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MarketScreener Homepage  >  Equities  >  Australian Stock Exchange  >  Mayne Pharma Group Limited    MYX   AU000000MYX0

MAYNE PHARMA GROUP LIMITED

(MYX)
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Mayne Pharma : 2020 Corporate Governance Statement

10/08/2020 | 03:45am EST

8 October 2020

Manager, Company Announcements

ASX Limited

Level 4

20 Bridge Street

SYDNEY NSW 2000

Via E-Lodgement

2020 Corporate Governance Statement

In accordance with the Listing Rules, attached for release to the market is the Mayne Pharma 2020 Corporate Governance Statement.

This announcement is authorised by the Board.

Yours faithfully

Laura Loftus

Company Secretary

For further information, please contact

Lisa Pendlebury

VP Investor Relations & Communications

Phone: +61 419 548 434

Email: lisa.pendlebury@maynepharma.com

2020 CORPORATE GOVERNANCE STATEMENT

The Board of Directors of Mayne Pharma Group Limited (ASX:MYX) ("Company") is responsible for the corporate governance of the Group and is committed to applying the ASX Corporate Governance Council Corporate Governance Principles and Recommendations ("ASX Principles"). The Board guides and monitors the business and affairs of the Company on behalf of its shareholders. The Board requires the Company to maintain high standards of ethics and integrity at all times.

The ASX Principles are an important regulatory guide for listed companies reporting on their corporate governance practices. Under ASX Listing Rule 4.10.3, listed companies must disclose the extent to which they have followed the ASX Principles, and if any of the recommendations have not been followed, explain why. The Board believes that the Company's policies and practices comply in all substantial respects with the 3rd Edition of the ASX Principles.

Important information relating to the Company's corporate governance policies and practices are set out on the Company's website at maynepharma.com. The following documents are available on the corporate governance section of the website:

  • Corporate Governance Statement;
  • Board Charter;
  • Audit and Risk Committee Charter;
  • Remuneration and People Committee Charter;
  • Nomination Committee Charter;
  • Science, Technology and Medical Committee Charter;
  • Business Code of Conduct;
  • Communications Policy;
  • Continuous Disclosure Policy;
  • Risk Management Framework;
  • Securities Trading Policy;
  • Misconduct and Whistleblowing Policy;
  • Anti-Briberyand Anti-Corruption Policy;
  • Diversity Policy; and
  • Equal Opportunity 2019-2020 Report.

The Company will continue to update its policies and practices to reflect developing corporate governance requirements and practices.

1. The Board of Directors

  1. The Board's duties
    The role of the Board is to oversee and guide the management of the Company with the aim of protecting and enhancing the interests of its shareholders and taking into account the interests of other stakeholders including employees and the wider community. In addition, the Board is responsible for identifying areas of significant business risk and ensuring arrangements are in place to adequately manage those risks.
    The Board is responsible for setting the strategic direction and objectives of the Company, establishing goals for management and monitoring the achievement of those goals. The Chief Executive Officer is responsible to the Board for the day to day management of the Group. The Board ensures that the Chief Executive Officer is appropriately qualified and experienced to discharge their responsibilities and has procedures in place to assess the performance of the Chief Executive Officer.
    The Board has adopted a formal charter ("Board Charter") that clearly establishes the relationship between the Board and management and describes their functions and responsibilities. The Board Charter was last reviewed in June 2020. The Board Charter is posted on the corporate governance section of the Company's website.
    The Board also appoints the Company Secretary. The Company Secretary is responsible for coordination of all Board business including agendas, Board Papers and minutes; advising the Board and committees on governance matters; and helping to facilitate and organise the induction and professional development of Directors.
  2. Code of Conduct
    Directors of the Company are subject to the Company's Business Code of Conduct (see further discussion below in the Conduct and Ethics section). The Business Code of Conduct is considered by the Board to be an effective way to guide the behaviour of all Directors and employees and demonstrates the Company's commitment to ethical and compliant practices.

Mayne Pharma Corporate Governance Statement 2020

1

1.3 Board Composition

The composition of the Board is determined in accordance with the following principles and guidelines:

  • the Board should comprise at least three directors;
  • the Board should comprise a majority of independent non-executive directors;
  • the Board should comprise directors with an appropriate range of skills, experience and expertise;
  • the Chair should be an independent non-executive director; and
  • the Board shall meet regularly and follow meeting guidelines set down to ensure all directors are made aware of and have available all necessary information, to participate in an informed discussion of all agenda items.

The Board currently comprises eight Directors. There are seven independent Non-Executive Directors and one Executive Director. Details of the Directors are included on the About Us section of the Company's website.

