King IV’s “apply and explain” approach is resulting in the release of overwhelming amounts of information, which are obscuring—rather than highlighting—governance issues in South Africa.
Disclosure is at the heart of corporate governance. To be effective, stakeholders must have access to the information needed to substantiate boardroom claims that the company adheres to governance standards. But it is the quality and not the quantity of information made available to stakeholders that is critical.
The overwhelming volume of information that has been generated in the wake of the 2017 introduction of the King IV code of corporate governance poses a significant threat to the effectiveness of a governance system based on oversight and requiring disclosure.
The reality is that some companies use the governance code
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Reform of the financial system towards a sustainable economy has been detailed in an EU report, whose recommendations—which draw upon corporate governance reform—impact upon fiduciary duties in varying degrees.