CAR GROUP LIMITED - Governance Information 2018

Rules 4.7.3 and 4.10.3[1]

Appendix 4G

Key to Disclosures Corporate Governance Council Principles and Recommendations

Name of entity:
carsales.com Limited
ABN / ARBN: 91 074 444 018	Financial year ended:
91 074 444 018	30 June 2018

Our corporate governance statement[2] for the above period above can be found at:[3]

☐ These pages of our annual report: ☒ This URL on our website: http://shareholder.carsales.com.au/Investor-Centre/?page=CorporateGovernance

The Corporate Governance Statement is accurate and up to date as at 21 August 2018 and has been approved by the board.

The annexure includes a key to where our corporate governance disclosures can be located.

Date: 21 August 2018

Name of Director or Secretary authorising lodgement:

Nicole Birman

1 Under 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.

3 Mark 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.

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ANNEXURE – KEY TO CORPORATE GOVERNANCE DISCLOSURES

Corporate Governance Council recommendation	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 http://shareholder.carsales.com.au/Investor- Centre/?page=Corporate-Governance	`☐` 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.

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Corporate Governance Council recommendation	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 http://shareholder.carsales.com.au/Investor- Centre/?page=Corporate-Governance … 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 StatementOR `☐`at [insert location] … and the information referred to in paragraphs (c)(1) or (2): `☐`in our Corporate Governance Statement OR `☒`at http://shareholder.carsales.com.au/Investor-Centre/	`☐` 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
1.6	A listed entity should: (a) have and disclose a process for periodically evaluating the performance of the board, its committees and individual directors; 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
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

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Corporate Governance Council recommendation	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 StatementOR `☐`at [insert location] … and a copy of the charter of the committee: `☒`at http://shareholder.carsales.com.au/Investor- Centre/?page=Corporate-Governance … and the information referred to in paragraphs (4) and (5): `☒`in our Corporate Governance StatementOR `☐`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 StatementOR `☐`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 StatementOR `☐`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

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Corporate Governance Council recommendation	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 StatementOR `☐`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 http://shareholder.carsales.com.au/Investor-Centre/?page=Corp Governance	`☐`an explanation why that is so in our Corporate Governance Statement

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Corporate Governance Council recommendation	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 http://shareholder.carsales.com.au/Investor- Centre/?page=Corporate-Governance … 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

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Corporate Governance Council recommendation	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 http://shareholder.carsales.com.au/Investor- Centre/?page=Corporate-Governance	`☐` 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 http://shareholder.carsales.com.au/Investor-Centre/	`☐` 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

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Corporate Governance Council recommendation	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 http://shareholder.carsales.com.au/Investor- Centre/?page=Corporate-Governance … 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 StatementOR `☐`at [insert location]	`☐` an explanation why that is so in our Corporate Governance Statement

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Corporate Governance Council recommendation	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

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Corporate Governance Council recommendation	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 http://shareholder.carsales.com.au/Investor- Centre/?page=Corporate-Governance … 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 http://shareholder.carsales.com.au/Investor-Centre/ within the 2018 Annual Report	`☐` 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

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Corporate Governance Council recommendation	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 StatementOR `☐`at [insert location]	`☐` an explanation why that is so in our Corporate Governance Statement OR `☐` w e do not have an equity-based remuneration scheme and this recommendation is therefore not applicableOR `☐` 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 StatementOR `☐`at [insert location]	`☐` an explanation why that is so in our Corporate Governance Statement

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Introduction

The Board of carsales.com Ltd (the Company ) is responsible for the governance of the Company and its controlled entities (the Group ).

The Board is committed to achieving and demonstrating the highest standards of corporate governance and transparency, and ensuring that good corporate governance is a fundamental part of the culture and business practice of the Group.

The Board also continually reviews the governance framework and practices of the Company to ensure that they meet the interests of all stakeholders.

A description of the Group’s main corporate governance practices are set out in this report.

All of these practices, unless otherwise stated, were in place for the entire year and comply with the ASX Corporate Governance Principles and Recommendations (Third Edition) .

The Board of Directors

(Corporate Governance Principles and Recommendations 1.1, 1.3, 1.4, 2.3, 2.4, 2.5, 3.1) Board responsibilities

The Board adopted a formal charter in July 2012 (updated in June 2017) which details its functions and responsibilities .

A copy of the Board Charter is available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre/.

The Board’s responsibilities, as detailed in the Board Charter include:

protecting and enhancing the value of the assets of the Company;
setting the strategic direction of the Company and monitoring and reviewing strategic objectives;
reviewing and ratifying internal controls, codes of conduct and legal compliance;
reviewing the Company’s accounts;
reviewing and approving the operating budget and strategic plan for the Company;
evaluating performance and determining the remuneration of the Managing Director;
ensuring the significant risks facing the Company have been identified and adequate control monitoring and reporting mechanisms are in place;
approval of transactions relating to acquisitions, divestments and capital expenditure above delegated authority limits;
approval of financial and dividend policy; and
appointment of the Managing Director.