Non-Executive Director

Period in office as at 31 August 2020

Mr Corbett

9 years and 10 months

Mr Mathieson

13 years and 6 months

Mr Scholes

12 years and 11 months

Mr Robinson

6 years

Ms Dolan

3 years and 11 months

Mr Condella

2 years and 4 months

Mr Blake

2 years and 2 months

Average NED tenure

7 years and 5 months

The Board seeks to maintain an appropriate mix of skills and diversity in the membership of the Board. This includes diversity of skills, experience, location, gender and background in the pharmaceutical industry, international business, finance, accounting and management.

Gender diversity

Location

Age

1

2

2

3

5

7

4

Female

Male

US

Australia

50-59

60-69

70+

The following Board skills matrix describes the combined skills of the Board across a range of general and specialist areas. The Board considers that collectively the Directors have the appropriate range of skills and experience necessary to direct the Company's businesses and achieve the Company's strategic objectives.

BOARD

BOARD SKILLS MATRIX

REPRESENTATION

General Experience

Managing and Leading

Success in business at a senior level in a successful career.

8

Global Experience

Senior executive or equivalent exposure to a range of political,

8

cultural, regulatory and business environments.

Business / Commercial

Senior executive or equivalent experience in business/commerce in

8

a large business enterprise

Strategy

Track record of developing and implementing successful strategies.

8

Governance

Commitment to high standards of governance, including experience

8

with a large business enterprise which is subject to rigorous

governance standards.

Mayne Pharma Corporate Governance Statement 2020

2

BOARD

BOARD SKILLS MATRIX

REPRESENTATION

Specialist Experience

Industry-specific knowledge

Senior executive experience in a large biopharmaceutical,

4

pharmaceutical or medical organisation.

Finance/Legal/Risk

Board audit/risk management membership or senior executive or

7

management

equivalent experience in financial accounting and reporting,

corporate finance, internal financial controls or the provision of legal

services to large business enterprises.

Marketing

Senior executive experience in marketing and a detailed

7

understanding of the Group's corporate objective to create long-

term value through the provision of innovative products.

Capital Projects

Experience in an industry with projects involving large scale capital

7

outlays and long-term investment horizons.

Health, Safety & Environment

Experience related to workplace health, safety, environment and

8

social responsibility within a large business enterprise.

Remuneration

Board remuneration committee membership or senior executive or

6

equivalent experience relating to remuneration, including incentive

programs.

Government Affairs

Experience in liaising with government and experience with public

8

and regulatory policy.

R&D/Product Development

Experience in research and development or product development

3

with a large biopharmaceutical, pharmaceutical or medical

organisation.

Manufacturing/Quality

Experience in manufacturing or quality operations with a large

3

biopharmaceutical, pharmaceutical or medical organisation.

Directors are expected to maintain the skills and knowledge required to discharge their duties and obligations. The Board is provided with Board papers, presentations, briefings, and information related to material developments in laws, regulations and industry frameworks that may affect the Mayne Pharma business. Directors are expected to undertake any necessary continuing professional education and training.

1.4 Independence of Directors

The Board recognises the important contribution that independent Directors make to good corporate governance. Each Director is required to bring unfettered and independent judgement.

The Board has reviewed the position and associations of each of the eight Directors in office at the date of this report and considers that seven of the Directors are independent. In considering whether a director is independent, the Board has regard to the independence criteria in ASX Principle 2 and other facts, information and circumstances that the Board considers relevant. The Board assesses the independence of new Directors upon appointment and reviews their independence, and the independence of other Directors, at least annually.

The Board considers that Mr Corbett, Mr Blake, Mr Condella, Mr Mathieson, Mr Robinson, Mr Scholes and Ms Dolan meet the independence criteria in ASX Principle 2 and have no material business or contractual relationship with the Company, other than as a Director.

In considering the independence of the Directors, the Board considered each Director's tenure and concluded that Mr Mathieson and Mr Scholes had not held office for such a period as to interfere with the exercise of independent judgement. In reaching this conclusion, the Board noted that no Director had formed associations with management that might compromise their ability to exercise independent judgement.

The Board also considered Mr Mathieson's substantial shareholding in Mayne Pharma of 6% and concluded that this holding did not impact his exercise of independent judgement. The value of Mr Mathieson's interest in Mayne Pharma shares is a small part of his personal wealth which can be demonstrated by the Mathieson families' 14.6% ownership interest in Endeavour Group Limited which paid dividends of $58m to this shareholder in FY201.

Mr Richards is employed in an executive capacity by the Company and so is not considered to be independent.

The Directors will continue to monitor the composition of the Board to ensure its structure remains appropriate and consistent with effective management and good governance.

