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CORPORATE

Corporate Governance

Code of Conduct

1. OVERVIEW

1.1 The Medusa Mining Limited (the "Company" or "Medusa") Code of Conduct ("Code") governs Medusa's activities and the conduct of its Directors, employees, consultants and any other people when they represent Medusa.

1.2 This Code broadly outlines the manner in which Medusa wishes to conduct its business activities and deals primarily with:

  • general principles;

  • compliance with laws and regulations;

  • political contributions;

  • unacceptable payments;

  • giving and/or receiving gifts;

  • protection of Medusa assets;

  • proper accounting;

  • dealing with auditors;

  • unauthorised public statements;

  • conflict of interest;

  • the use of inside information;

  • share trading of Company shares (Insider Trading);

  • alcohol and drug abuse;

  • equal opportunity and employee discrimination;

  • environmental responsibilities;

  • occupational health and safety; and

  • economy and efficiency.

1.3 The Board of Medusa acknowledge that this Code will not cover every situation that employees may confront, but are nevertheless satisfied that it does provide the necessary guidance for employees to work within the overall framework.

1.4 Employees are urged to familiarize themselves with this Code and to direct any queries they may have to the CEO or Company Secretary.

2. GENERAL PRINCIPLES

2.1 Medusa, its subsidiaries and associated entities, Directors, employees, consultants and all other people when they represent Medusa are expected to comply, at all times with all laws governing its operations. They are also expected to conduct the Company's activities in keeping with the highest legal, moral and ethical standards.

2.2 All Directors and employees of Medusa, its subsidiaries and associated companies ("Employees") must conduct the business of the Company with the highest level of ethics and integrity in relation to customers, suppliers, competitors, each other and all others with whom they deal.
Employees must at all times, act:

(a) ethically, honestly, responsibly and diligently;

(b) in full compliance with the letter and spirit of the law and this Code; and

(c) in the best interest of the Company.

2.3 Any breach of applicable laws, prevailing business ethics or other aspects of this Code will result in disciplinary action, which may include (depending on the severity of the breach) termination of employment.
Breach of applicable laws or regulations may also result in prosecution by the appropriate authorities. Medusa will not pay, directly or indirectly, any penalties imposed on Employees as a result of a breach of law or regulation.

2.4 All Employees are requested to report immediately any circumstances which may involve deviation from this Code to the CEO or Company Secretary.

It is in the best interests of the Company for all Employees to immediately report any observance of a breach of this Code.

2.5 Employees who deal with agents, contractors or consultants who represent Medusa must make them aware of this Code and that Medusa expects them to conduct their business in accordance with this Code.

3. COMPLIANCE WITH LAWS AND REGULATIONS

3.1 The activities of Medusa must be conducted in compliance with all laws and regulations applicable in the jurisdiction in which activities are being undertaken.

3.2 Compliance with the law means observing the letter and spirit of the law as well as managing the business of Medusa so that the Company and Employees are recognized as "good corporate citizens" at all times.

3.3 It is recognised that, in some cases, there may be uncertainty about which laws and regulations are applicable and there may be difficulties in interpretation.

In such circumstances, Employees should consult with the CEO with respect to accessing external legal advice from Medusa's lawyers as is necessary to ensure compliance.

4. POLITICAL CONTRIBUTIONS

4.1 Political contributions (to any government official, political party, political party official, election committee or political candidate) must not be made directly or indirectly on behalf of the Company without the prior approval of the Board.

5. UNACCEPTABLE PAYMENTS

5.1 Bribes, kickbacks, inducements or other illegal payments of any kind must not be made to or for the benefit of any government official (of any country), customer, supplier or any other party in connection with obtaining orders or favourable treatment or for any other purpose.

This prohibition extends not only to direct payments but also to indirect payments made in any form through distributors, representatives, consultants, agents or other third parties.

5.2 Employees must not seek or accept any type of compensation, fee, commission or gratuity from a third party in connection with the operations of the Company.


6. GIVING AND/OR RECEIVING GIFTS

6.1 Employees must not give, seek or accept in connection with the operation of the Company any gift, entertainment or other personal favour or assistance which goes beyond common courtesies associated with accepted ethical and general commercial practice.

6.2 The purpose of paragraph 6.1 is to ensure that the offer or acceptance of a gift cannot create an obligation or be construed or used by others to allege favouritism, discrimination, collusion or similarly unacceptable practices by Medusa.

6.3 For avoidance of doubt, any gift received by an Employee (or series of gifts from the one party) which might, as a matter of judgement, fall outside paragraph 6.1, must be reported to the CEO and Company Secretary with full details of the background of the gift.

