Remuneration report

The remuneration report is set out under the following main headings:
A   Principles used to determine the nature and amount of remuneration
B   Details of remuneration
C   Service agreements
D   Share-based remuneration

The information provided in this remuneration report has been audited as required by section 308(3C) of the Corporations Act 2001.

A PRINCIPLES USED TO DETERMINE THE NATURE AND AMOUNT OF REMUNERATION (AUDITED)
The remuneration of executives is set by reference to the wider Rio Tinto Limited ("Rio Tinto") context, determined following review by the Rio Tinto Board Remuneration committee ("Rio Tinto Remuneration committee"). Executive remuneration and other terms of employment are reviewed annually by the Coal & Allied board and Rio Tinto having regard to performance against goals set at the start of the year, relevant comparative information and independent expert advice. In addition to base salary, remuneration packages include superannuation, retirement and termination entitlements, performance-related bonuses and fringe benefits.

Non-executive directors' remuneration
Fees to non-executive directors reflect the responsibilities and time spent by the director on the affairs of Coal & Allied. Non-executive directors' fees are reviewed annually. These are comprised of a base fee and any fees payable to directors for their membership on established committees of the board. In addition, from time to time, the board may approve that directors receive additional fees for services provided outside the established committee processes. At the 2001 annual general meeting, shareholders determined that the maximum aggregate remuneration payable to non-executive directors of Coal & Allied be $900,000 per annum. The total annual remuneration paid to non-executive directors, during 2008, including additional fees paid to non-executive directors for services provided outside the established committee processes was $861,000, exclusive of any superannuation entitlements.

The non-executive pay framework, including established committee fees, which has not increased since 1 January 2007, consists of:

	Amount $
Chaiman's fee	155,000 per annum
Base director's fee	100,000 per annum
Audit committee chairman's fee	25,000 per annum
Audit committee member fee	15,000 per annum
Health, safety and environment chairman's fee	5,000 per annum
Independent directors' chairman's fee	5,000 per annum
Other committee member	3,000 per annum

Executive remuneration
Coal & Allied employs some executives directly. Other executives are employed by the Rio Tinto Group and provide services to Coal & Allied under the terms of a Management Services Agreement ("MSA") between Coal & Allied and Rio Tinto Coal Australia Pty Limited.

The executive pay and reward framework consists of:
• base salary
• short-term performance incentives
• long-term incentive plans
• other benefits.

The incentive plans are variable components of the total remuneration package as they are tied to achievement of specific measures of personal and/or business performance and are therefore at risk. The other components of the package are referred to as "fixed" as they are not at risk, although some are also related to performance.

The composition of the total remuneration package is designed to provide an appropriate balance between fixed and variable components in line with Rio Tinto's and Coal & Allied's objective of aligning total remuneration with delivered personal business performance.

Base salary
Base salary is set at market expectations within the wider Rio Tinto framework and may be delivered as a mix of cash and prescribed non-financial benefits.

The base salary of the named executives is reviewed annually taking into account the individual executive's role, external market trends and personal and business performance. For Messrs van Dalsen, Light, Yeates, Tromans and Coulter, labour costs were charged to Coal & Allied based on the estimate of time spent in relation to the provision of services to Coal & Allied as set out in the MSA.

Short-term performance incentives
Executives gain incentives through participation in the Rio Tinto Short-Term Incentive Plan.

(a) Rio Tinto Short-Term Incentive Plan ("STIP")
The STIP provides an annual performance related cash bonus opportunity for participants and is designed to support the overall remuneration policy by:
• focusing participants on achieving calendar year performance goals which contribute to sustainable shareholder value; and
• providing significant bonus differential based on performance against challenging personal, business and other targets including environment, safety and health.

All executives have a significant percentage of their performance-based remuneration linked to the safety performance of Coal & Allied. The 2008 performance of site cash costs and saleable production at the operating sites constitutes another significant percentage of the performance-based remuneration. The success of capital management programmes, business improvement initiatives and the implementation of key strategic issues are also used to measure performance. Payment of the STIP is scheduled for March 2009.

