The following Statement sets out the governance practices of the Aquarius Platinum group.

• Board of Directors
• Structure of the Board
• Director Independence
• Board Evaluation
• Meetings of the Board
• Directors' Retirement and Re-Election
• Senior Independent Non-Executive Director
• Succession Planning
• Induction and Education
• Company Secretary
• Code of Conduct
• Diversity Policy
• Securities Trading Policy
• Committees of the Board
• Audit/Risk Committee
• Remuneration and Succession Planning Committee
• Nomination Committee
• Continuous Disclosure
• Communications with Shareholders
• Meetings
• Risk Management
• Corporate Governance Compliance

The Board of Directors of Aquarius Platinum is committed to the principles of good corporate governance and aims to achieve the highest standards and best practice in its overall performance. In accordance with the Australian Securities Exchange Corporate Governance Council’s (the Council’s) Corporate Governance Principles & Recommendations (the Recommendations) it has established systems of accountability and control through its corporate governance framework as outlined in its corporate governance statement.

Aquarius acknowledges the Council’s amendments to the Recommendations released on 30 June 2010 which take effect for the first financial year of listed entities beginning on or after January 2011. The Board is conscious that the corporate governance environment is constantly evolving and the charters and policies under which it operates its business will continue to be monitored and amended. The Company will disclose the extent to which it has followed the guidelines and any reasons for departure from these. The charters or their summaries referred to in the following statement are available in the Corporate Governance section on the website at www.aquariusplatinum.com.

board of directors

Role and responsibilities of the board

The Board is responsible for the overall effective management of the Group. It seeks to ensure that its activities conform to the regulatory and ethical requirements of its business affairs by establishing policies and controls to monitor the Group’s long-term strategic direction and financial decision making. The Board aims to create sustainable value for shareholders and act in the best interests of its stakeholders, including employees, suppliers and the communities in which it operates.

The Board is governed by a Charter which establishes guidelines to ensure its members act in the best interest of the Company.

The division of responsibilities between the Chairman and executive management, led by the Chief Executive Officer, are separate and clearly defined below:

• The Chairman, Mr Nicholas Sibley, is a nonexecutive independent director. He is responsible for leadership of the Board ensuring its members receive accurate, timely and clear information in order to facilitate effectiveness of its role. He sets the Board’s agenda, conducts its meetings and facilitates effective communication with shareholders.
• The Chief Executive Officer and Managing Director, Mr Stuart Murray, has responsibility for the management of the Group and leads executive management. He has been delegated responsibility by the Board for the day-to-day operation and administration of the Company. The Chief Executive Officer is assisted in managing the business of the Group by the Managing Director, the Executive Committee and the Board ofAquarius Platinum (South Africa) (Pty) Ltd. Mr Murray represents the Group’s interests as a director of the Mimosa Group of companies which owns the Mimosa Platinum Mine in Zimbabwe.

structure of the board

Name director in office	Date appointed to office	Executive/Non-executive	Independent
N.T. Sibley – Chairman	21 May 2001	Non-Executive	No
S.A. Murray – Chief Executive Officer	21 May 2001	Executive	No
D.R. Dix	31 March 2004	Non-executive	Yes
G.E. Haslam	1 May 2004	Non-executive	Yes
Sir W. Purves	10 February 2004	Non-executive	Yes
T. Freshwater	9 August 2006	Non-executive	Yes
K. Morna	6 February 2007	Non-executive	No
Z. Mankazana	6 February 2007	Non-executive	No

The bye-laws of the Company determine that the Board consists of not less than two and no more than nine directors. At the date of this report, the Board is comprised of eight directors, seven of whom are non-executive directors, including the Chairman, Mr Nicholas Sibley, and one executive director, Mr Stuart Murray, Chief Executive Officer.


The names of directors, their relevant qualifications and experience are set out in the Directors’ Report within this Annual Report. Their status as non-executive, executive or independent directors and tenure on the Board is set out in the table above.

director independence

The Board works to ensure the majority of directors are non-executive, therefore bringing independence, objectivity and a broad range of expertise to the Group. To facilitate their decision making, each director has the right to seek independent professional advice on matters relating to their position as a director or committee member of the Company at the Company’s expense, subject to prior approval of the Chairman, which shall not be unreasonably withheld.

