|
|
|
|
|
|
Cashbuild Limited - 1986/001503/06 |
|
Applied / Partially Applied / Not Applied |
|
|
|
|
|
|
|
|
Principle 1.1: The Board provides effective leadership based on ethical foundation |
|
|
|
Practice: |
The board ensures that the board's and management's conduct sets an example in that it aligns to the company values. |
|
This objective is achieved through adherence to Cashbuild's Governance structure (Mission, Vision, Values, Ethics Policy, Cashbuild Way, Risk Management, Internal Audit, Board Committees, Disciplinary Code of Conduct). |
|
|
|
|
Practice: |
The board promotes the stakeholder-inclusive approach of governance and takes account of the impact of the company's operations on internal and external stakeholders. |
|
The Board does promote the stakeholder inclusive approach of governance and takes into account the impact of the company's operations on stakeholders. The impact of the company's operations on internal and external stakeholders is clearly explained in the annual integrated report. |
|
|
|
|
Practice: |
All deliberations, decisions and actions of board are based on fairness, accountability, responsibility, transparency. |
|
Fairnes, accountability, responsibility and transparency are integral components of Cashbuild's core values and ethics charter to which the Board subscribes. The Board Charter subscribes to principles contained in King III, and more recently King IV, which also incorprates these value principles. |
|
|
|
|
Practice: |
Directors in performing their stewardship role exercise the following five moral duties: conscience, care, competence, commitment, courage. |
|
The 5 moral duties of concience, care, competence, commitment and courage are expected of Cashbuild Directors. |
|
|
|
|
Practice: |
The board sets the values to which the company will adhere to and these are formulated in the company's code of conduct. |
|
Cashbuild's core values as approved by the Board are clearly documented and communicated throughout the company and forms a basis of the company's Ethics Charter and company policies. |
|
|
|
|
|
|
|
|
Principle 1.2: The Board ensures that the company is and is seen to be a responsible corporate citizen |
|
|
|
Practice: |
The board considers not only financial performance, but also the impact of the company's operations on society and the environment. |
|
Giving consideration to the impact of the company's operations on society and the environment is an inherent focus area attended to at Board level during setting of company strategy and attendance of Board and Board sub-committee meetings. Reporting on the impact of the company's operations on society and the environment is done in the annual integrated report. |
|
|
|
|
Practice: |
The board protects, enhances and invests in the wellbeing of the economy, society and the environment. |
|
Cashbuild’s contribution to Corporate Social Investment focuses on:
• Employment opportunities
• New business opportunities (e.g. glass cutters, delivery contractors and local artisans)
• Support to Schools
• Bursary allocations
• Learnership programme |
|
|
|
|
Practice: |
The board ensures that the company performance and interaction with its stakeholders is guided by the Constitution and the Bill of Rights. |
|
Cashbuild's core values, code of ethics, and company policies (CB Way) has compliance to laws and basic best practices of the countries in which it operates (which includes the Constituation and Bill of Rights) as a inherent guiding principle to be adhered to. |
|
|
|
|
Practice: |
Evaluating and managing the risks of doing business in weak governance zones forms an important component of risk management. |
|
Non compliance to governance requirements is inherently considered in Cashbuild's risk management process. Cashbuild has an inherent zero tolerance approach to weak governance. That principle is also entrenched in the company's code of ethics which applies to all areas in which it trades. |
|
|
|
|
Practice: |
The board ensures that collaborative efforts with stakeholders are embarked upon to promote ethical conduct and good corporate citizenship. |
|
Sufficient collaboration with stakeholders to promote ethical conduct and good corporate citizenship is well entranched in Cashbuild's Core Values, Code of Ethics, and company policies (Cashbuild Way). |
|
|
|
|
Practice: |
The board ensures that measurable corporate citizenship programmes and policies are developed and implemented. |
|
Corporate citizenship programmes and policies are established in Cashbuild and are contineously improved on as part of Cashbuild's corporate citizinship growth journey. Measured projects (with related company policies in place) as reported in the annual integrated report involves Store Expansion, Relocation and Refurbishment; Customer Growth; Local Hiring Practices; Contractor Funding; Employment and Transformation (including BEE targets), Employee Training and Development, Community Investment (which includes investment in local schools), and energy and corbon management. |
|
|
|
|
Practice: |
The board satisfies itself that the strategy and business plans are not encumbered by risks that have not been thoroughly examined by management. |
|
The Board utilises the GRM Audit & Risk Committee pack as a source of information to satisfy this requirement. |
|
|
|
|
|
|
|
|
Principle 1.3: The Board ensures that the company ethics are managed effectively |
|
|
|
Practice: |
The board ensures that ethical risks and opportunities are incorporated in the risk management process or ethics programme; i.e. and ethics risk and opportunity profile is compiled. |
|
Ethical risks and opportunities are formally assesed and governed via the Social and Ethics Committee reporting to the Board. |
|
|
|
|
Practice: |
The board ensures that the company's ethics performance is assessed, monitored, reported and disclosed. |
|
Ensuring that the company's ethics performance is monitored, reported and disclosed is a responsibility of the Social and Ethics Committee. Discharge of this responsibility is done with the assitance of Executive Directors serving as members on the committee (chaired by non executive chairperson) and Human Resources and Group Risk members of the executive management team. |
|
|
|
|
Practice: |
The board has ensured that a code of conduct and ethics-related policies, through which ethical standards are clearly articulated, have been established and implemented. |
|
Refer to Cashbuild Values, and Code of Ethics. |
|
|
|
|
Practice: |
The board ensures compliance with the code of conduct is integrated into the strategy and operations of the company; i.e. the ethical organisational culture is reflected in the company's vision and mission; strategies and operations; its decisions and conduct; and the manner in which it treats its internal and external stakeholders. |
|
Refer to company vission, mission, core values, ethics charter and annual integrated report. |
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 2.1: The board acts as the focal point for and custodian of corporate governance |
|
|
|
Practice: |
The board has a well drafted charter. |
|
The Board does have a charter that clearly sets out its role and duties. The charter is distributed in preparation for each Board meeting and is subject to comment, update and approval at least once per annum. |
|
|
|
|
Practice: |
The board meets at least four times a year. |
|
Cashbuild Board does meet at least 4 times per annum in Feb/March, May/June, Aug/Sept, and Nov/Dec with additional meetings arranged as the need arrises. |
|
|
|
|
|
|
|
|
Principle 2.2: The Board appreciates that the strategy, risk, performance and sustainability are inseparable |
|
|
|
Practice: |
The board informs and approves strategy (as opposed to being a passive recipient of strategy as proposed by management). |
|
Company strategy is determined by Cashbuild Executive. Board members and executives revisits strategy annually during which strategy is reviewed and agreed upon. Information regarding strategic matters (strategy update) takes place during quarterly Board meetings. Responsibility of the Board to set strategy and approve business plans is contained in the Board Charter. |
|
|
|
|
Practice: |
Board takes steps to ensure that long-term planning will result in sustainable outcomes taking account of people, planet, profit. |
|
Review of long term planning resulting in sustainable outcomes is an inherent task performed by Board members during strategic sessions and Board meetings. Measurement of sustatinable results and reporting thereof by Cashbuild management is reviewed by Board members prior to release of the annual integrated report. |
|
|
|
|
Practice: |
The board ensures that the strategy is aligned with the purpose of the company, the value drivers of its business and the legitimate interests and expectations of its stakeholders. |
|
Purpose of the company, value drivers of its business, and interests of stakeholders are carefully considered during annual strategy meetings and confirmed during Board meetings. |
|
|
|
|
Practice: |
Strategy is translated into key performance and risk areas (including finance, ethics, compliance and sustainability); and the associated performance and risk measures are identified and clear. |
|
Strategy implementation is a formalised process governed company strategy policy and addresses risk areas that include finance, ethics, compliance, sustainability and associated performance and risk measures. |
|
|
|
|
Practice: |
The board considers sustainability a business opportunity; i.e. long-term sustainability is linked to strategy and guides strategy. |
|
Profitability and long term sustainability is an inherent long term key performance objective of Cashbuild that is incorporated into business strategy-setting. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 2.14: The Board and its directors act in the best interests of the company |
|
|
|
Practice: |
Directors are permitted to take independent advice in connection with their duties at company cost following a board approved procedure. |
|
Directors has a right to professional advise at expense of the company subject to adherence to the related process as set out in the Board Charter. |
|
|
|
|
Practice: |
Real or perceived conflicts of interest are disclosed to the board and managed appropriately. |
|
Required declaration of conflicts of interest and management thereof is governed in terms of the applicable paragraph in the Cashbuild Board Charter. |
|
|
|
|
Practice: |
The company has a policy regarding dealing in securities by directors, officers and selected employees. (Only applicable if listed company.) |
|
Dealing in securities by directors, officers and employees is goverened in terms of paragraph 10 of Board Charter for directors and officers and company remuneration policy contained in the CB Way for staff. |
|
|
|
|
Practice: |
The board has unrestricted access to all company information, records, documents and property subject to following a board approved process. |
|
Cashbuild Board Members have unrestricted authority to consult with Executive Directors and Executive Management to obtain information about the company, its operations, assets or liabilities as stipulated in the Board Charter. |
