Corporate governance

Actions taken in 2010:

–	Director education continued.
–	Induction of the newly appointed chairmen of board and key risk committees.
–	Group-wide roll out of the revised code of ethics and related staff training continued.
–	The regulatory and legislative oversight management committee made significant progress in identifying the implications for the group of the evolving legislative and regulatory requirements.
–	Maintained inclusion on the JSE Socially Responsible Investment (SRI) Index.
–	Group practices were aligned to the King Code requirements.

Looking ahead to 2011:

–	Complete the actions required to align the group's governance processes to the King Code.
–	Continue to track and assess regulatory developments and formulate appropriate responses.
–	In South Africa, implement the new corporate law regime, together with new or amended legislation relating to companies, competition, privacy of information and consumer protection, as well as banking law and regulations.
–	Review internal, local and international governance structures to ensure new regulatory requirements are understood and met, and that international best practice is considered.

Introduction

The board operates on the understanding that sound governance practices are fundamental to earning the trust of stakeholders, which is critical to sustaining performance and preserving shareholder value.

The group's governance framework enables the board to balance its role of providing risk oversight and strategic counsel, and ensuring adherence to regulatory requirements and risk tolerance. The board is committed to upholding the fundamental tenets of governance, which include discipline, independence, responsibility, fairness, social responsibility, transparency and accountability of directors to all stakeholders.

The board's approach to governance is to embrace relevant local and international best practice. The principles of the King Code inform the governance framework and practices of the group and its subsidiaries. These have been reviewed and updated to ensure compliance with the King Code where appropriate.

The group established a steering committee to implement the requirements of the King Code. The project comprised six workstreams and the committee provided detailed feedback to the board on the gaps identified and the mechanisms required to address them. The board approved the steering committee's implementation plan, which included modifications to existing corporate governance structures. In 2010, the focus was on establishing the framework for applying the King Code where group practices differed with the Code, and implementation began. The group has made strides in the application of the King Code principles. In limited circumstances where a decision has been taken that the principles and recommendations of King Code will not be applied, reasons are given.

The group is in the process of finalising a policy to ensure that a consistent governance framework and standards are applied to, and adopted by, its subsidiaries. In all jurisdictions, governance developments are monitored on an ongoing basis to ensure that local requirements are met.

The Standard Bank of South Africa Limited, which conducts the group's domestic banking operations, is a major subsidiary of the group as defined in the JSE Limited (JSE) Listings Requirements. Liberty Holdings is a significant subsidiary of the group, governed by specific regulatory and legislative requirements. Liberty Holdings' compliance with the relevant requirements is documented in its annual report available at www.liberty.co.za.

Governance framework

Codes, regulations and compliance

Complying with all applicable legislation, regulations, standards and codes is integral to the group's culture. The board delegates responsibility for compliance to management and monitors this through the compliance function and a dedicated regulation and legislation oversight function. Oversight of compliance risk management is delegated to the group audit committee, which reviews and approves the compliance mandate submitted by the group chief compliance officer, who reports on a quarterly basis on, among others, the status of compliance risk management in the group, significant areas of non-compliance, as well as feedback on interactions with regulators. The group compliance function as well as the compliance policy and governance standards are subject to review and audit by group internal audit. The regulation and legislation oversight committee is a dedicated management committee that assesses the impact of proposed legislation and regulation. Material regulatory issues are escalated to the group risk oversight committee.

Through the Banking Association of South Africa, a code of banking practice has been endorsed by its members, to provide safeguards for consumers. Educational material on the code of banking practices, published by the Banking Sector Education and Training Authority (Bankseta), has been adapted to Standard Bank's specific requirements. The code of banking practices was revised in 2010 to take into account the recommendations of the Competition Commission's inquiry into banking in South Africa and the publication of the updated code of banking practices is expected during 2011.

The group is committed to social responsibility and sound environmental management. Further details on the group's economic, social and environmental impacts and contributions can be found in the Standard Bank Group's 2010 sustainability report available at www.standardbank.com or the group's sustainability website at www.standardbank.com under sustainable development.

Board and directors

Board structure and composition

The board of directors is the group's highest decision-making body and is ultimately responsible for governance. Directors are elected by the group's shareholders. The group has a unitary board structure and the roles of chairman and chief executive are separate. The chairman is an independent non-executive director, as are the majority of directors on the board. The balance of executive, non-executive and independent directors ensures a balance of power on the board, so that no individual or group can dominate board processes or decision-making and ensures the appropriate level of challenge.

Independent non-executive directors

The independence of board members is evaluated by the directors' affairs committee, which classifies independence according to the definitions in the King Code.

