Corporate governance

Tiger Brands is committed to the highest standards of corporate governance and ethical and moral business behaviour. This commitment is woven through every aspect of the group’s management structures at all of its operations. In all matters that are considered by the board, the board is cognisant of the fact that the directors and management are custodians of the company and its assets and manage them on behalf of shareholders, who are the true owners of the company.

Ethical practices are entrenched throughout the organisation as the only acceptable behaviour. The board sets the tone and standards in this regard, which in turn filters down to executive management and all employees. Tiger Brands adopts a zero-tolerance approach to infringements of governance and ethical standards at all levels of the company.

The group’s approach is strictly adhered to in each country in which it operates. Governance processes, such as audit, risk and remuneration committees and ethics lines are in place at each subsidiary across Africa. In addition, management operates in terms of a delegation of authority matrix that is formally approved by the board.

Good governance is a fundamental prerequisite for any considered new investment of the group within South Africa, across Africa or elsewhere.

Governance structure

Board

	Members	AC Parker (Chairman), BL Sibiya (Deputy Chairman), SL Botha, MJ Bowman, RMW Dunne, M Makanjee, KDK Mokhele, RD Nisbet, MP Nyama, PB Matlare (Chief Executive Officer), O Ighodaro (Chief Financial Officer) and CFH Vaux
	Responsibility	The board takes overall responsibility for directing the company to achieve its strategic objectives, vision and mission. It is accountable for the development and execution of the group’s strategy, operating performance and financial results. In terms of the board charter, responsibilities include: approving the strategic direction of the group and the budgets necessary for its implementation; being the guardian of the values and ethics of the group; appointing the Chief Executive Officer; retaining full and effective control over the operations of the group; monitoring the management and implementation of the corporate vision; and delegating responsibility to the executive committee or board sub-committees. A copy of the board charter is available on the company's website.
	Number of meetings per year	There are a minimum of six meetings held each year. There are four quarterly review meetings, one meeting to consider the five-year strategic plan and one meeting to approve the budget for the following year.

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See full terms of reference on our website www.tigerbrands.com.

Application of King III

In conformity with the primary South African corporate governance framework, the King Report on Governance for South Africa 2009 (King III), the group is satisfied that it has applied the key principles in all material respects other than where indicated to the contrary in this Integrated Annual Report. Tiger Brands has also adopted the principles of the GRI and the principal policies and practical applications of corporate governance as outlined by the Public Investment Corporation. In addition to this framework, Tiger Brands is committed to complying with all relevant legislation, regulations and best practices in all countries in which it operates.

Details of the application of King III are set out on page 242. The GRI Index is available on the website.

The board meets at least six times a year and monitors the performance of executive management. It addresses a range of key operational and strategic issues and ensures that debate on matters of policy, strategy and performance is critical, informed and constructive. In addition to the four quarterly board meetings, separate sessions are held annually to discuss strategy and budget plans. Non-executive directors are encouraged to meet both officially and unofficially with senior executive management on a regular basis. Twice a year, non-executive directors meet, without executive management being present, to informally discuss matters relating to the company.

In addition to the board meetings, board education and training takes place on an ad hoc basis.

Attendance at board and committee meetings is set out below:

All directors have access to the advice and services of the Company Secretary and, in appropriate circumstances may, at the group’s expense, seek independent professional advice concerning its affairs.

The roles of the Chairman and the Chief Executive Officer are strictly separate. All non-executive directors are considered independent and are appointed in terms of their business acumen and skill.

Board and committee evaluation

During 2014, the board contracted with a third party to conduct an independent evaluation of the board’s performance and of the statutory and other sub-committees of the board.

The scope of the board effectiveness assessment included an overall effectiveness assessment of the board itself collectively, a review of individual directors’ performance and contribution, a review of the Chairman’s leadership and contribution and a review of the Company Secretary’s role and contribution. The assessment was conducted by questionnaires and interviews.

This is explained in more detail in the remuneration report on pages 80 to 105.

Board processes

The board has delegated specific responsibilities to sub-committees of the board. In addition, the statutory committees established in terms of the Companies Act No 71 of 2008, as amended (the Companies Act) also report to the board. The board committees assist the directors in discharging their duties and responsibilities in terms of the Companies Act No 71 of 2008, as amended, and the appropriate governance authorities.

Audit committee

The report of the audit committee is set out on page 74.

Remuneration and nomination committees

The company’s Chief Executive Officer, Mr PB Matlare, attends committee meetings by invitation and assists the committee in its deliberations save when issues relating to his own compensation are discussed. As with Mr Matlare, no directors are involved in determining their own remuneration. The committee takes advice from the company’s human resources and finance functions, as well as independent consultants.

The committees perform two distinct functions, one relating to remuneration and the other to the nomination of non-executive directors to the board. When nomination issues are considered, the committee is chaired by the group Chairman, AC Parker.

A comprehensive remuneration report is set out on pages 80 to 105 of this Integrated Annual Report 2014.

Risk and sustainability committee

Although the committee has an independent oversight role, it does not assume the function of group management. This remains the responsibility of the executive directors, officers and other members of senior management.

The duties of committee members who are also directors of the company are in addition to the responsibilities held by them as members of the board. The other members of the committee comprise the group’s senior management, including representatives of the sustainability, compliance, financial, legal/secretarial, operational management and supply chain functions of the group. The group compliance officer also attends meetings of the committee and has direct access to the committee chairman.

Further, the internal and external auditors, as well as Marsh (Pty) Limited, which undertakes the risk and environmental reviews, attend all meetings of this committee. Specialists are invited when appropriate to provide advice on matters of risk and sustainability.

Reports on the proceedings of the committee and the minutes of the meetings are submitted to the audit committee and the board. In addition, major risks as put forward by the committee are considered by the board on a regular basis.

Social, ethics and transformation committee

The committee operates in line with the requirements of the Companies Act No 71 of 2008, as amended, and King III.

The main objectives of the committee are to monitor the group’s activities with regard to any relevant legislation, legal requirements and prevailing codes of best practice.

The report of the social, ethics and transformation committee is set out on page 78.