CORPORATE GOVERNANCE REVIEW
Corporate governance report
Our approach to governance
MultiChoice Group is committed to the highest standards of corporate governance, ethics and integrity. This governance philosophy drives our value creation for all stakeholders. We continue to entrench the principles of sound corporate governance throughout our organisation, applying appropriate business ethics and standards in the conduct of our business affairs.
The board understands and accepts its responsibility to safeguard and represent the interests of the stakeholders of the company in perpetuating a successful and sustainable business that ensures the achievement of the group's strategic objectives.
Our group governance framework
The board is the custodian of the group's corporate governance. The board, its committees, and the boards and committees of its subsidiaries are responsible for ensuring that the appropriate principles and practices of King IV are applied and embedded in the governance practices of group companies.
The board and board committee charters and policies were formulated in alignment with the recommendations contained in King IV and the requirements of the JSE Listings Requirements. The policies and charters were approved by the relevant board committees and ultimately by the board on 10 December 2018.
A disciplined reporting structure ensures that the board is fully apprised of subsidiary activities, risks and opportunities. All controlled entities in the group are expected to demonstrate good governance as set out in King IV, taking into account proportionality considerations. This means that the practices needed to demonstrate the group's governance in terms of King IV are applied, as appropriate across the group. The companies within the group are diverse and at different maturity stages and thus a one-size-fits-all approach cannot be followed when implementing governance practices. While good governance principles apply to all types and sizes of organisations, the practices implemented by each organisation to achieve the principles may vary. Practices are implemented as appropriate to give effect to overarching good governance principles.
As part of the internal annual CEO/CFO sign-off process, businesses across the group are requested to confirm that, as subsidiaries, they have aligned their policies to the MultiChoice Group policies.
Business and governance structures have clear approval frameworks that are reviewed on an annual basis and aligned to the group levels of authority approved by the board annually. The board is satisfied that the delegation of authority framework contributes to role clarity and the effective exercise of authority and responsibilities.
In relation to assessing corporate governance services, the MultiChoice Group has an internal company secretariat function, and an annual assessment of the company secretary's performance, qualifications and skills is undertaken.
Our King IV journey
The board recognises the link between effective governance, sustainable performance and the creation of long-term value for all its stakeholders. The board is committed to the principles of transparency, integrity, fairness and accountability, and recognises the need to implement good corporate governance principles. The board, therefore, seeks to apply the principles of King IV, which forms the cornerstone of our approach to governance. We support the overarching goals of King IV, being:
A thorough and comprehensive review has been conducted in relation to each principle and underlying recommended practice under King IV.
King IV application
MultiChoice Group is required, in terms of the JSE Listings Requirements, to report against the application of the principles of King IV. In line with the overriding principle in King IV of 'apply and explain', the board, to the best of its knowledge, believes that the group has satisfactorily applied the principles of King IV. For a more detailed review, see the King IV application report on our website.
The group continues to develop its governance policies, practices, and procedures in line with an integrated governance, risk, and compliance framework. The board is satisfied that every effort has been made in the year under review to apply all material aspects of King IV, where appropriate and relevant, and the group continues to entrench and enhance its understanding and application of the practices and principles of King IV.
Entrenching an ethical culture
The board is committed to entrenching an ethical culture throughout the group and sets the tone at the top by formulating our values and ensuring ethical business standards. The directors, overseen by the chair, hold one another accountable for decision-making and ethical behaviour. Directors, both individually and collectively, seek to demonstrate integrity, competence, responsibility, accountability, fairness and transparency to ensure effective leadership, which, together with management, assists in achieving strategic objectives.
It is our policy to conduct business dealings on the basis of compliance with applicable laws, rules, codes, standards and regulation, and proper regard for ethical business practices. The group's success in the markets in which it operates is built on integrity in its business affairs. We strive to prevent situations that may compromise these principles in our dealings with customers, suppliers, governments and business associates.