Matters specifically reserved for the Board

The Board has reserved for itself the following matters, which are in addition to any matters expressly required by law or other regulation to be approved by the directors:

setting the corporate objective of the Company and approving business strategies and plans of the Company designed to meet that objective;
reviewing the composition of the Board and Board Committees, the independence of directors, the Board’s performance and carrying out succession planning for the chairman and other nonexecutive directors;
reviewing the performance of management and the Company, including in relation to corporate governance, risk management, internal controls and compliance frameworks, systems, policies and processes adopted by the Company;
appointing and removing the Managing Director and carrying out succession planning for the Managing Director as applicable;
reviewing the performance of the Managing Director, his/her remuneration and contractual arrangements;
appointing and removing Senior Executives on the recommendation of the Managing Director;
reviewing the remuneration of Senior Executives on the review and recommendation of the Managing Director;
appointing and removing the Company Secretary;
dealing with any matters in excess of any specific delegations that the Board may from time to time delegate to the Managing Director and Senior Executives; and
approving the communication to shareholders and to the public of the half-year and full-year results and generally any public statements which reflect issues of the Company’s policy or strategy that the Board deems material.

Board Composition and Independence

The Company’s constitution includes provisions for the number of directors, casual vacancies and additional directors, appointment and removal of directors by General Meeting and retirement of directors. The Company’s constitution specifically provides that the Company is to have not less than three, nor more than twelve directors.

At the date of this Corporate Governance Statement, the Board consists of the following directors:

Name	Position	Date appointed
MrCameron McIntyre	Managing Director and CEO	17 March 2017
Mr Richard Collins	Independent Non-Executive Chair	17 July 2000,
		appointed to Chair 23
		March 2018
Mr Wal Pisciotta OAM	Non-Independent Non-Executive Director	25 June 1996
Mr Pat O’Sullivan	Independent Non-Executive Director	29 June 2007
Ms Kim Anderson	Independent Non-Executive Director	16 June 2010
Ms Edwina Gilbert	Independent Non-Executive Director	27 April 2016
Mr Kee Wong	Independent Non-Executive Director	9 July 2018

Board biographies are available in the FY18 Annual Report which is available from http://shareholder.carsales.com.au/Investor-Centre.

The Board has one alternate director, Mr Steven Kloss, who was appointed on 28 October 2005 by Mr Pisciotta. The role of the alternate director is to attend Board meetings and act as a voting alternate for the appointing full director if he is unable to attend a Board meeting. Mr Kloss is invited to all Board meetings to remain abreast of the matters affecting the Company which enables him to act effectively in the Alternate Director role, but does not vote in respect of Board decisions unless Mr Pisciotta is absent.

As can be seen from the above table, a majority of the Company’s directors are independent, and the Chair of the Board is independent.

All directors, whether independent or not, are required to act in the best interests of the Company and to exercise unfettered and independent judgment.

The independence of each of the non-executive directors is reviewed by the Board, at least annually. In assessing the independence of directors, the Board has regard to the provisions of the ASX Corporate Governance Council, 'Corporate Governance Principles and Recommendations’ (Third edition).

The Company defines an independent director as a non-executive director (i.e. not a member of management) who is free of any business or other relationship that could materially interfere with or could reasonably be perceived to materially interfere with the exercise of his or her unfettered and independent judgment and ability to act in the best interests of the Company.

When assessing the independent status of a director, the Board will consider whether the director:

is a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial shareholder of the Company;
is employed, or has previously been employed in an executive capacity by the Company or another Group member, and there has not been a period of at least three years between ceasing such employment and serving on the Board;
has within the last three years been a principal of a material professional adviser or a material consultant to the Company or another Group member, or an employee materially associated with the service provided;
is 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;
has a material contractual relationship with the Company or another Group member other than as a director;

has close family ties with any person who falls within any of the categories described above; and
has been a director of the entity for such a period that his or her independence may have been compromised.

In assessing each director’s independence the Board will consider the effect of a director’s business and other relationships and interests from the perspective of both the Company and the director. The Board may determine that a director is independent notwithstanding the existence of a relationship of the kind referred to above.

It is considered that all non-executive directors are independent except Mr Wal Pisciotta due to his shareholding and previous role as Chairman of Pentana Solutions Pty Ltd, which has historically had a material contractual relationship with the Company.

Two of the Company’s directors, Mr Richard Collins and Ms Edwina Gilbert are involved in automotive dealerships which use the Company’s services. All dealings with the relevant dealerships are on arm’s length terms, identical to those of other dealerships using the Company’s services. The Board recognises the value of having its most significant customer base represented on the Board and does not consider the existence of standard contractual arrangements between the Company and entities associated with dealer directors to impact independence.

Two of the Company’s directors, Mr Richard Collins and Mr Pat O’Sullivan, have served on the Board for 18 and 11 years respectively. The Board believes that they continue to act as effective independent directors. Mr Collins is an ardent advocate for the Company’s dealer customers and Mr O’Sullivan brings unparalleled attention to detail on all matters financial and regulatory for the Company. Both demonstrate willingness to question, challenge and provide independent counsel to the Board and Senior Executives based on their extensive skills and experience and neither have formed associations with management of the Company that are considered to impact their ability to exercise independent judgement.

Board diversity

All members of the Board are strong supporters of the Company’s efforts in achieving diversity and inclusion. In particular, the Remuneration and Nomination Committee includes diversity factors in its consideration of the qualities desired for new candidates and in the general Board renewal plans.

Non-executive director gender diversity (as at 21 August 2018)

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Female
33%
Male
67%
Male Female
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Non-executive directure tenure

(as at 21 August 2018)

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12 years + 0 - 3 years
33% 33%
9 - 12 years 6 - 9 years
17% 17%
0 - 3 years 6 - 9 years 9 - 12 years 12 years +
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Board Committees

The Board has established two committees to assist it in the administration of its responsibilities.

