Today, business faces increased activism and involvement by the stakeholders, as well as a closer scrutiny of the role of the Board to determine and allocate liability for such failures by management, with accountability extending even to non-executive directors. When seen against this background, the question is therefore not whether a company should or should not comply with the King III Code and Guidelines, but rather whether it can afford not to.
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"But what really matters is whether the entity has the quality of management that comes from careful tutelage by skilled masters, is passionate about serving shareholders and clients, and upholds the highest standards of corporate governance." Richard Stovin-Bradford, The Sunday Times - 28 October 2001 |
Embracing
Sound Corporate Governance Principles
The quality of management is an obvious and important indicator for investors,
measured by issues that include a commitment to and conformance with corporate
governance and best practice principles.
When management takes the initiative in embracing the importance of sound corporate governance principles, it signals an important starting point from which to grow an organisational culture of good governance. But for such interventions to be lasting, there is a process that needs to be entrenched, and its here that CGA can bring its expertise to bear.
CGA opposes the compliance of companies with King III becoming merely a 'tick-box' exercise. Instead, we recognise that it is the attitude and spirit of management in seeking compliance that is important, and indeed what investors are alert for. It is for this reason that CGA prefers to refer to the certification process as one of assessing proactive support for, and conformance with, the King III Code and Guidelines.
