CORPORATE GOVERNANCE

1
Presentation

• CORPORATE GOVERNANCE
• DEVELOPMENTS AND CHALLENGES
• Loren Wulfsohn
• 10 July 2006

2
Contents

• Introduction
• Current Developments in the region
• Challenges facing corporate governance reform in
  Africa
• Conclusion

3
Introduction

• Governance in any context reflects the value
  system of the society in which it operates.
  Accordingly, it would be pertinent to observe and
  to take account of the African worldview and
  culture in the context of governance of companies
  in South Africa.
• King Report on Corporate Governance for South
  Africa 2002 (King II)

4
African context

• Unique circumstances
• Governance Sustainable development
• Governance socio-political development
• Preponderance of state owned enterprises

5
Work done in the regionNEPAD

• NEPAD
• Commitment to eradicating poverty through
  sustainable growth and development
• Declaration on democracy, political economic and
  corporate governance
• Approved codes and standards

6
Work done in the regionNEPAD

• NEPAD Business Foundation
• Leading business organisations
• Develop best practice standards of corporate
  governance throughout Africa

7
Work done in the region APRM

• African Peer Review Mechanism (APRM)
• Self-monitoring mechanism
• Voluntary accession
• APRM process

8
Other Codes

•  
• - Equator Principles
• - Global Reporting Initiative
• - Global Compact
• - Extractive Industries Transparency Initiative

9
Work done in the region PACFCG

• Pan African Consultative Forum on Corporate
  Governance (PACFCG)
• Purpose
• Raise awareness of the significance of corporate
  governance
• Forge consensus on concepts and methods of
  corporate governance
• Develop action plans for the implementation of
  good corporate governance standards
• Contribute to and learn from the global policy
  dialogue on corporate governance

10
East and Southern African Regions

• Sub-Regional Organisations
• Common Market for Eastern and Southern Africa
  (COMESA),
• East African Community (EAC),
• Southern African Development Community (SADC),
  and
• Eastern Central and Southern African Federation
  of Accountants (ECSAFA)

11
COMESA
12
EAC
13
SADC
14
ECSAFA
15
Challenges facing corporate governance reform in
Africa

• Corruption
• Regulatory issues
• Inactive shareholders
• State owned enterprises
• Board weakness
• One-size fits all governance codes
• Professional bodies
• HIV/AIDS

16
Role of private and public sector

• Development is largely about enabling private
  investment and entrepreneurship to secure
  sufficient and equitable growth for people to
  have a hope for a better future. But economic
  change can not be separated from social change.
• Business and society must walk hand in hand.
• George Kell, UN, The UN Global Compact
• Concepts, Achievements, Future

17
Conclusion

• Value of partnerships private and public
• Reform measures need to be put into place
• Political buy-in for reform programmes
• Corruption is a huge issue
• Culture of disclosure and transparency aligned to
  international standards

18

• Thank
• you