  • As reported in Woolworths 2020 Annual Report

Mayne Pharma Corporate Governance Statement 2020

3

  1. Retirement and Re-Election of Existing Directors
    The Constitution of the Company requires one third of the Directors, other than Executive Directors, to retire from office at each Annual General Meeting. Directors who have been appointed by the Board during the year are required to retire from office at the next Annual General Meeting and are not taken into account in determining the number of Directors to retire at that Annual General Meeting. Directors cannot hold office for a period in excess of three years or later than the third Annual General Meeting following their appointment without submitting themselves for re-election. Retiring Directors are eligible for re-election by shareholders.
  2. Nomination and Appointment of New Directors
    Recommendations of candidates for new directors are made by the Nomination Committee for consideration by the Board as a whole. If it is necessary to appoint a new director to fill a vacancy on the Board or to complement the existing Board, a wide potential base of possible candidates is considered.
    In making recommendations to the Board regarding the appointment of Directors, the Nomination Committee periodically assesses the appropriate mix of skills, experience and expertise required by the Board and the extent to which the required skills and experience are represented on the Board. The committee also takes account of other factors such as diversity and cultural fit. The identification of a potential director may be assisted by the use of external search organisations and detailed background information in relation to the potential candidate is provided to all Directors prior to any decisions being made. Nominations for appointment are then approved by the Board as a whole.
    If a candidate is recommended by the Nomination Committee, the Board assesses that proposed new director against a range of criteria including background, experience, professional skills, personal qualities, the potential for the candidate's skills to augment the existing Board and the candidate's availability to commit to the Board's activities. If these criteria are met and the Board appoints the candidate as a Director, that Director must retire at the next Annual General Meeting of shareholders and will be eligible for election by shareholders at that General Meeting.
    New Directors are provided with a letter of appointment, setting out the terms of their appointment, including their powers, rights and obligations. An induction program is provided for new Directors to familiarise them with the business, history, culture, key risks, Board practises and procedures. This includes meetings with senior executives, site visits, provision of relevant corporate governance materials and policies and discussions with the Chair and other Directors.
  3. Board Meetings
    The Board meets formally at least ten times each year, and from time to time meetings are convened outside the scheduled dates to consider matters of importance. The Board met twelve times between 1 July 2019 and 30 June 2020.
    The Directors' attendance at Board meetings is detailed in the Annual Report.
    The agenda for meetings is prepared by the Company Secretary, in conjunction with the Chair, Chief Executive Officer, and periodic input from the Board. Comprehensive Board papers are distributed to Directors in advance of scheduled meetings. Board meetings typically take place at the Company's head office and manufacturing facility based in Salisbury, South Australia but also take place at the Company's commercial offices in Melbourne, Victoria and Raleigh, North Carolina, USA and at the operating facility in Greenville, North Carolina, USA.
    The Non-Executive Directors also meet regularly without management present.
  4. Performance Review
    The Board acknowledges the importance of regularly reviewing its own performance and effectiveness as well as the performance and effectiveness of its Committees and individual Directors.
    The Board conducts an annual assessment of its performance and effectiveness. The performance evaluation involves the Directors completing a questionnaire/survey and the Board then discussing the areas for improvement. The evaluation may establish goals and objectives for the Board and provide any recommendations for improvement to Board performance.
  5. Board Members' Rights to Independent Advice
    The Board has procedures to allow Directors, in the furtherance of their duties as directors or members of a Committee, to seek independent professional advice at the Company's expense, subject to the prior written approval of the Chair.

2. Board Committees

The Board has established the following committees to advise and support the Board in carrying out its duties:

  • Audit and Risk Committee;
  • Nomination Committee;
  • Remuneration and People Committee; and
  • Science, Technology and Medical Committee.

Directors' attendance at meetings of these committees is detailed in the Annual Report.

Mayne Pharma Corporate Governance Statement 2020

4

2.1 Audit and Risk Committee

It is the Board's responsibility to ensure that an effective internal control framework exists within the Company, including internal controls to deal with both the effectiveness and efficiency of significant business processes. Effective internal controls include the safeguarding of assets, the maintenance of proper accounting records, managing and mitigating business risks and the reliability of financial information.

The Board has established an Audit and Risk Committee to assist and advise the Board in fulfilling its responsibilities to oversee the Company's internal control framework, financial reporting obligations, risk management and adherence to legal and regulatory requirements. The Audit and Risk Committee operates under a Charter approved by the Board. The Charter was last reviewed and approved by the Board in June 2020.

The duties and responsibilities of the Audit and Risk Committee include:

  • ensuring appropriate accounting policies and procedures are defined, adopted and maintained;
  • ensuring that the operating and management reporting procedures, and the system of internal control, are of a sufficiently high standard to provide timely, accurate and relevant information as a sound basis for management of the Company's business;
  • reviewing the Financial Statements for accuracy and to ensure they reflect a true and fair view, prior to their presentation to the Board;
  • reviewing the scope of work including approval of annual audit plans and effectiveness of the external and internal audit (if any) functions within the Company;
  • where an Internal Audit function exists, appointing, on recommendation by the Chief Executive Officer or CFO, a person(s) responsible for Internal Audit functions as specified from time to time and, where an Internal Audit function exists, reviewing the scope and adequacy of the internal audit work plan and the independence, objectivity and performance of the Internal Audit function;
  • making recommendations to the Board of Directors on the appointment, reappointment or replacement of the external auditors (subject, if applicable, to shareholder ratification), and monitoring the effectiveness and independence of the external auditors;
  • reviewing and approving the terms of engagement and fees of external auditors;
  • reviewing and making recommendations to the Board of Directors on the rotation of the audit engagement partner and the scope and the adequacy of the external audit;
  • reviewing and assessing non-audit and assurance-related services to be provided by external auditors, and considering the potential for those services to compromise external auditors' judgement or the auditor independence requirements under the Corporations Act; and
  • obtaining an independence declaration from each external auditor, as required.