|
|
|
|
|
|
|
|
|
|
|
Principle 2.16: The Board has elected a chairman of the board who is an independent non executive director. The CEO of the company does not also fulfil the role of chairman of the Board. |
|
|
|
Practice: |
The chairperson is an independent non-executive director. |
|
The chairman is an independent non-executive director. |
|
|
|
|
Practice: |
The chairperson is not a former CEO. |
|
The chairman has not been the CEO of the company in the last three years. |
|
|
|
|
Practice: |
The chairperson is elected by board members every year. |
|
The chairman is not appointed by the board every year. The chairman is appointed in terms of the following directive as set oit in the Memorandum of Incorporation of the company: "The directors may elect a chairman and determine the period office is to be held. Should the Chairman be subject to rotation, and he or she is is not re-elected, he or she will cease to be Chairman of the Board, and then the Board shall select a new Chairman". |
|
|
|
|
Practice: |
The chairman ability to add value, and his performance against what is expected of his role and function is assessed every year. |
|
Annual internal evaluation of the Board does take place. The chairman's ability to add value and his or her performance is by implication assessed during completion of this process. Refer to Agenda item 15 of the 30 May 2016 Board meeting and Annexure M to the Board pack for that meeting for an example of the Board Evaluation criteria submitted for discussion and approval. |
|
|
|
|
Practice: |
A formal role description exists for the chairperson. |
|
No formalised written role description exists for the chairman. The role and responsibility of the Chairman of the Board of a listed entity such as Cashbuild is however dictated by the Companies Act, JSE regulations, and King IV, all of which Cashbuild subscribes to. The existence of a formal job description for the Chairman is therefore considered unnecessary. |
|
|
|
|
Practice: |
There is succession planning in place for the chairperson. |
|
There is currently no formal succession plan in in place for the chairman. Succession of Board Chairman is however considered to be a natural evolution process with the best candidate required to fill the vacancy to be selected from the pool of competent non-executive directors appointed to the Cashbuild Board. Should the need exist, formal recruitment of a Chairman will take place. Existence of formal succession planning for the chairman is therefore considered unnecessary, given the existing back-up, and ability to recruit an appropriate candidate should the need arise. |
|
|
|
|
Practice: |
It is disclosed whether the chairperson is an independent non-executive director and if not, the reason for it. |
|
Refer to annual integrated report. |
|
|
|
|
Practice: |
The chairperson of the board is not the chairperson of the remuneration committee. |
|
|
|
|
|
Practice: |
The nominations committee oversees a formal succession plan for the board, CEO and certain senior executive appointments. |
|
Although a back-up plan is in place for key positions, no formal succession plan exists. The nomination committee is involved in succession and senior executive appointments. |
|
|
|
|
|
|
|
|
Principle 2.17: The Board has appointed the Chief Executive Officer and has established a framework for the delegation of authority |
|
|
|
Practice: |
The board defines its own level of materiality and approves a delegation of authority framework. |
|
The Board makes reference to the level of materiality as determined by external audit. A framework for the delegation of authority (which is linked to approval values per position) is reviewed and approved by the board at least once per annum (more frequently if required). |
|
|
|
|
Practice: |
The board appoints the CEO. |
|
The CEO is apponted by the Board. |
|
|
|
|
Practice: |
The board has input in other senior executive appointments. |
|
Senior executive appointments are communinicated at Board level for contribution and comment. Decision making however remains with the director to whom such senior executive will report to. |
|
|
|
|
Practice: |
The role and function of the CEO is formalised. |
|
The role and function of the CEO are clearly formulated in writing in the CE job description. |
|
|
|
|
Practice: |
The CEO is not a member of the remuneration committee. |
|
The CE is not a member of the remuneration committee. He does however attend as an invitee. |
|
|
|
|
Practice: |
The CEO is not a member of the audit committee. |
|
The CE is not a member of the Audit & Risk Committee. Members are NV Simamane, DSS Lushaba and HH Hickey. These are all non executive directors. |
|
|
|
|
Practice: |
The CEO is not a member of the nomination committee. |
|
The CE is not a member of the nominations committee. The Nomination Committee consists of IS Fourie and AGW Knock |
|
|
|
|
Practice: |
There is a formal succession plan in place for the CEO and other senior executives. |
|
There is a formal back-up plan in place for all key positions at executive level. This back-up plan is however not a formal succession plan. Although existence of the formal back-up plan is considered sufficient, creation of a formal succession plan is in progress. |
|
|
|
|
Practice: |
There is a benchmark; i.e. performance measures, in place to evaluate the performance of the CEO. |
|
Performance of the CEO is monitored and measured by the Chairman. Performance measures on which measurement takes place is agreed upon between the CEO and Chairman. |
|
|
|
|
|
|
|
|
Principle 2.18: The Board comprises a balance of power, with a majority of non executive directors. The majority of non executive directors are independent. |
|
|
|
Practice: |
The classification of directors as independent or otherwise is disclosed on the basis of the yearly assessment of the independence of the independent non-executive directors. |
|
The matter of independence is addressed at recruitment stage and revisited annually. |
|
|
|
|
Practice: |
There is reporting on the procedure and outcome of the assessment of the suitability of non-executive independent directors to continue on the board as such, for a period longer than nine years. |
|
Reporting on the procedure and outcome of the assessment of the suitability of non-executive independent director(s) serving the board for longer of 9 years is done in the Corporate Governance Report. |
|
|
|
|
Practice: |
The nominations committee recommends eligibility of prospective directors on the basis of past performance, contribution and the objectivity of business judgement calls. |
|
|
|
|
|
Practice: |
The board comprises a majority of non-executive directors. |
|
4 Executives (Werner de Jager, Etienne Prowse, Shane Thoresson, and Andre van Onselen) and 5 Non-Executives (Stefan Fourie, Hester Hickey, Alistair Knock, Simo Lushaba, Nomahlube Simamane) |
|
|
|
|
Practice: |
A majority of non-executive directors are independent. |
|
All non-exucitve directors are considered "independent". |
|
|
|
|
Practice: |
The board has a minimum of two executive directors - the CEO and the director responsible for finance. |
|
MOI states that Board shall always consist of at least the minimum number required (4 at time of signing the MOI), and no more than 30. The Board currently consists of 9 directors of which 4 are executive and 5 are non-executive. The executive directors holds the Chief Executive, Financial Director and Operations positions. |
|
|
|
|
Practice: |
When determining the number of directors to serve on the board, the knowledge, skills and resources required as appropriate to the business of the company is considered. |
|
MOI states that Board shall always consist of at least the minimum number required (4 at time of signing the MOI), and no more than 30. The Board currently consists of 9 directors of which 4 are executive and 5 are non-executive. The number of directors required has been carefully considered and agreed upon at Board meeting level after giving due consideration to skills, qualifications and resource requirements. |
|
|
|
|
Practice: |
The board has considered whether its size, diversity and demographics make it effective. |
|
Careful consideration of board size, diversity, demographics and effectiveness is given at each Board meeting. The Governance Integrated Reporting Framework is published in each Board pack for reference, comment and update when applicable. Refer to Annual Integrated report for detailed description of composition of the Board. |
|
|
|
|
Practice: |
At least one third of non-executive directors rotates every year. |
|
At annual AGM a third of non-executive directors shall retire from office (or be made available for re-election). Refer to MoI and paragraph 6.1 of Board Charter. |
|
|
|
|
Practice: |
Independent non-executive directors serving for longer than 9 years are subjected to a rigorous review of their independence and performance by the board. |
|
One non-executive director (Nomahlube Simamane) has been appointed in 2004, thereby serving for a period in excess of 9 years. She has been subjected to re-election as per the rotational appointment structure. The board has assessed that the length of service of her as director has not impaired her independence, character and judgement. |
|
|
|
|
Practice: |
The board, through the nomination committee, recommends eligibility for re-election of retiring non-executive directors, while considering past performance, contribution and the objectivity of business judgement calls. |
|
The Board is required, through the nomination committee, to recommend whether non-executive directors should be eligible for re-election. Refer to MoI (paragraph 13.4) and Board Charter (paragraph 6) and Nomination Committee Charter. Although these requirements are documented in policy, it has not been performed as such. Retiring non-executives are automatically put forward for re-election at the applicable AGM. An action plan going forward is to have evaluation of non-executive directors for re-election as a standard agenda item at future nomination committee meetings. |
|
|
|
|
Practice: |
Non-executive directors that are classified as 'independent' by the company is subjected to an annual evaluation of their independence by the chairperson and the board.††††† |
|
Annual evaluation of directors (which includes their independence) are performed by the Chairman of the Board with feedback being presented by the Chairman to the Board upon completion of the exercise. |
|
|
|
|
|
|
|
|
Principle 2.19: Directors are appointed through a formal process |
|
|
|
Practice: |
Procedures for appointments to the board are formal and transparent and are a matter for the board as a whole, assisted by the nomination committee. |
|
Although procedures for appointments to the Board is not formally set out in a policy the process is treated as a matter for the Board and is governed via the Nominations Committee and the Board Charter. The area requiring improvement is formalising of an "Appointments to the Board" company policy. |
|
|
|
|
Practice: |
Prior to their appointment, procedures are in place to investigate the candidates' backgrounds along the lines of the approach required for listed companies by the JSE . |