These are an Audit and Risk Management Committee chaired by Mr Pat O’Sullivan and a Remuneration and Nomination Committee chaired by Ms Kim Anderson. Each Board committee operates under a formal charter that is made publicly available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre/.

Further details of the committees, their composition and responsibilities are set out in the relevant sections below.

Relationship between directors and management

Subject to the Company’s constitution and matters specifically reserved for the directors, the directors delegate responsibility for day-to-day management of the Company to the Managing Director. The non-executive directors do not participate in the day to day affairs or management of the Company.

Role of the Chair

The role of the Chair is set out in the Board Charter and includes being responsible for managing the Board effectively, providing leadership to the Board and being the interface with the Managing Director.

The Chair has the authority to act and speak for the Board and liaise with the Company’s stakeholders between meetings, subject to any agreed consultation processes.

The performance of the Chair is assessed by the Board annually.

Role of the Managing Director

The Managing Director has responsibility for the day-to-day management of the Company, providing leadership and managing and overseeing the interfaces between the Company and the public and acts as the principal representative for the Company.

Role of the Company Secretary

The Company Secretary, Ms Nicole Birman, is directly accountable to the Board and reports to the Chair in respect of all matters of Board operation. All directors are able to communicate directly with the Company Secretary and vice versa.

The role of the Company Secretary includes:

monitoring Board policy and procedures are being followed;
coordination of Board business, including agendas, papers and accurately capturing the business of the Board and committees in minutes;
facilitating the induction of new directors; and
attending to governance and regulatory matters.

Access to independent professional advice

The Board and each Board committee has authority to retain, at the Company’s expense, such legal, accounting or other advisers, consultants or experts as it considers necessary from time to time in the performance of its duties.

An individual director may engage separate independent counsel or advisors, at the expense of the Company in appropriate circumstances.

Management of conflicts and declaration of interests

The Company has and follows strict procedures for the management of any real or potential conflicts of interests involving directors. These procedures comply with Corporations Act requirements, and are designed to ensure that conflicted directors do not take part in the discussion or decision-making process on potential conflict-causing issues. On this basis, it is believed that a director who may be conflicted on a particular matter is able to maintain his or her independence on all other issues.

Directors are required to take all reasonable steps to avoid actual, potential or perceived conflicts of interests. The Corporations Act 2001 and the Company’s constitution require directors to disclose any conflicts of interest and, in certain circumstances, to abstain from participating in any discussion or voting on matters in which they have a material personal interest.

It is expected that directors will be sensitive to actual and perceived conflicts of interest that may arise and it is something to which they are expected to give ongoing consideration in view of the dynamic and rapidly changing nature of the Company’s business.

The Board has developed procedures which must be followed:

by a director who believes he or she may have a conflict of interest or material personal interest;
• for the holding of or the continuation of a meeting where it is proposed that a meeting will discuss any matter which gives rise or may give rise to a conflict or a real sensible possibility of a conflict of interest; and
for the monitoring and reporting of a director’s interest to ensure that the company complies with the obligations pursuant to the Corporations Act 2001 and the ASX Listing Rules.

The Company maintains a register of Director’s interests that all Director’s are required to keep up to date with any related parties to themselves and other interests that may be relevant to the Company.

Entities connected with the directors that had material business dealings with the Group during the year are described in the 2018 Annual Report which is available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre. In accordance with the Board Charter, the directors concerned declared their interests in those dealings to the Company and took no part in decisions relating to them or the preceding discussions. In addition, those directors did not receive any papers from the Company pertaining to those dealings.

Board Skills and Appointments (Corporate Governance Principles and Recommendations 1.2, 1.3, 2.1, 2.2, 2.6) Board Skills Matrix

Each year, the Board assesses the skills and experience present on the Board and considers this alongside the skills and experience that are desirable to be represented on the Board.

The Board conducted its annual review of its skills and experience for FY18 and the results are set out below:

Skill/ Experience	No of directors / 6
Executive management, leadership & strategy
Directors who have experience at an executive level, who are able to properly evaluate the performance of the CEO and Senior Executives and	6
oversee strategic organisational and human resources initiatives.
Governance / risk management
Experience sufficient to identify, assess and monitor key risks in the	6
Company in a wide range of areas.
ASX experience
Experience on the Board or as a Senior Executive for an ASX listed company, providing a familiarity with ASX rules including the requirement for	5
continuous disclosure.
Finance / Accounting
Qualification or extensive experience in accounting and / or finance and the
ability to analyse and critically assess financial statements, viability and	5
performance; contribute to strategic financial planning; and oversee budgets
and funding arrangements.
Legal
Qualification or extensive experience in the law, with the ability to contribute	3
to the assessment of the legal risk profile of the Company.
Marketing
Knowledge and experience in the strategic use of marketing and its inter-	5
relationship with sales and product.
People & culture
Experience in managing people, including the ability to evaluate the CEO and Senior Executive performance, oversee strategic human resource	5
management, workplace culture and the promotion of diversity and inclusion.
IT / product
Knowledge and experience in the strategic use of information technology and	4
design of product, particularly in relation to online businesses.
Business development / M&A
Knowledge and experience in identifying and assessing business development opportunities, in particular experience in negotiating, assessing	5
commercial terms and completing mergers and acquisitions.
Industry knowledge – automotive
Knowledge, experience and networks in the automotive industry, either through direct involvement or through the provision of services to the	4
industry.
Industry knowledge – online
Knowledge, experience and networks in the online industry, with a keen understanding of current trends and the ability to discuss upcoming	6
developments.
International experience
Knowledge and experience in markets outside of Australia, particularly experience in geographical areas in which the Company has interests,	3
including Asia and Latin America.

