CORPORATE GOVERNANCE 

With over four decades of existence, Sefalana prides itself in a strong governance culture and for being the first publicly listed company in Botswana. This culture has assisted us in positively contributing to the country’s growth, as the economy largely depends on the drive and efficiency of its larger organisations. The essence of any system of corporate governance is to freely drive a company forward but to exercise that freedom within the framework of effective accountability. The Board adopts concepts of ethical leadership, sustainable development, integrated reporting, corporate citizenship and stakeholder inclusivity as stipulated in King IV.

 

Sefalana strives to align itself to good corporate governance with reference to the newly constituted King IV that builds on the same foundations as King III but raises the importance of ethical and effective leadership with an objective of achieving an ethical culture, better performance, effective control and legitimacy. The Company has applied the guidelines as entrenched in the revised Botswana Stock Exchange (“BSE”) listing rules.

 

The Group also, on an on-going basis, looks at other regions in the World to determine best practice in Governance, to guide and improve the way in which it operates. This year a reference point was the UK’s Code. The adoption of the UK Corporate Governance Code amongst several governance codes is due to similar legal systems as well as the similarity of governance models being the Shareholder model of ownership and control.  The UK Corporate Governance Code sets out the standards of good practice for listed companies. Similar to the King Code the overarching principles of the Code are leadership, capability, accountability, sustainability and integrity.

 

The Board has in place a Board Charter to clarify roles of the Board and to enhance its decision-making processes. The purpose of the Board Charter is to clearly outline the structure of the Board and to define its role, focusing on strategic leadership, performance management, investor relations, risk management and governance. The Board Charter also outlines fiduciary duties of Directors according to Section 130 of the Companies Act and as recommended by King IV. The Board reviews the Charter annually to ensure that it is in line with recent changes in the law and standards of governance practice. No significant changes were made to the Charter during the reporting period.

The Board meets once every quarter and holds additional meetings as may be required from time to time.

The Board's ultimate responsibility is for the supervision of the Group’s activities. It has the following principal duties:

 

  1. Formulating and monitoring implementation of the Group's long term business strategy;
  2. Identification of key risks that threaten the Group’s ability to achieve its strategy;
  3. Approval of the Group's investment plans, budgets and forecasts;
  4. Review of reports submitted to the Board for approval;
  5. Review of the business operations of the Group;
  6. Establishing sound accounting and financial control principles, as well as principles of financial planning;
  7. Ensuring compliance with legal and ethical standards;
  8. Ensuring that the Managing Director and other members of the Senior Management team are competent, and that an effective succession strategy and plan is adopted for the Group's senior executive positions; and
  9. Review of Board sub- committees for purposes of delegation of power and duties in order to enhance the overall effectiveness of the Board

 

The Board uses the Annual General Meeting and Special General Meetings to communicate with Shareholders and potential investors and encourage their participation. Frequent announcements through the press and mailing of information for the attention of Shareholders are practiced wherever required. The Company circulates with every Notice of General Meetings a summary of the procedures governing voting at General Meetings.