Independence of directors in essence means those directors independent of management and free of any business or other relationship that could, or could reasonably be perceived to, materially interfere with the exercise of unfettered and independent judgement.

In line with the recommendations, the Board has accepted the guidelines outlined below in determining the independence of non-executive directors. In accordance with these, all directors, with the exception of Mr Stuart Murray as Chief Executive Officer of the Company, Mr Kofi Morna and Mr Zwelakhe Mankazana, who represent the Savannah Consortium’s BEE interests, are deemed independent.

The Board has accepted the following definition of an independent director. An independent director is someone who is not a member of management, is a non-executive director and who:

a. is not a substantial shareholder (5%) of the company or an officer of, or otherwise associated directly with a substantial shareholder of the company;

b. 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;

c. 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;

d. is not a material supplier or customer of the company or other group member, or an officer of or otherwise associated directly or indirectly with a material supplier or customer; and

e. has no material contractual relationship with the company or another group member other than as a director of the company.

board evaluation

The Board of Aquarius conducts regular reviews of itself on an ongoing basis throughout the year. The size of the Company and hands on management style requires an increased level of interaction between directors and executives throughout the year. Board members meet amongst themselves and with management both formally and informally. The Board considers that the current approach it has adopted with regard to the review of its performance and of its key executives provides the best guidance and value to the Group.

meetings of the board

In order to retain full and effective control over the Company and monitor the executive management team, the Board meets regularly and at least on a quarterly basis. Details of directors’ attendance at these meetings are set out in the Directors’ Report. An agenda set by the Chairman and briefing materials are distributed to each director approximately seven days prior to each meeting to ensure each director is familiar with the scheduled matters of business. All directors may add a matter to the agenda or raise matters not on the agenda at any Board meeting. Key executives and senior management of the Company contribute to board papers and are invited to attend Board meetings from time to time.

directors’ retirement and re-election

Aquarius’ bye-laws determine that at each Annual General Meeting, at least one third of the Board are retired by rotation, therefore holding their positions for no longer than three years. This period of time provides continuity. Non-executive directors are appointed for a three-year term and may be invited to seek reappointment. A director appointed during the year is subject for election at the forthcoming Annual General Meeting. Pursuant to the bye-laws of the Company, the Chief Executive Officer is not subject to retirement by rotation.

senior independent non-executive director

The senior independent non-executive director, Sir William Purves, is appointed by the Board.

succession planning

The Board brings the range of skills, knowledge, international experience and expertise necessary to govern the Group, but it is aware of the need to ensure processes are in place to assist with succession planning, not only for the Board, but within senior management. The Board periodically assesses its balance of skills and those of the Group in order to maintain an appropriate balance within the Company.

induction and education

In order to assist directors in fulfilling their duties and responsibilities within the Company, a comprehensive induction programme is provided, including meetings with other Board members, the executive team, senior management and visits to the operating sites of the Company in South Africa and Zimbabwe. The program enables the new appointees to gain an understanding of the Company’s financial, strategic, operational and risk management position at all times. Full access to all documentation pertaining to the Company is provided.

company secretary

The Company Secretary, Mr Willi Boehm, is responsible for supporting the effectiveness of the Board by monitoring that Board policy and procedures are complied with, coordinating the flow of information within the Company and the completion and despatch of items for the Board and briefing materials. The Company Secretary is accountable to the Board on all governance matters. All directors have access to the services of the Company Secretary. The appointment and removal of the Company Secretary is a matter for the Board as a whole.

code of conduct

The Aquarius code of conduct has been developed by the Board to provide a framework for all employees to conduct the business of the Company in an ethical and legal manner. The Board believes it is important that the Company maintains its obligations to shareholders and stakeholders.

There are areas in which the Company must develop detailed policies in accordance with the requirements of local authorities and comply with local laws. The code of conduct stands as a set of principles developed by the Board to guide all employees to act with integrity and make informed choices when communicating or acting on behalf of the Company.