The board has adopted a code of business ethics and conduct (the code) which sets out the standards for business conduct throughout the group which is supported by a wide range of group policies.
As the group conducts business in various countries, our employees are also subject to the laws and regulations of those countries, and the group policies are supplemented by local policies and procedures. Ensuring that group companies adopt appropriate processes and establish supporting policies and procedures is an ongoing process.
The board has delegated responsibility for regular review of the code and an ethics communication plan to the remuneration committee of the board.
Management focuses on policies and procedures that address key ethical risks, such as conflicts of interest, accepting inappropriate gifts and acceptable business conduct. The social and ethics committee is responsible for overseeing and reporting on business ethics in relation to the group, taking into account specific disclosures and best practice as recommended by King IV.
Management teams across the group understand and apply the code and create and maintain awareness of the code and associated policies such as the whistleblower policy. Reference to the code is included in the contracts of new employees of major subsidiaries, and in the induction process for new employees. The code applies to the recruitment, performance evaluation and reward processes. Management teams are required to monitor adherence to the code and apply a zero-tolerance policy to violations. Sanctions are in place and action is taken when necessary, which includes prosecuting to the fullest extent of the law when appropriate.
Reference to our code is included in third-party procurement contracts of certain major subsidiaries. Contractors, agents and consultants who work with any group company are expected to follow the same standards of business conduct. Group companies may require specific steps to be taken, including, where appropriate, due diligence checks and specific contractual terms for specific types of contractors, agents and consultants.
The risk management function monitors the group's whistleblower facility operated by Deloitte Tip-offs Anonymous. Where appropriate, internal audit and/or external forensic consultants investigate reported matters. Significant allegations and fraud are reported to the audit and risk committees. Furthermore, the social and ethics committee receives reports on whistleblower activity and ethics. Internal audit and risk support the social and ethics committee and remuneration committee with an assessment of the group's ethics performance annually.
Performance and future focus
During the year, the code was approved by the board and integrated into the group's strategies and operations.
Our focus for the year ahead is to ensure ethics are entrenched throughout the business through training and awareness campaigns. Our whistleblowing and internal speak-up mechanisms will be reviewed to identify areas of improvement.
The group's ethics performance will be monitored and reported to the social and ethics committee quarterly.
Responsible corporate citizenship
The board, assisted by the social and ethics committee, ensures that the company is, and is seen to be, a responsible corporate citizen by taking into consideration, not only the financial performance of the company but also, the impact that business has on the environment and the society within which it operates.
The group's sustainable development policy includes the responsibility for corporate citizenship. Moreover, the group's purpose, values and strategy are aligned with the principles of responsible corporate citizenship.
The group's businesses manage numerous corporate citizenship initiatives affecting the workplace, economy, society and environment. These include broad-based black economic empowerment (BBBEE) and employment equity performance for South African subsidiaries; local employment, health and safety laws; employee development opportunities; responsible tax policy; fraud and anti-bribery and anti-corruption initiatives; initiatives to minimise impact on the environment; and corporate social investment initiatives which contribute to the societies in which our businesses operate.
Performance and future focus
Our key areas of focus during the reporting period were the identification of our material stakeholders across operations and geographies as well as policy development and implementation to ensure and support responsible corporate citizenship in the group.
Going forward we will be focusing on enhancing monitoring and reporting techniques to the social and ethics committee.
Ensuring compliance with laws and regulations
The group has a primary listing on the JSE Limited (the JSE) and is, therefore, subject to the JSE Limited Listings Requirements (JSE Listings Requirements), the guidelines in King IV and legislation applying to publicly listed companies in South Africa.
The board is responsible for ensuring that the group complies with all of its statutory obligations as specified in the company memorandum of incorporation (MOI), the Companies Act, the JSE Listings Requirements and all other regulatory requirements. The directors have taken steps to ensure, to the best of their knowledge, the group's compliance with all these requirements.