With respect to the STIP cash bonuses the following table sets out the maximum percentage of the base salary that may be achieved:

Name	Maximum percentage of the 2008 base salary ⁽¹⁾
H van Dalsen ^{(2) (3)}	100%
M Coulter ⁽³⁾	60%
G B Gageler	60%
C Halfpenny	60%
R S Light⁽³⁾	70%
A Sutton	60%
K R Tromans ⁽³⁾	70%
D R Yates⁽³⁾	70%

⁽¹⁾The above rates apply to the bonuses paid in 2009 in relation to 2008 performance.
⁽²⁾ Mr van Dalsen resigned in November 2008. No STIP was payable to him for 2008.
⁽³⁾Employed by the Rio Tinto Group.

On 3 February 2009, a decision was made to defer the STIP payout to be paid in relation to 2008 performance into shares for certain senior executives. For Messrs Light, Yeates and Tromans, this will mean that 50 per cent of their bonus payout will be paid in cash as normal and 50 per cent of their bonus payout will be deferred into shares. Of the deferred shares, half will vest over 2 years (31 December 2010) and the other half will vest over 3 years (31 December 2011), subject to continued service within the Rio Tinto Group. The individuals will also receive a match of 25 per cent of their base salary in shares which will vest according to the above schedule. Executives who leave due to retirement with the Company's consent or are deemed redundant will receive their bonus deferral at departure and pro-rata vesting based on time of the 25 per cent of base salary portion that has been contributed by the company. Consistent with the retention aspect of the deferral, executives who resign prior to vesting will forfeit the bonus deferral as well as the 25 per cent of salary portion.

(b) Rio Tinto Retention Award
In 2007, Rio Tinto introduced a retention award programme for select senior Rio Tinto employees, designed to further support the Rio Tinto Group's ability to attract and retain key staff in an increasingly tight and competitive labour market. The uncertainty in the market coming on top of the extremely active market for senior executives and professionals in the resources sector magnified the risk to Rio Tinto of losing key senior employees with direct impacts on business performance.

The managing director and other eligible key management personnel each accepted a retention award, with a view to retaining their services, of nine months base salary plus nine months of their target STIP, as at 1 December 2007. Half of this retention bonus was paid to eligible key management personnel in December 2008. The balance will be paid to eligible key management personnel in July 2009 if they remain employed within the Rio Tinto Group at that time. As Mr van Dalsen resigned on 26 November 2008, no retention award was paid to him.

In 2008, Rio Tinto approved the introduction of a PIP for key staff involved in its efforts to identify and rapidly implement initiatives to achieve or exceed production forecasts for the second half of 2008. Individual production targets that applied to an employee and upon which the PIP bonus was calculated were based upon the specific site performance requirements.

The PIP bonus opportunity commenced once the PIP production threshold for the second half of 2008 was exceeded and increased to 25 per cent of an employee's current base salary for achievement of target and 37.5 per cent of current base salary for outstanding performance.

Payment of the PIP was subject to an employee continuing to be employed by Rio Tinto on the payment date scheduled for January 2009. Payments under the PIP were made by the relevant employing company with regular salary payments in February 2009. Normal tax deductions applied. Payments made did not count towards superannuation contributions or benefits, or any other benefit plans in which the individual was entitled to participate.

The PIP is in addition to any eligibility for annual cash bonus awards. The payment made under the PIP does not count as salary for calculation of any annual cash bonus awards or pension contributions or benefits, or any other benefit plans in which an employee is entitled to participate.

The executives referred to in this report who were entitled to participate in PIP were Messrs Yeates, Tromans, Gageler, Halfpenny and Ms Sutton.

Long-term incentive plans
Executives gain incentives through participation in the Rio Tinto long-term incentive plans. Eligibility to participate in the various plans varies depending on the level of the executive. Due to the parameters applied in calculating the performance share plans related to Rio Tinto, it is not possible to reliably estimate the minimum and maximum amount of the share bonus. As these plans involve the awarding of Rio Tinto securities at a future date, the Rio Tinto board has a policy prohibiting an executive from limiting his or her exposure to risk in relation to the securities. This is contained in the 'Rules for dealing in securities of Rio Tinto, its subsidiary and associated companies' which is available on the Rio Tinto website. All employees subject to these rules receive regular training and information about this prohibition and the grants of shares and options under the plans are conditional upon compliance with the rules.

