BUSINESS TALK

The essence of Corporate Governance

Business SA is being challenged by the impact of the King III Code of Conduct which ultimately determines how businesses need to behave in the best interest of all stakeholders involved.

In creating and maintaining a so-called best practise corporate governance framework for your business, the Board of Directors and / or senior management needs to address, and answer to, the following aspects:

Ethical behaviour and decision making within the business,
The ability to sustain the business at a strategic and financial level
The avoidance of any unwanted conflicts of interest for either the business or any of its key staff or directors,
Decision making and business practises always in the best interest of the business, and not necessarily the shareholders and/or senior management,
Decent control over finances,
Transparent reporting,
Compliance with all relevant statutory requirements,
Internal auditing practises to pro-actively indentify any misconduct at whatever level within the business.

Implementing a proper corporate governance structure and 'frame of mind' in the short term might be perceived by many as just another administrative or compliance burden. This approach misses the point and could be detrimental should any of the above elements be neglected, leading to the business suffering damages and/or become liable to a third party as a result of any related mismanagement in the business.

Business can only benefit by applying sound governance practises. We believe that managing a business in a responsible manner and establishing appropriate reporting structures can safeguard the business now and into the future.

Reinier Matthee
Marathon Group