The Board and senior executives of the Company have a clear commitment to the code of conduct.

diversity policy

Following the Council’s amendments to the Recommendations released on 30 June 2010 which take effect for the first financial year beginning on or after January 2011, the Board has approved a Diversity Policy. The policy documents the Company’s commitment to create a work environment that is fair and inclusive.

Diversity within the Group encompasses but is not limited to gender, age, ethnicity, and cultural background. Aquarius employment policies and procedures are guided by the Mineral and Petroleum Resources Development Act no. 28 of 2002 and the accompanying Broad-Based Socio-Economic Charter for the South African Mining Industry. The Board believes that diversity contributes to its business and benefits shareholders and stakeholders. The Board has responsibility for oversight of this Policy and it will be reviewed on an annual basis. More information can be found in the Corporate Citizenship Report on the website in the reports section.

securities trading policy

The Board has adopted a policy covering dealings in securities by directors and relevant employees. The policy is designed to reinforce to shareholders, customers and the international community that Aquarius’ directors and relevant employees are expected to comply with the law and best practice recommendations with regard to dealing in securities of the Company.

In addition to the Australian Securities Exchange Listing Rules, a director and relevant employees must comply with the Model Code on directors’ dealings in securities, as set out in Annexure 1 to Listing Rule 9 of the Rules of the United Kingdom Listing Authority.

In addition to restrictions on dealing in “Closed Periods”, a director and relevant employees must not deal in any securities of the Company on considerations of a short term nature and must take reasonable steps to prevent any dealings by, or on behalf of, any person connected with him in any securities of the Company on consideration of a short term nature. In line with the listing rules of the Australian Securities Exchange (ASX), the UK Listing Authority (LSE), the JSE Securities Exchange South Africa (JSE) and the U.S. Securities and Exchange Commission (SEC), all dealings by directors in the securities of the Company are announced to the market.

committees of the board

The Board has established three standing committees to assist in the execution of its responsibilities: the Audit/Risk Committee, the Remuneration & Succession Planning Committee and the Nomination Committee. Other committees are formed from time to time to deal with specific matters.

In line with best practice, each of the committees operates under a Charter approved by the Board detailing their role, structure, responsibilities and membership requirements. Each of these Charters is reviewed annually by the Board and the respective committee.

audit/risk committee

The Audit/Risk Committee (the Committee) has been established to assist the Board of Aquarius in fulfilling its corporate governance and oversight responsibilities in relation to the company's financial reports and financial reporting process, internal control structure, risk management systems (financial and non-financial) and the external audit process. The Committee is governed by a charter approved by the Board.

The Committee consists of:

• five members;
• only non-executive directors;
• a majority of independent directors; and
• an independent chairperson, who shall be nominated by the Board from time to time but who shall not be the chairperson of the Board.

The members of the Committee at the date of this report are as follows:

• Sir William Purves (Chairman)
• Mr Nicholas Sibley
• Mr David Dix
• Mr Edward Haslam
• Mr Kofi Morna

Qualifications of Audit/Risk Committee members:

Sir William Purves is the Chairman of the Audit Committee and Senior Independent Director of the Company. Sir William joined the Hong Kong and Shanghai Banking Corporation in 1954 (now part of the HSBC Group). He was appointed Chief Executive in 1986 and Group Chairman the following year.

Mr Sibley is a Chartered Accountant, a director of Richland Resources Ltd, Wah Kwong Maritime Transport Holdings Ltd and a quoted investment company. He was formerly Deputy Chairman of Wheelock Capital from 1994 to 1997, as well as Executive Chairman of Barclays de Zoete Wedd (Asia Pacific) Limited, from 1989 to 1993. Mr Sibley is a former director of Barclays de Zoete Wedd Holdings Ltd.

Mr Dix’s background is in economics, law and taxation and he is a Barrister and Solicitor in the High Court of Australia. He has held various positions with Shell Australia Limited and worked for 16 years in Corporate Advisory at both Macquarie Bank Limited and UBS AG specialising in the mining industry, including Head of Resources for Asia Pacific and in London as Head of Mining. Mr Dix is Non Executive Chairman of Australian Oil Company, AED Oil Limited and Non Executive Chairman of Troy Resources NL.

