The King Report IV on Corporate Governance for South Africa™ (“King IV”) defines corporate governance as the application of ethical and effective leadership by the governing body. Good governance outcomes such as ethical culture, good performance, effective control, and legitimacy help to achieve this ideal.
In order to deliver good corporate governance outcomes, King IV™ promotes governance as an integral component within the running of an organisation, whilst simultaneously ensuring the sustainable development of the organisation.
Determining whether your organisation’s current corporate governance framework is sufficient
Currently, King IV™ has 16 principles which clearly articulates recommend practices aimed at achieving a good governance framework. Even though your organisation may have adopted the principles of King III™, there are numerous changes to King IV (in comparison to King III).
Kilgetty is an approved agent for a software programme that enables us to perform a thorough King IV gap analysis on your entire organisation. The service enables you to identify existing gaps and implement the required remedies to address these gaps.
Next steps once the King IV gaps have been identified
King IV advocates an outcomes-based approach towards realising good corporate governance outcomes. This is facilitated by the mindful application of King IV’s recommended practices which encourages moving away from the traditional tick-box approach which organisations have mostly adopted.
This is easily achieved through the implementation of an appropriate corporate governance framework aimed at assisting the governing board with the achievement of specific governance outcomes. Similarly, the process aids the establishment of appropriate policies by the governing board.
King IV recommends the disclosure and adoption of a board charter prescribing the manner in which members of a governing body are held to account for ethical and effective leadership. Similarly, relevant to the oversight and implementation of policies, King IV recommends that appropriate delegation of authority to management and board committee’s be implemented.
The way forward — after a good corporate governance framework has been implemented
Primarily the governing board is responsible for planning, monitoring and oversight of policies. Moreover, in relation to these policies, the governing board must ensure that full accountability is taken for them.
In particular, principle 5 of King IV advises that the governing board is responsible for the organisation’s reporting process. As such, the governing board must implement a reporting framework which suitably facilitates continuous monitoring of policies.
Kilgetty is suitably able to professionally assist your organisation with the implementation of a good corporate governance framework.