The group has a legal compliance programme that is led by the group head of legal compliance and legal compliance teams with support from external consultants. The legal compliance programme includes:
- Legal compliance framework and roadmap, which sets out the legal compliance strategy, goals and objectives. It addresses the requirements of an adequate and fit-for-purpose legal compliance programme and provides for key activities to mitigate the identified legal compliance risks.
- Groupwide policies built on the principles in the code of business ethics and conduct. The legal compliance, anti-bribery and anti-corruption, sanctions and export controls and competition compliance policies were approved by the board in December 2018.
Future focus areas include continuing to raise awareness of the compliance principles, making improvements to the framework based on emerging risks, incorporating feedback from monitoring activities and focusing on the implementation of enhanced third-party screening.
Each segment is required to provide a quarterly legal compliance report to the group legal compliance function. This report includes an overview of key compliance risk areas and mitigating measures, key compliance regulatory developments and material compliance incidents and investigations. The group legal compliance function uses these reports to compile a consolidated report provided to the risk committee. Reports on legal compliance from a social and ethics perspective will in future also be provided to the social and ethics committee. Assurance on the effectiveness of compliance management is received through a combined assurance model.
These arrangements enable the risk committee, and the board, to oversee the group's legal compliance holistically in a way that supports good corporate citizenship.
Assurance
The audit committee and the board oversee that assurance services and functions enable effective control and support the integrity of information for internal decision-making and to enable accurate external reporting. Internal audit reports on the internal control environment are submitted to the audit committee.
The group follows a combined assurance model, which covers key risks through an appropriate combination of assurance service providers and functions, including line functions that own and manage risks, specialist internal audit and risk support and compliance functions (for the group and significant businesses), as well as external auditors and other relevant parties, such as regulatory inspectors. This model is linked to key risks and an assessment of the effectiveness of our combined assurance model is reported on to the audit and risk committees. The company secretary, group general counsel and external counsel guide the board on legal requirements.
The audit committee appoints the head of internal audit. The head of internal audit has unrestricted access to and meets periodically with the chair of this committee.
Executive chair, lead independent director and chief executive officer
The board is chaired by Imtiaz Patel, an executive director. The chair is responsible for providing leadership to the board and overseeing its efficient operation and has been tasked with ensuring effective corporate governance practices.
The board is of the view that appointing an executive chair is appropriate for the company under the circumstances as he has valuable group, industry and regulatory intellectual capital to contribute to the future development and progression of the business.
The lead independent director, Steve Pacak, acts as lead director in all matters where there may be an actual or perceived conflict and it would be inappropriate for the chair to deal with the matter concerned.
The board has satisfied itself that Steve acts with independence of mind and judgement and there is no interest, position, association or relationship that is likely to influence unduly or cause bias in decision-making in the best interests of the company. The board made this determination as to Steve's independence having regard to a number of factors including consideration of Steve's historical relationship with the Naspers group (and his interest in Naspers) and his directorship of MultiChoice South Africa Proprietary Limited. Bearing these factors in mind, the board determined that Steve is best placed to fulfil the role as lead independent director given his significant experience in governance within the environment the group operates in.
The chief executive officer (CEO), Calvo Mawela, is responsible for leading the implementation and execution of the approved strategy, policy and operational planning of the group, as well as ensuring that the day-to-day affairs of the group are appropriately supervised and controlled.
Board
MultiChoice Group has a unitary board, which provides oversight and control. The board charter sets out the division of responsibilities, providing for delegation of authority while enabling the board to retain effective control. The board delegates authority to established board committees, as well as to the CEO, with clearly defined mandates.
The majority of board members are non-executive directors and independent of management. To ensure that no one individual has unfettered powers of decision-making and authority, the roles of the chair, lead independent director and CEO are separate and well defined.
The board's responsibilities include providing the group with clear strategic direction, ensuring that there is adequate succession planning at senior levels, reviewing operational performance and management and reviewing policies and processes that seek to ensure the integrity of the group's risk management and internal controls.