(a) Share Option Plan ("SOP")
An annual grant of options to purchase shares (in Rio Tinto) in the future at current market prices is made to eligible senior executives. The Rio Tinto Remuneration committee decides the level of grants each year, taking into consideration local remuneration practice and personal performance. The maximum grant under the SOP is three times base salary, based on the average share price over the previous financial year. Under the SOP no options are granted at a discount and no amount is paid or payable by the recipient on grant of the options. No grants were made under the SOP in 2008 for Coal & Allied executives as this plan was restricted to Rio Tinto Executive committee members.

No options will become exercisable unless the Rio Tinto Group has met stretching performance criteria. In addition, before approving any vesting, and irrespective of the performance against the respective performance criteria, the Rio Tinto Remuneration committee retains discretion to satisfy itself that the Rio Tinto Total Shareholder Return ("TSR") performance is a genuine reflection of underlying financial performance.

Under the SOP, vesting is subject to Rio Tinto's TSR equalling or outperforming the HSBC Global Mining Index (the "Index"), measured over a three year performance period. The Index covers the mining industry globally. Rio Tinto's TSR is calculated as a weighted average of the TSR of Rio Tinto plc and Rio Tinto Limited. If the TSR performance equals the Index, the higher of one third of the original grant or 20,000 options will vest (subject to the actual grant level not being exceeded). The full grant vests if the TSR performance is equal to or greater than the Index plus five per cent per annum. TSR performance at this level historically approximates the upper quartile of the Index. Between these points, options vest on a sliding scale, with no options becoming exercisable for a three year TSR performance below the Index.

Options granted under the 2004 SOP before 31 December 2006 will be subject to a single fixed base retest five years after grant if they have not vested after the initial three year performance period, with options granted after 31 December 2006 not subject to any retest. These latter options will, therefore, lapse if they do not vest at the conclusion of the three year performance period.

All SOP grants made prior to 2004 have now vested in full. The SOP grant made in 2004 was tested against the performance condition in 2007. The performance condition was not achieved and these options have therefore not vested. The 2004 SOP grant will be retested in 2009. The option grant made in 2005 was tested against the performance condition in 2008. The performance condition was achieved and these options vested in full.

Prior to any options vesting, the Rio Tinto Group's TSR performance against the criteria relevant to the SOP is calculated independently by actuaries Watson Wyatt.

If there were a change of control or a company restructuring, options would become exercisable subject to the satisfaction of the performance criteria measured at the time of the takeover or restructuring. However the Rio Tinto Remuneration committee may at its discretion, and with the agreement of participants determine that options will be replaced by equivalent new options over shares of the acquiring company.

Where an option holder dies in service, qualifying options vest immediately, regardless of whether the performance criteria have been satisfied. The estate will have 12 months in which to exercise the options.

(b) Mining Companies Comparative Plan ("MCCP")
Rio Tinto's performance share plan, the MCCP, provides eligible senior executives with a conditional right to receive Rio Tinto shares. The maximum conditional award under the current MCCP is two times base salary calculated using the average share price over the previous financial year.

The conditional awards will only vest if performance criteria are satisfied. Prior to the vesting of conditional awards, the Rio Tinto Group's TSR performance against the performance condition contained in the MCCP is calculated independently by Watson Wyatt. In addition, the Rio Tinto Remuneration committee retains discretion to satisfy itself that performance is a genuine reflection of underlying financial performance.

In the event of a change in control or a company restructuring, the awards would only vest subject to the satisfaction of the performance condition measured at the time of change of control or restructuring. Additionally, if performance is deemed to end during the first 12 months after the conditional award is made, that award will be reduced pro-rata.