Mr Haslam is the former Chief Executive of Lonmin plc. He joined Lonmin in 1981, was appointed a director in 1999 and Chief Executive Officer in November 2000. He retired from Lonmin in April 2004. Mr Haslam is Chairman of Finnish Nickel Mining Company Talvivaara plc. and Senior Independent Director of the South African company Namakwa Diamonds Ltd. In 2011 he was appointed Senior Independent Director of London and Toronto listed gold miner Centamin Egypt Limited.

Mr Morna is an Executive Director of Savannah Resources (Pty) Limited, the lead investor in the Savannah Consortium, Aquarius Platinum’s BEE partner. Prior to joining Savannah Resources, Mr Morna worked with the International Finance Corporation as an Investment Officer, Gemini Consulting as a Senior Management Consultant and Schlumberger Oilfield Services as a Field Engineer. He is currently a director of Mkhombi Holdings, Hall Core Drilling, AIM and ASX listed Ferrum Crescent and a number of private mining exploration and beneficiation companies.

The Board deems all members of the Committee have the relevant experience and understanding of accounting, financial issues and the mining industry to enable them to effectively oversee audit procedures.

The Committee reviews the performance of the external auditors on an annual basis and meets with them at least twice a year to:

• review the results and findings of the audit at year end and half year end and recommend their acceptance or otherwise to the Board; and
• review the results and findings of the audit, the appropriateness of provisions and estimates included in the financial results, the adequacy of accounting and financial controls, and to obtain feedback on the implementation of recommendations made.

The Committee receives regular reports from the external auditor on the critical policies and practices of the company, and all alternative treatments of financial information within generally accepted accounting principles that have been discussed with management.

The Committee assesses the company's structure, business and controls annually. It ensures the Board is made aware of internal control practices, risk management and compliance matters which may significantly impact upon the company in a timely manner.

The Committee meets when deemed necessary and at least twice a year. The Company Secretary acts as secretary of the Committee and distributes minutes to all Board members.

Details of attendance at Committee Meetings are set out in the Directors' Report.

remuneration & succession planning committee

The members of the Remuneration and Succession Planning Committee (the Committee) at the date of this report are as follows:

• Mr Edward Haslam (Chairman)
• Mr Nicholas Sibley
• Mr David Dix
• Mr Zwelakhe Mankazana

The Committee is governed by a charter approved by the Board. The Board deem all members of the Committee have the relevant experience and understanding to enable them to effectively oversee their responsibilities. The members of the Committee are non-executive directors whom the Board consider independent.

The Committee reviews compensation arrangements for the directors and the executive team. The committee assesses the appropriateness of the nature and amount of emoluments of such officers on a periodic basis by reference to relevant employment market conditions, with the overall objective of ensuring maximum shareholder benefit from the retention of a high quality executive team.

Such officers are given the opportunity to receive their base emoluments in a variety of forms including cash and fringe benefits such as motor vehicles. The nature and amount of directors’ and officers’ emoluments are linked to the Company’s financial and operational performance.

In carrying out its responsibilities, the Committee is authorised by the Board to secure the attendance of any person with relevant experience and expertise at Committee meetings, if it considers their attendance to be appropriate and to engage, at the Company’s expense, outside legal or other professional advice or assistance on any matters within its charter or terms of reference.

The Committee reviews succession planning for key executive positions (other than executive directors) to maintain an appropriate balance of skills, experience and expertise in the management of the Company. The Committee does not allow for retirement benefits of non-executive directors. Nonexecutive directors are remunerated by way of an annual fee in the form of cash and do not receive options or bonus payments.

For details of remuneration of directors and executives please refer to the Directors’ Report.

The Committee meets as necessary, but must meet at least once a year. The Company Secretary acts as secretary of the meetings and distributes minutes to all Board members. Details of attendance at Committee Meetings are set out in the Directors’ Report.

nomination committee

In order to fulfil the Company’s responsibility to shareholders to ensure that the composition, structure and operation of the Board are of the highest standard, the full Board of Aquarius acts as the Nomination Committee and is guided by a Charter. The Board believes the input of all directors is essential due to their respective expertise and knowledge of the platinum industry and exposure to the markets in which the Group operates.

