Corporate governance in South Africa differentiates between non-executive directors (“NED”) and independent directors (“ID”) of companies. An ID is defined as a person who has no interest, position, association or relationship with the company or its executives. NEDs by definition are neither full-time executives nor IDs. We will refer to both of these as NEDs read more..
Internal pressure is a pervasive threat to the internal audit's objectivity. Nothwithstanding this, the internal audit function of larger enterprises is critical for assessing the maintenance of good governance. It provides the audit committee and the board with a clear, unfettered view of internal compliance with company policies. Few people are aware that amongst internal read more..
It is important to note that unalterable provisions pitch the MoI vs the Companies Act. The latter will always prevail over provisions of the company’s MOI. What are the alterable provisions? Cliffe Dekker Hofmeyr ("CDH") noted that "proxy appointments are a critical tool to ensuring that meetings proceed and decisions are made, where shareholders/members cannot read more..
Managing personal conflicts of interest in the workplace is not receiving enough attention. Do you have a program to manage potential areas of conflict of interest? Does your company have a policy to counter conflicts of interest? Who is responsible for its oversight? Areas where potential conflicts of interest could occur Here are a number read more..
"The business rescue process of South African Airways, which, after almost eight months and billions of rand, is still not complete, has put the spotlight on whether business rescue is indeed a viable option provided by the Companies Act." says Carin Smith of Fin24. The success rate of business rescue in South Africa is approximately read more..
Ever wondered why a board opts to buy back the company’s shares? A share buy-back is almost always the subject of a shareholders’ resolution at each AGM of an issuer. Common sense dictates that boards resolve to pursue a share buy-back arrangement under the following circumstances: A discount exists between the current market price and read more..
The memorandum of incorporation (MOI) is the main constitutional document governing a company's affairs and deals with various matters including, amongst others, the company's powers, internal governance, the regulation of securities and the powers of its board and shareholders. The Act, however, is not a rigid document and recognizes that modern businesses require flexibility in read more..
There is no doubt that the Companies Act (71 of 2008) (“Act”) has modernised corporate law in South Africa, by amongst other things, creating flexibility and simplicity in the formation and maintenance of companies whilst promoting a balance between the rights and obligations of shareholders and directors. This includes the concept of alterable and unalterable read more..
The Companies Act No. 71 of 2008 (the “Act”) came into effect on 1 May 2011, and amongst other important provisions, introduced the concept of the public interest (“PI”) score of a company. This is an important development, as it determines the financial reporting standards that the enterprise must follow. It applies equally to companies read more..
Regulation 30 of the SA Companies Act 2008 as amended provides that a company must, unless its exempted by CIPC from doing so, file its annual return with CIPC within 30 business days after the anniversary of its date of incorporation if incorporated in South Africa, or the date of transfer of its registration in read more..