|
Candidates nominated are reviewed in terms of background check performed by HR and verification of credentials as contained in CV. Candidates are subject to interview by members of the Board and Executive Management. Final interview prior to selection is done by the Chairman of the Board. Appointments to the Board is finalised by way of election by shareholders (represented by the Board) at a general or annual general meeting. |
|
|
|
|
Practice: |
An agreement is concluded with all non-executive directors that includes the directors' code of conduct to be complied with, the contribution that is expected from the specific individual, the remuneration for holding office as director and the terms of directors' and officers' liability insurance to be provided. |
|
Non executive directors do not have formal letter of appointment. Refer to Cashbuild MoI, Board Charter, Corporate Governance portion of Annual Integrated report where matters of code of conduct, contribution, remuneration, terms and liability insuarnce are addressed. |
|
|
|
|
Practice: |
Details of directors' appointment procedure and composition of board are provided in the integrated report. |
|
Refer to corporate governance section of the annual integrated report. |
|
|
|
|
Practice: |
The board makes full disclosure regarding individual directors to enable shareholders to make their own assessment of directors. |
|
Appropriate and required reporting is contained in the annual integrated report. |
|
|
|
|
Practice: |
Reasons for the removal, resignation or retirement of directors are provided. |
|
Reasons for the removal, resignation or retirement of directors are provided in the integrated report as and when necessary. |
|
|
|
|
Practice: |
The number of meetings held each year by the board and each board committee and the details of attendance of each director(as applicable) at such meetings are disclosed. |
|
|
|
|
|
Practice: |
The nominations committee identifies and participates in selecting board members. |
|
|
|
|
|
Practice: |
The nominations committee ensures that new directors have not been declared delinquent nor are serving probation in terms of section 162 of the Act. |
|
|
|
|
|
|
|
|
|
Principle 2.20: The induction of and ongoing training, as well as the development of directors are conducted through a formal process |
|
|
|
Practice: |
The board ensures that inexperienced directors are developed through mentorship programmes. |
|
No formal mention is made in the Board charter of mentorship programs of inexperienced directors. A key criteria of appointment of Cashbuild directors is however their level of experience. All Cashbuild directors are considered to have sufficient experince, thereby not necessitating a formal mentoring program. Any director has the right to obtain professional advice when deemed necessary within the framework set out in the Board Charter (paragraph 11). |
|
|
|
|
Practice: |
The board ensures that continuing professional development programmes are implemented.... |
|
No formal continuing professional development programme is in place. It is however expected of Cashbuild Directors to have and maintain a personal contineous professional development programme, and where the need is identified, appropriate assistance will be made available. |
|
|
|
|
Practice: |
The board ensures that directors receive regular briefings on changes in risks, laws and the business environment. |
|
Changes in risks, laws and business environment is considered specifically by the Audit and Risk, and Social and Ethics Committees that reports into the Board. Formal updates on these topics are provided by Governance, Risk and Compliance service providers (e.g, internal and external audit and members of management) at these meetings. |
|
|
|
|
Practice: |
The board ensures that a formal induction programme is established for new directors. |
|
An induction program is utilised for new directors appointed. The program is tailored to the needs of both the company and the new director and is set up to allow the new directors to contribute as soon as possible. This program although coordinated by the Group HR Executive is not documented in policy or guideline format. Documenting of this process is considered an area requiring improvement. |
|
|
|
|
|
|
|
|
Principle 2.21: The Board is assisted by a competent, suitably qualified and experienced company secretary. |
|
|
|
Practice: |
The company secretary is empowered by the board to effectively perform his duties. |
|
The company secretary is empowered through MOI, Companies Act, JSE listing requirements, job description and outsource contract by the board to effectively perform his or her duties |
|
|
|
|
Practice: |
The company secretary is appointed and removed by board. |
|
Appointment of the company secretary by the Board is governed by Company Authority Framework which requires Board approval for both appointment and removal of company secretary. |
|
|
|
|
Practice: |
The company complies with the provisions of the Companies Act, 2008 in relation to the appointment and removal of the company secretary. |
|
Adherence to the provisions of the Companies Act with regards to appointment, removal evaluation and duties of the company secretary is attended to in the Baord Charter. |
|
|
|
|
Practice: |
The role and function of the company secretary is formalised. |
|
The role and function of the company secretary is clearly formulated in writing in outsource contract. |
|
|
|
|
Practice: |
The nominations committee establishes procedures for appointments to the board and ensures that these are properly carried out. |
|
|
|
|
|
|
|
|
|
Principle 2.22: The evaluation of the Board, its committees and individual directors is performed every year. |
|
|
|
Practice: |
An overview of the appraisal process of the board, board committees, individual directors, the results thereof and action plans are disclosed in the integrated report. |
|
Cashbuild undertakes an annual Board self evaluation. The outcome of that is contained in the Corporate Governance report. Action plans emanating from the results of the appraisal are not considered necessary to be recorded in the integrated report. |
|
|
|
|
Practice: |
The remuneration committee considers the results of the evaluation of the performance of the CEO and other executive directors, both as a directors and as executives in determining remuneration. |
|
|
|
|
|
Practice: |
The board determines it's own role, functions, duties and performance criteria as well as that for directors on the board and the board and board committees to serve as a benchmark for performance appraisal. |
|
The Board and its committees are subject to regular internal assessement of performance. |
|
|
|
|
Practice: |
The results of performance evaluation are used to identify training needs for directors. |
|
Performance evaluations of directors are not constructively used to identify training and development needs of these directors. Cashbuild Directors are appointed because of their skill and experience. Should any need for training and development be identified assistance will be provided where required. |
|
|
|
|
Practice: |
The nomination for re-appointment of a director only occurs after the evaluation of the performance and attendance of the director. |
|
Executive appointments are not appointed for a fixed term. Re-appointment of executive directors is therefore not a requirement. Formal evaluation of the performance of non-executive directors prior to re-nomination for appointment is not required because assessment of all directors is conducted on an annual basis. |
|
|
|
|
|
|
|
|
Principle 2.23: The Board delegates certain functions to well-structured committees without abdicating from its own responsibilities. |
|
|
|
Practice: |
The composition and role of each board committee are disclosed. |
|
Refer to corporate governance portion of integrated report. |
|
|
|
|
Practice: |
The names and details of any external advisers who regularly attend or are invited to attend committee meetings are disclosed. |
|
No external advisers, with the exception of external audit, regularly attends or are expected to attend committee meetings. |
|
|
|
|
Practice: |
The audit committee terms of reference deal with: composition; objectives, purpose and activities; delegated authorities - including the extent of power to make decisions; tenure; and reporting mechanism to the board. |
|
|
|
|
|
Practice: |
The audit committee is entitled to obtain independent professional advice at cost of the company on any issue within the ambit of its scope and subject to following a board approved process. |
|
|
|
|
|
Practice: |
The risk committee's terms of reference are approved by the board. |
|
|
|
|
|
Practice: |
The risk committee is chaired by a non-executive director. |
|
|
|
|
|
Practice: |
The risk committee's terms of reference deal with: composition; objectives, purpose and activities; delegated authorities - including the extent of power to make decisions; tenure; and reporting mechanism to the board. |
|
|
|
|
|
Practice: |
The risk committee is entitled to obtain independent professional advice at cost of the company on any issue within the ambit of its scope and subject to following a board approved process. |
|
|
|
|
|
Practice: |
There is a board remuneration committee. |
|
|
|
|
|
Practice: |
The remuneration committee's terms of reference deal with: composition; objectives, purpose and activities; delegated authorities - including the extent of power to make decisions; tenure; and reporting mechanism to the board. |
|
|
|
|
|
Practice: |
The remuneration committee is entitled to obtain independent professional advice at cost of the company on any issue within the ambit of its scope and subject to following a board approved process. |
|
|
|
|
|
Practice: |
All members of the remuneration committee are non-executive directors. |
|
|
|
|
|
Practice: |
The remuneration committee is chaired by an independent director. |
|
|
|
|
|
Practice: |
The nominations committee's terms of reference are approved by the board. |
|
|
|
|
|
Practice: |
The nominations committee's terms of reference deals with: composition; objectives, purpose and activities; delegated authorities - including the extent of power to make decisions; tenure; and reporting mechanism to the board. |
|
|
|
|
|
Practice: |
The majority of members of the nominations committee are independent. |
|
|
|
|
|
Practice: |
The nomination committee is entitled to obtain independent professional advice at cost of the company on any issue within the ambit of its scope and subject to following a board approved process. |
|
|
|
|
|
Practice: |
There is a nomination committee. |
|
|
|
|
|
|
|
|
|
Principle 2.24: A governance framework has been agreed upon between the group and its subsidiary Boards |
|
|
|
Practice: |
The integrated report provides details of the implementation and adoption of policies, processes or procedures of the holding company by subsidiary company(ies). |
|
|
|
|
|
Practice: |
There is a governance framework between the group and its subsidiary boards. |
|
|
|
|
|
Practice: |
