Question

What is the procedures to follow in electing new members to the board , give some advise of the recommended practices as set out in King IV and how it differs from King Ill in
respect of board composition.

Answer 1

Ethical procedures to follow in electing new members to the board are as follows:

• Mentioning term of officers
• Maintaining meeting protocol to conduct electing of new members
• Election of statutory officers
• Nomination submission
• Voting
• Record of meeting
• Removing the previous member from the board
• Casual Vacancy

Recommended practices set out in King IV are as follows:

• The government body must show an ethical and effective gesture
• Organizational ethics must be maintained to retain an organizational culture
• The organization must ensure to be a responsible and corporate citizen
• The core purpose of the organization must be highly prioritized
• An effective stakeholders engagement
• The governing body must emphasize a focal point and maintain corporate governance
• Appropriate management of knowledge, skill, experience, and diversity should be highly prioritized
• The governing body should ensure independence judgment
• A proper performance evaluation
• Clarity and effectiveness must be properly maintained to ensure authority and responsibility
• Proper risk management must be maintained with strategic objectives
• An information support strategic objectives
• Must have compliance with ethical laws, responsibilities, and code of conduct
•   A fair remuneration policy
• Effective environmental control
• Execution of government roles and responsibilities
• The institutional investor should ensure responsible investment

Difference between King III and King IV are as follows:

• King III had 75 ethical principles while King IV has only 17 principles
• King III had ‘
• King III had applied and explained'' approach. However, King IV has ‘apply or explain approach''
• King III did not have sector supplements but King IV has sector supplements for municipalities and non-profitable organizations