Principle 5 of King Report on Corporate Governance for South Africa™ prescribes that a governing board should ensure that reports issued by the organisation enable stakeholders to make informed assessments of the organisation’s performance, and its short, medium and long-term prospects.
King IV™ clearly articulates the responsibilities of the governing board which is to set the direction of how an organisation’s reporting should be approached and conducted.
The King IV™ recommended practices provides that the aforementioned can be brought about by the governing board instituting the following:
Approving management’s determination of the reporting frameworks to be used, whilst taking into account legal requirements, the intended audience and purpose thereof;
Ensuring that the annual financial statements, sustainability reports, social and ethics committee reports or online printed information and reports comply with legal requirements and/or meet the legitimate and reasonable information needs of material stakeholders;
Oversight by ensuring that the organisation issues an integrated report at least annually;
Approve management’s bases for determining materiality for the purpose of deciding which information should be included in external reports;
Ensure the integrity of external reports; and
Ensure that the organisation’s corporate governance disclosures, integrated reports and annual financial statements (and any other reports) are published on the organisation’s website or on other platforms.
In the coming weeks, be on the lookout for further articles on King IV™. Kilgetty Statutory Services frequently analyses and discusses King IV™ principles in order to better-equip organisations with the practical implementation of effective good governance practices.