Corporate Governance Committee Charter

(As approved by the Board of Directors on September 16, 2022)

The Board of Directors of SEMIRARA MINING AND POWER CORPORATION (Company) has established a Corporate Governance Committee to assist the Board in the perofrmance of its coporate governance responsibilities, inclduing the functions that were formerly assigned to a Nomination ensuring compliance with and proper observance of corporate governance principles and practices. 

Further, the Board of Directors may create a Sub-Committee to support the Corporate Governance Committee in the performance of its oversight duties where necessary.

1. MEMBERSHIP

     1.1 The Corporate Governance Committee shall consist of at least three (3) members appointed by the Board of Directors, majority of whom shall be Independent Directors.

     1.2 The Chairman of the Committee must be an Independent Director. 

     1.3 The Committee Member’s term shall be for one year. Committee Members may be replaced at any time by a majority of the Board. 

     1.4 All Committee Members must be Directors of the Board. A Member’s cessation as a Board Director means his automatic termination as a Committee Member. 

     1.5 Committee Members shall be entitled to committee membership per diems or fees.

2. DUTIES

The Committee’s duties and responsibilities shall be as follows:

2.1 Corporate Governance

     2.1.1 Oversee the implementation of the corporate governance framework and periodically review the said framework to ensure that it remains appropriate in light of material changes to the corporation’s size, complexity and business strategy, as well as its business and regulatory environments.

     2.1.2 Adopt corporate governance policies and ensure that these are reviewed and updated regularly, and consistently implemented in form and substance.  

2.2 Board Performance

     2.2.1 Set good governance guidelines detailing responsibilities and performance expectations for Board Directors.

     2.2.2 Develop and implement an annual or periodic evaluation process of the Board’s effectiveness and performance (including that of individual Board members). The full Board and Committee self-assessment shall include the Board/Committee responsibilities, structure, meetings, processes, and management support. The individual director self-assessment performance areas shall take into account leadership, interpersonal skills, strategic thinking and participation in Board meetings and committee assignments. 

     2.2.3 Oversees the periodic performance evaluation of the Board and its committees, individual Board Directors, and senior executive management, and conducts an annual self-evaluation of the Committee’s own performance.

     2.2.4 Ensures that the results of the Board evaluation are shared, discussed, and that concrete action plans are developed and implemented to address the identified areas for improvement.

2.3 Nomination and Selection

     2.3.1 Determines the nomination and election process for the Company’s Directors and has the special duty of defining the general profile of Board members that the Company may need and ensuring appropriate knowledge, competencies and expertise that complement the existing skills of the Board;

     2.3.2 Promulgate guidelines to govern the conduct of nomination of independent directors, new executive and non-executive directors, and other positions requiring appointment of the Board. 

     2.3.3 Be responsible for identifying, evaluating qualifications, skills and experience that are aligned to the Company’s strategy and accepting nominations of candidates for election as Board members and to fill Board vacancies as and when they arise, as well as considering issues of potential conflicts of interest for such candidates. 

     2.3.4 Make recommendations to the Board on the appointment of new executive and non-executive directors, including making recommendations to Board mix and balance between executive and non-executive directors appointed to the Board.

     2.3.5 Set the terms of reference for qualifications and competencies of senior management officers, i.e. CEO, VPs, and which shall include strategic business acumen, financial & technical expertise, experience, professional ethics, and such other qualifications aligned to the Company’s strategy. 

     2.3.6 Review the qualification of senior management officers prior to movement, appointment or promotion, and approve final disposition thereof.   

     2.3.7 Retain or use professional search firms or other external sources when searching for candidates to the Board of Directors.   

2.4 Succession Planning

     2.4.1 Undertake the responsibility for succession planning for the Board to ensure that positions are filled not just in terms of Board membership, but also Committee membership, Board and Committee Chairs and senior executive officer positions.

     2.4.2 Make an annual report to the Board on executive succession planning which should include policies for Chairman and Chief Executive Officer (CEO) selection and succession in the event of an emergency or retirement.  The entire Board will work with the Committee to evaluate and nominate potential successors to the Chairman and CEO.  

     2.4.3 Review periodically with the Chairman and CEO the executive succession plans relating to positions held by elected senior management officers. 

2.5 Board Development

     2.5.1 Recommend a Board and Director Development program which shall include orientation, continuing education/training programs, assignment to board committees, site visits, relevant trainings for members of the Board, and/or Board retreat, among others.

2.6 Director and Executive Remuneration

     2.6.1 Establish a formal and transparent procedure to develop a policy on determining the remuneration of Directors and Officers that is consistent with the Company’s culture, strategy and control environment as well as business environment in which it operates, and remuneration packages for corporate and individual performance.