The performance criteria compare Rio Tinto's TSR with the TSR of a comparator group of a number of international mining companies over the same four year period. The composition of this comparator group is reviewed regularly to ensure that it continues to be relevant in a consolidating sector. The comparator group for the 2005 conditional award (which vests in 2009) contains ten companies (including Rio Tinto): Alcoa, Anglo American, Barrick Gold, BHP Billiton, Freeport-McMoRan Copper & Gold, Grupo Mexico, Newmont, Rio Tinto, Teck Cominco and Xstrata.

Awards are released to participants as either Rio Tinto plc or Rio Tinto Limited shares or as an equivalent amount in cash. In addition, for conditional awards made after 1 January 2004, a cash payment equivalent to the dividends that would have accrued on the vested number of shares over the four year period is made to those participants who were in executive director and product group chief executive roles at the date of grant.

(c) Management Share Plan 2007 ("MSP 2007")
In addition to the plans above, the Company also has the MSP 2007, which was created in 2007 ("MSP 2007"). This plan is designed to support the Rio Tinto Group's ability to attract and retain key staff in an increasingly tight and competitive labour market. Under the MSP 2007, certain senior management may receive a conditional award of shares which is subject to service-based and/or performance-based vesting condition(s) depending upon the nature of the award. Shares to satisfy the awards are purchased in the market and no new shares will be issued to satisfy awards under this plan. Participants are allocated shares to approximate the cash amount of dividends that would have been received had the recipient owned the shares between the grant date and the vesting date.

In the case of a change of control, awards vest on the date of the change of control but, in the case of an award which is subject to a performance condition, only to the extent that the vesting condition has been satisfied. The Rio Tinto Remuneration committee may decide that the award is reduced pro rata to reflect the acceleration of vesting. Prior to the change of control, and with the consent of the acquiring company, the shares can be converted to shares in the acquiring company. After a change of control, this can only be achieved with the consent of the employee.

Other benefits
(a) Share-based remuneration not dependent on performance

Coal & Allied executives employed in the Rio Tinto Limited part of the Group may participate and be granted options at a discount in the Rio Tinto Share Savings Plan ("SSP") as described in note 40 of the financial report. This share-based remuneration is not dependent on performance.

Executives may participate in share and share option plans that are available to all employees at particular locations and for which neither grant nor vesting is subject to the satisfaction of a performance condition. These plans are consistent with standard remuneration practice whereby employees are offered participation in such plans as part of their employment to encourage alignment with the long term performance of the Company.

The SSP is a savings-related share option plan which is open to employees in Australia and elsewhere and was introduced in 2001. Under the plan, the number of options issued to an employee is based on the fixed month savings amount as selected by the employee when joining the SSP, multiplied by the months in the selected savings period, plus savings account interest earned, the total of which is divided by the exercise price. At the end of the savings period participants may exercise an option over shares granted at a discount of up to 20 per cent to the market value at the time of grant. The number of options to which participants are entitled is determined by the option price, the savings amount and the length of the savings contract. No consideration is paid or payable by the participant on receipt of the options.

B DETAILS OF REMUNERATION (AUDITED)

Amounts of remuneration
The Corporations Act 2001 requires certain disclosures in respect of the five highest paid company and Group executives. Australian and International accounting standards (AASB 124 and IAS 124 respectively) require disclosures for key management personnel ("KMP"). KMP are persons (including executive and non-executive directors of Coal & Allied) having the authority and responsibility for planning, directing and controlling the company's activities, directly or indirectly.

The directors of Coal & Allied during 2008 are listed on the Directors' report page.

The board has considered the definition of KMP as required by AASB 124 and IAS 124 and has decided that, in addition to the executive and non-executive directors, they comprise the following executives; although not directly employed by Coal & Allied, due to their provision of services to Coal & Allied as set out in the MSA, Messrs Light, Yeates, Tromans and Coulter are included as KMPs. The following executives also include the five company and Group executives who received the highest remuneration from Coal & Allied or the Group for the year:

M D Coulter - general manager corporate development
G B Gageler - general manager Hunter Valley Operations
C Halfpenny - general manager Mount Thorley Warkworth Operations
R S Light - chief financial officer
A Sutton - general manager Bengalla Operations
K R Tromans - general manager marketing
D R Yeates - chief operating officer

The KMP and the five highest paid company executives and Group executives will be referred to collectively as the 'key management personnel'.

