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Board governance at a glance
Group Company Secretary
The Group Company Secretary supports the board and its committees by advising them on directors’ statutory duties, JSE Listings Requirements, disclosure obligations, and good corporate governance practices.
Following the review of the Group Company Secretary by the board, it is satisfied that the governance arrangements and controls between the board, its committees and the office of the group company secretariat are sound and adequate for its effectiveness.
The Group Company Secretary maintains an arm’s-length relationship with the directors and is accessible to each of them for support and guidance. She reports administratively to the GCEO and functionally to the board Chairperson. The Group Company Secretary oversees governance in all subsidiaries as the operating model services from the centre.
The role of the board
The roles and responsibilities of directors are articulated in the Companies Act and the board charter. The board is satisfied that it has fulfilled its mandate in terms of its board charter. To regulate its work, the board approves the annual workplan, compiled against its charter and the committees’ terms of reference and divided into quarterly activities. This ensures that the board monitors and discharges all its activities in accordance with its charter. The charter is amended as and when needed.
Some key matters that the board considered were:
- There were two strategy sessions convened in September 2019 and February 2020. The first session considered the expected changes to market and industry dynamics over the medium and long term to unlock future value. This entailed reviewing the market and technology trends, while assessing the market, competitor and regulatory developments. The second session reviewed the flight plans, and responses to key macro-economic challenges. There was engagement on how can drive innovation through technology disruption, increasing competitiveness and enterprise development activities.
- The board engaged on the ICASA proposed framework for the allocation of spectrum policy directive, and the options for consideration.
- As customer service is central to the operations of the group, the board focused on improving service delivery and customer experience.
- The board focused on adverse regulatory and unstable market and economic conditions. Non-compliance with laws and regulations, cybersecurity threats, information and technology governance, market disruptions and disruptive technologies were considered.
- The board considered succession planning for the directors and group exco members. It mandated the nominations and remuneration committees with ensuring that succession planning is in place for both groups.
- The board approved the group ethics handbook and the governance framework. Organisational ethics and good corporate governance remain a focal point on the board due to their respective criticality in managing successful entities.
- Market update on the group’s restructuring programme, and the potential impact thereof.
Board committees
The board has delegated some of its activities to duly constituted committees to assist it in discharging its duties. The board has six committees, each guided by terms of reference. The board committees are satisfied that they have fulfilled their roles and responsibilities in terms of the approved terms of reference. These terms of reference are reviewed annually, or as and when the need arises, for adequacy and taken through the governance structures for consideration. In terms of the group governance framework, the committees fulfil the statutory compliance role for the group where required.
The terms of reference of each committee were last approved in April 2020, and the changes thereto were in accordance with the JSE Listings Requirements, reviewed Delegation of Authority (DOA), and the newly implemented group governance framework. Through the group company secretariat, all incoming members to the board committees were inducted to assist with onboarding processes.
The board charter and each committee’s terms of reference are available at https://www.telkom.co.za/ir/Governance/Governance.shtml.