7. PROTECTION OF COMPANY ASSETS

7.1 Employees are responsible for taking all prudent steps to ensure the protection of Company assets and resources. In particular, Employees should take care to minimize the possibility of theft of Medusa's property by any person.

7.2 Employees must ensure that Medusa assets and resources are used only for the purposes of the Company and in accordance with appropriate authorizations.

8. PROPER ACCOUNTING

8.1 Employees must ensure that all accounting and financial records, accurately and fairly reflect, in reasonable detail, the underlying transactions and all Medusa assets, liabilities and any disposal of Medusa assets.

8.2 Accounting and financial records must be adequately protected from destruction or tampering and be retained for a sufficient period of time to meet compliance requirements.

8.3 The accounting and financial records must be prepared and maintained in accordance with Generally Accepted Accounting Principles.

9. DEALING WITH AUDITORS

9.1 Employees must at all times, fully co-operate with the Company's auditors.

9.2 Employees must not make any false or misleading statement nor conceal any relevant information from Company's auditors.

10. UNAUTHORISED PUBLIC STATEMENT

10.1 Employees must not, without authority, directly or indirectly state that they are representing the Company or its public position in respect of any matter.

10.2 Employees must not directly or indirectly engage in any activity which could by association cause the Company public embarrassment or other damage.

11. CONFLICT OF INTEREST

11.1 Employees must not use their position for personal benefit independent from the business of the Company or to benefit any other business or person.

11.2 Employees must not take advantage of any property or information belonging to the Company, or opportunities arising from those, for personal benefit independent from the business of Medusa or to benefit any other business or person.

11.3 No Employee, may directly or indirectly have an equity interest in, or have a significant beneficial connection with, any business or individual which competes with or is a supplier to the Company without the prior written consent of the CEO.

11.4 Employees must not place themselves in situations where their private interest could conflict directly or indirectly with their obligations to the Company. It is the responsibility of the Employees to disclose any personal interest they may have in a project, company or other matter where the Employee is involved in the assessment, negotiations or other activity relating to that matter.

11.5 All Employees are required to obtain consent before accepting any outside directorship or other appointment to enable an assessment to be made as to whether such appointment could cause a conflict of interest which may affect objective judgement.

11.6 Employees must not engage directly or indirectly in any outside business activity involving commercial contact with, or work for the benefit of, Medusa commercial customers, suppliers or competitors without the prior written consent of the CEO.

11.7 Ownership of shares in a listed entity which deals with or competes with Medusa is not a violation of this Code provided the Employee does not directly or indirectly own more than 10% of the shares in the listed entity.

12. THE USE OF INSIDE INFORMATION

12.1 Employees must not disclose confidential Company information to any third party without the prior consent of the CEO.

12.2 Employees must maintain the confidentiality of all Company documents and must not disclose any information contained within the documents to any third party without the prior consent of the CEO.

12.3 Employees must not use Company information for the purpose of directly or indirectly obtaining personal gain.

13. SHARE TRADING OF COMPANY SHARES (INSIDER TRADING)

13.1 The Corporations Act 2001, contains provisions which prohibit a person in possession of material, non-public information relating to a company from dealing in any way with shares, options or other shares issued by that company or issued or created over the company's shares by third parties ("shares").
The Company has established a policy on share trading, designed to protect the Company and its Employees from intentionally or unintentionally breaching these laws.

13.2 The principal insider trading prohibition in Australian law is contained in section 1043A of the Corporations Act.
Section 1043A prohibits a person (an "insider") who is in possession of information relating to the Company that is not generally available but, if the information was generally available (see para 14.5), a reasonable person would expect that information to have a material effect (see para 14.6) on the price or value of Medusa shares ("material non-public information") from:

(a) applying for, acquiring, disposing of or entering into an agreement to apply for, acquire or dispose of Medusa shares;

(b) procuring another person to apply for, acquire, dispose of Medusa shares; or

(c) directly or indirectly communicating the material non-public information to another person when the insider knows, or ought reasonably to know, that the other person would or would be likely to:

(i) apply for, acquire, dispose of or enter into an agreement to apply for, acquire or dispose of Medusa shares; or

(ii) procure another person to apply for, acquire, dispose of or enter into an agreement to apply for, acquire or dispose of Medusa shares.

13.3 Information relating to Medusa would be considered to be generally available after it has been released to the Australian Stock Exchange ("ASX") and the ASX has fully disseminated that information to the market.

13.4 A reasonable person would be taken to expect information to have a material effect on the price of Medusa shares if that information would, or would be likely to, influence persons who commonly invest in shares, in deciding whether or not to acquire or dispose of Medusa shares.

