Governing our
business

Good corporate governance is key to achieving our strategy. It facilitates effective and prudent management that can deliver the long-term success of the company. Alexander Forbes believes that the application of the principles of good governance as contained in the King Code of Governance Principles and the King Report on Governance 2009 (King III), are a cornerstone of the Alexander Forbes business.

To ensure that our operations are executed in accordance with these principles, we have established a management system that includes a compliance framework, code of ethics, as well as policies and protocols to govern processes and operations.

Our governance framework is applicable to all of the group’s subsidiaries in addition to those policies and procedures that are specific to certain subsidiaries.

Alexander Forbes has a unitary board. Its mission is to represent and promote the interests of the company’s shareholders and relevant stakeholders by adding value to the company’s performance. The board is responsible for ensuring that the group’s operations, processes and activities are underpinned by a strong system of governance that is fully integrated into all aspects of its business. At the date of issue of this report the company’s board of directors consisted of ten members. Of these, five were independent directors, three non-executive directors and two executive directors.

The board is governed by the board charter. The charter regulates how the board conducts business in accordance with the principles of good corporate governance, setting out specific individual and collective roles and responsibilities.

The board committee structure is designed to assist the board of the company in performing its duties and responsibilities. Although the board delegates certain functions to these committees, it retains ultimate responsibility for their activities. Each board committee has formal written terms of reference that are reviewed every year.

During the year under review the subsidiary board and audit committee meeting processes were streamlined in order to reduce duplication of information and reporting, while continuing to comply with regulatory reporting requirements.

In preparing for the implementation of King IV, we commenced training and commissioned a gap analysis of the King IV requirements. The gap analysis will include testing the relevant policies and statutory documents against the principles of King IV and workshops will be held to review the reports arising from the gap analysis.

During 2017 Alexander Forbes adopted a policy to promote gender diversity at board level. The voluntary target set by the board in the policy is that 30% of the board should comprise women within three years of adoption of the policy. The nominations committee will monitor the gender composition of both the board and executive team and make recommendations to the board.

Key focus areas of the board in 2017

• Reviewing and approving the group’s revised strategy, which culminated in Ambition 2022
• Conducting the annual JSE compliance review, the annual review of the board’s terms of reference and work plan, and the annual review of the group authorities matrix
• Approving the integrated annual report, annual financial statements, notice of annual general meeting, solvency and liquidity reports, interim report, dividend declarations and general buy-back programme
• Adopting a gender diversity policy
• Reviewing and approving the board committees’ terms of reference
• Receiving and considering feedback on the board assessment report
• Reviewing and approving the transaction with African Rainbow Capital, the disposal of LCP, and other acquisitions and disposals
• Adopting an acquisitions policy and establishing an acquisitions committee
• Receiving a briefing on the Financial Sector Charter codes and the DTI codes
• Agreeing and adopting a capital allocation strategy
• Reviewing and approving the annual budget and Ambition 2022 group strategy

For more detailed information on governance, including meeting attendance, focus areas, board and committee terms of reference, committee updates and our adherence to the King III principles, please see the full governance report on our website.

The full governance report also contains the remuneration report and chapters on risk and regulatory management.

www.alexanderforbes.co.za/investor-relations/integrated-reports