GOLDEN STATE MINING LIMITED — Governance Information 2018

Nov 5, 2018

GOLDEN STATE MINING LIMITED ACN 621 105 995 (COMPANY)

CORPORATE GOVERNANCE STATEMENT

This Corporate Governance Statement is current as of 24 October 2018 and has been approved by the Board of the Company.

This Corporate Governance Statement discloses the extent to which the Company will, as at the date it is admitted to the official list of the ASX, follow the recommendations set by the ASX Corporate Governance Council in its publication "Corporate Governance Principles and Recommendations" 3rd edition (Recommendations). The Recommendations are not mandatory, however, the Recommendations that will not be followed have been identified and reasons provided for not following them along with what (if any) alternative governance practices the Company intends to adopt in lieu of the recommendation.

The Company has adopted a Corporate Governance Plan that provides the written terms of reference for the Company's corporate governance duties that is available on the Company's website at www.goldenstatemining.com.au.

Due to the current size and nature of the existing Board, the Board has not established individual Board committees. Under the Board's Charter, the duties that would ordinarily be assigned to individual committees are currently carried out by the full Board under the written terms of reference for those committees.

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
Principle 1: Lay solid foundations for management and oversight
Recommendation 1.1 A listed entity should have and disclose a charter which sets out the respective roles and responsibilities of the Board, the Chair and management, and includes a description of those matters expressly reserved to the Board and those delegated to management.	YES	The Company has adopted a Board Charter that sets out the specific roles and responsibilities of the Board, the Chair and management and includes a description of those matters expressly reserved to the Board and those delegated to management.
		The Board Charter sets out the specific responsibilities of the Board, requirements as to the Board's composition, the roles and responsibilities of the Chairman and Company Secretary, the establishment, operation and management of Board Committees, Directors' access to Company records and information, details of the Board's relationship with management, details of the Board's performance review and details of the Board's disclosure policy.

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
		A copy of the Company's Board Charter, which is part of the Company's Corporate Governance Plan, is available on the Company's website.
Recommendation 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 relevant to a decision on whether or not to elect or re-elect a Director.	YES	(a) The Company has guidelines for the appointment and selection of the Board in its Corporate Governance Plan. The Company's Nomination Committee Charter (in the Company's Corporate Governance Plan) requires the Nomination Committee (or, in its absence, the Board) to ensure appropriate checks (including checks in respect of character, experience, education, criminal record and bankruptcy history (as appropriate)) are undertaken before appointing a person or putting forward to security holders a candidate for election, as a Director.
		(b) In accordance with the Nomination Committee Charter, all material information relevant to a decision on whether or not to elect or re elect a Director will be provided to security holders in the Notice of Meeting containing the resolution to elect or re-elect a Director.
Recommendation 1.3 A listed entity should have a written agreement with each Director and senior executive setting out the terms of their appointment.	YES	The Company's Nomination Committee Charter requires the Nomination Committee (or, in its absence, the Board) to ensure that each Director and senior executive is a party to a written agreement with the Company which sets out the terms of that Director's or senior executive's appointment. The Company has written agreements with each of its Directors and senior executives.
Recommendation 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.	YES	The Board Charter outlines the roles, responsibility and accountability of the Company Secretary. In accordance with this, the Company Secretary is accountable directly to the Board, through the Chair, on all matters to do with the proper functioning of the Board.
Recommendation 1.5		(a) The Company has adopted a Diversity Policy. While the Diversity Policy provides a framework for the Company to achieve a list of
A listed entity should: (a) have a diversity policy which includes requirements for the Board or a relevant committee of the Board: (i) to set measurable objectives for achieving gender diversity; and	PARTIALLY	measurable objectives that encompass gender equality, the Company does not propose to establish measurable gender diversity objectives in the foreseeable future as:

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
(ii) to assess annually both the objectives and the entity's progress in achieving them; (b) disclose that policy or a summary or it; and		(i) the Company's senior management team is experienced and stable and there is no intention to make changes to the Board or senior management team in the coming year; and
(c) disclose as at the end of each reporting period: (iii) the measurable objectives for achieving gender diversity set by the Board in accordance with the entity's diversity policy and its progress towards achieving them; and (iv) either: (A) 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 (B) if the entity is a "relevant employer" under the Workplace Gender Equality Act 2012, the entity's most recent "Gender Equality Indicators" as defined in that Act.		(ii) application of a measurable gender diversity objective requiring a specified proportion of women on the Board and in senior executive roles will, given the small size of the Company and the Board, unduly limit the Company from applying the Diversity Policy as a whole and the Company's policy of appointing based on skills and merit. (b) The Diversity Policy is available, as part of the Corporate Governance Plan, on the Company's website. (c) (iii) The Board does not presently intend to set measurable gender diversity objectives because, if it becomes necessary to appoint any new Directors or senior executives, the Board considered the application of a measurable gender diversity objective requiring a specified proportion of women on the Board and in senior executive roles will, given the small size of the Company and the Board, unduly limit the Company from applying the Diversity Policy as a whole and the Company's policy of appointing based on skills and merit. (iv) 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) for each financial year will be disclosed in Annual Reports or on the Company's website.
Recommendation 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	YES	(a) The Company's Nomination Committee (or, in its absence, the Board) is responsible for evaluating the performance of the Board, its committees, and individual Directors. It may do so with the aid of an independent advisor. The process for this is set out in the Company's Corporate Governance Plan, which is available on the Company's website.

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
(b) disclose in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance with that process.		(b) The Company's Corporate Governance Plan requires the Company to disclose whether or not performance evaluations were conducted during the relevant reporting period. Details of the performance evaluations conducted will be provided in the Company's Annual Reports.
Recommendation 1.7 A listed entity should:	YES	(a) The Board is responsible for evaluating the performance of the Company's senior executives on an annual basis. A senior executive, for these purposes, means key management personnel (as defined in
(a) have and disclose a process for periodically evaluating the performance of its senior executives; and		the Corporations Act) other than a non-executive Director. The applicable processes for these evaluations can be found in the
(b) disclose in relation to each reporting period, whether a performance evaluation was undertaken in the reporting period in accordance		Company's Corporate Governance Plan, which is available on the Company's website.
with that process.		(b) The Company's Corporate Governance Plan requires the Company to disclose whether performance evaluations were conducted during the relevant reporting period. Details of the performance evaluations conducted will be provided in the Company's Annual Reports.
Principle 2: Structure the Board to add value
Recommendation 2.1		Due to the size and nature of the existing Board, and the magnitude of the
The Board of a listed entity should:	YES	Company's operations, the Company is of the view that it does not need a Nomination Committee and that its resources would be better utilised in
(a) have a nomination committee which:		other areas.
(i) has at least three members, a majority of whom are independent Directors; and		Under clause 4(h) of the Company's Board Charter, the full Board currently carries out the duties that would ordinarily be assigned to the Nomination
(ii) is chaired by an independent Director,		Committee under the written charter for that committee and in the
and disclose:		Company's view the experience and skill set of the current Board is sufficient to perform these roles.
(iii) the charter of the committee;		The duties of the Nomination Committee (which are currently carried out
(iv) the members of the committee; and		by the Board) are outlined in Schedule 5 of the Company's Corporate Governance Plan available online on the Company's website.
(v) 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		The Board devotes time at annual Board meetings to discuss Board succession issues. All members of the Board are involved in the Company's