13.5 Determining what is material non-public information is subjective. It would, as an indication, most likely include (but not be restricted to ) the following types of information:

  • mergers, acquisitions and takeover of Corporations;

  • change in business strategy and direction;

  • joint venture agreement to acquire/dilute interest in mineral properties;

  • significant development and/or revaluation of existing projects;

  • the appointment or resignation of any Director or Senior Executive. In the case of the CEO, disclosure of key terms and conditions of relevant employment of termination package;

  • declaration of dividends;

  • capital raising and funding proposals;

  • proposals involving the issue of Medusa shares;

  • under subscriptions or over subscriptions to an issue;

  • the occurrence or threat of industrial or strike action;

  • any Medusa media release;

  • the occurrence of an environmentally related incident;

  • natural disasters that have material effect on the Company's business;

  • decisions of regulatory authorities which could impact Medusa's business;

  • the threat, commencement or settlement of any litigation or claim;

  • material information affecting a significant customer or supplier;

  • the purchase or sale of a significant asset;

  • the appointment of a receiver, manager, liquidator or administrator in respect of a loan, trade credit, trade debt, borrowings or securities held by Medusa or any of its subsidiaries;

  • information about beneficial ownership of shares obtained by Medusa under the Corporations Act;

  • significant events affecting or relating to the operation or joint venture;

  • a material change in Medusa's financial forecast or expectations;

  • proposal to change the independent external auditor of Medusa;

  • change of significant investors' attitudes to investment in Medusa;

  • any rating (or change to a rating) applied by a rating agency;

  • related party agreements.

13.6 The confidentiality of material non-public information must be strictly maintained within Medusa by all persons who have access to that information, regardless of title or position. No Employee shall disclose such information, except on a need-to-know basis, inside or outside of the Company.

13.7 Employees, must not purchase or sell shares in the Company whilst in possession of material non-public information.
Employees in possession of material non-public information must not cause or procure a third party to deal in the shares of Medusa.

13.8 Directors and senior executives are routinely in possession of material non-public information (which, if generally available, would or would be likely to, influence persons who commonly invest in shares in deciding whether or not to subscribe for, buy or sell shares in Medusa). As such, they (or any family member or associate over whom they have influence) are prohibited from dealing in the Company's shares without providing the CEO with prior written notice of their intent to deal to do so. The notice must include a statement that they do not believe they are in possession any material non-public information. (Directors must notify the Chairperson and the Chairperson must notify the Board.) A notice procedure will be issued to these Directors and executives.

Directors and senior executives must confirm with the Chairperson or CEO (as appropriate) (and the Chairperson or CEO must notify the Board) that the trading has occurred.

13.9 Any questions relating to the interpretation or enforcement of this Code should be forwarded to the CEO or Company Secretary.

13.10 Directors trading in the Company's shares must notify the Company Secretary within 2 business days of the trade to ensure that the appropriate forms with respect to share trading in the Company's securities by Directors are lodged with the ASX.

14. ALCOHOL AND DRUG ABUSE

14.1 Employees must not be under the influence of any drugs, including alcohol, whilst at work or when conducting any Company related activities.

14.2 The possession, transfer and use of any illegal substance on Company premises, or at any Company related function is prohibited.

14.3 Failure to comply with 14.1 and 14.2 is regarded as a serious act of misconduct and may result in termination of employment.

15. EQUAL OPPORTUNITY AND EMPLOYEE DISCRIMINATION

15.1 The Company will not permit discrimination, intimidation or harassment of, or by, Employees on the basis of race, gender, marital status, national origin or religious beliefs, or on the basis of any other personal characteristics protected by legislation.

15.2 Discrimination is prohibited at any level of the Company or in any part of the employment relationship which includes areas such as recruitment, promotion, training opportunities, salary, benefits and terminations.

16. ENVIRONMENT

16.1 Medusa is fully aware of it obligations to comply with relevant statutory and regulatory requirements with respect to the environment.

16.2 The Company monitors appropriately its environmental performance and is committed in ensuring proper rehabilitation is carried out the sites where the Company has been conducting its exploration or operational activities.

17. OCCUPATIONAL, HEALTH AND SAFETY

17.1 The Company is committed to ensuring that sound occupational health and safety practices are carried out in compliance with existing laws and regulations governing its activities.

17.2 Medusa is aware of the benefits associated with providing Employees with a safe and healthy workplace and will continue to develop, maintain and promote safe and productive practices in all aspects of its activities.

18. ECONOMY AND EFFICIENCY

18.1 Employees must at all times, in performing their roles, act in the most cost effective and responsible way by ensuring that the Company's:

  • property and equipment are only used for authorized Company business;

  • assets, property and resources are adequately secured; and

  • the avoidance of waste of the Company's resources.

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