Page 19 - Profmark_2024_Directors Guide

BOARD, COMMITTEES AND MEETINGS

Main Objectives of the Board
The main “best interest” objectives of the board, are:
■ To operate in the best interests of the shareholders
■ To operate in the best interests of the company.
These objectives may be achieved by implementing a framework of corporate strategy
and good corporate governance.
The board is responsible for determining the company’s strategic direction, which
includes determining the business model, which entity to trade through, the capital
structure and strategic planning.
Corporate governance is the implementation and execution of the corporate strategy, as
managed by the board of directors in terms of conformance and performance standards.
Directors have a duty to operate in the best interest of the shareholders at all times.
Directors have numerous administrative duties within the company, such as facilitating
meetings of the shareholders and the board, and a duty to make sure that shareholders
are able to exercise their voting rights.
Structure of the Board
The “board” refers to the collective word used to designate directors when they act
together as a group. When determining the structure of the board, the company should
take cognisance of factors such as the nature of the business, needs of the company,
structure of committees, quorum requirements and the skills and knowledge required
to make decisions. The Act does not prescribe how the board should be structured,
save to state that at least three non-executive directors must be appointed to the audit
committee of a public company or State owned company.
However, good governance principles and the King Reports recommend that a balanced
board of non–executive, independent non-executive and executive directors be elected,
so as to ensure a clear separation of ownership from control and reward structures
and that the board operates independently and is not an extension of the day to day
management of the company. It is recommended that the board structure be reviewed
on an annual basis.

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