ANNUAL REPORT - Ashburton Minerals

Directors’ Report
Remuneration Report
This report details the nature and amount of remuneration for
each Director of Ashburton Minerals Ltd.
Remuneration Policy
The remuneration policy of Ashburton Minerals Ltd has
been designed to align director and executive objectives
with shareholder and business objectives by providing a
fixed remuneration component and offering specific longterm
incentives based on key performance areas affecting
the Economic Entity’s financial results. The Board of
Ashburton Minerals Ltd believes the remuneration policy to
be appropriate and effective in its ability to attract and retain
appropriate executives and directors to run and manage the
Economic Entity, as well as create goal congruence between
directors, executives and shareholders.
The Board’s policy for determining the nature and amount of
remuneration for board members and senior executives of the
Company is as follows:
The remuneration policy, setting the terms and conditions
for the executive directors and other senior executives,
was developed and approved by the board.
Non-executive directors, executive directors and senior
executives receive a base salary (which is based on
factors such as length of service and experience), which
is calculated on a total cost basis and includes any
FBT charges related to employee benefits including
motor vehicles, as well as employer contributions to
superannuation funds.
Executive directors can be employed by the Company
on a consultancy basis, on board approval, with
remuneration and terms stipulated in individual
consultancy agreements.
The board reviews executive packages annually by
reference to the Company’s performance, executive
performance and comparable information from industry
sectors and other listed companies in similar industries.
In addition external consultants may be used to provide
analysis and advice to ensure the directors and senior
executives’ remuneration is competitive in the market
place.
Directors and senior executives receive a superannuation
guarantee contribution required by the government,
which is currently 9%, and do not receive any other
retirement benefits. Some individuals, however, may
choose to sacrifice part of their salary to increase
payments towards superannuation.
All remuneration paid to directors and executives is
valued at the cost to the Company and expensed.
Shares given to directors and executives are valued
as the difference between the market price of those
shares and the amount paid by the director or executive.
Options are valued using the Black-Scholes methodology.
The board policy is to remunerate non-executive directors
at market rates for comparable companies for time,
commitment and responsibilities. The Board determines
payments to the non-executive directors and reviews their
remuneration annually, based on market practice, duties
and accountability. Independent external advice is sought
when required. The maximum aggregate amount of fees
that can be paid to non-executive directors is subject to
approval by shareholders at the Annual General Meeting.
Fees for non-executive directors are not linked to the
performance of the Economic Entity. The Directors are
not required to hold any shares in the Company under the
Constitution of the Company, however, to align directors’
interests with shareholder interests, the directors are
encouraged to hold shares in the Company.
The Board believes that it has implemented suitable practices
and procedures that are appropriate for an organisation of
this type and size.
Remuneration Committee
During the year ended 30 June 2007, the Economic Entity did
not have a separately established nomination or remuneration
committee. Considering the size of the Economic Entity
and the number of directors, the Board is of the view that
these functions could be efficiently performed with full Board
participation.
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Ashburton Minerals Ltd 2007