The Board has added a new metric to the matrix since FY17 for people and culture. People and culture have always been of the utmost importance to the Company and the Board has taken the view

that having directors with experience and knowledge in this area is vital to the continued success of the Company.

With the departure of Mr Greg Roebuck in 2017, the Board identified that additional IT and product experience would be desirable in a future appointment. This was taken into consideration in the appointment of Mr Kee Wong in July 2018. Mr Wong has extensive technology and product experience, along with considerable knowledge and experience in markets outside of Australia. Due to the timing of Mr Wong’s appointment to the Board, his skills and experience are not captured in the above skills matrix.

Relevant information relating to each Board member is set out in the Company’s Annual Report to shareholders. In addition, information about directors up for election or re-election is contained in the notice of meeting for the relevant Annual General Meeting sent to shareholders. This provides shareholders with sufficient information to form a view on each director’s role and their suitability for election or re-election.

The Board considers that all necessary skills and experience are adequately represented on the Board.

Remuneration and Nomination Committee

The Board has established a Remuneration and Nomination Committee consisting of the following directors, all of whom are independent:

Ms Kim Anderson - Committee Chair
Mr Pat O’Sullivan
Ms Edwina Gilbert

When a new director is to be appointed, the Remuneration and Nomination Committee reviews the range of skills, experience and expertise on the Board, identifies its needs and prepares a short-list of candidates with appropriate skills and experience. The Remuneration and Nomination Committee ensures that appropriate checks are undertaken prior to appointing a director. These checks may include references and police checks. Where necessary, advice is sought from independent search consultants.

The Board then appoints the most suitable candidate who must stand for election at the next Annual General Meeting of the Company.

The responsibilities the committee may undertake in its nomination function include:

considering the appropriate size and composition of the Board;
establishing plans for identifying, assessing and enhancing director competencies;
establishing processes for evaluation of the performance of the Board, its committees and directors;
reviewing the skills, experience and expertise represented on the Board and determining whether those skills meet the required skills identified;
recommending changes to the membership of the Board;
making recommendations to the Board on candidates it considers appropriate for appointment;
• reviewing a retiring non-executive director's performance and making recommendations to the Board as to whether the Board should support the nomination of a retiring non-executive director; and
reviewing the Company's succession planning to maintain an appropriate balance of skills, experience and expertise on the Board.

A copy of the Remuneration and Nomination Committee Charter is made publicly available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre/.

During the course of FY18 there were 4 meetings of the Remuneration and Nomination Committee. The meetings are split in the table below between those that are formally scheduled by the Company Secretary according to the annual Board meeting timetable and those ad hoc meetings called at shorter notice to address specific matters that arise from time to time.

Details of attendance of those meetings are:

Director name	Scheduled meetings of Remuneration and Nomination committee	Scheduled meetings of Remuneration and Nomination committee	Ad hoc meetings of Remuneration and Nomination committee	Ad hoc meetings of Remuneration and Nomination committee
	A	B	A	B
Kim Anderson (Chair)	2	2	2	2
Pat O’Sullivan	2	2	2	2
Edwina Gilbert	2	2	2	2

A = Number of committee meetings held during the time the director was a member of the committee B = Number of meetings attended

Appointment & re-election of Board members

The Company has developed a ‘Procedure for the selection and appointment of directors’ which is made publicly available in the Investor Centre of the Company website.

In addition to the specific skills, knowledge and experience deemed necessary for a suitable candidate, consideration is given to:

the extent to which the candidate is likely to contribute to the overall effectiveness of the Board and work constructively with the existing directors;
the integrity of the candidate;
whether the candidate would be prepared to question, challenge and offer critiques;
whether the candidate had a proven track record of creating value for shareholders;
a commitment by the candidate to the highest standards of governance;
the nature of existing positions held by the appointee including directorships or other relationships and the impact that each may have on the appointee’s ability to exercise an independent judgment; and
whether the candidate will bring an independent point of view to the Board’s decision making process.

The composition of the Board is reviewed annually by the Board and the Chair is to assess the Board’s effectiveness.

Induction and training of directors

Non-executive directors do not have formal service contracts with the Company. The appointment of any new director is made by, and in accordance with, a formal letter of appointment which details the key terms and conditions relative to that appointment, including:

term of appointment, and the requirement to stand for election at the next Annual General Meeting following appointment, and at least every three years thereafter;
time commitment expected;
duties and responsibilities;
remuneration;
disclosure obligations; and
confidentiality.

All new directors appointed undertake an induction program, coordinated by the Company Secretary, to assist them in fulfilling their duties and responsibilities and to gain an in depth understanding of the Group. The induction program includes one on one meetings with the Managing Director, Chair and each other Director as well as each Senior Executive of the Company and gaining an understanding of the various codes of conduct and charters of the Board and Company.

The induction program ensures that new directors are appropriately introduced to the Company, its operations and personnel and is acquainted with the industry within which the Company operates.

In addition, regular Board meetings include updates from Company executives to ensure that all directors remain up to date in their knowledge of relevant industries and governance responsibilities. To assist directors to better understand the Company’s international operations, Board members have visited various overseas investments of the Company.

Appointment of Senior Executives

On appointment, all Senior Executives of the Company sign formal employment contracts setting out the terms of their employment and notice period. A summary of the terms of employment for Senior Executives is included in the Remuneration Report in the FY18 Annual Report available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre.

