The SepHold board comprises 9 directors, three of whom are executive directors and six non-executive directors. Four of the non-executive directors are independent. The SepHold board is satisfied that it has the requisite balance of skills, knowledge, experience and diversity to make it effective. It continuously reviews its diversity and succession requirements.
SepHold is committed to high ethical standards. The company code of ethics has been aligned with corporate governance trends and practices. It has been adopted as part of SepHold’s continuing effort to:
- comply with all applicable laws and regulations;
- observe the highest standards of honesty and integrity;
- demonstrate due regard for the interests of stakeholders;
- conduct our business sustainably;
- ensure safety and health;
- ensure the protection of the environment; and
- ensure the education and training of employees, officers and directors.
To read the code of ethics, click here
The board is responsible for the group’s compliance with applicable laws, rules, codes and standards as reported throughout the integrated annual review. Compliance is integral to the group’s culture, and key to its strategy. SepHold, as the listed entity, complies with various codes and regulations, including the Companies Act, the JSE Listings Requirements and King IV. The group applied the King IV code to the furthest possible extent during the 2018 financial year. To better apply the principles the board through a gap analysis identified areas to focus on in the 2019 financial year.
To read the King IV Application register, click here
In discharging its duties, the board delegates authority to committees and individuals through clearly defined terms of reference, which it reviews regularly. The board maintains effective control through a well-developed governance process that provides for the delegation of authority. The chairmen of these committees, in conjunction with the board, are elected by the members of each committee.
The group executive committees are responsible for operational activities, developing strategy and policy proposals for consideration by the various boards, and implementing the directives of the various boards. The role of the executive committees includes:
- developing and implementing strategy, operational plans, policies, procedures and budgets;
- monitoring operational and financial performance;
- assessing and controlling risk;
- prioritising and allocating resources; and
- monitoring competitive forces.
AUDIT AND RISK COMMITTEE
The role of the audit and risk committee is described in its charter. The committee chairman holds office for no longer than five consecutive years, unless the remuneration and nomination committee and the board have sound reason to determine otherwise.
The committee executed the following statutory responsibilities in 2018:
- Nominated a registered, independent auditor for appointment by shareholders, and determined their fees and terms of engagement;
- Oversaw the external audit processes and prepared a report for the annual financial statements that describes how the committee carried out its functions and whether it is satisfied of the auditors’ independence. Refer to pages 1 to 3 of the annual financial statements for the committee’s report;
- Reported to the board on any matters related to SepHold and Métier’s accounting practices, the content or auditing of annual financial statements and internal financial controls; and
- Performed other functions determined by the board, including: developing and implementing a policy plan for a systematic, disciplined approach to evaluate and improve risk management; internal control and governance processes and information technology management.
Feedback on 2018 focus areas
- Assessed and helped improve internal controls at Métier and SepCem;
- SepCem debt covenants management: successfully negotiated for the reshaping by the lenders;
- Risk and safety management: began aligning Métier’s risk management methodology to SepCem’s; and
- Facilitated workshops on amendments to reporting standards, emerging industry practices in the concrete industry, plant site visits and carbon tax
FY 2019 key focus areas:
- Application of new accounting IFRS Standards 9 and 15
- Development of a group information technology framework
- Risk management
SOCIAL AND ETHICS COMMITTEE
The committee comprises four members of the board including four standing invitees. The board members are constituted of two independent non-executives, one non executive and one executive director.
The standing invitees are:
- Métier Managing director
- Executive Manager operations
- Executive Manager organisation performance
- Head of risk
The committee focused on the operating companies in the following matters:
- SepCem’s community relations and the related outstanding issue;
- Monitoring the SepCem EDP;
- Employment equity and employee retention; and
- Corporate citizenship custodianship
- The review of group conduct and ethics codes
- The maintenance of good relations with customers
- Monitoring the implementation of Métier and SepCem with regulatory requirements, particularly the approval of the SepCem SLP
- Impact of the mining charter on Aganang
Feedback on 2018 focus areas
Drafted and signed a memorandum of understanding with the communities located near the Aganang plant. This will enable the resolution of several outstanding matters including:
- Métier BBBEE status: the level 6 achieved was significantly better than anticipated
- Employee retention plan at SepCem: review of plan indicated a success rate of approximately 75%
- Unionisation at SepCem: the associate successfully concluded a relationship charter with AMCU and a 12-month wage agreement
FY 2019 key focus areas:
- Conclude the engagement process for the SepCem SLP approval
- Pursue the appointment of community elected board members into the Torosesha
To read the Gender Policy, click here
REMUNERATION AND NOMINATION COMMITTEE
The remuneration and nomination committee (REMCO) is chaired by Mr. M Ngoasheng with the board chairman, Mr. B Williams, chairing the meeting portion dealing with nominations. The group chief executive and the financial director were invited to meetings to assist the committee in executing its mandate.
To contribute to the group’s implementation of the strategic objectives the committee achieved the following in FY 2018:
- The development of the board succession plan;
- Group succession plans for executive positions;
- The approval of the SepHold and Métier short-term incentives;
- The approval of the King IV aligned remuneration policy;
- The nomination of Ms Bulo as non-executive director; and
- Review of the committee charter to align with King IV.
Feedback on the FY 2018 focus areas:
- Group succession: Developed succession plans for all key positions
- Board gender and skills diversity: Reviewed the board gender diversity policy
- Enhancement of key performance areas to align to strategic objectives: Updated the performance indicators for the SepHold executive management
The REMCO considered and applied King IV’s guidance of fairness, responsibility and transparency stipulated in principle 14 to enhance the group remuneration policy. The group’s remuneration policy excluding SepCem is described in the report below. The group participates in the determination of the appropriate remuneration strategy and policy at SepCem through the representation of three directors.
To read the Renumeration report 2018, click here