Enterprise governance and compliance
KING II IMPLEMENTATION PLAN
As part of its compliance with King II, Nedbank Group has a comprehensive implementation and monitoring plan to meet all its requirements and recommendations. This plan – the implementation of which is monitored by the Directors Affairs’ Committee and Enterprise Governance and Compliance – covers all the corporate governance requirements relating to the Banks Act as well as the recommendations of the Myburgh Report and has been approved by the board.
As at 31 December 2008, the group complied with King II – the only areas of non-compliance being the following:
- Group Chairman, Reuel Khoza, is a non-executive director, but not independent. This is as a result of his position at Aka Capital, a strategic business partner of Nedbank Group due to its BEE transaction. He is also a director of the group’s holding company, Old Mutual plc.
- Mustaq Enus-Brey is chairman of the Group Risk and Capital Management Committee and not classified as independent, as he represents one of the group’s black business partners.
- The Chairman of the Credit Committee (Prof. Michael Katz) and the Group Transformation and Sustainability Committee (Lot Ndlovu) were not yet classified as independent non-executive directors.
Note 1: With effect from 20 February 2009, the boards of Nedbank Group and Nedbank Limited approved the reclassification of Prof Michael Katz and Lot Ndlovu from non-executive to independent non-executive directors.
The Nedbank Board is satisfied that these areas of non-compliance do not impair the governance integrity of the group.
The group’s governance framework incorporates a full range of governance objectives, and individual responsibilities are clearly delineated at board, board committee, executive and management levels.
In line with the recommendations of King II, Nedbank Group has a unitary board structure comprising the following 15 directors:
Patience Mnxasana was appointed as an independent non-executive director from 1 October 2008. Jim Sutcliffe, Barry Davison and Cedric Savage resigned from the board during 2008.
Three of the seven non-executive directors, including the Chairman, are not considered independent, as they either serve as directors or are senior executives of the group’s holding company, Old Mutual plc. Mustaq Enus-Brey, Gloria Serobe and Reuel Khoza are also not considered independent because of their relationship with Nedbank Group’s BEE partners.
Enterprise Governance and Compliance has provided input and commentary in respect of King III from both a sustainability and ethics content perspective and eagerly awaits the release of the first draft of King III.