| Audit committee | ||||
Members
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Mandate and key focus areas The audit committee is a statutory board committee per provisions of the Companies Act. It is mandated in terms of the DOA and is charged with the independent role of accountability. The audit committee has, among others, the responsibilities of internal and financial control, internal audit, external audit, risk management, combined assurance, financial statements and integrated report, communication with shareholders, compliance, and legal and regulatory matters related to accounting activities. The audit committee considered and/or approved the following key matters, among others:
For more details on the committee’s activities, refer to its report in the annual financial statements of the Audit Committee report. Also refer to the Group Chief Financial Officer's report. |
| Nominations committee | ||
Members
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Mandate and key focus areas The nominations committee is responsible for reviewing and making recommendations to the board on most governance-related matters, particularly board and committee composition. This includes all aspects of diversity such as academic qualifications, technical expertise, industry knowledge, experience, business acumen, race and gender. It works closely with the remuneration committee on succession planning for executive directors and critical roles. The committee considered the following key matters, among others:
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| Investment and transactions committee | ||
Members
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Mandate and key focus areas The committee deals with any significant investment or transaction relating to the acquisition of another business or legal entity, including any equity injection or possible merger or acquisition approved by the board. It ensures that approved transactions’ post-merger integration plans are adequate. It monitors the performance of investments against the original investment criteria and pre-investment assumptions through a formal post-acquisition review. The committee considered the following key matters, among others:
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| Risk committee | ||||
Members
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Mandate and key focus areas The risk committee assists the board in ensuring that management has an effective risk management process in place that identifies and monitors the management of the group’s key risks, in an integrated and timely manner. It oversees the governance of risk through the group’s ERM framework and its system of internal controls. The committee increased its focus on managing technology and information-related activities. The committee considered the following key matters, among others:
The group combined assurance framework |
| Remuneration committee | ||
Members
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Mandate and key focus areas The remuneration committee sets the group’s remuneration policy on behalf of the board. It oversees remuneration for executive directors and senior executives; monitors the execution of the remuneration policy for the group, including non-executive directors; and makes recommendations to the board. The committee considered the following key matters, among others:
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| Social and ethics committee | ||
Members
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Mandate and key focus areas The social and ethics committee is a statutory board committee per the provisions of the Companies Act. Its activities emphasise the environment, and social, governance and ethics-related matters. It considers the UN Global Compact Principles, Organisation for Economic Co-operation and Development recommendations, the Employment Equity Act and the B-BBEE Act, and adheres to the requirements of Regulation 43 of the Companies Act. The committee considered the following key matters, among others:
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Board and committee attendance
| Director | Board | Audit committee |
Remuneration committee |
Nominations committee |
Investment and transactions committee |
Social and ethics committee |
Risk committee |
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| Independent non-executive directors | ||||||||
| MS Moloko (Chairperson) | 9/9 | – | 2/26 | 3/3 | 1/16 | – | – | |
| SL Botha | 8/93 | – | 3/3 | 4/4 | – | – | – | |
| GW Dempster | 4/53 | 2/24 | – | – | – | – | 2/24 | |
| N Kapila | 9/9 | – | – | – | 8/8 | 4/4 | – | |
| KT Kweyama | 9/9 | – | – | 3/43 | – | 4/4 | – | |
| PCS Luthuli | 9/9 | 8/8 | – | – | – | 3/32 | – | |
| DD Mokgatle | 9/9 | 1/15 | – | – | – | 3/32 | 3/3 | |
| KW Mzondeki | 9/9 | 8/8 | 3/3 | – | 8/8 | – | ||
| F Petersen-Cook | 9/9 | 1/15 | – | – | 8/8 | – | 3/3 | |
| KA Rayner | 7/72 | 6/62 | – | – | – | – | 2/22 | |
| SP Sibisi | 7/93 | – | – | – | 2/33 | 3/32 | – | |
| RG Tomlinson | 8/93 | 7/83 | 2/22 | – | 7/83 | – | – | |
| LL Von Zeuner | 8/93 | 8/8 | – | – | – | 4/4 | 3/3 | |
| JA Mabuza | ||||||||
| (former Chairperson) | 1/11 | – | 1/11 | 1/11 | – | – | – | |
| Executive directors | ||||||||
| SN Maseko | 9/9 | 7/83 | 3/3 | 4/4 | 8/8 | 3/43 | 2/33 | |
| TBL Molefe | 9/9 | 8/8 | 3/3 | – | 7/83 | 4/4 | 3/3 |
| 1 | Resigned effective 31 May 2019. |
| 2 | Appointed 15 July 2019. |
| 3 | Apology. |
| 4 | Resigned as an audit committee member effective 27 August 2019, and from the board effective 30 November 2019. |
| 5 | Not members, attended a special audit committee meeting by invitation on 12 February 2020. |
| 6 | Appointed as chairperson of the board and nominations and remuneration committees and resigned as a member of the investment and transactions committee effective 1 June 2019. |