Board and Executive Evaluation and Codes of Conduct

(Corporate Governance Principles and Recommendations 1.3, 1.6, 1.7, 3.1)

The Company has developed a process for evaluation of performance of the Board, Board committees, individual directors and Senior Executives. This process is documented and made publicly available in the Investor Centre of the Company website.

Board performance assessment

The process for Board performance assessment involves an annual review of various aspects of the performance of the Board including the efficacy of meetings, quality of Board papers and reports, and performance of the Chair and the Board committees.

In relation to the performance of individual directors, regular dialogue and feedback takes place during the year between the Chair and directors.

An assessment of Board performance has been conducted during the year.

Senior Executive performance reviews

The performance of the Managing Director and his direct reports are evaluated annually in accordance with the published process for evaluation of performance.

All direct reports of the Managing Director are evaluated by the Managing Director and the performance evaluation of the Managing Director is facilitated by the Chair, with ultimate oversight by the Board.

The evaluation of the Managing Director involves an assessment of a range of factors including the overall performance of the Company and the achievement of specific pre-determined goals.

During the reporting period, a performance evaluation for Senior Executives (including the Managing Director) has taken place in accordance with this process. Code of Conduct

The Company, including its directors and Senior Executives, is committed to maintaining the highest standards of integrity and seeks to ensure all its activities are undertaken with efficiency, honesty and fairness.

The Company has developed a ‘Code of Conduct’ ( Code ) which has been fully endorsed by the Board and applies to all directors and employees. The Code is designed to ensure that it reflects the highest standards of behaviour and professionalism and the practices necessary to maintain confidence in the Group's integrity and to take into account legal obligations and reasonable expectations of the Company's stakeholders.

In summary, the Code requires that at all times all Company personnel act with the utmost integrity, objectivity and in compliance with the letter and the spirit of the law and Company policies.

A copy of the Company’s ‘Code of Conduct’ is made publicly available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre.

The Company maintains a high level of transparency regarding its actions consistent with the need to maintain the confidentiality of commercial-in-confidence material and, where appropriate, to protect shareholders’ interests.

Diversity and Inclusion

(Corporate Governance Principles and Recommendations 1.5)

The Company is committed to creating a diverse and inclusive work environment, with particular focus on gender equality. This commitment is outlined in detail in the Company’s 2018 Environmental, Social and Governance Report titled ‘Driving the Future: Our Sustainable Business’ which is publicly available in the Investor Centre on the Company website at http://shareholder.carsales.com.au/Investor-Centre.

A diverse and inclusive working environment provides a wide range of perspectives, innovation, engagement and improved operational performance. To achieve this environment, the Company promotes a workforce that embraces and respects diversity and inclusion through its Diversity Strategy.

The Company is proud to have been awarded the Workforce Gender Equality Agency (WGEA) Employer of Choice citation for three consecutive years (2016, 2017, 2018) in recognition of its systematic and strategic approach to achieving a gender diverse workplace. The Company continues to strive to exceed the expectations of WGEA year on year.

On 6 June 2018, in accordance with the Workplace Gender Equality Act 2012, carsales submitted a report to WGEA. This report provided information on carsales’ policies and gender diversity numbers across the business. This report is available in the Investor Centre on the Company website at http://shareholder.carsales.com.au/Investor-Centre.

Also available in the Investor Centre on the Company website is the Company’s Diversity Policy. This policy includes requirements for the Board to establish measurable objectives for achieving gender diversity and to assess both the objectives and the progress in achieving the objectives annually.

The objectives set by the Board, the initiatives implemented and progress towards achieving them are outlined below:

Objectives	Initiatives	Initiatives	Outcomes
Continue to grow the		Ongoing unconscious bias	In FY18 43.8% of
number of women in		education of managers on the	appointments were female,
senior roles and		importance of a diverse workforce	62.5% of managerial
professions where women are traditionally under represented.		and an executive-led Diversity Steering Committee. Maintaining quotas for recruitment shortlists.	appointments were female and the Executive Leadership Team of carsales is comprised of 30% female leaders.
		Reviewing all job advertisements
		for gender bias.
Continue to implement		Current initiatives include a training	Development programs had
career development		and development programs	39% female attendance.
programs to prepare		including communication,
women within the		presentation, management and	44% of promotions in FY18
business to take on		influence skills training.	were female staff members.
more senior roles.		Continued the Next Gear Graduate
		Program creating coaching and	Our 2019 Next Gear Graduate
		development opportunities.	program has a 50/50 gender
			split.
Foster an inclusive		We have a carsales mentor	The FY18 mentor program had
culture and		program available to all of our	40% female participants.
environment in which		people.
women network and		We support various women’s	Female networking groups
mentor each other to		networking groups including	hosted several sessions
progress their careers		sponsoring events such as	throughout the year and the
within carsales.		Changing the Ratio and women in	business collectively
		tech events.	celebrated International

		Delivered Coding 101 workshops	Women’s Day investing in an
		for our people as well as formed a	inspiring female world
		team of women to work with local	champion guest speaker.
		schools to encourage increased
		participation of females in STEM.
		Celebration of International
		Women’s Day.
Continue to enhance		In FY18 we made significant	In FY18, 24 members of the
flexible workplace		advancements in our flexible leave	carsales team took parental
arrangements for both		options including:	leave and carsales is currently
women and men.		Increased paid parental leave from	supporting 9 of our people
Enabling our people to		12 weeks to 16 weeks (plus 5	returning from a period of
manage work/life		additional days of paid leave during	parental leave with formal
commitments and		the first months returning to work to	flexible working arrangements.
preferences.		assist with the transition).
		In addition to our two weeks paid
		leave for secondary caregivers, we
		have also provided access to an
		additional10 days of sick / career’s
		leave.
		Introduced the ability to purchase
		additional one or two weeks of
		annual leave per year.
		Provided for early access to long
		service leave after seven years on
		continuous service (usually 10
		years depending on state
		legislation).

