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Chapter 3

King III

The Institute of Directors in Southern Africa (IoDSA) formally introduced the King
Code of Governance Principles and the King Report on Governance (King III).

It applies to all entities regardless of the manner and form of incorporation.
Principles are drafted on the basis that, if they are adhered to, any entity would have
practiced good governance.

The Code is divided into nine sections which address:

 ethical leadership and corporate citizenship

 boards and directors

 audit committees

 the governance of risk

 the governance of information technology

 compliance with laws, rules, codes and standards

 internal audit

 governing stakeholder relationships

 integrated reporting and disclosure.

King III has opted for an 'apply or explain' governance framework. Where the board
believes it to be in the best interests of the company, it can adopt a practice different
from that recommended in King III, but must explain it.

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