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
(b) if it does not have a nomination committee, disclose that fact and the processes it employs to address Board succession issues and to		nomination process, to the maximum extent permitted under the Corporations Act and ASX Listing Rules.
ensure that the Board has the appropriate balance of skills, experience, independence and knowledge of the entity to enable it to discharge its duties and responsibilities effectively.		The Board regularly updates the Company's Board skills matrix (in accordance with recommendation 2.2) to assess and ensure the Board has the appropriate balance of skills, experience, independence and knowledge of the entity to discharge its duties and responsibilities effectively.
Recommendation 2.2 A listed entity should have and disclose a Board skill matrix setting out the mix of skills and diversity that the Board currently has or is looking to achieve in its membership.	NO	Under the Nomination Committee Charter, the Nomination Committee (or, in its absence, the Board) is required to prepare a Board skill matrix setting out the mix of skills and diversity that the Board current has (or is looking to achieve) and to review this at least annually against the Company's Board skills matrix to ensure the appropriate mix of skills and expertise is present to facilitate successful strategic direction.
		The Company intends to develop a Board skill matrix setting out the mix of skills and diversity that the Board currently has or is looking to achieve in its membership. A copy will be made available on the Company's website.
		The Board Charter requires the disclosure of each Board member's qualifications and expertise. Full details as to each Director and senior executive's relevant skills and experience are available on the Company's website.
Recommendation 2.3		(a) The Board Charter requires the disclosure of the names of Directors
A listed entity should disclose:		considered by the Board to be independent. The Company will disclose those Directors it considers to be independent in its Annual
(a) the names of the Directors considered by the Board to be independent Directors;	YES	Report. The Board considers that two of the current Directors are independent.
(b) if a Director has an interest, position, association or relationship of the type described in Box 2.3 of the ASX Corporate Governance Principles and Recommendation (3rd Edition), but the Board is of the opinion that it does not compromise the independence of the Director, the		(b) There are no independent Directors who fall into this category. The Company will disclose in its Annual Report and ASX website any instances where this applies and an explanation of the Board's opinion why the relevant Director is still considered to be independent.
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		(c) The Board Charter requires the length of service of each Director to be disclosed. The length of service of each Director will be provided in the Annual Reports.

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
Recommendation 2.4 A majority of the Board of a listed entity should be independent Directors.	NO	The Board Charter requires that, where practical, the majority of the Board must be independent.
		At this stage, due to the current size and nature of the existing Board and the magnitude of the Company's operation, two of its directors are independent. As such, independent directors are not currently a majority of the Board.
Recommendation 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	NO	The Board Charter provides that, where practical, the Chair of the Board should be an independent Director and should not be the CEO/Managing Director.
the entity.		The Chair of the Company is not an independent Director. The Company does not have a CEO. The Chair is not the Managing Director.
		The Board does not have an independent Chair because, at this stage in the Company's development, Mr Damien Kelly is best placed to fulfil this role. The Board has taken the following steps to structure the Board to add value despite not having an independent Chairman:
		(a) Board meetings are held with a flat structure allowing contribution from all Directors that allows for a diversity of views to be considered;
		(b) The Board may as necessary consider the appointment of an independent director who can fulfil the role whenever the Chair is conflicted.
Recommendation 2.6 A listed entity should have a program for inducting new Directors and providing appropriate professional development opportunities for continuing Directors to develop and maintain the skills and knowledge needed to perform their role as a Director effectively.	YES	The Board Charter states that a specific responsibility of the Board is to procure appropriate professional development opportunities for Directors. The Board is responsible for the approval and review of induction and continuing professional development programs and procedures for Directors to ensure that they can effectively discharge their responsibilities.

	RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
	Principle 3: Act ethically and responsibly
	Recommendation 3.1 A listed entity should:	YES	(a) The Company's Corporate Code of Conduct applies to the Company's Directors, senior executives and employees.
(a) (b)	have a code of conduct for its Directors, senior executives and employees; and disclose that code or a summary of it.		(b) The Company's Corporate Code of Conduct (which forms part of the Company's Corporate Governance Plan) is available on the Company's website.
	Principle 4: Safeguard integrity in financial reporting
	Recommendation 4.1 The Board of a listed entity should:	YES	The Company's Corporate Governance Plan contains an Audit and Risk Committee Charter that provides for the creation of an Audit and Risk
(a)	have an audit committee which:		Committee (if it is considered it will benefit the Company), with at least three members, all of whom must be independent Directors, and which
(i)	has at least three members, all of whom are non-executive Directors and a majority of whom are independent Directors; and		must be chaired by an independent Director who is not the Chair. The Company currently does not have an Audit and Risk Committee as it is of the view that its resources would be better utilised in other areas. This
(ii)	is chaired by an independent Director, who is not the chair of the Board,		is due to the current size of the Company, the magnitude of its operations and the fact that the Board has sufficient skills and expertise to effectively carry out the role of the Audit and Risk Committee.
	and disclose:
(iii)	the charter of the committee;		Under clause 4(h) of the Company's Board Charter, the full Board currently carries out the duties that would ordinarily be assigned to the Audit and
(iv)	the relevant qualifications and experience of the members of the committee; and		Risk Committee under the written charter for that committee. The role and responsibilities of the Audit and Risk Committee are outlined
(v)	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		in Schedule 3 of the Company's Corporate Governance Plan available online on the Company's website, which include managing the relationship of the Company with its external auditors.
(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 financial reporting, including the processes for the appointment and removal of the external auditor and the rotation of the audit engagement partner.		The Board devotes time at annual Board meeting to fulfilling the roles and responsibilities associated with maintaining the Company's internal audit function and arrangements with external auditors. All members of the Board are involved in the Company's audit function to ensure the proper maintenance of the entity and the integrity of all financial reporting.

