King Iii

Business School Corporate Governance Series

March 2010

King’s Counsel* King III and related legislative requirements

Steering point

Full-text version Contains the full-text of relevant provisions of applicable legislation. Printed copies of the abridged version can be obtained from the PricewaterhouseCoopers Library and Information Centre at +27 (11) 797 5062.

*connectedthinking

2 PricewaterhouseCoopers

‘There is always a link between good governance and compliance with law. Good governance is not something that exists separately from the law and it is entirely inappropriate to unhinge governance from law.’

– King Report on Governance for South Africa 2009

The King Committee on governance issued the King Report on Governance for South Africa – 2009 (the ‘Report’) and the King Code of Governance Principles – 2009 (the ‘Code’), together referred to as ‘King III’, on 1 September 2009. King III was drafted on the premise that governance matters that had been legislated were accepted as a minimum baseline. To distinguish between legislated and non-legislated recommendations, the following drafting convention was used in the Report: • Legal requirements are indicated by the word ‘must’; • In aspects where the King Committee believed the application of the Code will result in good governance, the word ‘should’ is used, and • The word ‘may’ indicates areas where the King Committee recommends certain practices for consideration. In this edition of Steering Point, we examine all paragraphs in the Report that indicate legislated requirements (in other words, the ‘musts’) or where reference is otherwise made in the Report to an Act of Parliament, and have linked these paragraphs to the related legislation and to the most prevalent relevant sections and subsections thereof. Please note: • Extracts from the Report show the paragraph numbering as per the Report. • The Companies Act, 2008, is currently undergoing a process of rectification. Companies Act,...