The board is the focal point and custodian of corporate governance, exercising its leadership and oversight role by annually approving the strategy and the business plan and overseeing implementation. Its role, responsibilities, membership requirements and procedural conduct are documented and are set out in the board charter, which it regularly reviews to guide its effective functioning. In addition, it is the board's responsibility to ensure compliance with all statutory and regulatory requirements, and in particular, the Companies Act and the JSE Listings Requirements.
The board determines and approves, from time to time, the levels of authority for the CEO and the various members of senior management, while the audit committee and the risk committee monitor compliance with these predetermined levels of authority.
The board meets as often as required, but at least four times annually.
Composition
The group recognises that a balanced board supports value creation. The composition of the board (including board member rotation) is therefore reviewed annually, in accordance with the board charter and the board's diversity policy, by the nomination committee, which will make recommendations to the board.
The composition of the board is considered holistically, taking into account all aspects of diversity (including gender and race) in terms of its diversity policy, and capitalising on differences in the skills, geographical and industry experience of its members. The chief executive and financial director are board members. The board is satisfied that its composition is qualitatively and quantitatively balanced in terms of skills, independence, demographics, gender, nationalities, experience and tenure needed to discharge its role and responsibilities.
Through the annual self-assessment of the board and its subcommittees, the knowledge and skills set will be evaluated and improved where required. Furthermore, where necessary, subject-matter experts are available for matters requiring specialised guidance.
Non-executive directors bring diverse perspectives and independence to the board's decision-making. None of the directors, other than the executive directors, have a fixed term of appointment and one third of the non-executive directors are subject, by rotation, to retirement and re-election by shareholders at least every annual general meeting, in accordance with the company's MOI.
The mandatory retirement age for non-executive directors is 75 years, at which time the director shall vacate office at the end of the financial year in which that director turns 75, unless the board, in its discretion, decides otherwise.
The size and composition of the board is determined by the shareholders, subject to the company's MOI, applicable legislation and regulatory requirements and King IV.
As at year-end, the board consisted of three executive directors and seven non-executive directors, four of whom are independent, with no director having unfettered powers of decision-making.
Board composition as at
31 March 2019
Board demographics(1) (%)
Independence(1) (%)
Age (years)(1) (%)
Note
(1) Prior to the appointment of Christine Sabwa, Jabu Mabuza and Fatai Sanusi.
Succession planning and performance
The board is satisfied that the company is appropriately resourced and that its delegation to management contributes to an effective arrangement by which authority and responsibilities are exercised.
The board approves the appointment of the chief executive and the financial director. The remuneration committee is required to consider the performance of the chief executive and financial director annually against agreed performance incentive objectives. The audit committee is required to consider the performance of the financial director and the finance function and will report thereon in its report included in the integrated report.
The board approves the group levels of authority annually, which include delegated authorities to the group chief executive. The board evaluates the overall performance of the chief executive and financial director. The integrated annual report discloses performance measures for the chief executive, financial director and chief investment officer. Executive directors are also assessed in their capacity as directors as part of the annual individual directors' evaluation process.
Succession plans for the chief executive and senior executives are in place and are reviewed annually by the remuneration committee.
Appointment and board diversity policy
MultiChoice Group recognises and embraces the benefits of having a diverse board, and sees increasing diversity at board level as an essential element in maintaining a competitive advantage.
Each director is identified and selected by the board, as assisted by the nominations committee, the recommendation of which shall be subject to final approval by the board.
In terms of the appointment and board diversity policy, in considering the composition of the board, cognisance shall be taken of the gender and racial mix in order to represent the demographics of the markets in which it operates and to promote racial diversity at board level. The individual board members contribute to the collective blend of knowledge, skills, resources, objectivity and experience of the board. A diverse board includes and makes good use of differences in the skills, experience, background, academic qualifications, technical expertise, knowledge, nationality, age, race, gender and other distinctions between members of the board. These differences are considered in determining the optimum composition of the board and, when possible, should be balanced appropriately. All board appointments are made on merit, in the context of the skills, experience, independence and knowledge, which the board as a whole requires to be effective.
