Mandate of the Board of Directors
The Board of Directors (the “Board”) of Northern Sun Mining Corp. (the “Corporation”) is responsible for the supervision of the management of the business and affairs of the Corporation. The Board will carry out the procedures, responsibilities and duties set out below, either directly or through its committees, currently consisting of the Audit Committee; the Compensation Committee and the Compliance Committee.
1. The Board should consist of persons who possess skills and competencies in areas that are relevant to the Corporation’s activities. A majority of the directors will be “independent” directors within the meaning of applicable securities law and listing requirements.
2. The directors of the Corporation will be elected by the Corporation’s shareholders at the annual meeting of shareholders for a term of one year.
3. The Board will have at least four regularly scheduled meetings per year.
4. The Chairman, the Chief Executive Officer (“CEO”) and the Lead Director, if one, will be responsible for the Board’s agenda. Prior to each Board meeting, the Chairman and the CEO will discuss agenda items for the meeting with the Lead Director, if one. Materials for each meeting will be distributed to directors in advance of the meetings.
5. Directors are expected to attend at least three quarters of all meetings of the Board held in a given year and to adequately review meeting materials in advance of all such meetings.
6. The independent directors shall hold in camera sessions without management and non-independent directors present at each meeting. The Lead Director, if one, will chair meetings of the independent directors.
7. The Board may appoint such committees from time to time as it considers appropriate. Each permanent committee will have a mandate that will be approved by the Board setting out the committee’s responsibilities and the extent of the powers delegated to it.
Oversight of Management and the Board
8. The Board is responsible for the appointment and replacement of senior officers. The Board will ensure that appropriate succession planning, including the appointment, training and monitoring of senior management and members of the Board, is in place.
9. The Board is responsible for satisfying itself as to the integrity of the CEO and other senior officers and that the CEO and other senior officers create a culture of integrity throughout the Corporation.
10. The Board will annually consider what additional skills and competencies would be helpful to the Board, with the Corporate Governance and Nominating Committee being responsible for identifying specific candidates for consideration for appointment to the Board.
11. Through the Compensation Committee, the Board will review the compensation of directors to ensure that the compensation realistically reflects the responsibilities and risks involved in being an effective director and will review the compensation of members of the senior management team to ensure that it is competitive within the industry and that the form of compensation aligns the interests of each senior management member with those of the Corporation.
12. The Board is responsible for reviewing the financial and underlying operational performance of the Corporation.
13. The Board will review and approve annual financial statements, management’s discussion and analysis related to such annual financial statements, budgets and forecasts, and the Corporation’s annual information form, management information circular and annual report.
14. The Board, primarily through the Audit Committee, will monitor and ensure the integrity of the internal controls and procedures (including adequate management information systems) within the Corporation and the financial reporting procedures of the Corporation.
15. The Board is responsible for establishing and reviewing from time to time a dividend policy for the Corporation.
16. The Board has primary responsibility for the adoption of the strategic direction of the Corporation. The Board will contribute to the development of strategic direction by approving, at least annually, a strategic plan and budget developed and proposed by management. The plan and budget will take into account the business opportunities and business risks of the Corporation. The Board will review with management from time to time the strategic planning environment, the emergence of new opportunities, trends and risks and the implications of these developments for the strategic direction of the Corporation. The Board will review and approve the Corporation’s financial objectives, plans and actions, including significant capital allocations and expenditures.
17. The Board is responsible for ensuring that the principal business risks of the Corporation are managed appropriately.
18. The Board will monitor corporate performance against the strategic and business plan and budget, including assessing operating results to evaluate whether the business is being properly managed.
19. The Board is responsible for reviewing and approving material transactions not in the ordinary course of business presented to the Board.
Communications and Reporting to Shareholders
20. The Board is responsible for overseeing the Corporation’s continuous disclosure program with a view to satisfying itself that procedures are in place to ensure that material information is disclosed in a timely fashion.
21. The Board will ensure that the Corporation has a disclosure policy that includes a framework for investor relations and public disclosure in place.
22. The Corporate Governance and Nominating Committee will establish the Board’s approach to corporate governance principles.
23. The Board is responsible for assessing its own effectiveness in fulfilling this mandate and shall assess its mandate as well as the mandate of each of its committees from time to time and at least annually.
24. The Board is responsible for evaluating the relevant relationships of each independent director and shall make an affirmative determination that such relationship does not preclude a determination that each such director is independent.
