34 DIRECTORS’ REPORT Principles used to determine the nature and amount of remuneration Remuneration philosophy Remuneration for Directors and Senior Executives is based on the overall objective of attracting and retaining people of high quality who will make a worthwhile contribution to the consolidated entity in the short, medium and long term, and thereby contribute to long term shareholder value. The Board and its Remuneration and Nomination Committee take a balanced position between the need to pay market rates to attract talent, and the financial resources of the consolidated entity, in determining remuneration. Non-Executive Directors remuneration The Constitution of the consolidated entity and the ASX listing rules specify that the aggregate remuneration of NonExecutive Directors shall be determined from time to time by General Meeting. The last determination for the consolidated entity was at the Annual General Meeting held on 16 November 2022 when the shareholders approved the new constitution with an aggregate remuneration of $560,000. Non-Executive Directors’ fees are reviewed periodically by the Board and are regularly compared with those of companies of comparable market capitalisation and stage of development. The Chairman’s fees are determined independently to the fees of other non-executive Directors based on comparative roles in the external market. The Chairman’s fees increased to GBP12,000 per month for April, May and June 2023 to recognise the additional time the Chair spent securing the support of, and funds from major investors in the January 2023 fundraising through his personal and direct relationships; leading all discussions and negotiations with the current Chief Executive Officer and the incoming Chief Executive Officer about the position of Chief Executive Officer; and assisting the incoming Chief Executive Officer during the next short term period to secure additional funding for the business and to participate in 3rd party discussions as necessary. In the event that a director’s appointment ceases other than for reasons (a) - (c) (a) if a director becomes disqualified from managing a corporation under the Corporations Act; (b) if a director is removed in accordance with section 203D of the Corporations Act; and (c) if, pursuant to the terms of the Constitution and the Listing Rules, a director is not re-elected to the Board after mandatory retirement and in particular, directly as a result of a corporate re-structuring or acquisition of the Company; and having carried out all duties required to facilitate such a transaction the non-executive directors will be entitled to a termination payment equivalent to 3 months fees and in the case of the Non- Executive Chairman 6 months fees. The consolidated entity issued 7,930,000 share options under the ESOP during the financial year ended 30 June 2023, of which 6,000,000 were issued to KMP. Executive Directors and other KMP The Board and the Remuneration and Nomination Committee, in consultation with the Managing Director, have put in place a remuneration structure which provides incentive for employees to drive the activities of the Company forward. These arrangements are reviewed annually at the end of the calendar year. The Board determines an appropriate level of fixed remuneration for the CEO and Group Executives, as well as the proportion of performance based remuneration. The executive remuneration and reward framework has three components: • fixed remuneration • short-term performance incentives - cash bonus • share-based payments - award of options through the ESOP Fixed remuneration is reviewed annually by the Remuneration and Nomination Committee based on individual performance, the overall performance of the consolidated entity and comparable market remunerations. The Remuneration and Nomination Committee approved increases in fixed remuneration during the financial year ended 30 June 2023. The short-term incentives program is designed to align the targets of the consolidated entity with the performance hurdles of executives. Short-term incentive payments are granted to executives based on specific annual performance objectives, metrics and performance appraisals. Annual performance reviews are conducted at the end of each calendar year and bonuses are paid shortly after the performance reviews are completed. Annual performance objectives cover matters such as progress in clinical trials and management of the Company’s financial resources. The Board or the Remuneration and Nomination Committee may, at its discretion, award bonuses for exceptional performance. The long-term incentive comprises equity-based payments. The consolidated entity aims to attract and retain high calibre executives, and align their interests with those of the shareholders, by granting equity-based payments which are issued at the share price on date of issue and vest in tranches based on tenure. The share-options issued to executives are governed by the ESOP. Employee share option plan The Employee Share Option Plan (‘ESOP’) was most recently approved by shareholders on 10 November 2021. The ESOP provides for the issue of options to eligible individuals, being employees, Non-executive directors and Officers of the consolidated entity.
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