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
Recommendation 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 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.	YES	The Company's Audit and Risk Committee Charter requires the CEO and CFO (or, if none. the person(s) fulfilling those functions) to provide a sign off on these terms.
Recommendation 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.	YES	The Company's Corporate Governance Plan provides that the Board must ensure the Company's external auditor attends its AGM and is available to answer questions from security holders relevant to the audit.
Principle 5: Make timely and balanced disclosure
Recommendation 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.	YES	(a) The Board Charter provides details of the Company's disclosure policy. In addition, Schedule 7 of the Corporate Governance Plan is entitled 'Continuous Disclosure Policy' and details the Company's disclosure requirements as required by the ASX Listing Rules and other relevant legislation. (b) The Board Charter and Schedule 7 of the Corporate Governance Plan are available on the Company website.
Principle 6: Respect the rights of security holders
Recommendation 6.1 A listed entity should provide information about itself and its governance to investors via its website.	YES	Information about the Company and its governance is available in the Corporate Governance Plan which can be found on the Company's website.

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
Recommendation 6.2 A listed entity should design and implement an investor relations program to facilitate effective two-way communication with investors.	YES	The Company has adopted a Shareholder Communications Strategy which aims to promote and facilitate effective two-way communication with investors. The Strategy outlines a range of ways in which information is communicated to shareholders and is available on the Company's website as part of the Company's Corporate Governance Plan.
Recommendation 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.	YES	Shareholders are encouraged to participate at all EGMs and AGMs of the Company. Upon the dispatch of any notice of meeting to Shareholders, the Company Secretary shall send out material in that notice of meeting stating that all Shareholders are encouraged to participate at the meeting.
Recommendation 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.	YES	The Shareholder Communication Strategy states that, as a part of the Company's investor relations program, Shareholders will be able to register with the Company Secretary to receive email notifications of when an announcement is made by the Company to the ASX, including the release of the Annual Report, half yearly reports and quarterly reports. Links are made available to the Company's website on which all information provided to the ASX is immediately posted.
		Security holders will be able to register with the Company to receive email notifications when an announcement is made by the Company to the ASX. Shareholders queries should be referred to the Company Secretary at first instance.
Principle 7: Recognise and manage risk
Recommendation 7.1 The Board of a listed entity should: (a) have a committee or committees to oversee risk, each of which: (i) has at least three members, a majority of whom are independent Directors; and	YES	(a) The Company's Audit and Risk Committee Charter provides for the creation of an Audit and Risk Committee (if it is considered it will benefit the Company), with at least three members, all of whom must be independent Directors, and which must be chaired by an independent Director. (b) The Company currently does not have an Audit and Risk Committee
(ii) is chaired by an independent Director, and disclose:		as it is of the view that its resources would be better utilised in other areas. This is due to the current size of the Company, the magnitude of its operations and the fact that the Board has sufficient skills and