25. The Board is responsible for ensuring appropriate standards of corporate conduct including adopting a corporate code of conduct for all employees and senior management, and ensuring that a system is in place to monitor compliance with such code. Only the full Board may grant waivers of the code of conduct which would be to the benefit of directors and/or senior officers.
26. The Board is responsible for performing such other functions as prescribed by law.
27. The Board may at any time retain outside financial, legal or other advisors at the expense of the Corporation. Any director may, subject to the approval of the Corporate Governance and Nominating Committee, retain an outside advisor at the expense of the Corporation.
28. The Chairman will provide leadership to directors in discharging their duties as set out in this mandate, including by:
(a) leading, managing and organizing the Board consistent with the approach to corporate governance adopted by the Board from time to time;
(b) promoting cohesiveness among the directors;
(c) being satisfied, together with the Lead Director, if one, that the responsibilities of the Board and its committees are well understood by the directors;
(d) satisfying itself as to the integrity of the senior officers of the Corporation and ensuring that such senior officers create a culture of integrity throughout the organization;
(e) together with the Lead Director, if one, and the Chair of the Corporate Governance and Nominating Committee, reviewing the committees of the Board, the Chairs of such committees and the mandates of such committees; and
(f) together with the Lead Director and the Chair of the Corporate Governance and Nominating Committee, ensuring that the Board, committees of the Board, individual directors and senior management of the Corporation understand and discharge their duties under the approach to corporate governance adopted by the Board from time to time.
29. In connection with meetings of the directors, the Chairman shall be responsible for the following (in consultation with the Lead Director, if one, and the Chair of the Corporate Governance and Nominating Committee, as appropriate):
(a) scheduling meetings of the directors;
(b) coordinating with the Chairs of the committees of the Board to schedule meetings of the committees;
(c) reviewing with the Lead Director, if one, items of importance for consideration by the Board;
(d) together with the Lead Director, if one, ensuring that all business required to come before the Board is brought before the Board, such that the Board is able to carry out its duties;
(e) setting the agenda for meetings of the Board;
(f) monitoring the adequacy of materials provided to the directors by management in connection with the directors’ deliberations;
(g) ensuring that the directors have sufficient time to review the materials provided to them and to fully discuss the business that comes before the Board;
(h) presiding over meetings of the directors; and
(i) encouraging free and open discussion at meetings of the Board.
30. The Board will appoint a Lead Director in circumstances in which the Chairman of the Board is not considered independent under applicable securities laws, in order to provide independent leadership to the Board and for the other purposes set forth below.
31. The Corporate Governance and Nominating Committee will recommend a candidate for the position of Lead Director from among the independent members of the Board. The Board will be responsible for approving and appointing the Lead Director.
32. The Lead Director will hold office at the pleasure of the Board, until a successor has been duly elected or appointed or until the Lead Director resigns or is otherwise removed from the office by the Board.
33. The Lead Director will provide independent leadership to the Board and will facilitate the functioning of the Board independently of the Corporation’s management. Together with the Chair of the Corporate Governance and Nominating Committee, the Lead Director will be responsible for the corporate governance practices of the Corporation.
34. The Lead Director will:
(a) In conjunction with the Chair of the Corporate Governance and Nominating Committee, provide leadership to ensure that the Board functions independently of management of the Corporation;
(b) In the absence of the Chairman, act as chair of meetings of the Board;
(c) Recommend, where necessary, the holding of special meetings of the Board;
(d) Review with the Chairman and the CEO items of importance for consideration by the Board;
(e) Consult and meet with any or all of the Corporation’s independent directors, at the discretion of either party and with or without the attendance of the Chairman, and represent such directors in discussions with management of the Corporation concerning corporate governance issues and other matters;
(f) Together with the Chairman, ensure that all business required to come before the Board is brought before the Board, such that the Board is able to carry out all of its duties to supervise the management of the business and affairs of the Corporation;
(g) Together with the Chairman and the Chair of the Corporate Governance and Nominating Committee, ensure that the Board, committees of the Board, individual directors and senior management of the Corporation understand and discharge their duties and obligations under the approach to corporate governance adopted by the Board from time to time;
(h) Mentor and counsel new members of the Board to assist them in becoming active and effective directors;
(i) Facilitate the process of conducting director evaluations;
(j) Promote best practices and high standards of corporate governance; and
(k) Perform such other duties and responsibilities as may be delegated to the Lead Director by the Board from time to time.
35. The Board welcomes input and comments from shareholders of the Corporation relating to this mandate. Such input and comments may be sent to the Board at the Corporation’s address.