Performance and future focus
During the period, the board considered its size, structure and diversity. The board considers diversity in terms of race, gender, nationality, age and experience. The board believes the current composition supports the group's ability to create value.
Independence
All directors were appointed to the newly formed MultiChoice Group board in December 2018 and accordingly, none of the directors have served on the board for longer than nine years.
Categorisation as either a non-independent or independent non-executive director is done annually.
In line with King IV, the board has undertaken to carry out a rigorous independence assessment when any director has served for nine years or longer.
Information
Information relevant to a meeting is supplied on a timely basis to the board, ensuring directors can make informed decisions. The directors have unrestricted access to information about the company and its senior management and, where appropriate, may seek independent advice on matters within the board's mandate, at the company's expense.
Conflicts of interest
Potential conflicts are appropriately managed to ensure candidates and existing directors have no conflicting interests between their obligations to the company and their personal interests.
All directors are required to declare personal interests on an annual basis. Declaration of directors' interests is a standing agenda point on the board's agenda. Directors who believe there may be a conflict of interest on a matter must advise the company secretary and will be recused from the decision-making process. The Companies Act process is applied in this regard.
Directors are required to adhere to a policy on trading in securities of the company. The trading in securities policy is aligned to the Financial Markets Act and JSE Listings Requirements.
Board evaluations
The board and all board committees' charters include the onus of annual assessments. Assessments of the performance by the board, its subcommittees and the company secretary are conducted every second year, however, performance in general, is considered every year as part of the review of the composition of the board and its committees. The lead independent director will head the evaluation of the chair.
Given the short amount of time the board and its committees were in operation during 2019, no formal assessment was undertaken this year. However, as good practice, the board undertook an online, question-based evaluation of the chair and has conducted individual peer reviews for the directors. While the time period since constituting the board has been short, the evaluations were undertaken in order for the board to identify any possible areas of improvement early. There have been no major areas of concern raised.
The board is satisfied that the evaluation process will assist with improving its performance.
Board meeting attendance
| Membership | Designation | Meeting attendance(1) | |||
| Mohammed Imtiaz (Imtiaz) Patel | Executive chair | 2/2 | |||
| Stephan Joseph Zbigniew (Steve) Pacak | Lead independent director | 2/2 | |||
| Calvo Phedi Mawela | CEO | 2/2 | |||
| Timothy Neil (Tim) Jacobs | CFO | 2/2 | |||
| Donald Gordon (Don) Eriksson | Independent non-executive director | 2/2 | |||
| Kgomotso Ditsebe Moroka | Independent non-executive director | 1/2 | |||
| Louisa Stephens | Independent non-executive director | 2/2 | |||
| Francis Lehlohonolo Napo (Nolo) Letele | Non-executive director | 2/2 | |||
| Elias Masilela | Non-executive director | 2/2 | |||
| John James (Jim) Volkwyn | Non-executive director | 2/2 | |||
Note
(1) The board was only constituted in December 2018 and thus, there were only two board meetings held during FY2019.
Performance and future focus
The focus of the board during FY2019 was on ensuring the successful listing of the group on the JSE, including the review and formalisation of the governance policies and related framework. Furthermore, the board approved the group's strategy and budget. The board is satisfied that it has fulfilled its responsibilities in accordance with its charter for the year under review.
Looking ahead, the board's focus will be on:
- providing strategic direction
- monitoring management implementation and progress of strategic objectives
- stakeholder engagement, relationships and activities and business impacts, and
- monitoring ethical conduct.
Shareholders communication
The group is committed to ongoing and transparent communication with its shareholders. In all communications with shareholders, the board aims to present a balanced and understandable assessment of the group's position. This is done through adhering to principles of openness, and substance-over-form reporting, striving to address matters of material significance to shareholders.