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
(iii) the charter of the committee; (iv) the members of the committee; and		expertise to effectively carry out the role of the Audit and Risk Committee.
(v) 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		Under clause 4(h) of the Company's Board Charter, the full Board currently carries out the duties that would ordinarily be assigned to the Audit and Risk Committee under the written charter for that committee.
(b) if it does not have a risk committee or committees that satisfy (a) above, disclose that fact and the process it employs for overseeing the entity's risk management framework.		The role and responsibilities of the Audit and Risk Committee are outlined in Schedule 3 of the Company's Corporate Governance Plan available online on the Company's website.
		The Board devotes time at quarterly Board meetings to fulfilling the roles and responsibilities associated with overseeing risk and maintaining the entity's risk management framework and associated internal compliance and control procedures.
Recommendation 7.2		(a) The Audit and Risk Committee Charter requires that the Audit and Risk Committee (or, in its absence, the Board) should, at least annually,
The Board or a committee of the Board should: (a) review the entity's risk management framework with management at	YES	satisfy itself that the Company's risk management framework continues to be sound.
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.		(b) The Company's Corporate Governance Plan requires the Company to disclose at least annually whether such a review of the Company's risk management framework has taken place.
Recommendation 7.3		(a) The Audit and Risk Committee Charter provides for the Audit and Risk
A listed entity should disclose:	YES	Committee (or, in its absence, the Board) to monitor the need for an internal audit function.
(a) if it has an internal audit function, how the function is structured and what role it performs; or		(b) The Company does not currently have an internal audit function due to its size. The Company is committed to understanding and managing
(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.		risk and to establishing an organisational culture that ensures risk management is included in all activities, decision making and business processes.
Recommendation 7.4		The Audit and Risk Committee Charter requires the Audit and Risk Committee (or, in its absence, the Board) to assist management determine

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
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.	YES	whether the Company has any material exposure to economic, environmental, and social sustainability risks and, if it does, how it manages or intends to manage those risks.
		The Company's Corporate Governance Plan requires the Company to 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. The Company will disclose this information in its Annual Report and on its ASX website as part of its continuous disclosure obligations.
Principle 8: Remunerate fairly and responsibly
Recommendation 8.1		(a) The Company's Remuneration Committee Charter that provides for the
The Board of a listed entity should:	YES	creation of a Remuneration Committee (if it is considered it will benefit the Company), with at least three members, all of whom must be
(a) have a remuneration committee which:		independent Directors, and which must be chaired by an independent
(i) has at least three members, a majority of whom are independent Directors; and		Director. (b) The Company does not have a Remuneration Committee as it is of the
(ii) is chaired by an independent Director,		view that its resources would be better utilised in other areas. This is due
and disclose:		to the current size of the Company, the magnitude of its operations and the fact that the Board has sufficient skills and expertise to
(iii) the charter of the committee;		effectively carry out the role of the Remuneration Committee.
(iv) the members of the committee; and		Under clause 4(h) of the Company's Board Charter, the full Board
(v) 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		currently carries out the duties that would ordinarily be assigned to the Remuneration Committee under the written charter for that committee.
(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		The role and responsibilities of the Remuneration Committee are outlined in Schedule 4 the Company's Corporate Governance Plan available online on the Company's website.
such remuneration is appropriate and not excessive.		The Board will devote time at the annual Board meeting to fulfilling the roles and responsibilities associated with setting the level and composition of remuneration for Directors and senior executives and ensuring that such remuneration is appropriate and not excessive.

RECOMMENDATIONS (3RD EDITION)	COMPLY	EXPLANATION
Recommendation 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 and ensure that the different roles and responsibilities of non-executive Directors compared to executive Directors and other senior executives are reflected in the level and composition of their remuneration.	YES	The Company's Corporate Governance Plan requires the Board to disclose its policies and practices regarding the remuneration of non-executive, executive and other senior Directors, which is disclosed on the Company's website.
Recommendation 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.	YES	The Company's Corporate Governance Plan states that the Board is required to review, manage and disclose the policy (if any) 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. The Board must review and approve any equity based remuneration schemes and any transactions which limit the economic risk of participating in the scheme. The Company does not have an equity based incentive remuneration scheme. A copy of the Company's Corporate Governance Plan is available on the Company's ASX website.