The Company’s Constitution requires that the minimum number of Directors is three and the maximum is 10. The Company has two major shareholders, Australian Pipeline Ltd (APA Group) and Cheung Kong Infrastructure Holdings (Malaysian) Ltd (CKI).

Under Envestra’s Constitution, while CKI holds more than 15% of Envestra’s securities, they may appoint up to two non-executive Directors.

If their holding is between 10 and 15%, they may appoint one Director.

The APA Group and CKI Directors are not regarded as being independent under the ASX Corporate Governance Guildelines, as both organisations each hold 32.7% and 19.2% (as at 22 November 2011) respectively of the Company’s issued capital.  In addition, APA Group has a significant contractual relationship with Envestra under the Operating and Management Agreements related to the Company’s assets.

The existence of a shareholder with more than a 30% holding in the Company mitigates the non-independent status of CKI.

Membership of the Board comprises:

•     Three independent non-executive Directors.
•     Two non-executive Directors nominated by APA Group.
•     Two non-executive Directors appointed by CKI.
•     The Managing Director.

The Company's Constitution requires that the Chairman must be an independent Director.

To comply with the ASX guidelines on independent Directors, it would be necessary to appoint two additional Directors, which would require an amendment to the Constitution.  However, given the balance between the existing major shareholders’ representatives on the Board, and the independent Directors, the existing Board structure is considered appropriate, particularly as under the Constitution the Chairman has a casting vote in the event of an equality of votes.

Directors are subject to retirement by rotation and election by shareholders at a general meeting.

No Director may remain on the Board for more than three years without re-election. Where a Director is appointed during the year, that Director will hold office until the next Annual General Meeting and then be eligible for re-election.

When considering Board vacancies, Directors take into account the candidate’s capacity to enhance the mix of skills and experience of the Board and to contribute to the development of the Company. When a vacancy exists, the Board identifies candidates with the relevant experience and expertise, using external consultants when required.

The current Board has a broad range of expertise covering financial, legal, banking, commercial and operational backgrounds, with all members bringing the benefits of experience from other Boards and industries.