Key elements of our corporate governance
In alignment with the Companies Act and the JSE Listings Requirements, our Board considers the following:
diversity – gender
and race – and
Our Board has 17 members, 10 of whom are independent and four of whom are now executive directors – with the appointment of a new Financial Director and a second Deputy Chief Executive Officer. On 24 March 2016, shareholders were advised that lead independent director, Trevor Munday, would step down as director in the second half of 2016. However, on 8 November 2016, we announced that as a result of the increased demand on the Board due to the Barclays PLC sell-down, his departure has been postponed to provide continuity on our key committees.
Francis Okomo-Okello, the former Chairman of Barclays Bank of Kenya Limited, retired from that board on 7 October 2016. As indicated in previous reports, Francis has been regarded as independent in relation to Barclays Africa throughout.
12 of our 17 Board members are South African, of whom four are black and four are women. We aim to improve women representation on our Group Board. In 2016, we met our target of 25%, and we aim to reach 26%2 in 2017. Women make up 33% of our country bank boards, and 25% of our South African subsidiary boards – both figures are up year-on-year.
Barclays PLC is reconsidering its nominees to our Board. These changes are subject to Board and regulatory processes and will be announced when finalised.
In accordance with King III, all directors serving on the Board for longer than nine years are assessed to determine the level of their independence and the quality of their contribution. Yolanda Cuba and Trevor Munday have been assessed in this regard, and the Board has found them suitably independent, with continuing strong contributions.
No individual director or group of directors has unfettered powers of decision-making.
|To govern a group of this magnitude and complexity, we appoint directors with appropriate regard to their education, diversity, expertise and experience in order to enhance the required collective set of skills, to ensure robust governance, keen commercial decision-making and strong technical inputs. Directors are appointed through a formal and transparent process which is facilitated by the Directors’ Affairs Committee on behalf of the Board. The Board as a whole approves all appointments on recommendation by the Directors’ Affairs Committee. The Directors’ Affairs Committee comprises only independent non-executive directors, and is chaired by the Group Chairman.|
|Our Board remains satisfied with the competency and experience of Nadine Drutman (BCom, LLB, LLM), our Group Company Secretary. She maintains an arm’s length relationship with the Board, providing guidance to Board members on the execution of their duties, and she maintains her knowledge of developments in corporate governance best practice and regulation. All Board members have unhindered access to her services in all aspects of the Board’s mandate and the operations of the Group.|
|Board evaluation||In January 2017, the Board members evaluated the performance of the Board and the members, in respect of the 2016 year. The Board was found to be performing well. Identified areas of improvement will receive attention through the 2017 Board meeting cycle.|
|Applying King III principles
(King III fact sheet)
With the exception of the two areas below, the Group has applied all the principles of King III:
Following the launch of King IV on 1 November 2016, we conducted an assessment of our Board Charter and committee terms of reference against the principles and recommended practices of King IV. Our view is that we are well positioned in terms of King IV and, in the main, already apply most of its recommended practices.
Key considerations to enhance our application of practices under King IV and to respond to the subsequent related JSE amendments include the following:
While we believe our level of disclosure is in line with current best practice, the specific disclosure obligations introduced by the recommended practices in King IV could lead to potential extensive additional disclosures in the form of our explanation of how we applied the principles.
King IV recommends that the board of the holding company should ensure the agreed group governance framework is implemented across the group, and the subsidiaries must form part of the governance arrangements for the group and must agree to all the policies of the group. We have approximately 145 subsidiary entities and will supplement our existing arrangements so as to strengthen our governance in respect of all active entities.
Changes to governance
During the year, we established an Ad hoc committee of the Board dedicated to provide oversight and advice to management in respect of the Barclays PLC sell-down and its impact on the Group. This committee met frequently, and provided guidance to management and feedback to the Barclays Africa and Absa Bank Boards.
We work with the country boards to continuously improve skill sets, governance practices and quality of reporting. This year saw heightened feedback to the country boards through their chairmen on the matter of the separation to maintain open communication. This empowers the country boards to engage with their regulators. This process is ongoing with regular interactions at board and management level.
The Group Remuneration and Human Resources Committee changed its name to the Group Remuneration Committee (RemCo) following a review of its terms of reference. Consequently, it is more focused on remuneration matters, together with executive succession, attraction and retention. All other human resources matters were confirmed to be within the purview of the Social and Ethics Committee.