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| Corporate governance |
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| Compliance |
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The Telkom Board subscribes to the values of good
corporate governance as espoused in the Code of
Corporate Practices and Conduct of King II (the Code). In so
doing, the directors recognise the need to conduct the
enterprise with integrity and in accordance with best
corporate practices.
The Board is of the view that Telkom complies in all
material respects to the principles of the Code. While it
acknowledges the importance of good governance, the
Board is aware that Telkom does not strictly comply with
certain principles set out in the Code. These areas of noncompliance
stem mainly from certain provisions in Telkom's
articles of association. Most of the areas of non-compliance
will be resolved by no later than March 5, 2011, when the
provisions of Telkom's articles of association resulting in noncompliance
with the Code fall away or earlier if the
shareholding of a significant shareholder falls below certain
stipulated levels. |
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| Chairman and Board of Directors |
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The Board takes overall responsibility for the Company and
its role is to exercise leadership and sound judgement in
directing it to achieve continued prosperity and to act in the
best interests of stakeholders.
Telkom has a unitary Board comprising 11 directors. In
accordance with Telkom's articles of association, five nonexecutives
including the Chairman have been appointed by
the Government of South Africa (the Class A shareholder)
and one non-executive appointed by the Public Investment
Corporation (the Class B shareholder). |
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There are four other non-executive directors who are
appointed at the Company's annual general meeting and
are considered to be independent, as set out in King II
and the JSE Listings Requirements. The only executive
director on the Board is the Chief Executive Officer. In line
with best practice, the roles of the Chairman and Chief
Executive Officer have been separated. The Board is
led by Ms SL Arnold, the Chairman, while operational
management of the Group is the responsibility of
Mr RJ September, acting Chief Executive Officer.
In terms of the articles of association, the non-executive
directors appointed by the Class A shareholder and Class B
shareholder have a fixed term of three years and may be
elected to the Board by those shareholders. The Chairman
has a term of one year and is re-elected as Chairman for
the ensuing year by the Class A shareholder. The four
independent non-executive directors are subject to
retirement by rotation and re-election by shareholders at
least every three years in accordance with the articles of
association and JSE Listings Requirements. |
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| The holders of the Class A and B ordinary shares are the
Government of the Republic of South Africa and the Public
Investment Corporation respectively. The only significant
shareholder is the Class A shareholder who currently holds
38.9% of the issued ordinary shares in the Company. The
significant shareholder has certain Board-reserved matters
which are detailed in the Company's articles of association.
Pursuant to the articles of association, whilst the Government
is a significant shareholder, neither Telkom nor any of its
subsidiaries may take action with respect to certain reserved
matters unless authorised by the Board. In addition, the
authorising resolution of the Board must have received the
affirmative vote of at least one of the directors appointed by
the Government. |
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| The members' resignations and appointments to the Telkom
Board of Directors are as follows: |
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| Resignations |
| TCP Chikane |
– |
June 19, 2006 |
| NE Mtshotshisa |
– |
October 31, 2006 |
| LRR Molotsane |
– |
April 5, 2007 |
| PL Zim |
– |
April 11, 2007 |
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| Appointments |
| KST Matthews |
– |
June 19, 2006 |
| SL Arnold |
– |
November 1, 2006 |
| RJ September |
– |
May 8, 2007 |
| MJ Lamberti |
– |
May 29, 2007 |
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| Company Secretary |
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All directors have access to the advice and services of the
Group Company Secretary, who is responsible for ensuring
compliance with procedures and applicable statutes and
regulations. All directors, irrespective of whether or not they
are executive or non-executives are entitled to liaise with the
Group Company Secretary in regard to items on the
agenda for Board meetings. The Group Company Secretary
is responsible for the development of director training and education. The appointment and removal of the Group
Company Secretary is a matter for the Board as a whole.
Mr VV Mashale served as Secretary to the Company during
the period under review. Mr VV Mashale resigned from the
Company as at May 31, 2007 and was replaced by Ms SF
Linford who joined Telkom as Group Company Secretary
with effect from June 1, 2007.
Details of the secretary's business address and the Company's
registered office are set out on page the ibc page. |
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| Board meetings |
| Board meetings are held at least once a quarter. In addition
to these meetings, whenever circumstances dictate the
necessity, special Board meetings are convened. During the
past financial year, four scheduled Board meetings were
held and three additional special Board meetings were
convened. Details of attendance by each director including
attendance at committee meetings of the Board are set out
in the table below. Certain members of senior management
attend Board meetings when invited to make presentations
on particular Company issues of interest to the Board.
A majority of directors, one of whom must be a
representative of the Class A shareholder, is required for a
quorum for Board meetings. |
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| The following table presents the attendance of meetings held during the 2007 financial year by directors: |
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Scheduled |
Special |
Number of
meetings1 |
Attendance |
Number of
meetings1 |
Attendance |
| Non-executive |
|
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| NE Mtshotshisa (Chairman) (resigned October 31, 2006) |
2 |
2 |
1 |
1 |
| TCP Chikane (resigned June 19, 2006) |
1 |
0 |
0 |
0 |
| SL Arnold (appointed November 1, 2006) |
2 |
1 |
2 |
2 |
| TD Mahloele |
4 |
3 |
3 |
2 |
| M Mostert |
4 |
4 |
3 |
3 |
| DD Tabata |
4 |
4 |
3 |
3 |
| YR Tenza |
4 |
4 |
3 |
3 |
| B du Plessis |
4 |
4 |
3 |
3 |
| TF Mosololi |
4 |
2 |
3 |
2 |
| PL Zim (resigned April 11, 2007) |
4 |
1 |
3 |
3 |
| PSC Luthuli |
4 |
4 |
3 |
3 |
| KST Matthews (appointed June 19, 2006) |
3 |
3 |
3 |
2 |
| Executive |
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| LRR Molotsane (left the employment of Telkom on April 5, 2007) |
4 |
4 |
3 |
3 |
| 1 |
The table represents the possible meetings based on the appointment and resignation dates of members. |
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