Details of the nature and amount of each major element of remuneration of each director of Coal & Allied and each of the other key management personnel is set out in the tables below.

Analysis of bonuses included in remuneration

For each cash bonus, the percentage of the available bonus that was paid in the financial year and the percentage that was forfeited because the person did not meet the service and performance criteria are set out below. No part of the bonuses is payable in future years. Cash bonuses paid in 2008 were measured against 2007 performance criteria.

C SERVICE AGREEMENTS (AUDITED)
Remuneration and other terms of employment for the managing director and other executives are formalised in service agreements. Each of these agreements provide for the provision of performance-related cash bonuses, performance related share plans within the wider Rio Tinto context and other benefits including car allowances. Other major provisions of the agreements relating to remuneration are set out below.

W H Champion - managing director
• Term of agreement - open.
• Base salary for the year effective 1 March 2009 of US$504,900 including superannuation to be reviewed annually.
• Termination by employee is with two months notice in writing or by the employer giving six months written notice or equivalent salary in lieu of notice.
• Salary costs are charged to Coal & Allied based on the estimate of time spent by Mr Champion in relation to the provision of services to Coal & Allied as set out in the Management Services Agreement.

M D Coulter - general manager corporate development
• Term of agreement - open.
• Base salary for the year ended 31 December 2008 of $296,000 excluding superannuation (last increased on 1 March 2008) to be reviewed annually.
• Termination by employee is with one months notice in writing or by the employer giving three months written notice or equivalent salary in lieu of notice.
• Salary costs are charged to Coal & Allied based on the estimate of time spent by Mr Coulter in relation to the provision of services to Coal & Allied as set out in the Management Services Agreement.

G B Gageler - general manager Hunter Valley Operations
• Term of agreement - open.
• Base salary for the year ended 31 December 2008 of $284,000 excluding superannuation (last increased on 1 March 2008) to be reviewed annually.
• Termination by employee is with one months notice in writing or by the employer giving three months written notice or equivalent salary in lieu of notice.

C Halfpenny - general manager Mount Thorley Warkworth
• Term of agreement - open.
• Base salary for the year ended 31 December 2008 of $303,000 excluding superannuation (last increased on 1 March 2008) to be reviewed annually.
• Termination by employee is with one months notice in writing or by the employer giving three months written notice or equivalent salary in lieu of notice.

R S Light - chief financial officer
• Term of agreement - open.
• Base salary for the year ended 31 December 2008 of $412,000 excluding superannuation to be reviewed annually by the Rio Tinto Remuneration committee.
• Termination by employee is with two months notice in writing or by the employer giving six months written notice or equivalent salary in lieu of notice.
• Salary costs are charged to Coal & Allied based on the estimate of time spent by Mr Light in relation to the provision of services to Coal & Allied as set out in the Management Services Agreement.

A Sutton - general manager Bengalla
• Term of agreement - open.
• Base salary for the year ended 31 December 2008 of $279,190 excluding superannuation (last increased on 1 March 2008) to be reviewed annually.
• Termination by employee is with one months notice in writing or by the employer giving three months written notice or equivalent salary in lieu of notice.

K R Tromans - general manager marketing
• Term of agreement - open.
• Base salary for the year ended 31 December 2008 of $352,000 excluding superannuation to be reviewed annually by the Rio Tinto Remuneration committee.
• Termination by employee is with two months notice in writing or by the employer giving six months written notice or equivalent salary in lieu of notice.
• Salary costs are charged to Coal & Allied based on the estimate of time spent by Mr Tromans in relation to the provision of services to Coal & Allied as set out in the Management Services Agreement.

