King 3 Code on Corporate Governance, Kicks In

 The first King Code on Corporate Governance was published during 1994 under the auspices of the Institution of Directors in Southern Africa. It was launched in response to the increasing concern about corporate failures and the apparent need for better control measures and procedures for corporate entities.

The second King Code was finalised during March 2002 expanding and reviewing the first King Code. Since the publication of the second Code, there have been significant developments such as the enactment of a new comprehensive Companies Act. This necessitated a comprehensive review of the second Code.

The King 3 Code on Corporate Governance was introduced on 1 March 2010 and will in view of the obligations placed on Directors of Companies in accordance with the new Companies Act, have a wider application than the earlier Codes.

It is obvious that many entities as at 1 March 2010 did not comply with King 3, and the Institute of Directors reassured that entities were not required to have completed their governance processes by that date.

The launch of King 3 should be seen as the start of a journey towards better corporate governance.

Pieter Rautenbach