There are formal policies and practices in place to ensure equal treatment of shareholders within the group. |
|
Although the principle of equal treatment of shareholders within the Cashbuild Group is implied, it is not recorded as such in company policy. |
|
|
|
|
Practice: |
Insider Trading is dealt with in terms of relevant stock exchange rules. |
|
|
|
|
|
Practice: |
Implementation and adoption of policies, processes or procedures of the holding company are considered and approved by the subsidiary company. |
|
|
|
|
|
Practice: |
The holding company respects the fiduciary duty of the director who represents the holding company on the board of the subsidiary to that subsidiary. |
|
|
|
|
|
Practice: |
Consultation takes place by the holding company board with the chairperson of the subsidiary board and nomination committee prior to nominating a shareholder representative director. |
|
|
|
|
|
|
|
|
|
Principle 2.25: The company remunerates its directors and executives fairly. |
|
|
|
Practice: |
There exists remuneration policies and practices that address base pay and bonuses, employee contracts, severance and retirement benefits and share-based and other long-term incentive schemes. |
|
Remuneration policies meeting all requirements are contained in the Cashbuild Way. |
|
|
|
|
Practice: |
Remuneration policies and practices are aligned with company strategy. |
|
Remuneration policy as contained in the Cashbuild Way are aligned with company strategy and linked to individual performance. |
|
|
|
|
Practice: |
Incentives are based on targets, both financial and sustainability related, that are stretching, verifiable and relevant. |
|
Principles governing incentives are clearly set out in Remuneration policies contained in the Cashbuild Way. |
|
|
|
|
Practice: |
Multiple performance measures are used to avoid manipulation of results or poor business decisions. |
|
A multitude of individual KPI's are considered during annual performance measurementas well as overall comapny performance during determination of annual bonusses. Process is contained in CB Way performance appraisal and incentive management policies and procedures. |
|
|
|
|
Practice: |
Remuneration levels reflect the contribution of senior executives. |
|
Remuneration levels are formaly determined by way of job profile and grading. Remuneration levels are subject to periodic benchmarking exercises (once every three years). Performance is monitored by way of formal annual performance reviews. Changes in remuneration structure is presented to Remuneration Committee for review and approval. |
|
|
|
|
Practice: |
If incentives are given for both long-term and short-term goals, the performance drivers are not duplicated and a balance is struck with the need to reward success over the longer term. |
|
Short term goals are incentivsed by annual bonus process which is dependent on company operational performance. Long term goals are incentivised through management share incentive scheme. |
|
|
|
|
Practice: |
Employment contracts do not commit the company to pay on termination arising from an executive's failure. |
|
Standard Cashbuild employment contracts do not commit the company to pay on termination if the termination arises from an executive's failure. |
|
|
|
|
Practice: |
There is no automatic entitlement to bonus or share-based payments on early termination of employment. |
|
Standard terms of engagement entered into with employees refrains from any reference to automatic entitlement to bonus or share based payments on early termination of employment. |
|
|
|
|
Practice: |
There is no provision in employment contracts for severance as result of change in control of company. |
|
Standard contracts of employment used in Cashbuild does not make provision for severance payments as result of change in control of the company. |
|
|
|
|
Practice: |
Participation in incentive schemes is limited to employees and executive directors and provides appropriate limits for individual participation. |
|
Participation in Cashbuild's share based and long-term incentive schemes is limited to senior employees and does provide appropriate limits for individual participation. |
|
|
|
|
Practice: |
High leveraging of incentive schemes is avoided. |
|
Leveraging of share based incentive schemes through financing thereof does not take place in Cashbuild. |
|
|
|
|
Practice: |
Share incentive awards and options are granted regularly and consistently, generally once a year. |
|
Share based incentives are awarded based on recommendation made by CE and Chairman and put forward for approval by Remco. This is done regularly. Recent developments (since 2016) caters annual awarding of share based incentives to Executives and Senior Management. |
|
|
|
|
Practice: |
No awards of share options and incentives are allowed in closed periods. |
|
Awards of share-based incentives and options are not allowed in closed periods. |
|
|
|
|
Practice: |
No backdating of awards of share options and incentives is allowed. |
|
Backdating of awards of share-based incentives and options in not allowed in Cashbuild. |
|
|
|
|
Practice: |
Awards of share options and incentives are subject to a vesting period from 3 to 10 years. |
|
Awards of share options have a standard vesting period of 3 years with an option to be exercised for a further 2 year period after vesting date. |
|
|
|
|
Practice: |
The value of awards of share options and incentives are not significant in comparison to base pay. |
|
The value of awards is policy and formula driven, and is consistently applied to all participating and qualifying members of staff. Refer to remuneration structure contained in remuneration report. |
|
|
|
|
Practice: |
The share-based and long-term incentive schemes have special conditions in place for change of control, roll-over for capital reconstruction, early termination of employment or dismissal for good cause. |
|
The Store Operations Management Trust allows for automatic vesting of shares upon early involuntary termination (e.g. retirement, retrenchment, disability and or death). All other company share investment schemes have no automatic vesting provision. |
|
|
|
|
Practice: |
Non-executive fees comprise a base fee and attendance fee per meeting. |
|
No-executive directors' fees comprise both a base fee and an attendance fee per meeting. |
|
|
|
|
Practice: |
Non-executive fees are approved by shareholders in advance by special resolution. |
|
Non executive directors remuneration is approved by way of special resolution at AGM. |
|
|
|
|
Practice: |
The remuneration report includes details of retention benefits paid. |
|
Refer to integrated report. |
|
|
|
|
Practice: |
The remuneration report includes details of limits for participation in incentive schemes. |
|
Refer to integrated report. |
|
|
|
|
Practice: |
Performance measures for vesting of share options and the reasons for choosing them are disclosed in the remuneration report. |
|
Share options at executive level is granted on an allocation process governed by REMCO. Performance ,measures associated with this share based incentive scheme is disclosed in the annual report. Refer to remuneration report. |
|
|
|
|
Practice: |
The remuneration report includes details of main performance parameters. |
|
Main performance parameters or targets for threshold are disclosed in remuneration report. |
|
|
|
|
Practice: |
The remuneration committee's terms of reference are approved by the board. |
|
|
|
|
|
Practice: |
The remuneration committee assists the board in setting and administering remuneration. |
|
|
|
|
|
Practice: |
The remuneration committee ensures that the mix of fixed and variable pay, in cash, shares and other elements, meets the company's needs and strategic objectives. |
|
|
|
|
|
Practice: |
The remuneration committee satisfies itself as to the accuracy of recorded performance measures that govern vesting of incentives. |
|
|
|
|
|
Practice: |
The remuneration committee ensures that all benefits, including retirement benefits and other financial arrangements are justified and correctly valued. |
|
|
|
|
|
Practice: |
The remuneration committee selects an appropriate comparative group when comparing remuneration levels. |
|
|
|
|
|
Practice: |
The remuneration committee ensures that remuneration levels reflect the contribution of senior executives and executive directors. |
|
|
|
|
|
Practice: |
The remuneration committee regularly reviews incentive schemes to ensure continued contribution to shareholder value. |
|
|
|
|
|
Practice: |
The remuneration committee considers the appropriateness of early vesting of share-based schemes at the end of employment. |
|
|
|
|
|
Practice: |
The remuneration committee advises on the remuneration of non-executive directors. |
|
|
|
|
|
Practice: |
The company has established share-based and/or long-term incentive schemes. |
|
Share based (long-term incentive schemes) has been established in Cashbuild and is appropriately goverened by company policy. |
|
|
|
|
|
|
|
|
Principle 2.26: The company has disclosed the remuneration of each individual director and prescribed officer. |
|
|
|
Practice: |
The remuneration report is included in the integrated report. |
|
Refer to integrated report. |
|
|
|
|
Practice: |
The remuneration report includes details of all benefits paid and awarded to directors. |
|
Refer to integrated report. |
|
|
|
|
Practice: |
The remuneration report includes an overview of the policy on base pay. |
|
Refer to integrated report. |
|
|
|
|
Practice: |
The remuneration report includes details re the use of comparative benchmarks. |
|
Refer to integrated report. |
|
|
|
|
Practice: |
The remuneration report includes justification of salaries paid above median. |
|
Directors and executives are not paid above the median. Junior employees paid salaries above the median is addressed (analysed and approved) at internal Remco level and reported to the Board Remco. These are exceptional circumstances and carefully monitored, approved and reported on at Remco level. |
|
|
|
|
Practice: |
The remuneration report includes details of material payments that are ex-gratia in nature. |
|
Company does not make material payments that are ex gratia in nature. |
|
|
|
|
Practice: |
The remuneration report includes the term of executive service contracts as well as the notice period for termination. |
|
There is no "terms / duration of service" associated with executive service contracts. Executives are employed as full time employees of the company and their appointment complies with standard company HR policies and procedures. |
|
|
|
|
Practice: |
The nature and period of restraint provided for in executive service contracts are disclosed in the remuneration report. |
|
It is stated in remuneration report that executive employment contracts does not include restraint clauses. |
|
|
|
|
Practice: |
The maximum and the expected potential dilution as a result of incentive awards are disclosed in the remuneration report. |
|
Dilution caused by incentive awards is reported in the remuneration report (Refer toe "remuneration structure"). |
|
|
|
|
Practice: |
Details of the non-executive directors' fees, including those fees payable for serving on a board committee are disclosed in the remuneration report. |