As and when required, the Audit and Risk Committee engages external consultants to review the Group's internal control environment, as the Company does not yet have an internal audit function. The Vice President, Governance Risk and Compliance (VP, GRC) role is responsible for leading the implementation of the Company's control framework, whereby each business unit and functional leader is required to formally consider its risk environment, document identified risks and risk treatment plans, and periodically report on the progress of ongoing risk mitigation through the implementation of those treatment plans.

The operation and responsibilities of the Audit and Risk Committee are consistent with ASX Principle 4 and ASX Principle 7. The Committee met six times during the financial year ended 30 June 2020.

The members of the Audit and Risk Committee at the date of this report were:

  • Mr I Scholes - Chair;
  • Mr P Blake; and
  • Ms N Dolan.

In addition to the members of the Committee, the CFO and the VP, GRC attend the Audit and Risk Committee meetings and representatives of the external auditors are invited to attend when appropriate.

2.2 Appointment of external auditors

The Audit and Risk Committee is responsible for making recommendations to the Board of Directors on the appointment, reappointment or replacement (subject, if applicable, to shareholder ratification) and the remuneration of the external auditors, and is responsible for monitoring of effectiveness and independence of the external auditors, including resolution of disagreements between management and the auditor regarding financial reporting.

The appointed external auditor is required to attend the Company's Annual General Meeting to answer any questions from shareholders in relation to the audit.

The Committee must approve all audit and non-audit services provided by the external auditors and must not engage the external auditors to perform any non-audit/assurance services that may impair or appear to impair the external auditor's judgement or independence in respect of the Company. The Committee may delegate the approval authority to a member of the Committee. The decisions of any Audit and Risk Committee member to whom the approval authority is delegated must be presented to the full Committee at its next scheduled meeting.

Mayne Pharma Corporate Governance Statement 2020

5

When reviewing the auditor's independence, the Committee will typically require the rotation of the audit partner at least once every five years, in accordance with the Corporations Act 2001. A new audit partner commenced for the 2019 financial year.

2.3 Nomination Committee

The Board has established a Nomination Committee to assist the Board in selecting candidates for the position of director. The members of the Nomination Committee at the date of this report were:

  • Mr R Corbett - Chair
  • Mr F Condella; and
  • Ms N Dolan.

The purpose of the Nomination Committee as set out in its Charter is to assist and advise the Board in fulfilling its responsibilities to shareholders on matters relating to the nomination and succession planning of the directors of Mayne Pharma.

The duties and responsibilities of the Nomination Committee include:

  • supporting and advising the Board in fulfilling its responsibilities to shareholders in ensuring that the Board is comprised of individuals who are best able to discharge the responsibilities of directors having regard to the law and standards of governance;
  • developing and reviewing a Board skills matrix setting out the skills, experience and expertise required on the Board, the extent to which these are represented on the Board and those that the Board is looking to achieve in is membership including any emerging or governance issues;
  • making recommendations to the Board on the necessary and desirable competencies of new directors to the Board;
  • reviewing and making recommendations to the Board regarding the structure, size and composition of the Board and the effectiveness of the Board as a whole;
  • establishing processes for the identification and recruitment of suitable candidates for appointment to the Board and for the re-election of directors;
  • developing director induction programs that are undertaken by new directors and assessing if professional development opportunities are needed to address emerging business and governance issues;
  • establishing processes for evaluating the performance of individual directors and the Board as a whole;
  • reviewing the policies in relation to retention and termination of the CEO and key leadership roles;
  • overseeing the succession plans and processes for the CEO and other key leadership roles and review the pool of internal candidates to fill these positions; and
  • developing succession plans for the Board.

The Charter was last reviewed and approved by the Board in June 2020. The operation and responsibilities of the Nomination Committee are consistent with ASX Principle 2.

The Committee met once during the financial year ended 30 June 2020.

2.4 Remuneration and People Committee

The Board has established a Remuneration and People Committee to assist the Board in ensuring that appropriate and effective remuneration and other people-related policies are in place that support the Company's strategy and objectives and to review these on behalf of the Board.

The members of the Remuneration Committee at the date of this report were:

  • Mr R Corbett - Chair;
  • Mr P Blake; and
  • Mr I Scholes.

