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1 – 10 of over 13000The purpose of this paper is to explore the prominence and positioning of ethics in the four editions of the King Report on corporate governance for South Africa that were…
Abstract
Purpose
The purpose of this paper is to explore the prominence and positioning of ethics in the four editions of the King Report on corporate governance for South Africa that were published since 1994. It tells a tale of how certain ethics aspects remained fairly constant over the four editions of the King Report on corporate governance for South Africa (King I in 1994; King II in 2002; King III in 2009; King IV in 2016), whilst other ethics aspects evolved quite substantially over the four editions.
Design/methodology/approach
In this paper, a conceptual distinction between “Ethics of Governance” and “Governance of Ethics” will be introduced, which will then be used to analyse the ethics dimensions of the four King reports.
Findings
It will be demonstrated that there is continuity across the four editions of the King Report as far as the Ethics of Governance is concerned.
Originality/value
With regards to the Governance of Ethics, there has been a quite drastic evolution in both the prominence and positioning of ethics since the publication of the first King Report in 1994.
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This paper aims to delve into the progress in governance application regimes over the years.
Abstract
Purpose
This paper aims to delve into the progress in governance application regimes over the years.
Design/methodology/approach
This paper was conceptual/analytical in nature and based on research of King Reports and other desktop research.
Findings
Distinctive developments in the narrative and practice of governance in the King Reports were found.
Originality/value
A unique reporting of the development in governance praxis through the King Reports is provided.
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The purpose of this paper is to provide the reader with a high-level overview of the key messages of each of the four King Reports on Corporate Governance for South Africa…
Abstract
Purpose
The purpose of this paper is to provide the reader with a high-level overview of the key messages of each of the four King Reports on Corporate Governance for South Africa, published during the period from 1994 to 2017, with a particular focus on the stakeholder-inclusive approach. While confirming the constant themes and messages, it also highlights the unique features and attributes of each of these reports.
Design/methodology/approach
This paper is based on a review and comparison of the four King Reports of Corporate Governance for South Africa with a particular focus on the stakeholder-inclusive approach.
Findings
The key findings of this paper are: the concept of “stakeholder inclusivity” is a common theme across all four the King Reports forming part of the review while, at the same time, having a unique flavour in each of the reports and visibly developing over the years. The reliance on human intervention and ethical leaders to appropriately and effectively steer the stakeholder-inclusive approach is obvious. In the absence of this, no corporate governance code will provide adequate safeguards to stakeholders against corporate failures and disasters, whether in South Africa or anywhere else.
Originality/value
This paper is a part of a special issue which looks at the contribution of the King Reports to governance globally.
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This paper aims to discuss the King Reports and Codes and the development of South Africa’s common law. The role of developing the common law is explicitly recognised in the…
Abstract
Purpose
This paper aims to discuss the King Reports and Codes and the development of South Africa’s common law. The role of developing the common law is explicitly recognised in the Constitution, as is the obligation to give effect to the spirit, purport and objects of the Bill of Rights. With decisions of the Supreme Court of Appeal being based on the King Code, the King Code is now an integral part of South Africa’s common law.
Design/methodology/approach
When the task team drafting King IV commenced their work, one of the important issues raised with Mervyn King, as Chairman, was the challenge to ensure that King IV was aligned to the now firmly entrenched common law principles taken from King I, King II and King III. It is believed that this has been achieved and it is hoped that King IV (and the subsequent King Reports that will inevitably follow because the corporate milieu keeps changing) continues to enrich South Africa’s common law.
Findings
The King Reports and Codes have been made part of South Africa’s common law.
Originality/value
This paper fulfils an identified need to study the King Report and Code, as it relates to South Africa’s common law.
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In South Africa, King III requires companies to have their corporate social responsibility (CSR) disclosures independently assured. Within this context, the purpose of this paper…
Abstract
Purpose
In South Africa, King III requires companies to have their corporate social responsibility (CSR) disclosures independently assured. Within this context, the purpose of this paper is to examine internal audit’s CSR assurance role.
Design/methodology/approach
With reference to the International Professional Practices Framework of the Institute of Internal Auditors, the first phase of the study conceptually considers whether internal audit does qualify as an independent CSR assurance provider. Using a content analysis of integrated reports, the second phase examines the extent to which internal audit’s CSR assurance role has been disclosed. The final phase relies on survey responses to understand the emerging trends observed in the second phase.