|
Refer to remuneration report. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 3.1: The Board has ensured that the company has an effective and independent audit committee |
|
|
|
Practice: |
The audit committee meets at least twice a year. |
|
|
|
|
|
Practice: |
The audit committee's terms of reference are approved by the board. |
|
|
|
|
|
Practice: |
The audit committee meets with the external and internal auditors without management being present at least once a year. |
|
|
|
|
|
Practice: |
The nominations committee presents shareholders with suitable candidates for election as audit committee members. |
|
|
|
|
|
Practice: |
There is an audit committee |
|
|
|
|
|
|
|
|
|
Principle 3.2: Audit committee members are suitably skilled and experienced independent non-executive directors |
|
|
|
Practice: |
The role of the audit committee is summarised in the integrated report. |
|
|
|
|
|
Practice: |
It is disclosed whether the audit committee has adopted formal terms of reference. |
|
|
|
|
|
Practice: |
It is disclosed in the integrated report whether the audit committee has satisfied its responsibilities for the year in compliance with the formal terms of reference. |
|
|
|
|
|
Practice: |
The names and qualifications of all members of the audit committee during the period under review, and the period for which they served on the committee are disclosed in the integrated report. |
|
|
|
|
|
Practice: |
The integrated report includes information regarding any other roles assigned to the audit committee by the board. |
|
Refer to audit and risk committee report. |
|
|
|
|
Practice: |
The shareholders elect the audit committee members at the AGM. |
|
Audit Committee members are proposed by the Board members at Board meeting level. These A&RC members are then formally proposed for election at the next AGM. |
|
|
|
|
Practice: |
The audit committee consists of at least three members. |
|
|
|
|
|
Practice: |
All members of the audit committee are independent non-executive directors. |
|
|
|
|
|
Practice: |
Audit committee members collectively have knowledge and experience on financial risks, financial and sustainability reporting, and internal controls. |
|
|
|
|
|
Practice: |
Audit committee members collectively have knowledge and experience on corporate law. |
|
Audit Committee members have general knowledge and experience of corporate law and are not considered specialists on the topic. Specialist skills and advice is sourced when and where deemed necessary. |
|
|
|
|
Practice: |
Audit committee members collectively have a thorough understanding of the complexities of International Financial Reporting Standards, South African Statements of Generally Accepted Accounting Practice, Global Reporting Initiative standards or any other financial reporting framework and set of standards applicable. |
|
|
|
|
|
Practice: |
The board fills vacancies on the audit committee that arise until the next AGM when the formal election is done by shareholders . |
|
|
|
|
|
Practice: |
The nominations committee evaluates whether audit committee members collectively have basic level of qualification and experience. |
|
|
|
|
|
Practice: |
The audit committee includes in the integrated report both the following: - a statement on whether or not it considered and recommended the internal audit charter for approval by the board; and - a description of its working relationship with the Chief Audit Executive. |
|
Although the internal audit charter is submitted for approval by the A&RC annually and the working relationship with the A&RE is clearly defined, these facts should be clearly stated in the Audit & Risk Committee report. |
|
|
|
|
|
|
|
|
|
|
|
Principle 3.4: The audit committee oversees integrated reporting |
|
|
|
Practice: |
The audit committee recommends the integrated report for approval by the board. |
|
The Audit and Risk Committee has since the 2014 financial year formally reviewed and recommnded the integrated report to the board for approval. |
|
|
|
|
Practice: |
The audit committee arbiters between the management and the external auditors when there is a disagreement on auditing and accounting matters. |
|
|
|
|
|
Practice: |
The audit committee has regard to all factors and risks that may impact on integrity of the integrated report; e.g.. judgements, changes in accounting policies, significant or unusual transactions, factors that may predispose management to present misleading information, any evidence that brings into question any previously published financial information, etc. |
|
|
|
|
|
Practice: |
The audit committee reviews a documented assessment by the management of the going concern premise of the company. |
|
|
|
|
|
Practice: |
The audit committee considers the need to issue interim results. |
|
|
|
|
|
Practice: |
The audit committee reviews the content of summarised information. |
|
|
|
|
|
Practice: |
The audit committee engages the external auditors to provide assurance on the summarised financial information. |
|
|
|
|
|
Practice: |
The audit committee recommends to the board the whether to engage an external assurance provider on material sustainability issues. |
|
|
|
|
|
Practice: |
The audit committee evaluates the independence and quality of the external assurance providers on sustainability. |
|
|
|
|
|
Practice: |
The audit committee reviews the disclosure of sustainability issues in the integrated report to ensure that it is reliable and does not conflict with the financial information. |
|
The Audit and Risk Committee has since the 2014 financial year formally reviewed and recommnded the integrated report to the board for approval. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 3.7: The audit committee should be responsible for overseeing internal audit |
|
|
|
Practice: |
The audit committee is responsible for the appointment, performance assessment and/or dismissal of the CAE or outsourced internal audit service provider. |
|
TheAudit & Risk Executive is appointed by the CE who takes responsibility for the monitoring of his performance. The Chairman of the Audit Committee is involved with the appointment of the ChiefAudit Executive and is informed of his performance. |
|
|
|
|
Practice: |
The internal audit plan is approved by the audit committee. |
|
|
|
|
|
Practice: |
The audit committee ensures that the company's internal audit function is independent and has the necessary resources, standing and authority within the company to enable it to discharge its functions. |
|
|
|
|
|
Practice: |
The audit committee oversees cooperation between external and internal audit to avoid overlapping of audit scope. |
|
|
|
|
|
Practice: |
The audit committee ensures that the internal audit function is subjected to an independent quality review as and when it determines it appropriate. |
|
Formal independent review by the IIA takes place at least once per annum. The most recent assessment was completed in May 2014 and the next assessment id due in 2018. |
|
|
|
|
|
|
|
|
Principle 3.8: The audit committee is an integral component of the risk management process. |
|
|
|
Practice: |
The terms of reference of the audit committee set out its responsibilities regarding risk management. |
|
|
|
|
|
Practice: |
The audit committee specifically has oversight of financial reporting risks, internal financial controls, fraud risks as these relate to financial reporting and IT risks as these relate to internal reporting. |
|
|
|
|
|
Practice: |
There is a statement from the board in the integrated report on the effectiveness of internal financial controls based on a formal documented review thereof. |
|
Refer to Audit & Risk Committee Report of the Integrated Annual Report. |
|
|
|
|
Practice: |
There is a risk committee consisting of board members. |
|
|
|
|
|
Practice: |
The risk committee has oversight of the company's risk management function. |
|
|
|
|
|
Practice: |
The audit committee discloses in the integrated report the nature and extent of material weaknesses in the design, implementation or execution of financial controls that resulted in material financial loss, fraud or material errors. (Only applicable in the event that there has been material financial loss, fraud or material errors resultant from weakness in financial controls.) |
|
|
|
|
|
|
|
|
|
Principle 3.9: The audit committee is responsible for the recommending the appointment of the external auditor and overseeing the external audit process. |
|
|
|
Practice: |
The audit committee recommends to shareholders the appointment, reappointment and removal of external auditors. |
|
|
|
|
|
Practice: |
The audit committee approves the external auditors' terms of engagement and remuneration. |
|
|
|
|
|
Practice: |
The audit committee monitors and reports on the external auditor's independence. |
|
|
|
|
|
Practice: |
The audit committee defines a policy for non-audit services provided by the external auditor. |
|
|
|
|
|
Practice: |
The audit committee reviews any accounting and auditing concerns identified as a result of the internal or external audit. |
|
|
|
|
|
Practice: |
The audit committee is informed of any Reportable Irregularities identified and reported by the external auditor. |
|
|
|
|
|
Practice: |
The audit committee reviews the quality and effectiveness of the external audit process. |
|
|
|
|
|
|
|
|
|
Principle 3.10: The audit committee has reported to the board and the shareholders as to how it has discharged its duties. |
|
|
|
Practice: |
There is a description in the integrated report of how the audit committee carried out its functions in the period under review. |
|
Refer to audit and risk committee report. |
|
|
|
|
Practice: |
A statement on whether the audit committee is satisfied that the auditor is independent of the company is included in the integrated report. |
|
Refer to audit and risk committee report. |
|
|
|
|
Practice: |
The integrated report includes commentary in any way the committee considers appropriate on the financial statements, the accounting practices and the internal financial control of the company. |
|
Refer to audit and risk committee report. |
|
|
|
|
Practice: |
The audit committee reports internally to the board on its statutory duties and duties assigned to it by the board. |
|
|
|
|
|
Practice: |
The audit committee reports to the shareholders on it's statutory duties. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 4.1: The Board is responsible for the governance of risk. |
|
|
|
Practice: |
A policy and plan for a system and process of risk management have been developed. |
|
Cashbuild Enterprise Risk Management Framework (Cashbuild Risk Management policy) is well developed and approved by the Board and is subject to an annual update review. |
|
|
|
|
Practice: |
The board's responsibility for risk governance is expressed in the board charter and risk policy and plan. |
|
The Board's responsibility for risk governance is set out in the Baoard Charter and the Risk Management CB Way. |
|
|
|
|
Practice: |
The risk policy includes: the company's definitions of risk terms and risk management; risk management objectives; the risk approach and philosophy; and the various responsibilities and ownership for risk management within the company. |