The duties and responsibilities of the Remuneration and People Committee are set out in its Charter which was last reviewed and approved by the Board in June 2020. The key duties and responsibilities of the Committee include:

  • review and oversee the Company's key people and organisational culture strategies and their alignment with the overall strategy and vision;
  • review and endorse remuneration strategies and policies, at least every three years or more frequently if required;
  • recommend to the Board any changes in remuneration policy including superannuation, other benefits and remuneration structure for executives and which is likely to have a material impact on the Company;
  • consider and recommend to the Board the following on an annual basis remuneration policies and packages for the CEO and direct reports to the CEO;
  • review and recommend to the Board proposals for employee equity plans;
  • review and recommend to the Board proposals for short- and long-term incentive programs for executives;
  • review and recommend to the Board any changes to the remuneration framework for directors, including non- executive directors' fees;
  • ensure there is a proper performance management process in place throughout the organisation and that it is operating effectively;

Mayne Pharma Corporate Governance Statement 2020

6

  • be informed of current trends in executive remuneration and associated incentive initiatives and legislative issues associated with executive remuneration programs;
  • review talent management processes and strategy, ensuring alignment with overall People & Culture strategy and monitor operational effectiveness of talent management processes;
  • review the Company's policies in respect of diversity, including strategies or changes to address any gender pay gap;
  • review the Remuneration Report contained in the Company's Annual Report and make recommendations to the Board for approval; and
  • ensure compliance with ASX corporate governance practices and the Listing Rules, and other relevant regulations.

A brief discussion on the Company's remuneration policies in respect of Directors and executives is set out in the Annual Report. Detailed disclosure of the remuneration paid to the Company's Directors and executives is set out in the Remuneration Report, which forms part of the Annual Report.

The Committee met four times during the financial year ended 30 June 2020.

2.5 Science, Technology and Medical Committee

The Board has established a Science, Technology and Medical Committee to assist and advise the Board in overseeing the strategic direction and investment in research and development and other scientific initiatives of the Company.

The members of the Science, Technology and Medical Committee at the date of this report were:

  • Prof B Robinson - Chair;
  • Mr F Condella;
  • VP Research & Development;
  • Chief Medical Officer; and
  • EVP and General Counsel.

The Committee has the following responsibilities to assist the Board in its oversight of the Company's scientific and therapeutic strategies:

  • Reviewing any potential or new scientific and therapeutic initiatives by the Company that could have an impact on its overall growth, performance and/or competitive position;
  • Reviewing the scientific and therapeutic aspects of the Company's investments in technology through acquisition, in- licensing or other business development activities;
  • Reviewing scientific and therapeutic trends that could have a significant impact on the Company and more generally, the industry; and
  • Regularly reviewing ongoing R&D activity of the Group including tracking to goals, timelines and budget.

The Committee Charter was last approved by the Science, Technology and Medical Committee in June 2020.

The Committee met four times during the financial year ended 30 June 2020.

3. Risk Management and Financial Reporting

3.1 Risk Identification and Management

The Board accepts that taking and managing risk is central to building shareholder value and the Board is responsible for the Group's risk management strategy. Management is responsible for implementing the Board's strategy and for developing a control infrastructure designed to identify and mitigate risks across operations.

The Company employs executives with the requisite experience and qualifications to enable the Board to manage the risks to the Company. The Board has requested the Audit and Risk Committee oversee the Group's risk management processes and procedures.

The Group's identification and management of business risks is set out in a Risk Management Framework. The Framework is based on AS/NZS ISO 31000:2009 and provides a framework under which the Company can categorise the risks that are faced by the Group; the likelihood, consequence and potential impact if the risk were to eventuate, and the residual risk faced by the Group given the existence of appropriate controls.

The risks faced by the Company are diverse and vary significantly in terms of the likelihood of the event occurring and the consequence of such an event. Each specific risk is identified in the risk register and allocated to a member of the Corporate Executive Committee (CEC) and managed through day-to-day operations and compliance with appropriate, tailored standards and controls.

The risk register is updated by the CEC and reviewed by the Audit and Risk Committee. The Audit and Risk Committee last reviewed the risk register at its September 2018 meeting, and the Board last reviewed it at its October 2018 meeting. The VP, GRC aims to lead a complete refresh of the risk register every two years. As at the date of this report, the VP, GRC is in the process of leading a comprehensive review of the risk register which will be tabled with the Audit & Risk Committee and the Board over FY21. The VP, GRC and Management regularly report to the Audit and Risk Committee and the Board on material business risks and emerging risks, with periodic reporting as well as face to face discussions in Board meetings and

Mayne Pharma Corporate Governance Statement 2020

7

management presentations. A summary of the Risk Management Framework is disclosed on the Company's website in accordance with ASX Principle 7.

The VP, GRC works closely with the Audit and Risk Committee and the CEC to strengthen the Group's Risk Management Framework and processes.

