IoDSA sets wheels in motion for update of King III

A task team convened by the King Committee on Corporate Governance has recommended that the King Report on Governance for South Africa 2009 (King III) be updated. The task team came to the conclusion that whilst the basic content and philosophies of King III would remain in place, there was room for the Report to be enhanced to assist with accessibility and implementation, particularly for smaller entities and non-profits.

The Institute of Directors in Southern Africa (IoDSA) is the custodian of the King reports and the holder of their copyrights. The King reports have achieved international recognition and have helped place South Africa in the vanguard of progressive corporate governance.

Ansie Ramalho, Chief Executive of the IoDSA, who lead the task team says that a number of factors influenced the task team’s ultimate recommendation for an update of King III. "While listed companies are applying King III, we note that non-profit organisations, private companies and entities in the public sector have experienced challenges in adapting King III to their particular circumstances. The enhancement will aim to make South Africa’s authoritative guide on corporate governance more accessible to all types of entities and sectors,” she says.

Greater succinctness and streamlining would be invaluable in positioning the King Report for the digital and mobile ages. As workplaces become paperless and boundaryless, the King framework must be made accessible on mobile and tablet devices.

"The revised Report will contain the same excellent content with fewer principles and more succinct, specific practice recommendations. It will also be easier to implement and access thanks to technology,” says Mervyn King SC, chairman of the King Committee. The opportunity will also be used to consider the latest governance developments since the publication of King III - "Corporate governance is a journey, not a destination, so it’s absolutely right that as we consider enhancement regarding implementation that we take new developments here and internationally into account.”

"Examples of key issues that will define corporate governance into the future are remuneration and integrated reporting,” observes Ramalho. "It’s also clear that we need to assist users to better align the principles in King III with the changing international thinking on responsible investing, and with the Code for Responsible Investing in South Africa (CRISA).”

"The timeline for finalisation of the revision is not yet confirmed but”, says Ramalho, "the revision will only be completed by early-2016 at the earliest. As the fundamental philosophy and concepts as currently espoused by King III will not change, companies should continue following King III as it stands.”