CALTEX AUSTRALIA LIMITED

ACN 004 201 307

BOARD GOVERNANCE POLICY

Introduction

The Board is committed to conducting the business and operations of Caltex Australia Limited and its group
companies (Caltex) in line with high standards of corporate governance and in the best interests of Caltex
shareholders.

This Policy contains the Boards approach to its governance arrangements.

Board Composition

The Board has adopted a set of desired capabilities which the Nomination Committee uses when it considers
candidates for appointment to the Board. These capabilities include general corporate, commercial, industry-
specific and personal attributes.

The Caltex Board reviews its composition annually, taking into account the number of independent directors
and the mix of skills, experience, expertise and diversity on the Board.

The Boards current composition reflects its policy that a majority of its directors, including the Chairman, are
independent, and that all members of the Audit Committee and a majority of members of the Human
Resources Committee, Nomination Committee and OHS & Environmental Risk Committee are independent.

Appointment

The process for the selection and appointment of an independent, non-executive director typically involves
the following steps.

The Nomination Committee reviews the Boards composition against the desired capabilities of the
Board, considers Caltexs current and potential future circumstances, and develops documented
criteria for the selection of a new director.
The Nomination Committee engages an independent executive recruitment organisation to conduct a
search for potential candidates based on a brief outlining the selection criteria. The recruitment
organisation is requested to provide a list of candidates for consideration by the Nomination
Committee. Directors may suggest possible candidates as part of this process.
The Nomination Committee selects a short list of potential candidates and members of the Nomination
Committee interview one or more of the short-listed candidates. The Nomination Committee regularly
provides updates to the Board about the progress of the recruitment process.
The Nomination Committee agrees on the preferred candidate(s) and arranges meetings with
directors.
The Nomination Committee arranges to undertake appropriate background checks (including checks
relating to the candidates character, experience, education, criminal record and bankruptcy history)
and reports to the Board on the results of the checks.
The Board appoints its preferred candidate as a director (as a casual vacancy or an addition to the
Board).

Following appointment, each director receives a letter of appointment articulating the role and duties of
directors, including the Boards expectations relating to independence, participation and time commitment.
The letter of appointment is periodically reviewed by the Nomination Committee to ensure that it
appropriately reflects directors evolving roles.

Induction

All new directors take part in an induction program to familiarise them with Caltexs business and operations
and develop their understanding of Caltexs strategy, performance, risks, governance and external
environment.
The induction program is tailored for each directors experience and circumstances, and includes briefings
with other Board members and senior executives, site visits and external training as appropriate. New
directors also receive an information pack containing key business and governance materials.

The Nomination Committee periodically reviews the induction program to ensure that it appropriately reflects
directors evolving roles, changes to Caltexs business, operations and operating environment.

Election and Re-election

A director who is appointed as an addition to the Board or to fill a casual vacancy holds office until the end of
the annual general meeting immediately following the directors appointment, and is eligible for election by
shareholders at the meeting.

Existing directors must also retire in accordance with the Constitution and may submit themselves for re-
election at the next relevant meeting.

If elected or re-elected by shareholders, a director holds office for three years or until the third annual
general meeting following the directors last election (whichever is longer).

Before each annual general meeting, the Board decides whether to support a director standing for election or
re-election. Board support for a directors election or re-election is not automatic and is determined having
regard to advice provided by the Nomination Committee.

The Nomination Committee considers various matters when forming its recommendation to the Board about
the election or re-election of a director, including the:

directors performance;
desired composition of the Board, including its size, diversity and desired capabilities; and
directors external commitments.

The Boards recommendation is included in the notice of meeting sent to shareholders, together with
biographical information about the director standing for election or re-election.

Tenure

The Board has adopted the following guiding principles relating to the tenure of non-executive directors.

A director should serve a maximum of three terms of three years from the date of first election by
shareholders, so that the director serves no more than 10 years from the date of first appointment by
the Board.
The Board may, at its discretion, request a director to continue to serve on the Board beyond this 10
year period.
If the Board requests a director to continue to serve on the Board beyond the 10 year period, the
director must submit himself/herself for re-election at the next annual general meeting and the Board
will give consideration to, and may increase, the frequency of the meetings at which the director will be
required to stand for re-election.
The Board will regularly assess the independence of each director who continues to serve on the
Board beyond a period of 10 years.

Review of Policy

The Board will review this Policy at least every two years.

Publication

This Policy will be made available on the Caltex website (www.caltex.com.au).

Approved: 6 May 2015

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