Mayne Pharma strives to provide a dynamic, rewarding and safe place to work and is committed to acting consistently with the highest ethical standards and in strict compliance with the law in all its operations. To achieve this there are important standards and rules that all Directors, executives and other employees must be aware of and follow, that ensure all actions and decisions support the Company's values, vision and objectives. The Company's Business Code of Conduct covers a broad range of matters and refers to those practices necessary to maintain confidence in the Company's integrity. See further discussion below in the Conduct and Ethics section.

3.2 Integrity in Financial Reporting and other periodic corporate reports

Consistent with ASX Principle 4.2, the Company's financial report preparation and approval process for the financial year ended 30 June 2020 involved both the Chief Executive Officer and the CFO providing detailed representations to the Board covering:

  • compliance with the Company's accounting policies and relevant accounting standards;
  • the accuracy of the financial statements and that they provide a true and fair view;
  • integrity and objectivity of the financial statements; and
  • the effectiveness of the system of internal control.

The Board has received a declaration from the Chief Executive Officer and the CFO that, in their opinion, the financial records of the Company 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 Company 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 Full Year Financial Statements, Remuneration Report and Half Year Financial Statements are audited by the Company's auditor Ernst & Young each year.

  1. Whistleblower Protection Policy
    Mayne Pharma has a Misconduct and Whistleblower policy that provides a framework for employees and others to raise concerns about misconduct or activities that do not comply with the Company's policies and provides detail on the Company's commitment to treat people with respect when they speak out if faced with an integrity or other ethical concern. Employees are encouraged to make reports as early as possible, and can raise matters of concern with their supervisors, the Company's human resources, compliance or legal teams or by making an anonymous report through the Company's whistleblower hotline, which is administered by an independent third party. Details of investigations are reported to the Audit & Risk Committee.
    Employees are trained on this policy and reminded of the independent whistleblower hotline annually. Periodic surveys are conducted to assess and strengthen awareness of the Policy. A copy of the Misconduct and Whistleblower Policy can be accessed on the corporate governance section of the Company's website. It was last reviewed September 2020.
  2. Anti-Corruptionand Anti-Bribery
    The Company's Business Code of Conduct and Anti-Bribery and Anti-Corruption Policy outline Mayne Pharma's zero tolerance policy towards bribery and corruption. The Company has a robust training program to give our employees the awareness and knowledge to comply with applicable laws and regulations and to reinforce that the Company will not tolerate any act of impropriety. Our activities must comply not only with Company policies but with applicable laws in all countries in which we do business. A copy of the Anti-Corruption and Anti-Bribery Policy can be accessed on the corporate governance section of the Company's website. It was last reviewed August 2019.
    Our policy prohibits the offer, promise or giving of any payment or benefit at any time to an individual or entity for the purpose of improperly influencing decisions or actions with respect to our business. This applies to direct engagements (e.g., those driven by our Company) as well as to indirect engagements (e.g., those managed through a third-party intermediary or partner). We conduct Anti-Bribery /Anti-Corruption training with relevant employees who engage with third parties including government officials. Our agreements with third party distributors who market and sell our products contain obligations requiring the distributors to comply with all relevant Anti-Bribery /Anti-Corruption laws and regulations.
    Details of any material breaches of this policy are reported to the Audit & Risk Committee.
  3. Anti-CompetitiveBehaviour
    Mayne Pharma's compliance program ensures employees are aware of and have the relevant knowledge to comply with anti-trust laws and regulations (sometimes referred to as competition law). Anti-trust laws differ across different jurisdictions so training and other elements of the program are tailored as required to ensure that employees are aware of the laws and regulations that affect them.
    The Business Code of Conduct outlines general principles to safeguard against violations of anti-trust/competition law. These principles are expanded in a Global Anti-Trust and Competition Policy and in training programs provided to those employees

Mayne Pharma Corporate Governance Statement 2020

8

who interact with external parties and are therefore at risk of engaging in or witnessing anti-competitive conduct. Training is conducted in small groups on a regular basis, with examples provided to explain how the laws and regulations may affect each person's day-to-day work and when an issue may arise so they are able to respond appropriately.

Mayne Pharma has significantly strengthened its anti-trust compliance program over the last three years and continues to enhance its policy and supporting procedures around anti-trust compliance and its pricing function.