Findings
The study finds that although internal audit does provide independent CSR assurance, this assurance is primarily intended for internal stakeholders to assist in improving the quality of CSR reporting practices. With one notable exception across the study period, the results suggest that any benefits accruing to external stakeholders were not deliberate, but merely incidental. The paper concludes by arguing that although internal audit will continue to incorporate material CSR issues into its mandatory risk-based auditing approach, the results will not necessarily be publicly available. The extent of reliance that external stakeholders can place on company CSR disclosures are therefore not directly influenced by internal audit’s involvement in CSR-related matters. However, by adopting a proactive CSR role, internal audit can assist reporting companies improve their CSR reporting practices.
Originality/value
Although CSR assurance has been extensively researched, this is one of the first studies to specifically consider the CSR assurance role of the internal audit activity. Despite its South African orientation, given the emerging nature of the CSR assurance phenomenon, the study findings have global implications.
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Mumbi Maria Wachira, Thomas Berndt and Carlos Martinez Romero
This study aims to explore factors influencing voluntary adoption of international sustainability and integrated reporting guidelines within a mandatory reporting framework. Given…
Abstract
Purpose
This study aims to explore factors influencing voluntary adoption of international sustainability and integrated reporting guidelines within a mandatory reporting framework. Given South Africa’s political history, the authors argue that accounting practice can be used to secure the legitimacy and transparency of businesses.
Design/methodology/approach
Two logistic regression equations are used to predict the likelihood of firms’ subscribing to either Global Reporting Initiative (GRI) or the Integrated Reporting (<IR>) framework, respectively. The authors consider annual, sustainability and integrated reports issued for the financial year ended 2014.
Findings
The results show a statistically and significant positive association between the adoption of the GRI’s guidelines and the level of transparency of non-financial disclosures and environmental sensitiveness. The application of the <IR> framework is also associated with the level of a firm’s transparency score and with its respective analyst following, which acts as a measure for capital markets requiring a high information environment.
Originality/value
This paper illustrates the development of integrated and sustainability reporting (SR) practices within an emerging market. By drawing distinctions between locally developed South African codes of corporate governance, namely, King I-III and international guidelines proxied by the GRI’s guidelines for SR, and the <IR> framework, the authors show that South African firms still adopt international guidelines despite the mandatory framework in place.
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The purpose of this study is to provide a high-level review of the evolution of shareholder activism and institutional investor engagement in the corporate governance ecosystem in…
Abstract
Purpose
The purpose of this study is to provide a high-level review of the evolution of shareholder activism and institutional investor engagement in the corporate governance ecosystem in South Africa. Furthermore, it specifically seeks to explain the incorporation of such aspects into the various key codes and reports on corporate governance in South Africa since 1994.
Design/methodology/approach
Historical narrative and analysis.
Findings
This study highlights how shareholder activism and institutional investor engagement in the corporate governance ecosystem have been considered and addressed in South Africa since the publication of the First King Report in 1994. The progress that has been made specifically with regard to the introduction of a code for institutional investors is highlighted. The study ultimately acknowledges that this evolution is a continuing journey on the road to stakeholder inclusivity and engagement, and then concludes that the specific role and impact of institutional investors, particularly given some of the recent corporate governance failures, will require further consideration going forward. This should ensure the continued alignment of all stakeholders and assist in making the necessary improvements to the overarching governance framework and attendant culture.
Originality/value
This study is a part of a special issue that looks at the contribution of the King reports to governance globally.
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Abdifatah Ahmed Haji and Mutalib Anifowose
This paper aims to examine the role of the audit committee function as an internal assurance provider in the emerging integrated reporting (IR) practice. In particular, the…
Abstract
Purpose
This paper aims to examine the role of the audit committee function as an internal assurance provider in the emerging integrated reporting (IR) practice. In particular, the authors examine the role of the overall effectiveness, as well as specific aspects, of the audit committee function in IR practice.
