scholarly journals Evaluation of corporate integrated reporting in South Africa post King III release South Africa: An exploratory enquiry

2013 ◽  
Vol 6 (2) ◽  
pp. 421-438 ◽  
Author(s):  
Theophilus S. Makiwane ◽  
Nirupa Padia
Keyword(s):  
South Africa ◽  
Risk Management ◽  
Corporate Governance ◽  
Financial Performance ◽  
South African ◽  
Listed Companies ◽  
Integrated Reporting ◽  
Management Processes ◽  
The Future ◽  
Governance Risk

Following the release of the King III report on Corporate Governance for South Africa, which became effective in March 2010, South African companies are expected to embrace the concept of integrated reporting in terms of which they are required to provide details of their strategies, corporate governance, risk management processes, financial performance and sustainability. More importantly, companies need to show how these components of integrated reporting are linked to one another so that stakeholders can make informed decisions about such companies’ current performance as well as their ability to create and sustain value in the future. The purpose of this study was to determine whether the level of reporting by South African listed companies has improved since the release of the King III report. It was subsequently found that there have been some progress in this regard, but there is still much room for improvement if the objectives of integrated reporting are to be fully met.

scholarly journals The effect of industry nuances on the relationship between corporate governance and financial performance: Evidence from South African listed companies

2018 ◽  
Vol 21 (1) ◽  
Author(s):  
Jonty Tshipa ◽  
Leon M. Brummer ◽  
Hendrik Wolmarans ◽  
Elda Du Toit
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
South African ◽  
Resource Dependence ◽  
Stock Exchange ◽  
Listed Companies ◽  
Company Performance ◽  
Johannesburg Stock Exchange ◽  
Good Corporate Governance ◽  
The Relationship

Background: Premised on agency, resource dependence and stewardship theories, the study investigates empirically the existence of industry nuances in the relationship between corporate governance and financial performance of companies listed in the Johannesburg Stock Exchange. Aims: The main objective of the study is to understand the relationship between internal corporate governance and company performance from the perspective of three distinct economic periods, as well as industry nuances, cognisant of endogeneity issues. Setting: South Africa, as an emerging African market, offers an interesting research context in which the corporate governance and financial performance nexus can be examined empirically. Method: A sample of 90 companies from the five largest South African industries, covering a 13-year period from 2002 to 2014 (1170 firm-year observations) was examined with three estimation approaches. Results: Two key trends emerged from this study. First, the relationship between corporate governance and company performance differed from industry to industry. Second, the association between corporate governance and company performance also changes during steady and non-steady periods, which is an indication that the nexus is driven by the state of the global economy and the type of the industry. Conclusion: Evidence from the study suggests that companies should be allowed to optimise rather than maximise their corporate governance options. This finding questioned the approach of the recently published King IV Code of Good Corporate Governance, which requires Johannesburg Stock Exchange-listed companies to ‘apply and explain’ as opposed to ‘apply or explain’ as pronounced by King III Code of Good Corporate Governance.

scholarly journals The South African code of corporate governance. The relationship between compliance and financial performance: Evidence from South African publicly listed firms

2015 ◽  
Vol 12 (2) ◽  
pp. 149-169 ◽  
Author(s):  
Jonty Tshipa ◽  
Thabang Mokoaleli-Mokoteli
Keyword(s):  
South Africa ◽  
Corporate Governance ◽  
Firm Performance ◽  
Financial Performance ◽  
South African ◽  
Small Firms ◽  
Large Firms ◽  
Board Size ◽  
Tobin's Q ◽  
Listed Firms

Using both Return On Assets (ROA) and Tobin’s Q as proxies for performance, the study seeks to explore if better governed firms exhibit greater financial performance than poorly governed firms. The paper employs a panel study methodology for a sample of 137 Johannesburg Stock Exchange (JSE) listed firms between 2002 and 2011. The results show that the compliance levels to corporate governance in South Africa (SA) has been improving since 2002 when King II came into force. However, the compliance level in large firms appears to be higher than in small firms. Further, the findings show that the market value of large firms is higher than that of small firms. These results largely support the notion that better governed firms outperforms poorly governed firms in terms of financial performance. Notably, the empirical results indicate that board size, CEO duality and the presence of independent non-executive directors positively impact the performance of a firm, whereas board gender diversity, director share-ownership and frequency of board meetings have no impact on firm performance. This suggests that greater representation of independent non-executive director, a larger board size and the separation of CEO and Chairman should be encouraged to enhance firm performance. Unexpectedly, the presence of internal key board committees, such as remuneration, audit and nomination, negatively impact firm performance. Similar to UK, South Africa has a flexible approach to corporate governance, in which listed firms are required to apply or explain non-conformance to King recommendations. This study has policy implications as it determines whether the flexible corporate governance approach employed by SA improves corporate governance compliance than the mandatory corporate governance approach as employed by countries such as Sri Lanka and US, and whether compliance translates into firm performance. The significant finding of this study is that compliant firms enjoy a higher firm performance as measured by ROA and Tobin’s Q. This implies that compliance to corporate governance code of practice matters, not just as box ticking exercise but as a real step change in the governance of South African listed firms. This paper fulfils an identified need of how compliance to corporate governance influences firm performance in South Africa. The findings have implications to JSE listing rules, policy, investor confidence and academia.

