King III - Boards and Directors

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Boards and Directors

King III confirms the role of the Board as the focal point for corporate governance. The Board has collective responsibility to provide and ensure good governance. As such, it is the responsibility of the directors to ensure, among others, that the company:

operates ethically and with integrity, and as a responsible corporate citizen
considers the interests of the community within which it operates
integrates governance, strategy, risk, performance and sustainability
complies with laws and regulations
identifies and manages risks
employs structures and processes to ensure the integrity of its integrated reporting.

Although the directors are ultimately accountable for adherence to appropriate best practice principles, the direct responsibility of the Board is focused on the design and adoption of adequate policies, inculcating the required culture to adhere to such policies, and the subsequent oversight of the implementation of such policies.
Management bears responsibility for the implementation of policies, strategy, business plans and the like.
In order to ensure the effective functioning of the Board, King III proposes a unitary board structure comprising executive, non-executive and independent non-executive members. The majority should be non-executives, of whom the majority should be independent. The Board should be chaired by an independent non-executive director. The CEO of the company should not also fulfil the role of the Chair of the Board.

King III further proposes a formal election and induction process for new Board members, ongoing director development, and emphasises the importance of effective Board performance. It also provides guidance on remuneration of directors and executives, and the composition and responsibility of Board committees.

King III proposes that the Boards of all companies establish audit, risk, remuneration and nominations committees, and be assisted by a competent company secretary.

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