Design/methodology/approach
The authors examine the integrated reports of 246 firm-year observations of large South African companies over a three-year period (2011-2013), following the introduction of an “apply or explain” IR requirement and an embedded “combined assurance” model in South Africa. Drawing from conflicting theoretical perspectives of economics-based (e.g. agency theory) and socio-political theories (e.g. legitimacy theory), the authors develop competing hypotheses to predict the role of the overall, as well as specific aspects, of the audit committee function in IR practice.
Findings
Consistent with the predictions of economics-related theories, the authors find that the overall effectiveness of the audit committee function has a strong positive association with the extent and quality of IR practice. In particular, audit committee authority and meetings are shown to have a significant positive impact on IR practice. However, as implied by socio-political theories, the authors do not find a significant association between key aspects of the audit committee function such as audit committee independence and financial expertise and IR practice.
Practical implications
This study informs local and international regulatory authorities, as well as the business community, about the potential significance of internal assurance mechanisms such as the audit committee function in the emerging IR practice. Given the practical challenges associated with independent external assurance provisions, the findings of this study suggest that internal assurance mechanisms – such as the audit committee function – can be genuine and cost-effective alternative assurance mechanisms in enhancing the credibility and reliability of non-financial reporting practices, particularly the emerging IR practice. The results also inform academic researchers to take cognisance from the expanding roles and responsibilities of audit committees and conduct in-depth investigation on “how” the audit committee function is handling the increasing responsibilities.
Originality/value
The study provides initial empirical account towards the role of the audit committee function in the emerging IR practice. The study is novel because it shows the significance of internal assurance mechanisms in wider organisational reporting practice.
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The purpose of the paper is to analyse the relationship between corporate social responsibility and the concept of Black economic empowerment in South Africa. The paper examines…
Abstract
Purpose
The purpose of the paper is to analyse the relationship between corporate social responsibility and the concept of Black economic empowerment in South Africa. The paper examines whether government interventions in the area of corporate social responsibility post‐1994 have been successful. The paper also assesses critically the level of voluntary commitment that businesses in South Africa have displayed in the area of corporate social responsibility.
Design/methodology/approach
Corporate social responsibility in South Africa pre‐1994 and post‐1994 is examined and compared. The Broad‐Based Black Economic Empowerment Act (2003), the new South African Companies Act (2008) and the King Codes of Corporate Governance Principles in South Africa are critiqued. A distinction is made between government and business corporate social responsibility initiatives.
Findings
The paper principally concludes that meaningful corporate social responsibility in the area of human rights can be better achieved if it is based on commitment and collaborative partnership.
Practical implications
The paper provides a basis for empirical research on corporate social responsibility and socio‐economic development in South Africa.
Originality/value
This paper adds to the growing discourse of academic literature that supports a strategic partnership‐based approach to corporate social responsibility.
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The purpose of this paper is to provide a perspective on the distinctive stance of the King Report on Corporate Governance in South Africa, 2016 (King IV) in relation to a number…
Abstract
Purpose
The purpose of this paper is to provide a perspective on the distinctive stance of the King Report on Corporate Governance in South Africa, 2016 (King IV) in relation to a number of other codes of corporate governance issued globally.
Design/methodology/approach
The paper presents a comparative analysis between King IV and the codes of governance that apply in a select number of the jurisdictions, namely, Australia, Brazil, Malaysia, Nigeria and the UK. The selection of jurisdictions was done with the view of having a sample that is representative of the major global regions. Preference was given to codes that were issued or revised recently. Mention is also made of the G20/OECD Principles of Corporate Governance where appropriate.
Findings
The conclusion reached in this paper is that King IV is distinctive from the codes compared to it in this paper in six respects. These include that King IV defines corporate governance as accountable leadership instead of it being a system only and is drafted for positive outcomes instead of compliance; proposes an application regime that is qualitative instead of quantitative; integrates sustainable development into its model for corporate governance instead of treating sustainability as an ad hoc-matter; has applicability across the ecosystem of all organisations instead of limited application to listed or larger companies; and has a has built in a social value system to harness broad public support instead of reliance on bottom-down enforcement.
Originality/value
The implications of the distinct approach to corporate governance in King IV are explained in the paper and should serve as a premise to reconsider whether the more traditional approaches to corporate governance code development are still appropriate in light of the learning as evidenced in King IV.
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