The perceived relevance of tax risk-management in a South African context

2017 ◽  
Vol 25 (1) ◽  
pp. 82-94 ◽  
Author(s):  
Talya Gail Segal ◽  
Milton Segal ◽  
Warren Maroun
Keyword(s):  
Risk Management ◽  
Corporate Governance ◽  
South African ◽  
Academic Research ◽  
Small Sample ◽  
Integrated Reporting ◽  
Content Type ◽  
Control Structures ◽  
African Context ◽  
Perceived Relevance

Purpose Tax risk-management (TRM) is relatively understudied in the area of corporate governance and integrated reporting. The purpose of this study is to identify whether South African organisations identify, rank and manage tax risks in terms of importance and relevance to their own corporation. The study also aims to identify the link, if any, between TRM practices being implemented and the discussion and disclosure of these practices in the integrated report. Design/methodology/approach Detailed interviews with some of South Africa’s leading tax and corporate governance experts are used to highlight the TRM practices currently in place, as well as the evolution of these practices. These interviews also identify the connection between the practices and the integrated reporting disclosures. Findings The experts interviewed have identified a sound understanding of TRM practices in place and certainly some evolution of these practices over the past five years. What has been identified though is the need for further enhancement and incorporation of TRM practices into the corporate governance control structures within organisations. Integrated reporting disclosure of TRM still appears to be an area where there is need for improvement, specifically a better understanding by companies of how to use their integrated reports as a strategic asset of the company as opposed to merely a compliance exercise. Research limitations/implications The research relies on a relatively small sample of subject experts and does not provide a complete account of TRM developments. Originality/value The study adds value by contributing to research conducted on TRM. Although there has been research on ERM from a corporate governance perspective, few studies have examined this from a tax perspective, and there is virtually no formal academic research on the relationship between TRM and corporate governance from a South African perspective.

scholarly journals Corporate Governance, Integrated Reporting and Environmental Disclosure: Evidence from the South African Context

2020 ◽  
Vol 12 (12) ◽  
pp. 4820
Author(s):  
Antonio Corvino ◽  
Federica Doni ◽  
Silvio Bianchi Martini
Keyword(s):  
South Africa ◽  
Corporate Governance ◽  
Human Rights ◽  
Business Ethics ◽  
South African ◽  
Integrated Reporting ◽  
Environmental Disclosure ◽  
Ceo Duality ◽  
Ethics Policy ◽  
Corporate Social

This research aims to investigate how the adoption of King III can affect the corporate governance model of a sample of South African listed companies on the Johannesburg Stock Exchange (JSE). Particularly, we analyzed the influence of sustainability-related issues of the board of directors (BDs) on firm environmental disclosure, after the mandatory preparation of integrated reporting (IR). In addition, we also examined indepth whether some corporate social policies are able to condition the foregoing disclosure. The empirical study covers the period from 2010 (the first-time adoption of IR in South Africa) to 2015 (the earliest year of the release process regarding King Code of Governance Principles for South Africa 2009 (i.e., King III)). Data were collected by the Bloomberg database. With reference to the BDs features, great attention was paid to both business ethics policy and CEO duality. Instead, with regard to corporate social issues, we looked into the adoption of the policies pertaining to health and safety and the respect for human rights. Following the mandatory preparation of IR, our findings show a positive relationship between business ethics policy and firm environmental disclosure. Contrarily, CEO duality does not exert any effect over the earlier type of corporate reporting. Furthermore, empirical evidence substantiates the association between health safety and human rights policies that are very crucial in an emerging economy, such as South Africa, and firm environmental disclosure. The rationale of such results arguably resides in compliance with King III. Therefore, this study can provide interesting insights, given that its mandatory adoption might reveal an important turning point in the development of corporate governance codes, as well as being a “driver” for potential enhancements of firm environmental disclosure, inter alia, in line with the Sustainable Development Goal (SDG) 12.6.

scholarly journals Corporate governance, risk management and financial performance of listed deposit money bank in Nigeria

2021 ◽  
Vol 8 (1) ◽  
pp. 1888679
Author(s):  
Abiola Kafidipe ◽  
Uwuigbe Uwalomwa ◽  
Olajide Dahunsi ◽  
Faith Ojone Okeme
Keyword(s):  
Risk Management ◽  
Corporate Governance ◽  
Financial Performance ◽  
Governance Risk

scholarly journals Emerging trends in reporting: An analysis of integrated reporting practices by South African top 40 listed companies

2014 ◽  
Vol 7 (1) ◽  
pp. 231-250 ◽  
Author(s):  
Ben Marx ◽  
Ahmed Mohammadali-Haji
Keyword(s):  
South Africa ◽  
South African ◽  
Financial Reporting ◽  
Mineral Resources ◽  
Listed Companies ◽  
Integrated Reporting ◽  
Reporting Practices ◽  
Emerging Trends ◽  
Annual Reporting ◽  
Top 40