This integrated annual report is our primary form of communication with shareholders, in accordance with King IV and the JSE Listings Requirements. Furthermore, the board encourages shareholders' attendance at general meetings, and, where appropriate, will provide full and understandable explanations of the effects of resolutions to be proposed.
Company secretary
The company secretary is responsible for guiding the board in discharging its regulatory responsibilities. Directors have unlimited access to the advice and services of the company secretary who plays a pivotal role in the company's corporate governance policies and processes. She ensures that, in accordance with the pertinent laws, the proceedings and affairs of the board, the company itself and, where appropriate, shareholders, are properly administered. The company secretary monitors directors' dealings in securities and ensures adherence to closed periods. She attends all board and committee meetings. In accordance with King IV, the performance and independence of the company secretary is evaluated annually.
The nominations committee is responsible for recommending a suitable candidate for appointment as the company secretary and reviews the competence, qualifications and experience of the company secretary annually and reports on whether or not it is satisfied therewith.
A new group company secretary, Donna Dickson, joined the organisation in April 2019. She is appropriately empowered to fulfil her duties with regard to assistance to the board. The board is satisfied with the company secretary's competence, qualifications, experience, independence and suitability.
Donna is not a director of the company, and the board, having specifically considered the matter, is satisfied that she has an arm's length relationship with the board (and this has been the case prior to the admission).
A formal assessment of her performance will be carried out during FY2020.
Information and technology (I&T) governance
The company's I&T executive oversees I&T management in the group. The board is aware of the importance of I&T in relation to the company's strategy.
The board approves and annually reviews the I&T governance charter and cybersecurity policy. I&T governance is integrated into the operations of the group businesses. Management of each subsidiary or business unit is responsible for ensuring effective processes for I&T governance are in place.
The risk committee assists the board with overseeing I&T-related matters. I&T governance is a standing point on the risk committee agenda. I&T objectives have been included in the risk committee charter. The risk committee considers the risk register, as well as reports on I&T from internal audit and risk support and where relevant our legal compliance function.
Compliance with relevant laws and ethical and responsible use of I&T are addressed through the group's code of business ethics and conduct and legal compliance and data-privacy programmes. Data privacy is a high priority.
Internal audit provides assurance to management, the risk committee and board on the effectiveness of I&T governance, based on detailed controls to manage identified risks and reduce vulnerability. The social and ethics committee oversees I&T from an ethics perspective.
These arrangements for governing and managing I&T enable the risk committee and social and ethics committee, and ultimately the board, to oversee the group's I&T governance.
Performance and future focus
The group is highly dependent on the I&T systems and processes to effectively and timeously enable and support the implementation of its strategic objectives.
During the year, the group undertook a detailed monthly review to identify, evaluate and assess I&T risks monthly in the six key information and technology areas. The results were presented and discussed at the I&T governance board (chaired by the chief technology officer) that meets monthly. Based on the review, the group has developed mitigation plans to address the material risks highlighted.
Penalties
MultiChoice Group operates in a highly-regulated environment in South Africa; compliance is, therefore, a critical consideration. The company participates in the regulatory processes affecting its industry through various public forums and debates, providing inputs on formulating standards and strategies for the industry.
During FY2017, MultiChoice and M-Net received fines from the self-regulatory body, the Broadcasting Complaints Commission of South Africa (BCCSA). These relate to failure by channels to provide correct classification information, resulting in MultiChoice and M-Net contravening the BCCSA Code. Subsequently the group has ensured that there are sufficient controls regarding the classification of information and no fines since FY2017 have been received.
Fines paid to the BCCSA:
- FY2016: R10 000
- FY2017: R90 000
- FY2018: Rnil
- FY2019: Rnil
DStv Media Sales Proprietary Limited (DMS), a subsidiary of MultiChoice South Africa Proprietary Limited, entered into a consent agreement with the Competition Commission in FY2018, which was approved by the Competition Tribunal. It was agreed that an administrative penalty of R22m be paid (provided for in FY2017), a contribution of R8m, payable over three years to a fund to be administered through an industry trust to assist small black-owned media agencies.
