What is King III?
We hear a lot about King III in the press today, but just What is King III?
King III is…
- The King Code of governance for South Africa 2009
- - – Was effective in South Africa from 1 March 2010
- - – Should be read in conjunction with “The King Report on Governance for South Africa 2009”
- - – Applies to all entities regardless of the manner incorporation
- - – Is required to be complied with by all entities listed on the Johannesburg Stock Exchange (JSE)
King III is divided into 9 topics / chapters
- Ethics & corporate citizenship
- Boards & director governance
- Audit governance
- Risk governance
- IT governance
- Compliance
- Internal audit
- Stakeholders
- Integrated reporting
What does King III have that King II didn’t?
- King III principles apply on an “apply or explain” basis - NOT on a “comply” basis
- Is applicable to all entities and not only listed companies
- Information Technology Governance
- Business Rescue (recommendations for economically viable companies in financial difficulties)
- Fundamental and Affected transactions (mergers acquisitions amalgamations)
What international trends does King III pick up on?
- Alternative Dispute Resolution (“ADR”, mediation, conciliation arbitration)
- Non-Exec remuneration requiring shareholder approval
- Evaluation of directors and Board performance
- Risk-based internal audit
- Integrated Reporting (reporting on more than just the financial results)
- Stakeholder focus (broader consideration than the traditional shareholders)
- Social, Environment and Economic principles (People, Planet, Profit)
NOTE: The comments in this page are to be read within the context of the candor legal notices which can be found at this web site. The Institute of Directors in Southern Africa’s ownership of the copyright in the publications “King Report on Governance for South Africa 2009” and “King Code of Governance for South Africa 2009” is hereby acknowledged.
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