been adopted by the Apex Energy Board.

The business and affairs of Apex Energy are vested in the Directors who have responsibility for the management and control of Apex Energy. The Board will pursue best practice in corporate governance.

The best practice platforms of governance will apply to:

establishing the roles of management and the Board with a balance of skills, experience and independence appropriate to the nature and extent of corporate operations;
ensuring levels of integrity are maintained among those who can influence Apex Energy's strategy and financial performance, together with responsible and ethical decision making;
ensuring that Apex Energy meets the appropriate information needs of the investment community and maintains a public web site with such information which may be of use and interest;
ensuring the safety and rights of shareholders and all stakeholders;
in presenting Apex Energy's financial and non‐financial position, the Board will ensure the adoption of a process that safeguards, both internally and externally, the integrity of Apex Energy and its disclosure standards; and
ensuring that environmental best practice will at all times be a key focus of Apex Energy's Board, its management team, suppliers and consumers of its products.

Membership and expertise of the Board

The Board considers that its membership should comprise Directors with an appropriate mix of skills, knowledge, experience and personal attributes that allow the Directors individually and the Board collectively, to:

discharge their duties and responsibilities under the law efficiently and effectively;
understand the business of Apex Energy and the environment within which it operates to provide sound stewardship for management and Apex Energy's objectives, goals and strategic direction; and
assess the performance of management in meeting those objectives.

In addition to ensuring that the Board has a broad range of necessary skills, knowledge and experience to govern Apex Energy and understand the challenges that Apex Energy faces, the Board considers that its membership should represent an appropriate balance between Directors with experience and knowledge of Apex Energy and Directors with an external perspective. The Board also considers that its size should be conducive to effective discussion and efficient decision making. The Board believes that its current composition meets these requirements.

Board responsibilities

The principal role of the Board is to ensure the long term prosperity of Apex Energy by setting broad corporate governance policies and ensuring that they are effectively implemented by management.

The Board carries out this role principally by:

setting the strategic direction of Apex Energy and providing strategic guidance to management;
providing input into and approval of management's development of the corporate strategy and performance objectives;
reviewing and approving the business plans of Apex Energy ;
approval of annual budget and financial plans including available resources and major capital expenditure and initiatives;
overseeing and monitoring progress against budget via the establishment and reporting of both financial and non‐financial key performance indicators, organisational performance, the achievement of strategic goals and objectives and compliance with Apex Energy's Code of Conduct;
appointing, assessing performance and removing (where appropriate), senior executives of Apex Energy ;
monitoring financial performance including approval of the annual financial reports and liaison with Apex Energy's auditors; and
overseeing, reviewing and ratifying systems of governance, management processes, risk management, internal compliance and controls, codes of conduct and legal and regulatory compliance to ensure appropriate compliance frameworks and controls are in place.
review and monitor related party transactions and assess their propriety

Administration

The Board has delegated to executive management, responsibility for a number of matters including:

managing Apex Energy's day‐to‐day operations in accordance with the Board approved authorisations, policies and procedures;
developing Apex Energy's annual budget and recommending it to the Board for approval and managing the day‐to‐day operations within the budget; and
implementing corporate strategy and making recommendations on significant corporate strategic initiatives.

Board meetings

The Board plans to meet regularly to discuss the short and long term strategy of Apex Energy. The Board receives periodic reports, which provides current information concerning Apex Energy. The Board report includes salient financial details, together with information on the performance of operations, major initiatives, as well as legal, governance, risk management and compliance issues that may arise. The Board convenes by email and by telephone conference call to discuss matters of urgency and
importance with management, make recommendations to management and discuss strategy.

Chairperson and Chief Executive Officer

The Chairperson is responsible for leading the Board, ensuring Directors are properly briefed in all matters relevant to their roles and responsibilities, facilitating Board discussions and managing the Board's relationship with Apex Energy's executive management.

The CEO is responsible for implementing Apex Energy strategies and policies. The roles of the Chairperson and CEO may be undertaken by the same person.