D R Yeates - chief operating officer
• Term of agreement - open.
• Base salary for the year ended 31 December 2008 of $418,000 excluding superannuation to be reviewed annually by the Rio Tinto Remuneration committee.
• Termination by employee is with two months notice in writing or by the employer giving six months written notice or equivalent salary in lieu of notice.
• Salary costs are charged to Coal & Allied based on the estimate of time spent by Mr Yeates in relation to the provision of services to Coal & Allied as set out in the Management Services Agreement.

D SHARE-BASED REMUNERATION (AUDITED)
The current managing director, Mr Champion, is a participant in various share plans that involve the awarding of securities in Rio Tinto plc. Rio Tinto plc and Coal & Allied are not related parties for the purposes of the Corporations Act. Details of his holdings as at the date of this report are as follows:

Rio Tinto plc	498
Rio Tino plc options (SOP)	39,163
Rio Tinto plc restricted awards (MCCP)	30,256
Rio Tinto plc restricted awards (MSP)	3,694
Rio Tinto plc American Depositary Receipts (ADRs)	100

The previous managing director, Mr van Dalsen, was a participant in various share plans that involve the awarding of securities in Rio Tinto plc. Details of his holdings as at 31 December 2007 were as follows:

Rio Tinto plc shares	9,073
Rio Tinto plc options (SOP)	32,673
Rio Tinto plc restricted awards (MMCP)	19,843
Rio Tinto plc restricted awards (MSP)	2,000

(I) Rio Tinto Share Option Plan
The terms and conditions of each grant of options affecting remuneration of this or future reporting periods are as follows:

Grant date	Expiry date	Exercise price	Value per option at grant date	Date exercisable
22 April 2004	22 April 2014	$34.41	$6.17	22 April 2007
9 March 2005	9 March 2015	$47.04	$8.93	9 March 2008
7 March 2006	7 March 2016	$71.06	$17.09	7 March 2009
13 March 2007	13 March 2017	$75.12	$14.37	13 March 2010

Options are granted at the discretion of the Rio Tinto Remuneration committee in line with Rio Tinto guidelines. Model inputs for options granted during the year ended 31 December 2008 are further discussed at note 40 to the financial report.

(II) Rio Tinto Mining Companies Comparative Plan
Share awards under the MCCP are granted at the discretion of the Rio Tinto Remuneration Committee in line with Rio Tinto guidelines. The terms and conditions of each right to Rio Tinto Limited shares affecting remuneration in this or future reporting periods are as follows:

Award date	Vesting date	Date exercisable
1 January 2004	1 January 2008	31 December 2007
1 January 2005	1 January 2009	31 December 2008
1 January 2006	1 January 2010	31 December 2009
1 January 2007	1 January 2011	31 December 2010

No restricted awards of ordinary shares of Rio Tinto Limited were provided during the year as remuneration to any of the key management personnel of the consolidated entity.

Restricted awards of performance shares in Rio Tinto Limited shares were made by Rio Tinto to eligible key management personnel of the consolidated entity under the MCCP on 1 January 2008. The Rio Tinto Remuneration Committee reviewed the performance condition applicable to the restricted award and confirmed that the vesting will be dependent on Rio Tinto's TSR relative to 15 other mining companies. The price for Rio Tinto Limited shares as at 31 December 2008 was A$38.00.

(III) Rio Tinto Management Share Plan 2008
Share awards are granted at the discretion of the Rio Tinto Remuneration committee in line with Rio Tinto guidelines. Restricted awards of shares under the MSP were made by Rio Tinto to the key management personnel of the consolidated entity on 10 March 2008 (2007: 13 March 2007). These restricted awards vest in January 2011 (2007: January 2010) dependent upon continued employment with a Rio Tinto Group company on 31 December 2010. The price for Rio Tinto Limited shares as at 31 December 2008 was A$38.00.