|
Cashbuild's risk policy, which is subject to annual update, includes definitions of risk terms, risk management objectives, and responsibilities and ownership for risk management within the company. |
|
|
|
|
Practice: |
The risk plan includes: the company's risk management structure; the risk management framework - i.e. the approach followed for instance COSO, ISO, IRMSA ERM Code of Practice, IRM (UK), etc; the standards and methodology adopted - this refers to the measureable milestones such tolerances, intervals, frequencies, frequency rates, etc; risk management guidelines; reference to integration through for instance training and awareness programmes; and details of the assurance and review of the risk management process. |
|
Cashbuild's risk management plan incorporates generally accepted best practice such as COSO II, ISO 31000 and the IRMSA Code of Practice. |
|
|
|
|
Practice: |
The integrated report discloses how the board has satisfied itself that risk assessments, responses and interventions are effective. |
|
The Audit & Risk Committee does an assessment of the effectiveness of risk assessments, responses and interventions by reviewing and questioning risk based management information presented at Audit & Risk Committee and Board level. |
|
|
|
|
|
|
|
|
Principle 4.2: The Board has determined the levels of risk tolerance |
|
|
|
Practice: |
The board sets the levels of risk tolerance every year. |
|
Level of risk tolerance has been set by Cashbuild executive management and included in Risk Management policy. The Board is aware of Cashbuild's level of risk tolerance. The level of risk tolerance is however not formally reviewed on an annual basis. A formal annual review and confirmation / update of Cashbuild's risk tolerance level is taking place annually during review and approval of the Risk Management CB Way. |
|
|
|
|
Practice: |
The board monitors that risks taken are within the tolerance and appetite levels. |
|
Pro-active monitoring of risks taken within the company is monitored at Board level. Decisionmaking is governed by the corporate Authority Framework which assists with ensuring that decision making takes place within Cashbuild's risk tolerance and appetite levels. Risky decisions are supported by appropriate Board approval in compliance with approval of appropriate resolutions by the Board. |
|
|
|
|
Practice: |
It is disclosed where the limits of risk appetite exceed, or deviated materially from, the limits of the company's risk tolerance (the company's ability to tolerate). |
|
Cashbuild has a low risk tolerance. Any high risks exceptions are appropriately reported at Board level. No known instances of risks exceeding the company risk appetite have occurred during the most recent reporting period, therefore warranting a N/A answer to this question. |
|
|
|
|
|
|
|
|
Principle 4.3: The risk committee and/or audit committee has assisted the Board in carrying out its risk responsibilities. |
|
|
|
Practice: |
The risk committee considers the risk policy and plan. |
|
|
|
|
|
Practice: |
The risk committee monitors the whole risk management process. |
|
|
|
|
|
Practice: |
The risk committee reviews the risk management progress and maturity of the company, the effectiveness of risk management activities, the key risks facing the company, and the responses to address these key risks. |
|
|
|
|
|
Practice: |
Membership of the risk committee includes executive and non-executive directors; members of senior management and independent risk management experts to be invited, if necessary. |
|
Audit & Risk Committee consists of non-executive directors only. Executive directors attend on invitation. Company risk assessment, monitoring and tracking is done at executive director / management level with the status thereof reported to Audit and Risk Committee.with non executive directors having a standard invitation to attend. |
|
|
|
|
Practice: |
The risk committee has a minimum of three members. |
|
|
|
|
|
Practice: |
The risk committee members collectively have adequate and appropriate knowledge, skills and experience on risk. |
|
|
|
|
|
|
|
|
|
Principle 4.4: The Board has delegated to management the responsibility to design, implement and monitor the risk management plan. |
|
|
|
Practice: |
The board's risk policy and plan is implemented by management by means of risk management systems and processes. |
|
Detailed risk management systems (BarnOwl) and processes (Risk Management CB Way) are entrenched in the company. |
|
|
|
|
Practice: |
The Chief Risk Officer (CRO) or other senior employee responsible for risk management is a suitably experienced person who has access to and interacts regularly on strategic matters with the board and/or appropriate board committee and executive management. |
|
Cashbuild's Group Risk Manager is suitably experienced and has access to and regular interaction on strategic matters with the board and its committees and executive management. |
|
|
|
|
|
|
|
|
Principle 4.5: The Board has ensured that risk assessments are performed on a continual basis. |
|
|
|
Practice: |
The board ensures that effective and ongoing risk assessments are performed. |
|
Company-wide risk assessments are performed at least once per quarter. |
|
|
|
|
Practice: |
A systematic, documented, formal risk assessment is conducted at least once a year. |
|
A systematic documented formal risk assessment is conducted at least once a quarter. |
|
|
|
|
Practice: |
Risks are prioritised and ranked to focus responses and interventions. |
|
All Cashbuild risks are appropriately ranked and prioritised, and primary attention given to those risks with the highest ranking. |
|
|
|
|
Practice: |
A top-down approach is adopted in risk assessments without being limited to strategic and high-end risks only. |
|
A top down and bottom up approach is followed to risk assessments in Cashbuild with focus not limited to strategic or high end risks only. |
|
|
|
|
Practice: |
The board regularly receives and reviews a register of the company's key risks. |
|
A register containing the company top 10 risks is distributed to and discussed with the Board via the Audit & Risk Committee on a quarterly basis with unrestricted access to full register being provided for use should the need arise. |
|
|
|
|
Practice: |
The risk assessment process involves the risks affecting the various income streams of the company, the critical dependencies of the business, the sustainability and the legitimate interests and expectations of stakeholders. |
|
Cashbuild's risk assessment process is not restricted to or from any key focus areas. |
|
|
|
|
Practice: |
The board ensures that key risks are quantified where practicable. |
|
Risks are quantified in terms of impact and likelihood. Impact is quantified in terms of expected value where practical. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 5.1: The Board is responsible of information technology (IT) governance. |
|
|
|
Practice: |
The board ensures that an IT charter and policies are established and implemented. |
|
Although IT policies does exist it is not comprehensive enough and requires improvement. Adequacy of the IT charter and policies are curently being reviewed by the IT Executive whose target is to have these appropriately updated and approved. |
|
|
|
|
Practice: |
The board assumes the responsibility for the governance of IT and place it on the board agenda. |
|
The Board and its IT Governance Committee takes responsibility for the governance of IT and addresses that during IT Governance, Audit & Risk Committee and Board meetings. |
|
|
|
|
Practice: |
There is an IT governance framework that supports effective and efficient management of IT resources to facilitate the achievement of the company's strategic objectives. |
|
Management of IT resources is covered in terms of service level agereeements entered into with outsource partners. Creation of a formal IT governance charter is a high priority deliverable with completion planned to take place after appointment of IT Executive. |
|
|
|
|
Practice: |
The IT governance framework includes relevant structures, processes and mechanisms to enable IT to deliver value to the business and mitigate IT risk. |
|
|
|
|
|
Practice: |
The board receives independent assurance on the effectiveness of the IT internal controls. |
|
An IT Internal Audit Function (outsourced to Deloitte) has been created during the 2013/14 financial year. The IT internal audit function provides indpendent assurance on the effectiveness of IT internal controls (including outsourced IT services) in addition to that provided by external audit. |
|
|
|
|
|
|
|
|
Principle 5.2: IT has been aligned with the performance and sustainability objectives of the company. |
|
|
|
Practice: |
The board ensures that IT strategy is integrated with the company's strategic and business processes. |
|
IT strategy is an integral part of Cashbuild's business strategy and business processes. Inherent integration between IT and Business strategy exists. |
|
|
|
|
Practice: |
The board ensures that there is a process in place to identify and exploit opportunities to improve the performance and sustainability of the company through the use of IT. |
|
Continued improvement of the performance and sustainability of the company through the use of IT is a contineous business proces facilitated by the executive management team (e.g. standard agenda item for weekly executive focus meetings). |
|
|
|
|
|
|
|
|
|
|
|
Principle 5.4: The Board monitors and evaluates significant IT investments and expenditure. |
|
|
|
Practice: |
The board oversees the value delivery of IT and monitors the return on investment from significant IT projects. |
|
IT projects and related expenditure are closely managed and reported at IT Governance Committee and Board level. Improvement to business processes are carefully monitored by mangement and reported at IT Governance Committee level where return on investment is monitored and regular (quarterly) update provided to the Board. |
|
|
|
|
Practice: |
Business strategies and objectives and the role of IT in achieving them are clear. |
|
The role of IT (SAP & AR, and other related applications, service providers and support structures) in achieving business strategies and objectives is clearly defined and is subject to contineous monitoring and improvement. |
|
|
|
|
Practice: |
Good governance principles apply to all parties in the supply chain or channel for the acquisition and disposal of IT goods or services. |
|
Transparency in acquisition and disposal of IT goods and services related transacations is governed through adherence to company policy. Competitive quotes are obtained on all purchases. Orders are split between suppliers. Monitoring of expenses by FD takes place. |
|
|
|
|
|
|
|
|
Principle 5.5: IT is an integral part of the company’s risk management plan. |
|
|
|
Practice: |
IT risks form an integral part of the company's risk management activities. |
|
Formal IT risk assessement workshops takes place once per quarter. IT risks are used as prompters for IT internal audit. |
|
|
|
|
Practice: |
Management regularly demonstrates to the board that the company has adequate business resilience arrangements in place for disaster recovery. |
