A streamlined version of King IV, the draft King V Code on Corporate Governance (‘King V’) was recently circulated by the Institute of Directors in South Africa (‘IoDSA’) for public consultation. Underpinned by the critical role corporate governance plays in advancing the objectives of corporate institutions in South Africa, King V aims to, inter alia, clarify key terms, simplify governance principles, and standardise disclosure requirements.
Against the backdrop of various global and local developments, King V reflects recent revisions to the Companies Act, expanding technological advancements, changes in sustainability reporting, and growing shifts in remuneration-related practices. As such, the updated Code is necessary to ensure corporate governance standards are practical and effective.
Crucially, a core objective of King V is to enhance accessibility and user-friendliness. To that end, King V adopts simpler terminology, minimises the use of graphics, and streamlines the interpretation and scope of governance principles, which have been reduced from 17 to 12. Further, King V will operate as a stand-alone document, with all ancillary materials accessible from a single website.
Furthermore, King V incorporates a standardised approach to disclosure requirements and practices to improve accountability and internal monitoring. Designed to aid shareholders, regulators, and other interested stakeholders, the new disclosure template clarifies, facilitates, and details the content and form of disclosures on institutions’ governance practices in line with an apply-and-explain approach.
Notwithstanding the above revisions, King V does not substantially deviate from the content or core principles of King IV. Additionally, its institutional reach encompasses listed companies, SMEs, state-owned entities, local government bodies, and institutional investors, including retirement funds and life insurers. As such, institutions that already apply King IV will not experience transitional difficulties.
To facilitate transparency, the public consultation process is open to all interested parties. Members of the public may therefore make submissions on behalf of institutions or in their personal capacity. To submit comments, use this online form on IoDSA’s website by Friday, 4th April 2025.
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