(IV) Rio Tinto Share Savings Plan
The key management personnel of the consolidated entity who elect to participate in the Rio Tinto SSP as at 31 December 2008 are set out below:

W H Champion - Not currently a participant in the share savings scheme
D C W Ritchie - 2006 Rio Tinto Limited scheme vesting 1 January 2010
M Coulter - 2007 Rio Tinto Limited scheme vesting 1 January 2013
G B Gageler - 2007 Rio Tinto Limited scheme vesting 1 January 2011
C Halfpenny - 2007 Rio Tinto Limited scheme vesting 1 January 2013
R S Light - 2007 Rio Tinto Limited scheme vesting 1 January 2011
A Sutton - Not currently a participant in the share savings scheme
K R Tromans - 2006 Rio Tinto Limited scheme vesting 1 January 2010
2007 Rio Tinto Limited scheme vesting 1 January 2011
D R Yeates- Not currently a participant in the share savings scheme

Details of the Rio Tinto Share Savings Plan are described in note 40 of the financial report.

(V) Equity instrument disclosures relating to Directors and key management personnel
Options provided as remuneration - SOP
No restricted awards of ordinary shares of Rio Tinto Limited were provided during the year as remuneration to any of the non-executive directors of the parent entity.

Details of options over ordinary shares in Rio Tinto Limited provided as remuneration to the key management personnel of the consolidated and parent entity in respect of their duties as officers of the consolidated and parent entity are set out below. When exercisable, each option is convertible into one ordinary share of Rio Tinto Limited.

Restricted awards provided as remuneration - MCCP
No restricted awards of ordinary shares of Rio Tinto Limited were provided during the year as remuneration to any of the non-executive directors of the parent entity.

Details of options over ordinary shares in Rio Tinto Limited held during the year and provided as remuneration to the key management personnel of the consolidated entity in respect of their duties as officers of the consolidated and parent entity are set out below. When exercisable, each option is convertible to one ordinary share of Rio Tinto Limited.

Restricted awards provided as remuneration - MSP
No restricted awards of ordinary shares of Rio Tinto Limited were provided during the year as remuneration to any of the non-executive directors of the parent entity.

Insurance of directors

During the financial year, Coal & Allied paid a premium for an insurance policy insuring any past or present director, secretary, executive officer or employee of the Group (including directors) against certain liabilities. The directors have not included details of the nature of the liabilities covered or the amount of the premium paid in respect of the insurance contracts, as such disclosure is prohibited under the terms of the contract.

Proceedings on behalf of the company

No person has applied to a court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the company, or to intervene in any proceedings to which the company is party, for the purpose of taking responsibility on behalf of the company for all or part of those proceedings.

No proceedings have been brought or intervened in on behalf of the company with leave of a court under section 237 of the Corporations Act 2001.

Auditor

PricewaterhouseCoopers continues in office in accordance with section 327B of the Corporations Act 2001.

The board has noted that the auditor has advised in the auditor's independence declaration that the auditor has complied with its general independence requirements under the Corporations Act 2001.

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is attached on page 27.

Non-audit services

Coal & Allied may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor's expertise and experience with Coal & Allied are important.

Details of the amounts paid or payable to the auditor for audit and non-audit services provided during the year are set out in note 39 to the financial report.
The directors have considered the position, and in accordance with the advice received from the Audit committee, are satisfied that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the provision of non-audit services by the auditor, as set out in note 39, did not compromise the auditor independence requirements of the Corporations Act 2001, as the ratio of non-audit fees is at a level that would not impact on the impartiality and objectivity of the auditor.

Events subsequent to reporting date

The directors are not aware of any item, transaction or event of a material nature not otherwise disclosed that has arisen since 31 December 2008 that, in their opinion, has significantly affected, or may significantly affect, in future years:
• the Group's operations;
• the results of those operations; or
• the Group's state of affairs.

Rounding of amounts

Coal & Allied is a company of a kind referred to in Class Order 98/0100, dated 10 July 1998, issued by the Australian Securities and Investment Commission, relating to the "rounding off" of amounts in the directors' report. Amounts in the directors' report have been rounded off to the nearest tenth of a million dollars, in accordance with that Class Order, unless specifically stated to be otherwise.

Signed in Brisbane, on 27 February 2009 in accordance with a resolution of the directors.

C J S Renwick
Chairman

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