  1. Communication with shareholders
    1. Securities Trading by Directors and Employees
      The Board last amended and approved the Company's Securities Trading Policy in May 2018. The policy summarises the law relating to insider trading and sets out the policy of the Company that applies to Directors, officers and employees dealing in securities of the Company.
      The policy is reviewed regularly and a copy of the Securities Trading Policy can be accessed on the corporate governance section of the Company's website. This policy is provided to all Directors and employees and compliance with it is reviewed on an ongoing basis in accordance with the Company's risk management systems.
    2. Continuous Disclosure
      The Company has established policies and procedures in order to comply with its continuous and periodic disclosure requirements under the Corporations Act 2001 and the ASX Listing Rules. The Board has adopted a formal Continuous Disclosure Policy, which is available from the corporate governance section of the Company's website. The Continuous Disclosure Policy was last reviewed by the Board in July 2015.
      The Company Secretary has primary responsibility for the disclosure of material information to ASIC and ASX and maintains a procedural methodology for disclosure, as well as for record keeping. All material market announcements are provided to the Board promptly after they have been made.
      The Company's Continuous Disclosure Policy requires all employees and Directors to notify the Chief Executive Officer or the Company Secretary of any potentially material information or proposal as soon as practicable after the person becomes aware of that information. The CEO and the Company Secretary will keep the full Board informed of all relevant matters. The Policy also sets out what renders information material.
      The Board reviews the Company's compliance with this policy on an ongoing basis and will update it from time to time, if necessary.
    3. Shareholder Communications
      The Board recognises that shareholders and prospective new investors are entitled to receive timely and relevant high-quality information about the Company. Mayne Pharma has an investor relations program to facilitate two-way communication with investors.
      The Board's formal policy on communicating with shareholders, its Communications Policy, is available from the corporate governance section of the Company's website and supplements the Company's Continuous Disclosure Policy. The Board reviews this policy and compliance with it on an ongoing basis. The policy was last reviewed in July 2015.
      The aim of the Communications Policy is to make known the Company's methods for disclosure to shareholders and the general public. The Policy details the steps between disclosure to ASIC and ASX and communication to shareholders, with the Company's website playing an important role in the Company's communications strategy. It also sets out the methods of shareholder engagement including ASX releases, annual report and the annual general meetings to encourage shareholders and other interested parties to ask questions, meet key management and Board members and vote on key Board actions.
      The Company recognises the importance of shareholder participation in general meetings and encourages that participation. Shareholders are able to register their voting instructions electronically and voting on any substantial resolutions at an AGM is conducted by poll.
      The Company holds briefings with investors and analysts throughout the year around financial results and other significant announcements. The Company will lodge all presentation materials with the ASX prior to the presentation commencing if it contains new material information.
  2. Acting ethically and responsibly

Mayne Pharma is committed to operating its business in a sustainable manner that ensures its people are safe and well supported, local communities prosper, and the environment is well cared for so that it benefits future generations. The pharmaceutical industry is responsible for improving living standards around the world and enabling people to live longer and healthier lives. Mayne Pharma's key focus is to bring better medicines to market enabling patients to better manager diseases and their health.

Mayne Pharma Corporate Governance Statement 2020

9

Mayne Pharma is committed to providing a work environment that allows people to feel respected, appreciated and included. By living our Values, Mayne Pharma provides a framework to guide how we treat each other, our customers and our partners. Our Values are:

  • Integrity - maintaining high ethical standards, demonstrating honesty, and respecting fairness by doing the right thing, even when no one is looking.
  • Empowerment - encouraging everyone to take initiative, enabling growth and achievement.
  • Passion - showing pride, enthusiasm and dedication in everything we do.
  • Creativity - delivering value and striving to connect new ideas with business realities.
  • Agility - operating with timeliness as well as mental, emotional and physical flexibility.
  • Accountability - accepting our individual and team responsibilities, meeting our commitments, and acknowledging and learning from mistakes.

5.1 Conduct and Ethics

The Company's Business Code of Conduct was reviewed by the Board and last updated in September 2020. A copy of the Business Code of Conduct can be accessed on the corporate governance section of the Company's website. The Business Code of Conduct covers a broad range of matters and refers to those practices necessary to maintain confidence in the Company's integrity, including procedures in relation to:

  • compliance with the law;
  • business and financial records;
  • occupational health and safety;
  • conduct within and outside the workplace;
  • confidentiality and use of information;
  • conflict of interest;
  • equal opportunity;
  • whistle-blowing;
  • dealings with third parties;
  • data protection and privacy; and
  • bribery and corruption.

The Code applies to Directors, executives and other employees, and directs individuals to report any contraventions of the Business Code of Conduct to their supervisors, the Company's human resources, compliance or legal teams or by making an anonymous report through the Company's whistleblower hotline, which is administered by an independent third party. The Company also expects contractors, vendors and any other parties directly representing Mayne Pharma to comply with the Business Code of Conduct.

The Audit and Risk Committee is informed of any material breaches of the Code of Conduct.

6. Diversity and Inclusion

The Board recognises that a diverse and inclusive workforce is not only good for our employees but also good for business performance. Diversity enables the Group to attract and retain talented people, create more innovative solutions and be more flexible and responsive to our customers' and shareholders' needs. The Board has developed a diversity policy which was last approved and reviewed in September 2020. A copy of the diversity policy can be accessed on the corporate governance section of the Company's website.