Audit and Risk Management

(Corporate Governance Principles and Recommendations 1.1, 4.1, 4.2, 4.3, 7.1, 7.2, 7.3, 7.4) Audit and Risk Management Committee

The Board has established an Audit and Risk Management Committee consisting of the following non-executive directors, all of whom are independent:

Mr Pat O'Sullivan – Chair
Ms Kim Anderson
Ms Edwina Gilbert (replaced Mr Richard Collins on 28 February 2018)
Mr Kee Wong (appointed 30 July 2018)

The Audit and Risk Management Committee operates in accordance with a charter which is publicly available in the Investor Centre of the Company website. Details of the qualifications and experience of each of the members of the committee is included in the Company’s 2018 Annual Report, also available in the Investor Centre of the Company website.

The responsibilities of the committee include oversight and monitoring of:

external reporting;
external and internal audit;
internal control and risk management; and
related party transactions.

In fulfilling its responsibilities, the Audit and Risk Management Committee:

receives regular reports from management and the Company’s external and internal auditors;
• reviews the processes that the Managing Director and Chief Financial Officer have in place to support their certifications to the Board;
reviews any significant disagreements between the external auditors and management, irrespective of whether they have been resolved;
meets separately with the external auditors as required throughout the year without the presence of management; and
provides external and internal auditors with a clear line of direct communication at any time to either the Chair of the Audit and Risk Management Committee or the Chair of the Board.

The Audit and Risk Management Committee has authority, within the scope of its responsibilities, to seek any information it requires from any employee or external party.

During the course of FY18 there were 4 meetings of the Audit and Risk Management Committee.

Details of attendance of those meetings are:

Director name	Number of Audit and Risk	Number of Audit and Risk
	Management Committee	Management Committee
	meetings during tenure	meetings attended
Pat O’Sullivan(Chair)	4	4
Kim Anderson	4	4
Richard Collins (resigned from	3	3
Committee 28 February 2018)
Edwina Gilbert (appointed to	1	1
Committee 28 February 2018)

External Auditor

The Company appoints external auditors who clearly demonstrate quality and independence.

The Company has a process to ensure the independence and competence of the Company’s external auditor including the Audit and Risk Management Committee reviewing any non-audit work to ensure that it does not conflict with audit independence.

Information on procedures for the selection and appointment of the external auditor and for the rotation of external audit engagement partners are detailed in the committee’s charter referred to above. The performance of the external auditor is reviewed as required, taking into consideration assessment of performance, existing value and tender costs.

An analysis of fees paid to the external auditors, including a break-down of fees for non-audit services, is disclosed in the 2018 Annual Report which is available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre. It is the policy of the external auditors to provide an annual declaration of their independence to the Audit and Risk Management Committee.

The Company’s external auditor attends each Annual General Meeting where it is available to answer questions from shareholders relevant to the audit.

Risk Management

The Company’s Board charter provides that it is the responsibility of the Board to ‘ensure that the significant risks facing the Company have been identified and that adequate control monitoring and reporting mechanisms are in place’.

The Company’s Audit and Risk Management Charter also provides that the role of the Committee is to assist the Board in carrying out its accounting, auditing, financial reporting and risk management responsibilities.

The Company has developed a risk management policy which is publicly available in the Investor Centre of the Company website.

The Company seeks to take and manage risk in ways that will generate and protect shareholder value and recognises that the management of risk is a continual process and an integral part of the management and corporate governance of the business.

The Company acknowledges that its reputation is of great importance and it has an obligation to all stakeholders, including shareholders, customers, employees, contractors and the wider community and that the efficient and effective management of risk is critical to the Company meeting these obligations and achieving its strategic objectives.

The Audit and Risk Management Committee has completed an annual review of the risk management framework and is satisfied that given the size and complexity of the Company it continues to be sound.

The Company maintains a formal risk register which is at a minimum reviewed twice annually by Senior Executives and the Audit and Risk Management Committee.

Internal Audit

The Company does not have a formal internal audit function within the Group.

The Audit and Risk Management Committee has primary responsibility for evaluating the effectiveness of risk management and control processes in the Company. Day to day responsibility for managing risk and implementing internal control lies with the Executive Leadership Team, which is comprised of the Managing Director and 9 other Senior Executives, including the Chief Financial Officer and the Company Secretary. Details of the roles and experience of the Executive Leadership

Team are set out in the 2018 Annual Report and on the Management section of the Investor Centre of the company website at http://shareholder.carsales.com.au/Investor-Centre/?page=Management.

The Company’s Executive Leadership Team meets at least 3 times each month and as part of its responsibility assesses and manages risk facing the business.

A professional services firm was appointed as an outsourced internal audit provider to undertake targeted internal audits over key risk areas for the Group and these were reported directly to the Audit and Risk Management Committee as part of the internal audit plan for FY18 approved by the Audit and Risk Management Committee.

The work of the outsourced internal audit provider is supplemented by independent work carried out by the Company’s auditor PwC and other professional service providers on a targeted basis where risks are identified or additional assurance over the operation of controls is desirable.