During the past year there were no environmental inspections by environmental regulators, no accidents, nor were any environment-related fines imposed by any government.
Board committees
As provided for in the company's memorandum of incorporation (MOI) and the board charter, the board is supported and assisted by the audit committee, nominations committee, remuneration committee, risk committee and the social and ethics committee, which have clear mandates and oversight responsibility for various aspects of the business.
The responsibilities delegated to each committee are formally documented in the terms of reference for that committee, which have been approved by the board and are reviewed at least annually. All committees have clear roles and responsibilities as outlined in their committee charters.
The board delegates authority to established board committees, as indicated in the following diagram.
Audit committee
| Membership | Meeting attendance | |||
| Steve Pacak (chair) | 2/2 | |||
| Don Eriksson | 2/2 | |||
| Louisa Stephens | 2/2 | |||
The audit committee is chaired by Steve Pacak, an independent non-executive director. Other members include Louisa Stephens and Donald Eriksson, who are both independent non-executive directors.
This committee meets at least three times a year (and, when necessary, convene when a special meeting is requested by the external auditor. The committee is responsible for, among other things:
- Monitoring and reviewing the adequacy and effectiveness of accounting policies, financial and other internal control systems and financial reporting processes.
- Providing independent oversight of the group's combined assurance functions, including reviews of the independence and effectiveness of external audit, internal audit, non-audit services from auditors as well as compliance.
- Assessing compliance with applicable legal, regulatory and accounting standards and policies in the preparation of fairly presented financial statements and external reports.
Nominations committee
| Membership | Meeting attendance | |||
| Kgomotso Moroka (chair) | N/A* | |||
| Louisa Stephens | N/A* | |||
| Jim Volkwyn | N/A* | |||
Note
* No meetings were held during FY2019, with the first meeting held on 8 April 2019.
The nominations committee is chaired by Kgomotso Moroka, an independent non-executive director. Other members include Louisa Stephens, an independent non-executive director and Jim Volkwyn, a non-executive director. Imtiaz Patel (chair of the board) attends by invitation. The nominations committee meets at least twice a year, prior to scheduled meetings of the board.
The committee is responsible for, among other things:
- Identifying individuals qualified to be elected as members of the board and board committees, as well as the executive team. These individuals are then recommended to the board for appointment in terms of the company's MOI and the appointment and board diversity policy. The committee is also responsible for establishing procedures to ensure that the selection of individuals for recommendation are transparent.
- Reviewing the structure, size and composition of the board and its committees and making recommendations to the board with regard to any adjustments that are deemed necessary to ensure the required mix of skills, experience, other qualities and diversity to ensure the effectiveness of those bodies in compliance with applicable laws and regulations.
Looking ahead, the committee will focus on developing and approving board diversity targets as well as reviewing the composition of the board and its committees. At the end of FY2020, the committee will assess itself against its charter in order to evaluate whether it has carried out its duties during the reporting period.
Remuneration committee
| Membership | Meeting attendance | |||
| Kgomotso Moroka (chair) | N/A* | |||
| Steve Pacak | N/A* | |||
| Jim Volkwyn | N/A* | |||
Note
*No meetings were held during FY2019.
The remuneration committee is chaired by Kgomotso Moroka, an independent non-executive director. Other members include Steve Pacak, an independent non-executive director and Jim Volkwyn, a non-executive director. Imtiaz Patel (chair of the board), as well as the CEO and chief human resources officer attend by invitation.
The committee meets at least twice a year prior to scheduled meetings of the board. No meetings were held during FY2019.
The remuneration committee's responsibilities include:
- Independently reviewing and monitoring the integrity of the group's remuneration policies and implementation thereof.
- Ensuring that the company remunerates fairly, responsibly and transparently.
- Ensuring compliance with the statutory duties of the committee as contained in relevant legislation.