Companies should behave as responsible corporate citizens and conduct their business in a manner that meets existing needs without compromising the ability of future generations to meet their needs. Thus they should protect, enhance and invest in the wellbeing of the economy, society and the natural environment in which they do business. Annual reporting format of financial reporting does not take cognisance of stakeholders’ needs in this regard, and there is a need for reporting that brings together financial, sustainability, management commentary and governance aspects in a coherent, simplified and concise manner.The objective of this paper is twofold: it aims, firstly, to provide a brief overview of the development of integrated reporting, and, secondly, to provide evidence regarding the integrated reporting practices at the largest listed companies in South Africa. This is done through a literature review of current corporate governance and sustainability developments, supported by empirical evidence obtained from assessing, through content analysis, the integrated reporting practices of the top 40 companies on the Johannesburg Securities Exchange, South Africa. The study found that although integrated reporting is evolving, inconsistencies still exist regarding the process to follow, format, content, and value thereof. The study is of specific relevance for Africa with its rich mineral resources, as it is of vital importance that companies that do business on the continent behave as responsible corporate citizens, respect the environment and society, and provide accurate, reliable and credible reporting on their financial and sustainability performance to all of their stakeholders in a simplified and integrated manner.

scholarly journals Corporate governance and risk management: a South African perspective

2010 ◽  
Vol 7 (3) ◽  
pp. 138-148 ◽  
Author(s):  
Jackie Young
Keyword(s):  
South Africa ◽  
Risk Management ◽  
Corporate Governance ◽  
South African ◽  
Well Being ◽  
Public And Private ◽  
Management Concepts ◽  
Emerging Country ◽  
African Perspective ◽  
Sound Management

A code of governance is crucial for any emerging country as it endeavours to provide a sound management framework and principles. Corporate governance and risk management are fairly new management concepts, but are becoming important management disciplines for the public and private sectors in South Africa. The aim of this paper is to provide insight into corporate governance and risk management from a South African perspective. South Africa is regarded as one of the more advanced countries in Africa, although still an emerging country with huge development potentials. However, should corporate governance and risk management principles be lacking and not adequately developed and implemented, the aforementioned potential will be nullified and could negatively affect the economic growth and well-being of the country.

scholarly journals Management’s Fiduciary Responsibility Towards IT Governance In The Context Of The King III Code Of Corporate Governance In South Africa

2021 ◽  
Vol 8 (10) ◽  
pp. 90-105
Author(s):  
Nicholas Otu Mantey
Keyword(s):  
South Africa ◽  
Corporate Governance ◽  
South African ◽  
Business Processes ◽  
It Governance ◽  
Listed Companies ◽  
General Outcome ◽  
Fiduciary Responsibility ◽  
Governance Practices ◽  
Code Of Corporate Governance

The purpose of this study was to examine the extent to which South African listed companies trading on the Johannesburg Securities Exchange (JSE) are complying with IT governance imperatives in the context of the King III Code of Corporate Governance. Management information systems and usage of computers are now embedded in business processes to the extent that most firms will be dysfunctional should these tools become unavailable. The underlying theoretical setting for this study is anchored on the agency theory and the Porter’s competitive five forces model. Since there were inadequate constructs on the subject, a combination of research methods were used: desk-top review, exploratory study, and content analysis, by reviewing the annual financial statements of fifty JSE-listed companies (the main board) in South Africa. The general outcome of the study was that JSE-listed companies in South Africa were compliant with IT governance practices as prescribed in the King III Code of Corporate Governance. Most JSE-listed companies in South Africa utilized both generic and bespoke or owned-designed IT governance frameworks to meet IT governance requirements. The study also revealed that issues relating to IT governance were among priority issues for South African listed companies. The study concludes that JSE-listed companies in South Africa have indeed fulfilled their fiduciary responsibility towards IT governance. 

scholarly journals Bank strategic and risk management: A survey to determine the impact of the current world financial crisis on future bank management in South Africa

2010 ◽  
Vol 8 (1) ◽  
pp. 390-401
Author(s):  
B Wessels ◽  
JH Van Rooyen
Keyword(s):  
South Africa ◽  
Risk Management ◽  
Financial Crisis ◽  
South African ◽  
Financial Risk ◽  
Bank Management ◽  
The Future ◽  
Survey Results ◽  
Management Functions ◽  
The Impact

The purpose of this research was to determine how the banks in South Africa perceive the future of bank management and banks risk management over the next couple of years within the context of the financial crisis that recently played out globally. It is clear from the survey results that South African (SA) banks were not affected as much by the crisis as some of their international counterparts. Primarily because of the credit legislations introduced in SA recently. Other reasons may be due to conservatism and sufficient capitalisation of banks and less involvement in global markets where major problems were experienced. The survey indicates that SA banks are prepared to learn from the crisis and are planning to improve financial risk management. Consolidation or centralisation of the risk management functions may be prevalent. According to the survey, liquidity risk management that used to be a fairly low risk management priority in previous bank and treasury surveys, now tops the list of important risks te better manage in the future.

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