Further review of risk management activities and internal control processes is carried out by group finance, headed by the Chief Financial Officer. Group finance performs limited work throughout the year around financial and legal compliance controls, as well as risk assessment activities at the Company’s domestic and international investments.

Detailed information on the Company’s risk identification and management is contained in the Company’s 2018 Environmental, Social and Governance Report titled ‘Driving the Future: Our Sustainable Business’. The key economic risks that the Company faces are also set out in the Director’s Report of the 2018 Annual Report. Both reports are publicly available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre.

Given the nature of the Company’s activities there is little likelihood of material exposure to environmental and social sustainability risks.

Written Affirmations

Before approving financial statements for any financial period, the Board first receives from the Managing Director and the Chief Financial Officer written affirmations concerning the Company’s financial statements.

The affirmations from the Managing Director and the Chief Financial Officer include that, to the best of their knowledge and belief, the integrity of the financial statements is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the Board and that the Company’s risk management and internal compliance and control system is operating efficiently and effectively in all material respects insofar as they relate to financial reporting risks.

Management has reported to the Board as to the effectiveness of the Company’s management of its material business risks and the necessary written affirmations were received by the Board prior to the approval of the release of the 2018 Annual Report.

Remuneration Policies and Practices

(Corporate Governance Principles and Recommendations 8.1, 8.2, 8.3) Remuneration and Nomination Committee

The Board’s Remuneration and Nomination Committee consists of 3 independent directors, and is chaired by Ms Kim Anderson.

The Remuneration and Nomination Committee’s purpose, duties, membership and structure are documented in the ‘Remuneration and Nomination Charter’ which is publicly available in the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre. The Company has also developed a ‘Remuneration Policy’ which details how the Company remunerates its nonexecutive directors and Senior Executives. This policy is also publicly available in the Investor Centre of the Company website.

Details of attendance of those meetings are:

Director name	Scheduled meetings of Remuneration and Nomination committee	Scheduled meetings of Remuneration and Nomination committee	Ad hoc meetings of Remuneration and Nomination committee	Ad hoc meetings of Remuneration and Nomination committee
	A	B	A	B
Kim Anderson (Chair)	2	2	2	2
Pat O’Sullivan	2	2	2	2
Edwina Gilbert	2	2	2	2

A = Number of committee meetings held during the time the director was a member of the committee B = Number of meetings attended

The Remuneration and Nomination Committee reviews and makes recommendations to the Board on remuneration, recruitment, retention and termination policies and procedures applicable to Senior Executives and directors.

The responsibilities the committee may undertake in its remuneration function include:

reviewing Senior Executives and directors' remuneration and incentives, including the link between Company and individual performance;
reviewing current industry best practice;
considering different methods for remunerating Senior Executives and directors;
reviewing existing or proposed share option schemes or other incentive schemes;
considering superannuation arrangements;
recommending retirement, termination benefits and payments for Senior Executives; and
considering professional indemnity and liability insurance policies;

Remuneration policies

The remuneration policy for the Board, the remuneration of each director and the performance evaluation and structure of remuneration for the Company’s key management personnel are set out in the Remuneration Report which forms part of the Directors' Report of the 2018 Annual Report and is available from the Investor Centre of the Company website at http://shareholder.carsales.com.au/Investor-Centre.

Restrictions on dealing in securities

The Company has a ‘Securities Trading Policy’ relating to trading in the Company’s securities by directors, officers and other employees of the Group. This policy is documented and made publicly available in the Investor Centre of the Company website. The Company’s remuneration policy prohibits participants in the Employee Share Option plan from entering into transactions or arrangements which limit the economic risk of participating in the plan.

Communication with Shareholders and the Market

(Corporate Governance Principles and Recommendations 1.1, 5.1, 6.1, 6.2, 6.3, 6.4)

The Company has a dedicated section of its website designed to provide investors with relevant information on the Company’s governance, this is located at

http://shareholder.carsales.com.au/Investor-Centre/. This website includes for the benefit of investors:

market announcements and related information, posted immediately after release to the ASX;
news releases and financial presentations;
share price history, and historic financial reports;
calendar of upcoming carsales events and announcements;
details relating to the Company's directors and Senior Executives;
Board and Board committee charters and other corporate governance documents; and
other services for investors, such as access to the share registry information.

The website also contains the Company’s ‘Shareholder Communication Policy’.

Continuous Disclosure

As an ASX listed entity, the Company has an obligation under the ASX Listing Rules to maintain an informed market in its securities. The Company has a ‘Continuous Disclosure Policy’, available in the Investor Centre of its Company website. This policy sets out the key obligations of directors and employees of the Company to ensure compliance with its ASX Listing Rule and Corporations Act 2001 continuous disclosure obligations, and places accountability for such compliance on directors, executive officers and employees. The Company takes all reasonable steps to ensure that the market is advised of all information required to be disclosed under the Listing Rules and the Corporations Act 2001 which the Company believes would or may have a material effect on the price or value of the Company’s securities.

Investor Relations Program

The Company is committed to ensuring that shareholders, regulators and the wider investment community are informed of all major developments affecting the Company in a timely and effective manner.

Information is communicated with investors in a number of ways including:

annual and half-yearly reports;
market disclosures in accordance with the continuous disclosure policy;
updates on operations and developments;
announcements on the Company's website;
annual Environmental, Social and Governance report;
market briefings, including roadshows in Australia and overseas; and
presentations at annual general meetings.

Additionally, the Company makes Senior Executives available to provide briefings to investors throughout the year.