|
A BCM policy and related communication program is in place. An independent adequacy review of the Cashbuild BCM process has been scheduled for completion prior to June 2017. This will identify areas for improvement (if any) that will be duly attended to. |
|
|
|
|
Practice: |
The board ensures that the company complies with IT laws and that IT related rules, codes and standards are considered. |
|
An IT Executive has been appointed with responsibility for compliance to best practice (which includes laws and regulations). GRM and IT internal audit also contributes towards monitoring (and thereby ensuring) compliance to known IT related rules, codes and standards. |
|
|
|
|
|
|
|
|
Principle 5.6: The Board ensured that information assets are managed effectively. |
|
|
|
Practice: |
The board ensures all personal information is treated by the company as an important business asset and is identified. |
|
Cashbuild's code of ethics and company policy clearly states that all staff members are responsible for protecting the confidentiality of proprietary and staff's personal information. |
|
|
|
|
Practice: |
The board ensures that an Information Security Management System is developed, implemented and recorded that ensures security (confidentiality, integrity and availability of information). |
|
Cashbuild's Information Security Management policies and procedures requires update and refreshed roll-out. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 6.1: The Board ensures that the company complies with applicable laws and considers adherence to non binding rules, codes and standards. |
|
|
|
Practice: |
The extent of adherence to applicable non-binding rules, codes and standards is disclosed in the integrated report. |
|
Refer to annual integrated report. |
|
|
|
|
Practice: |
Details of how board discharged its responsibility to establish an effective compliance framework and processes are disclosed in the integrated report. |
|
Refer to paragraphs dealing with Board and Board Committee responsibilities in the corporate governance portion of the integrated report. |
|
|
|
|
Practice: |
The company has a system in place to ensure compliance with all applicable laws. |
|
A formal legal compliance risk identification and assessment exercise was conducted in 2014 culminating in a 3 year action plan to address identified areas for improvement. A repeat of this process is scheduled for completion prior to June 2017 with repeat thereof every 3 years thereafter. Responsibility for this initiative facilitated by Group Risk Management is supported by Executive Management with ultimate responsibility resting with the Board. |
|
|
|
|
Practice: |
Compliance with applicable laws is understood not only in terms of the obligations that they create, but also for the rights and protection that they afford. |
|
Cashbuild Board appreciates that the duty to act in the best interest of the compoany involves having regard to not only the obligation that laws create but also the rights and protection that they afford to the company. |
|
|
|
|
Practice: |
The board oversees that the compliance policy and system provide for examination of the context of law, and how other applicable laws interact with it. |
|
The board has as objective that company policies and procedures and adherence thereto take account of the context of law and how applicable laws relate to one another. Compliance with known legislation is duly considered during approval of Cashbuild policies and procedures. Legal advice is obtained during preparation and completion of company policy as and when required. |
|
|
|
|
Practice: |
The board continually monitors the company's compliance with applicable laws, rules, codes and standards. |
|
Legal compliance is a risk management deliverable which is reported on at Audit & Risk, and Social & Ethics Committee level. This is the medium through which the Board monitors the company's voluntary compliance with applicable laws, rules, codes and standards. |
|
|
|
|
|
|
|
|
Principle 6.2: The Board and each individual director have a working understanding of the effect of applicable laws, rules, codes and standards on the company and its business. |
|
|
|
Practice: |
The induction or ongoing training programmes of directors incorporate an overview of and changes to applicable laws, rules, codes and standards. |
|
Induction and ongoing training of directors does not include formalised overview of applicable laws, rules, codes and standards, and changes thereto. This requirement is however partially met by technical updates provided by external audit to board members as part of quarterly audit and risk committee handouts. Directors are required to be aware of applicable laws, rules, codes and standards. |
|
|
|
|
Practice: |
Directors sufficiently familiarise themselves with the general content of applicable laws, rules, codes and standards in order to be able to discharge their legal duties. |
|
Directors appointed to Cashbuild Board are required to have appropriate awarenes and or knowledge of applicable laws, rules, codes and standards sufficiently to discharge their legal duties. |
|
|
|
|
|
|
|
|
Principle 6.3: Compliance risk should form an integral part of the company’s risk management process. |
|
|
|
Practice: |
The risk of non-compliance is identified, assessed and responded to through the risk management processes. |
|
The risk of non complaince is appropriately identified, assessed and responded through the risk management process. A detailed legal compliance risk assessment was performed in 2014 with a 3 year action plan flowing from that.This process is scheduled to be repeated in May - June 2017. |
|
|
|
|
|
|
|
|
Principle 6.4: The Board should delegate to management the implementation of an effective compliance framework and processes. |
|
|
|
Practice: |
There is disclosure of material (or immaterial, but often repeated) regulatory penalties, sanctions or fines for contraventions or noncompliance with statutory obligations that were imposed on the company or any of its directors or officers; or a statement that no such events took place. |
|
|
|
|
|
Practice: |
Management has established the appropriate structures; educates, trains and communicates; and measures compliance. |
|
Appropriate structures has been set up to educate, train, communicate about and measure compliance to the Cashbuild Way which includes compliance to appropriate laws and regulations where applicable. |
|
|
|
|
Practice: |
The CEO has appointed an individual responsible for the management of compliance; e.g.. a Chief Compliance Officer. |
|
Management of compliance has not been formally assigned to an individual. Legal compliance is an implied responsibility of each director and member of executive and senior management. Monitoring of compliance and advising on areas for improvement is a task of the Audit & Risk Executive and the department reporting to him. |
|
|
|
|
Practice: |
The individual responsible for compliance is a suitably skilled and experienced person who has access to and interacts regularly on strategic compliance matters with the board and/or appropriate board committee and executive management. |
|
Although a Chief Compliance Officer has not been appointed, the task of monitoring compliance has been assigned to the Audit & Risk Executive who has appropriate access to information and interaction with all concerned. |
|
|
|
|
Practice: |
The compliance function has adequate resources to fulfil its duties. |
|
The GRM department whic includes internal audit (monitoring), risk management (identification and assessment), issues management (monitoring and reporting), and Cashbuild Way Administration (policy administration) has sufficient resources to fulfil its duties. |
|
|
|
|
Practice: |
The board ensures that a legal compliance policy, approved by the board, has been implemented by management. |
|
Adherence to laws and regulations are addressed by the Cashbuild Way and Code of Ethics. |
|
|
|
|
Practice: |
The board receives assurance on the effectiveness of the controls around compliance with laws, rules, codes and standards. |
|
The board receives assurance on the effectiveness of the internal controls intended to ensure compliance with laws, rules, codes and standards through internal and external audit service delivery. Status of assurance obtained is monitored with the company's combined assurance process. |
|
|
|
|
Practice: |
Compliance with laws, rules, codes and standards is incorporated in the code of conduct of the company. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 7.1: The Board should ensure that there is an effective risk based internal audit. |
|
|
|
Practice: |
Where there is no formal internal audit function, full reasons for it are disclosed in the company's integrated report, with an explanation as to how adequate assurance of an effective governance, risk management and internal control environment have been maintained. |
|
|
|
|
|
Practice: |
The company has established an internal audit function. |
|
Cashbuild Internal Audit function is well established with reporting lines to the Chief Executive and the Audit & Risk Committee. |
|
|
|
|
Practice: |
The internal audit function evaluates the company's governance processes. |
|
The internal audit function is involved in facilitating the assessment of Cashbuild's Governance processes. This assessment is subject to confirmation of accuracy by the executive management team. |
|
|
|
|
Practice: |
The internal audit function performs an objective assessment of the effectiveness of risk management and the internal control framework. |
|
The scope and extent of internal audit which includes an assessment of the effectiveness of risk management and the internal control framework is governed by the Internal Audit Charter, and Internal Audit and Risk Management policies. |
|
|
|
|
Practice: |
The internal audit function systematically analyses and evaluates business processes and associated controls. |
|
Systematic analysis and evaluation of business processes and associated controls is recorded in Cashbuild 3 year rolling internal audit plan which is subject to annual update, review and approval. |
|
|
|
|
Practice: |
The internal audit function adheres to the IIA Standards and code of ethics. |
|
Cashbuild Internal Audit adheres to the IIA's Standards for the Professional Practice of Internal Audit and Code of Ethics. The department received a Partially Conforms rating for adherence to Attribute and Performace Standards and a Generally Conforms rating for adherence to IIA Code of Ethics duringthe last external review conducted in May 2013. Action plans to address any gaps identified during the external review has already been attended to. Ratings allocated is expected to improve during the next independent external review (scheduled to take place once every 5 years). |
|
|
|
|
Practice: |
The internal audit function provides a source of information as appropriate, regarding instances of fraud, corruption, unethical behaviour and irregularities. |
|
Instances of fraud, corruption, unethical behaviour and irregularities are appropriately reported to the releveant audience(s) by way of audit and committee reports, management information, and specially arranged meetings as and when applicable. |
