Page 14 - Profmark BSA Guide 2025

of corporate legislation pertaining to their office, and have a duty to ensure that
the company complies with all other applicable laws, industry or sector specific
legislation. Directors are required to ensure that managers and employees are aware
of the legislation, and that all within the company are committed to act honestly, with
integrity, and with a high level of competence and knowledge. Adherence to non-
binding rules, codes and standards of good corporate governance are considered to
be key to the effective management and control of a company. The King IV ™ Report
and Code of Corporate Governance is a guideline for best practice and provides the
main standard for corporate governance in SA.
The King Report distinguishes between two types of directors:
■ Executive director: a full time salaried employee and under a contract of service
with the company who is involved in the daily running of the business.
■ Non-executive director: a part time director who is not an employee of the
company and is not involved in the day to day running of the business. A non-
executive director is independent from management and can therefore offer
objective judgement.
The draft King V™ Code introduces updates intended to improve clarity, usability and
relevance in governance practices. At the date of publication hereof, King V™ is not
yet in effect, however has been published for public comment.
Prescribed Officers
A prescribed officer is any person who fulfils the role of a director but who operates
under a different designation, including anyone who:
■ Exercises general executive control over and management of the whole, or a
significant portion, of the business and activities of the company, or
■ Regularly participates to a material degree in the exercise of general
executive control over and management of the whole, or a significant portion, of
the business and activities of the company.
A company secretary, may, for example, fall within the definition of a prescribed officer
in terms of the Act, even although he may not be a director appointed to the board of
the company. Prescribed officers are bound by the same codified duties and liabilities
of directors which are referred to in numerous sections of the Act.

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