Shareholders are encouraged to attend and participate in the Annual General Meeting. The meeting is held in a central location with easy access by public transport to make it easy for those shareholders who wish to attend. The full text of notices and accompanying materials are included on the Investor Centre of the Company's website and released to the ASX.

At the Annual General Meeting, shareholders elect the directors and have the opportunity to express their views, ask questions about Company business and vote on items of business for resolution by shareholders. Shareholders also receive an update from the Managing Director and have the opportunity to ask questions of the Board and the Company’s external auditor. Shareholders who cannot attend the meeting are able to submit voting instructions and questions to the Board ahead of the meeting to be answered at the Annual General Meeting. Electronic Communications

Shareholders may send and receive communications to and from the Company electronically by enrolling via the Investor Centre on the Company website at http://shareholder.carsales.com.au/Investor-Centre.

Investors can also elect to receive security information (including the Half-Year and Annual Report) electronically or in print by contacting the Company’s share registry, Computershare, by e-mail at [email protected] (further contact details are available in the Investor Centre).

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Appendix 1: Attendance at Board Meetings

The numbers of meetings of the Company's Board of directors held during the year ended 30 June 2018 and the numbers of meetings attended by each director is set out below. The meetings are split in the table below between those that are formally scheduled by the Company Secretary according to the annual Board meeting timetable, those that are short teleconferences where only a quorum of Board members are required and those ad hoc meetings called at shorter notice to address specific matters that arise from time to time:

	Full scheduled meetings of directors	Full scheduled meetings of directors	Short teleconference meetings of directors	Short teleconference meetings of directors	Ad hoc meetings of directors	Ad hoc meetings of directors
	A	B	A	B	A	B
Jeffrey Browne (Chair until 23 March 2018)	9	7	2	1	3	3
Richard Collins (Chair from 23 March 2018)	13	13	2	2	3	3
Cameron McIntyre	13	13	2	2	3	3
Wal Piscotta	13	13	2	1	3	1
Kim Anderson	13	13	2	1	3	3
Pat O'Sullivan	13	13	2	2	3	3
Edwina Gilbert	13	13	2	2	3	3

A = Number of meetings held during the time the director held office during the year B = Number of meetings attended

Kee Wong was appointed as a director on 9 July 2018 and therefore attended no Board meetings in the year to 30 June 2018.

Appendix 2: Cross-reference of Corporate Governance Recommendations to sections of this report

Principle	Recommendation			Report Section	Report Section	Report Section

		The Board of Directors	Board Skills and Appointments	Board and Executive Evaluation and Codes of Conduct	Diversity and Inclusion	Audit and Risk Management	Remuneration Policies and Practices	Communication with Shareholders and the Market
Lay solid foundations for management and oversight	1.1							
	1.2		
	1.3			
	1.4	
	1.5				
	1.6			
	1.7			
Structure the Board to add value	2.1		
	2.2		
	2.3	
	2.4	
	2.5	
	2.6		
Act ethically and responsibly	3.1			
Safeguard integrity in corporate reporting	4.1					
	4.2					
	4.3					
Make timely and balanced disclosure	5.1							
Respect the rights of security holders	6.1							
	6.2							
	6.3							
	6.4							
Recognise and manage risk	7.1					
	7.2					
	7.3					
	7.4					
Remunerate fairly and responsibly	8.1						
	8.2						
	8.3						

AI assistant

CAR GROUP LIMITED — Governance Information 2018

64605_rns_2018-08-21_41c3ac86-233a-45c5-9aff-886b25ba1d22.pdf

Appendix 4G

Key to Disclosures Corporate Governance Council Principles and Recommendations

ANNEXURE – KEY TO CORPORATE GOVERNANCE DISCLOSURES

Introduction

The Board of Directors

(Corporate Governance Principles and Recommendations 1.1, 1.3, 1.4, 2.3, 2.4, 2.5, 3.1) Board responsibilities

Matters specifically reserved for the Board

Board Composition and Independence

Board diversity

Non-executive directure tenure

Board Committees

Relationship between directors and management

Role of the Chair

Role of the Managing Director

Role of the Company Secretary

Access to independent professional advice

Management of conflicts and declaration of interests

Board Skills and Appointments (Corporate Governance Principles and Recommendations 1.2, 1.3, 2.1, 2.2, 2.6) Board Skills Matrix

Remuneration and Nomination Committee

Appointment & re-election of Board members

Induction and training of directors

Appointment of Senior Executives

Board and Executive Evaluation and Codes of Conduct

(Corporate Governance Principles and Recommendations 1.3, 1.6, 1.7, 3.1)

Board performance assessment

Senior Executive performance reviews

Diversity and Inclusion

(Corporate Governance Principles and Recommendations 1.5)

Audit and Risk Management

(Corporate Governance Principles and Recommendations 1.1, 4.1, 4.2, 4.3, 7.1, 7.2, 7.3, 7.4) Audit and Risk Management Committee

External Auditor

Risk Management

Internal Audit

Written Affirmations

Remuneration Policies and Practices

(Corporate Governance Principles and Recommendations 8.1, 8.2, 8.3) Remuneration and Nomination Committee

Remuneration policies

Restrictions on dealing in securities

Communication with Shareholders and the Market

(Corporate Governance Principles and Recommendations 1.1, 5.1, 6.1, 6.2, 6.3, 6.4)

Continuous Disclosure

Investor Relations Program

Appendix 1: Attendance at Board Meetings

Appendix 2: Cross-reference of Corporate Governance Recommendations to sections of this report

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CAR GROUP LIMITED Governance Information 2018