     2.6.2 Review and recommend to the Board a framework of remuneration and benefits for the Directors; 

     2.6.3 Where necessary, recommend that the Board seek an increase in the amount of remuneration for Directors subject to Shareholder approval requirement. The level of Director remuneration is to be set so as to attract the best candidates for the Board while maintaining a level commensurate with Boards of similar size and type.

     2.6.4 Review periodically the Company’s overall management evaluation and compensation policies, including, those applicable to the executive officers, to ensure that management is rewarded appropriately for their contributions to the Company’s growth and profitability and that such compensation policies are aligned with the Company’s objectives and Shareholder interests;

     2.6.5 Review, and make recommendations as necessary to the Board on the Company’s compensation and other benefit plans, including incentive compensation, share option plan, retirement and severance arrangements for executive Directors, Officers and key employees.

2.7 CEO Evaluation

     2.7.1 Review and approve goals and objectives relevant to the compensation of the CEO, including, but not limited to, the following criteria:



The criteria should ensure that the CEO’s interests are aligned with the long-term interests of the Shareholders; 

     2.7.2 Conduct annual reviews of the CEO’s performance in light of the abovementioned goals and objectives, and report the results thereof to the Board;

     2.7.3 Recommend to the Board the compensation levels of the CEO (including each of the individual elements thereof) based on the abovementioned evaluation.  

2.8 Environmental, Social and Governance (ESG)

     2.8.1 Oversee the Company’s strategy, framework, policies, programs and practices related to ESG;

     2.8.2 Oversee and review with Management the Company’s material ESG metrics, targets and performance that are most important to the business, including the relevant reporting standards for effective stakeholder communication and transparency;

     2.8.3 Oversee and report to the Board the material ESG issues and emerging topics that may affect the strategic goals, objectives and targets, or reputation of the company.



2.9 Disclosure

     2.9.1 Develop and implement a form on Full Business Interest Disclosure as part of the pre-employment requirements for all incoming Company officers and Directors, which among others, compels all officers and Directors to declare under the penalty of perjury all their existing business interests or shareholdings that may directly or indirectly conflict in their performance of duties once hired;

3. COMMITTEE MEETINGS

     3.1 Meetings of the Committee will be held as the Committee deems to be appropriate; however, the Committee should meet at least twice a year.  A meeting may be called, at any other time, by the Committee Chairman or any Committee Member when necessary.

     3.2 The notice of each meeting of the Committee, confirming the venue, time and date and enclosing an agenda of items to be discussed, shall other than under exceptional circumstances, be forwarded to each member of the Committee at least five  (5) calendar days prior to the date of the meeting.

     3.3 A majority of the Committee Members shall constitute a quorum, and the act of a majority of those present at any Committee meeting at which there is a quorum shall be the act of the Committee.

     3.4 The Company’s Corporate Secretary or any other person nominated by the Committee shall be the Secretary of the Committee in its meetings. Minutes of meetings shall be circulated to all the members of the Committee, and may also, if the Chairman of the Committee so decide be circulated to other members of the Board.

     3.5 The Chairman of the Committee shall attend the Annual Shareholders’ Meeting and be prepared to answer queries concerning Committee-related oversight matters. 

     3.6 The Committee may request any Company officer or employee, or any other individual to attend a Committee meeting or to meet with any Committee Member or consultant to the Committee as considered appropriate.  

4. Committee Reporting 

     4.1 The Committee Chairperson shall report matters requiring the Board’s proper disposition and attention regularly. He shall report to the Board, following each meeting, the Committee’s recommendations on matters set out in this Charter.

     4.2 The Committee shall prepare an annual report to the Board and shareholders that all responsibilities outlined in its Charter have been carried out, i.e. performance of oversight duties during the year, describing the Committee’s composition, responsibilities and how they were discharged, any other regulatory information, approval of non-audit services, among others.

5. COMMITTEE AUTHORITY

     5.1 The Board will ensure that the Committee will have access to professional advice both inside and outside of the Company in order for it to perform its duties.

     5.2 The Committee has the authority to retain, at the Company’s expense, and terminate persons having special competencies (including, without limitation, legal, accounting or other consultants and experts) to assist or advise the Committee in fulfilling its responsibilities

6. COMMITTEE PERFORMANCE

     6.1 The Committee shall review the adequacy or effectiveness of the Charter at least on an annual basis and recommend any proposed changes to the Board for approval.  

     6.2 The Committee shall conduct an annual review of its own performance and take follow-up action as appropriate.