|
|
|
|
|
|
|
|
|
|
|
Principle 7.3: Internal Audit should provide a written assessment of the effectiveness of the company’s system of internal controls and risk management. |
|
|
|
Practice: |
Internal controls are established not only over financial matters, but also operational, compliance and sustainability issues. |
|
Internal controls does address financial, operational, compliance and sustainability focus areas in Cashbuild. |
|
|
|
|
Practice: |
Internal audit provides a written assessment of the system of internal controls and risk management to the board. |
|
Internal audit does provide the board with a written assessment of the system of internal controls and risk management. Refer to the Annual Integrated Report. |
|
|
|
|
Practice: |
Internal audit provides a written assessment of internal financial controls to the audit committee. |
|
The outcome of financial control review(s) performed by internal audit annually is reported to the A&RC with access given to detailed reports as and when required. |
|
|
|
|
|
|
|
|
|
|
|
Principle 7.5: Internal audit should be strategically positioned to achieve its objectives. |
|
|
|
Practice: |
The internal audit function is independent and objective. |
|
The internal audit department is independent and objective. |
|
|
|
|
Practice: |
The internal audit function reports functionally to the audit committee. |
|
The internal audit function reports functionally to the CE with a direct reporting line to the Audit and Risk Committee. |
|
|
|
|
Practice: |
The CAE has a standing invitation to attend executive committee meetings. |
|
The Chief Audit Executive has a standing invitation to attend Audit & Risk, Social & Ethics, and IT Governance Committee meetings as well as Executive Management focus meetings. |
|
|
|
|
Practice: |
The internal audit function is a skilled and resourced as is appropriate for the complexity and volume of risk and assurance needs. |
|
The internal audit department does have appropriate skills and resources to meet the complexity and volume of risk and the assurance needs of the company, and where shortcommings are identified appropriate steps are taken (e.g outsourcing IT Internal Audit to Deloitte) |
|
|
|
|
Practice: |
The CAE develops and maintains a quality assurance and improvement programme. |
|
A quality assurance and improvement programme is in place and is subject to contineous improvement. |
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 8.1: The Board should appreciate that stakeholders’ perceptions affect a company’s reputation. |
|
|
|
Practice: |
The gap between stakeholder perceptions and the performance of the company is managed and measured to enhance or protect the company's reputation. |
|
Reputation management is of extreme importance to Cashbuild and is governed through the company policy (Cashbuild Way), Code of Ethics, and Core Values. Although high priority is placed on protection of the company's reputation, no formal measurement of the gap between stakeholders perceptions and the performance of the company has taken place as yet. The need for such a gap analysis is still to be pursued with required action steps decided upon after completion of such analysis. |
|
|
|
|
Practice: |
The company's reputation and its linkage with stakeholder relationships is a regular board agenda item. |
|
Company reputation and linkage with stakeholder reputation is not a formal standard board agenda item. Company reputation and stakeholder relationships is however a standard reportable item at quarterly Social and Ethics Committee meetings. The outcome of Social and Ethics Committee meetings are formally reported at Board meetings, and is so doing this requirement is achieved. |
|
|
|
|
Practice: |
Stakeholders which could materially affect the operations of the company are identified, assessed and dealt with as part of the risk management process. |
|
Identification of stakeholders and evaluation of their legitimate interests and expectations does take place. Stakeholders has been defined as including:
a) Customers and Communities;
b) Employees, learners, contractors and subcontractors;
c) Shareholders, investors, analysts and media;
d) Local and provincial governments and regulatory bodies;
e) Suppliers, service providers, specialists and industry partners,
f) JSE and other local and international regulatory / listing bodies. |
|
|
|
|
Practice: |
The process for identification and taking account of the legitimate interests and expectations of stakeholders is reviewed at least once a year. |
|
Annual identification of stakeholders and evaluation of their legitimate interests and expectations does take place and is reported on in the annual integrated report. |
|
|
|
|
|
|
|
|
Principle 8.2: The Board should delegate to management to proactively deal with stakeholder relationships. |
|
|
|
Practice: |
Management develops a strategy and formulates policies for the management of relationships with each stakeholder grouping. |
|
Action plans relating to the engagement of stakeholders are clearly defined and incorprated in company policy (which is governed by strategy) where required and applicable. |
|
|
|
|
Practice: |
The board oversees the establishment of mechanisms and processes that support stakeholders in constructive engagement with the company. |
|
Stakeholder engagement is reported to the Board as part of the integrated reporting cycle. The board does however not formally oversee mechanisms and processes that support constructive engagement by the company with its stakeholders. This is a standard agenda item / topic being discussed at Social and Ethics Committee level. |
|
|
|
|
Practice: |
The board encourages shareholders to attend the AGMs. |
|
Shareholder attendence of AGM's is encouraged by the Board. Refer to annual integrated report containing Notice of the AGM and notes thereto. |
|
|
|
|
|
|
|
|
|
|
|
Principle 8.4: Companies should ensure the equitable treatment of shareholders. |
|
|
|
Practice: |
There is equitable treatment of all holders of the same class of shares issued. |
|
Refer to appropriate notes to the annual financial statements. |
|
|
|
|
Practice: |
The board ensures that minority shareholders are protected. |
|
Refer to shareholder analysis as contained in general information portion of the annual integrated report. |
|
|
|
|
|
|
|
|
Principle 8.5: Transparent and effective communication with stakeholders is essential for building and maintaining their trust and confidence. |
|
|
|
Practice: |
The board has adopted communication guidelines that support a responsible communication programme. |
|
Stakeholder communication is governed by guidelines and directives contained in company core values, code of ethics and policy (CB Way) |
|
|
|
|
Practice: |
Complete, timely, relevant, accurate, honest and accessible information is provided by the company to its stakeholders whilst having regard to legal and strategic considerations. |
|
JSE / SENS reporting requirements are adhered to. |
|
|
|
|
Practice: |
Reasons for refusals of requests for information that were lodged with the company in terms of the Promotion of Access to Information Act, 2000 are included in the integrated report. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principle 9.1: The Board should ensure the integrity of the company’s integrated report. |
|
|
|
Practice: |
The company has controls to enable it to verify and safeguard the integrity of its integrated report. |
|
Cashbuild Executive Management and Directors (Executive and Non-Executive does detailed review of integrated report. Integrated report is subject to external audit review. Assurance is provided on the financial portion of the integrated report. Any issues of concern identified by external audit regarding accuracy, validay and integrity is highlighted for management action. The draft integrated report is subject to review and approval by Non-Executive Board members prior to finalisation thereof, thereby providing verification and safeguarding of the content. |
|
|
|
|
|
|
|
|
Principle 9.2: Sustainability reporting and disclosure should be integrated with the company’s financial reporting. |
|
|
|
Practice: |
The board includes commentary on the company's financial results in the integrated report. |
|
Refer to Chairman's report, Chief Executive's report, and Director's report. |
|
|
|
|
Practice: |
The board discloses if the company is a going concern. |
|
Refer to Directors' Responsibilities and Approval paragraph of the Integrated Annual Report. |
|
|
|
|
Practice: |
The board ensures that the positive and negative impacts of the company's operations and the plans to improve the positives and eradicate or ameliorate the negatives in the financial year ahead are conveyed in the integrated report. |
|
Effects of company operations on the environment and society and plans to improve are being attended to in the integrated annual report (refer specifically to stakeholder analysis and sustainability report). |
|
|
|
|
Practice: |
The integrated report discloses the nature of the company's dealings with stakeholders and the outcomes of these dealings. |
|
|
|
|
|
|
|
|
|
Principle 9.3: Sustainability reporting and disclosure should be independently assured. |
|
|
|
Practice: |
Sustainability reporting is independently assured. |
|
Sustainability reporting is not independently assured. The option of having sustainability reporting independently assured is scheduled for review . |
|
|
|
|
Practice: |
The scope of independent assurance over sustainability report is disclosed in the integrated report. |
|
Independent assurance of sustainability report has not taken place to date. This is an area for improvement still to be scheduled. |
|
|
|
|
|
|
|
Overall Score |
|
Disclaimer
The assessment criteria of the web-based tool, the governance assessment instrument (GAI) have been based on the practice recommendations of the King III report. These criteria are intended to assess quantitative aspects of corporate governance only and not qualitative governance. As such, the results are proposed to serve as an indication of the structures, systems and processes in place and are not intended to include an indication of the governance culture of an entity.
The responsibility for the input of data in order to attain a result through the use of this is that of the user and the entity in respect of which the user licence has been granted (licensee). The results based on the use of the GAI may be based on the subjective opinion of the licensee or the representative user(s) and may not be true reflection of the actual state of the governance structures, systems and processes at the entity.
The The Global Platform for Intellectual Property (Pty) Ltd ("TGPIP") makes no warranty or representation as to the accuracy or completeness of either the assessment criteria or the results. Neither TGPIP nor any of its affiliates nor the software developer shall be held responsible for any direct, indirect, special, consequential or other damage of any kind suffered or incurred, as a result of reliance on the results produced through the use of the GAI.
|