If the appointment of a new director is required to fill a vacancy on the Board, or to complement the existing Board, a range of candidates are considered. Qualifications of the proposed director are assessed by the Board to see if their skills and experience will enhance the Board and whether they will have the availability to commit to the Board’s activities. As noted previously, a director appointed during the year is subject for election at the forthcoming Annual General Meeting. The Board may at times take into consideration the advice of external consultants to assist with this process.

New directors are provided with a letter to formalise their appointment. This sets out the Company’s expectations once they accept the position, their duties, rights, responsibilities and policies of the Company.

Meetings take place as often as necessary, but the Committee must meet at least once a year. The Company Secretary acts as secretary of the meetings and distributes minutes to all Board members.

Appointments are referred to shareholders at the next available opportunity for election in general meeting.

continuous disclosure

The Company has in place a Continuous Disclosure Policy. The Policy is in line with the Australian Securities Exchange’s guidance policy on timely and balanced disclosure. It outlines the Company’s commitment to disclosure, ensuring that timely and accurate information is provided to all shareholders and stakeholders. The Company Secretary is the nominated Communication Officer and is responsible for liaising with the Board to ensure that the Company complies with its continuous disclosure requirements. A three member Disclosure Committee has been formed comprising the Chief Executive Officer, Mr Stuart Murray, the Company Secretary, Mr Willi Boehm and any one non-executive director. The Disclosure Committee is responsible for overseeing and coordinating the disclosure of information and announcements to the regulatory authorities, analysts, brokers, shareholders, the media and the public. The Disclosure Committee regularly reviews the Company’s compliance with its continuous disclosure obligations.

communications with shareholders

Shareholder communication is given high priority by the Company. In addition to statutory requirements, such as the Annual Report and Financial Statements for the half and full year, Aquarius Platinum maintains a website which contains announcements and quarterly reports which have been released to the listing authorities – the ASX, LSE and the JSE, and forwarded to the U.S. Securities and Exchange Commission (SEC). Presentations that senior executives may deliver to conferences or analysts are also placed on the website as they occur so they may be viewed by shareholders and prospective investors. Shareholders are able to contact the Company via the email address at info@aquariusplatinum.com. Through the website, shareholders are also given the opportunity to provide an email address by which they are able to receive these documents.

The Chief Executive Officer hosts webcasts for the half year and full year results and notification of these is provided on the Company’s website.

meetings

Aquarius Platinum Notice of Meeting materials are distributed to shareholders with an accompanying explanatory memorandum.

These documents present the business of the meeting clearly and concisely and are presented in a manner that will not mislead shareholders or the market as a whole. The Notice is despatched to shareholders in a timely manner providing at least 21 days notice pursuant to the bye-laws of the Company. Each notice includes the business of the meeting, details of the location, time and date of the meeting and proxy voting instructions.

Upon release of the Notice of Meeting and Explanatory Memorandum to the ASX, LSE and the JSE, a full text of the Notice of Meeting and Explanatory Memorandums is placed on the website for shareholders and other market participants who may consider investing in the Company.

risk management

The Company has established policies on risk oversight and management. The Board is committed to monitoring, identifying and managing the material risks of the business activities across the Group. The Company has risk registers across its operations that are updated by the Chief Executive Officer and Company Secretary on a quarterly basis. They are tabled for review by the Audit Committee quarterly and by the full Board of Aquarius annually. This ensures the Board is made aware of internal control practices, risk management and compliance matters which may significantly impact upon the Company in a timely manner.

The registers set out risks that have been identified. The risks are categorised based on the severity of risk and the probability of the event occurring, and subsequently assessed. The risk registers are subject to regular review by the Board who ensure adequate control measures are identified to guarantee the highest return to shareholders and stakeholders. Further information on Risk Management is located in the Corporate Citizenship Report available on the website in the reports section.

Corporate governance compliance

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