Mayne Pharma supports employees to achieve an appropriate work-life balance, promotes and rewards employees based on skills, experience and merit and promotes a workplace is free from discrimination and harassment.

This Company's approach to diversity includes a framework that helps the Company achieve the following:

  • access to the broadest and most diverse pool of qualified talent;
  • a welcoming workforce culture that embraces diversity at all levels;
  • use of recruitment practices that support a fair and equitable selection process at all levels where candidates are assessed on the basis of skills and capabilities;
  • endeavour to ensure there is no discrimination in hiring, compensation, access to training, promotion, termination or retirement based on race, caste, national origin, religion, age, disability, gender, marital status, sexual orientation, union membership or political affiliation;
  • improved employee motivation and engagement;
  • enhanced teamwork and innovative solutions; and
  • Set diversity related measurable objectives for the Company and review progress annually.

Mayne Pharma Corporate Governance Statement 2020

10

Below is a summary of the gender composition of the organisation as at 30 June 2020:

Board

Senior Executive1

12%

28%

88%

72%

Female

Male

Female

Male

Management

Employees

36%

44%

64%

56%

Female

Male

Female

Male

1. Senior executive captures all senior leadership (President, Chief, Executive Vice President, Vice President, 'Head of' and Director level). Management captures all employees with one or more direct reports and includes senior executives.

44% of the workforce and 36% of all management positions were held by females. At the most senior leadership level 28% were female.

The Group's approach to diversity is underpinned by practical objectives to ensure that all of its employees have equal opportunity to demonstrate their talents, commitment and results. The Company will measure its progress against these objectives and report to the Board annually.

The Company will support employees to achieve an appropriate work-life balance, promote and reward employees based on skills, experience and merit as well as ensure the workplace is free from discrimination and harassment.

The Board has a diversity target of 30% of its directors of each gender and expects to progressively improve over time towards this objective. When considering new Directors, the Board is committed to ensuring there is a balance of skills, diversity and experience in candidate selection.

Mayne Pharma Corporate Governance Statement 2020

11

6.1 Diversity and inclusion

The following is a summary of progress against Mayne Pharma's measurable objectives for FY20, as approved by the Board.

OBJECTIVES

MEASUREMENT

FY20 PERFORMANCE

Equal opportunity employer

Our recruitment practices are fair and equitable at all stages and candidates are assessed on the basis of their skills and capabilities for the position and cultural fit with the business

We endeavour for:

  1. all selection processes and decisionsto include both male and female representatives, and
  2. at least 1 female and 1 male will beinvited to participate in the interview process, where appropriately skilled candidates have applied

Our Recruitment & Selection policy reflect these practices.

  1. We ensure representation of males and females in the recruitment process. The selection process generally involves 2 stages of interviews with between three and four leaders making up the selection panel.
  2. For the vast majority of roles both male and female suitably skilled candidates have applied and been shortlisted for consideration. In addition to interviewing, a variety of checks and assessments are undertaken to ensure the right skillset and capability is identified.

Equal gender participation

We endeavour for equal participation,

At a Group level non-management positions

We seek to maintain diverse

allowing for a 10% variance either way.

consist of 54% males and 46% females. 64% of

participation at all levels

We will therefore seek to maintain a

management positions are held by males,

balance of at least 40% females and 40%

leaving 36% held by females. This distribution

males, in both management and non-

of male and female leaders is unchanged from

management positions

FY19.

Equal

opportunity

for

We endeavour for equal development

Throughout FY20 we have undertaken a

development

opportunities, allowing for a 10%

number of leadership programs internally, in

High

potential

employees

variance either way.

addition to supporting external development

have

equal

opportunity

to

We will therefore seek to maintain a

opportunities, for both existing and potential

development

programs

to

balance of at least 40% females and 40%

future leaders.

build a diverse pipeline of

males, for participation in leadership or

talent

for

succession

opportunities

future leadership development program

opportunities

Equal gender remuneration

Employees will be paid appropriate remuneration, based on their level of experience, achievements and competencies for their role

Undertake an annual pay equity analysis for employees in the same roles, and if any issues are identified, resolutions areto put in place

The most recent pay equity analysis was conducted in July 2019.

In line with previous analysis that have been undertaken, no issues were identified that required resolutions to be put in place.

The Company is also required to comply with the requirements of the Workplace Gender Equality Act 2012. In June 2020 the Company lodged its annual compliance report which can be accessed on the corporate governance section of the Company's website.

In the US, the Company has an Affirmative Action Plan. One aspect of this plan is to assess opportunities for social inclusion of minorities and protected groups (e.g. veterans, people with disabilities, etc) against market availability. Goals have been developed to attract qualified applicants in identified under-employed groups.

Mayne Pharma Corporate Governance Statement 2020

12

Disclaimer

Mayne Pharma Group Limited published this content on 08 October 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 08 October 2020 07:44:09 UTC


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