Audit Committee

Apex Energy is not required to have a separate Audit Committee. After consideration of the current size and complexity of the activities of Apex Energy, the Board have decided, for the time being, not to have a separate Committee. The Board of Apex Energy shall directly review all matters and discharge its responsibilities relating to accounting policy, continuous disclosure and financial risk management. Apex shall have an appointed independent Auditor.

Environmental, Risk and Occupational Health and Safety

Apex Energy is committed to compliance with all relevant environmental and occupational health and safety laws and regulations. The Board is responsible for reviewing the adequacy of compliance with all regulatory requirements relating to occupational health, safety and the environment, monitoring the management of identified risks, highlighting new risks and reviewing action to be taken for their control, supporting a culture of safe working practices and concern for the environment, reviewing any serious injury or environmental incident and monitoring that correct practices are followed by all employees and contractors.

There are a variety of risks that exist in the gas industry in which Apex Energy operates and there are a range of factors, some of which are beyond the control of Apex Energy and which may impact on Apex Energy's performance.

Remuneration and Nomination

It is Apex Energy's objective to provide maximum stakeholder benefit from the retention of a high quality Board and executive management team by remunerating Directors and key executives fairly and appropriately in accordance with market conditions and reflective of their contribution. The expected outcomes of this remuneration philosophy are the retention and motivation of key Directors and executives, the attraction of quality management to Apex Energy and the provision of performance incentives which allow Directors and executives to share the rewards of the success of Apex Energy.

Apex Energy is not required to have a separate specific Remuneration Committee and after consideration of the current size and complexity of the activities of Apex Energy have decided, for the time being, not to have a separate Committee. The Board of Apex Energy shall directly review all matters related to remuneration and engagement of further Board members and executive management.

Review of Board and executive performance

In order to ensure that the Board continues to discharge its duties effectively, the performance of all Directors is reviewed regularly by the Chairperson.

The Board undertakes regular assessment of its collective performance and the performance of any Committees in accordance with Apex Energy's performance evaluation process for directors and executives. The Board also regularly reviews the performance of the executive management team.

Independent advice

Apex Energy permits any Director to obtain advice about transactions or matters of concern at Apex Energy's cost. Approval for Directors seeking independent advice is subject to the approval of the Chairperson acting reasonably. Where appropriate, Directors share such independent advice with other Directors.

Company policy and practice for dealing in shares

The freedom of all officers and employees to deal in the shares is restricted in a number of ways namely by statute and by common law. Apex Energy is not listed on any Stock Exchange and therefore it is not bound by requirements of the ASX Listing Rules, however, Apex Energy has adopted an insider trading policy for dealing in shares. The insider trading policy provides that officers and employees may deal in shares provided that, at all times, they are not in possession of material information which has not been disclosed to shareholders, or with the express prior approval of the Chairperson or the CEO.

Shareholder communications

The Board aims to ensure that shareholders are informed of all information necessary to assess the performance of Apex Energy.
Information is communicated to the shareholders through:

the annual report, which is distributed to all shareholders (other than those who elect not to receive it);
the AGM and other shareholder meetings called to obtain approval for Board action as appropriate;
encouraging active participation by shareholders at shareholder meetings;
encouraging all shareholders who are unable to attend general meetings to communicate issues or ask questions by writing to Apex Energy.
from time to time occasional reports to shareholders on matters likely to be of relevance to them.
maintaining of a public web site with relevant information about the Company and its business

Company commitment to continuous disclosure

Whilst Apex Energy is not Listed on any Stock Exchange and therefore not subject to rigorous continuous disclosure requirements of Listing Rules, the Board has approved a disclosure policy to ensure the fair and timely disclosure of information to the shareholders which is likely to have effect on Apex Energy.

External audit independence

Apex Energy's policy is to appoint external auditors who demonstrate quality and independence. The performance of the auditor is reviewed annually and applications for tender of external audit services are requested as deemed appropriate, taking into account an assessment of performance, existing value and tender costs.

The external auditor will be requested to attend the AGM and be available to answer Shareholder questions about the conduct of the audit and the preparation of the content of the audit report.