- Annually reviewing and making recommendations to the board on the remuneration of non-executive directors, for approval by the shareholders, for a period of two years from the date of the annual general meeting where the remuneration is approved or until such time as non-executive directors' remuneration is amended by way of special resolution of shareholders, whichever comes first.
Looking ahead, at the end of FY2020, the committee will assess itself against its charter in order to evaluate whether it has carried out its duties during the reporting period.
Risk committee
| Membership | Meeting attendance | |||
| Steve Pacak (chair) | 2/2 | |||
| Louisa Stephens | 2/2 | |||
| Don Eriksson | 2/2 | |||
| Imtiaz Patel | 2/2 | |||
| Calvo Mawela | 2/2 | |||
| Tim Jacobs | 2/2 | |||
The risk committee is chaired by Steve Pacak, an independent non-executive director. Other members include Louisa Stephens and Donald Eriksson, independent non-executive directors; board chair, Imtiaz Patel; CEO, Calvo Mawela; and CFO, Tim Jacobs. Christine Sabwa was appointed to the risk committee by the board in June 2019. Regular attendees include business unit risk managers, the head of internal audit, group general counsel and the head of regulatory.
The risk committee meets at least twice a year prior to scheduled meetings of the board and is established to independently review management's recommendations on risk management.
The risk committee's functions include:
- Monitoring and providing recommendations to the board on the group's risk management systems, including the systems, processes, methodologies and tools of risk governance and risk management, and annual operating plans for overall risk management and forensics.
- Reviewing, approving and recommending risk measurement methodologies to the board, including methodologies used to identify, assess, measure, monitor and report on risks, including methods used for the calculation of risk exposures.
- Monitoring and reviewing the regulatory compliance processes and procedures.
During 2019, the focus for the committee was on ensuring the group was adequately insured, with a particular focus on the necessary directors and prescribed officers' insurance cover.
Looking ahead, the committee will focus on the group's risk management processes, risk tolerance and appetite. At the end of FY2020, the committee will assess itself against its charter in order to evaluate whether it has carried out its duties during the reporting period.
Social and ethics committee
| Membership | Meeting attendance | |||
| Kgomotso Moroka (chair) | N/A* | |||
| Steve Pacak | N/A* | |||
| Nolo Letele | N/A* | |||
| Calvo Mawela | N/A* | |||
| Tim Jacobs | N/A* | |||
Note
| * | No meetings were held during FY2019. |
The social and ethics committee is chaired by Kgomotso Moroka, an independent non-executive director. Other members are Steve Pacak, Nolo Letele, Calvo Mawela and Tim Jacobs. The chairs of the audit, risk and remuneration committees shall each be a member of the social and ethics committee together with the CFO and CEO. Imtiaz Patel (chair of the board) attends by invitation.
This committee meets at least twice a year prior to scheduled meetings of the board. No meetings were held during FY2019, and as a result the group will produce its first committee report in FY2020.
The primary purpose of the social and ethics committee is to oversee the group's activities with regard to sustainable social and economic development initiatives, which include public safety, HIV/Aids, environmental management, corporate social investment, consumer relationships, labour and employment, the promotion of equality and ethics management.
This committee is responsible for ensuring and monitoring compliance with all applicable laws (including the Companies Act), as well as relevant codes and standards relating to BBBEE, employment equity, environmental management, health and safety, HIV/Aids, corporate social responsibility, consumer relationships and human resources. Its responsibilities further include:
- Reviewing, at least every second year, the strategies and policies of the group designed to achieve responsible corporate citizenship.
- Reviewing and approving the group code of ethics and the group's stakeholder management plan and policy.
- Reporting to shareholders as required in terms of the Companies Act.
Looking ahead, the committee will focus on enhancing its ethics management processes as well as its stakeholder engagement and response processes. Furthermore, the committee will strive to improve its corporate citizenship policies and processes, including improving sustainability, corporate citizenship and social impacts. At the end of FY2020, the committee will assess itself against its charter in order to evaluate whether it has adequately carried out its duties during the reporting period.