Two non-executive directors have served on the board for more than nine years, namely Doug Band and Saki Macozoma. After a rigorous review, the board has concluded that Doug Band is independent in fulfilling his duties irrespective of tenure. Saki Macozoma and Cyril Ramaphosa are not considered independent, due to their respective interests in the group's strategic empowerment partners, Safika and Shanduka. Hongli Zhang and Yagan Liu, the non-executive directors representing ICBC, the group's largest shareholder, are similarly not independent.

Resignation, retirement and removal of directors

No directors were removed during the period under review. Derek Cooper and Martin Shaw retired after the annual general meeting on 27 May 2010.

Due to a change in executive responsibilities, ICBC president Kaisheng Yang resigned from the board as director and deputy chairman, and from all board committees on which he served with effect from 8 October 2010. Hongli Zhang was appointed to these positions on the same date. Mr Zhang has extensive financial and banking experience, and the cooperation between ICBC and the group continues to be progressed.

Rick Menell, a member of the board since 1997, resigned on 4 February 2011 due to a conflict of interest. Mr Menell played an important role as an independent non-executive director on the board and member of the remuneration, and group and SBSA risk and capital management committees.

Succession planning

Succession planning is a key focus and the directors' affairs committee considers the composition of the board and its committees on an ongoing basis. The retention of board members with considerable experience is sought to ensure that appropriate levels of management oversight are maintained.

The board is satisfied that the current talent pool available within the group and the work being done to strengthen it provides adequate succession depth over the short and long term.

Skills, knowledge, experience and attributes of directors

The board ensures that directors possess the skills, knowledge and experience to fulfil their duties. The directors bring a balanced mix of attributes to the board, including:

–	domestic and international experience;
–	operational experience, including IT;
–	understanding of macroeconomic and microeconomic factors affecting the group;
–	financial, legal, entrepreneurial and banking skills; and
–	expertise in risk management and internal financial control.

Directors' qualifications and brief curricula vitae are provided in the board of directors.

The directors' affairs committee regularly considers board members individually and collectively to ensure the board remains strategically, demographically and operationally appropriate.

Access to information and resources

Executive management and the board interact regularly. This is encouraged and the group executive committee attends all board meetings. Non-executive directors meet without the executive directors in closed sessions at each board meeting.

Directors have unrestricted access to group management and company information, as well as the resources to carry out their roles and responsibilities. This includes external legal advice at the group's expense. A formal policy in this regard was approved in 2010.

Appointment policy

The board regularly reviews the group's nominations and appointments policy, which is aligned with applicable legislation and regulations. These include, but are not limited to, the requirements of the Companies Act, Banks Act and JSE Listings Requirements.

The policy sets out the process for nominating and appointing directors and key executives. There is a formal process for appointing directors. Shareholders are provided with information on the directors' education, qualifications, experience and other key directorships. In terms of the policy, executive management requires permission for external board appointments. This reduces potential conflicts of interest and helps ensure that management devotes sufficient time and focus to group business.

In making an appointment, the board takes cognisance of the knowledge, skills and experience of a prospective director, as well as other attributes considered necessary for the role. The board also considers the need for demographic and appropriate gender representation. Candidates are subject to a "fit and proper" enquiry, as required by the Banks Act and the JSE Listings Requirements.

Strategy

The board is responsible for the group's strategic direction. Management presents the group strategy annually and discusses and agrees it with the board. The board ensures the strategy is aligned with the group's values, performance and sustainability objectives, and addresses the associated risks.

Financial performance is monitored through quarterly management reports.

In line with banking regulations, the board agrees the group's corporate governance and risk management objectives for the year ahead. The directors' affairs committee and the relevant risk committees monitor performance against governance and risk objectives, respectively, and a report is submitted to the board. The assessment for the period under review found that the group had materially achieved its corporate governance and risk management objectives.

Board responsibilities

The key terms of reference in the board's mandate, which sets out the board's responsibilities, include the following:

–	agree the group's objectives, strategies and plans for achieving those objectives;
–	review annually the corporate governance and risk and capital management process and assess achievement against objectives;
–	delegate to the chief executive or any director holding executive office or any senior executive any of the powers, authorities and discretions vested in the directors;
–	delegate similarly such powers, authorities and discretions to any committee and subsidiary company boards as may exist or may be created from time to time;
–	determine the terms of reference and procedures of all board committees, review the board's and the committees' mandates annually and review their reports and minutes;
–	consider and evaluate reports submitted by members of the executive;
–	ensure that the audit committee is effective and independent;
–	review and monitor the performance of the chief executive and executive management;
–	ensure consideration is given to succession planning for the board, chief executive and executive management;
–	establish and review annually, and approve major changes to, relevant group policies;
–	consider the remuneration of non-executive directors on the board and board committees, based on proposals made by the group remuneration committee, and make recommendations to shareholders for approval;
–	approve capital funding for the group, and the terms and conditions of rights or other issues and any prospectuses in this regard;
–	ensure that an adequate budget and planning process exists, measure performance against budgets and plans, and approve annual budgets for the group;
–	approve significant acquisitions, mergers, takeovers, divestments of operating companies, equity investments and new strategic alliances entered into by the group;
–	consider and approve capital expenditure;
–	consider and approve any significant changes proposed in accounting policy or practice, and consider the recommendations of the group audit committee;
–	consider and approve the annual financial statements and the annual integrated report, results and dividend announcements and notices to shareholders, and consider and agree the basis for considering the group to be a going concern as per the recommendation of the group audit committee;
–	assume ultimate responsibility for financial and information technology governance, operational and internal systems of control, and ensure adequate reporting on these by respective committees;
–	consider the effectiveness of internal controls;
–	ensure that an effective and robust risk management process is in place which is linked to strategy, performance and sustainability;
–	ensure that regulatory reporting to the board is comprehensive;
–	ensure a balanced and understandable assessment of the group's position in reporting to stakeholders;
–	monitor management and stakeholder relations and provide effective leadership based on an ethical foundation;
–	consider and approve the group's political party funding policy and material political connections of directors if necessary;
–	review non-financial matters that have not been specifically delegated to a committee;
–	agree specifically, from time to time, matters that are reserved for its decision, retaining the right to delegate any of these matters to any committee in accordance with the articles of association;
–	ensure that the company applies applicable laws and considers non-binding rules and standards which is consistent with an effective compliance framework;
–	ensure that a governance framework is consistently applied across the group including subsidiaries; and
–	ensure that disputes are resolved effectively and efficiently as possible.

The board has reviewed and approved the annual integrated report, with assurances on the information having been provided by the group audit committee.

Delegation of authority

The board retains effective control through a well-developed governance structure that provides a framework for delegation. Board committees facilitate the discharge of board responsibilities and provide in-depth focus on specific areas. The board reviews the mandate of each committee at least annually.

The board delegates authority to the chief executive and executive directors to manage the business and affairs of the group. The group executive committee assists the chief executive when the board is not in session, subject to statutory parameters and the board's limits on the delegation of authority to the chief executive. The group governance office monitors board-delegated authorities.

View the group executive committee. View the group's corporate governance framework, which shows board and executive management reporting lines.

Board meetings

The board meets once per quarter with an additional annual meeting to consider the group strategy. Ad hoc meetings are held when necessary.

Board of directors – meeting attendance

Board of directors’ meetings for 2010	Mar	May	Aug	Oct	Dec
TMF Phaswana (chairman)^1,2	√	√	√	√	√
DE Cooper^1,3	√	√	–	–	–
Kaisheng Yang^4,5	√	√	√	–	–
Hongli Zhang (deputy chairman)^4,6	–	–	–	√	√
SJ Macozoma (deputy chairman)⁴	√	√	√	√	√
DDB Band¹	√	√	√	√	√
RMW Dunne¹	√	√	√	√	√
TS Gcabashe¹	√	√	√	√	√
SE Jonah KBE¹	A	√	√	A	A
Sir Paul Judge¹	√	√	√	√	√
KP Kalyan¹	√	√	√	√	√
Yagan Liu⁴	√	√	√	√	√
JH Maree⁷	√	√	√	√	√
RP Menell^1,8	√	√	√	√	√
KD Moroka¹	√	√	√	√	√
AC Nissen¹	√	√	√	√	√
MC Ramaphosa⁴	√	√	√	√	A
SP Ridley⁷	√	√	√	√	√
MJD Ruck¹	√	√	√	√	√
MJ Shaw^1,9	√	√	–	–	–
Lord Smith¹	√	√	√	√	√
EM Woods¹	√	√	√	√	√

¹	Independent non-executive director.
²	Appointed chairman 27 May 2010.
³	Retired as director and chairman 27 May 2010.
⁴	Non-executive director.
⁵	Resigned as director and deputy chairman 8 October 2010.
⁶	Appointed as director and deputy chairman 8 October 2010.
⁷	Executive director.
⁸	Resigned as director 4 February 2011.
⁹	Retired as director 27 May 2010.
√	= Attendance
A	= Apology
–	= Not applicable

Board effectiveness and evaluation

The board measures its effectiveness in a number of ways. Its performance is assessed annually against its mandate, as is the performance of its committees. Findings are reported to the directors' affairs committee after the external auditors have reviewed them.

The directors' affairs committee considers different methods of evaluating performance and makes recommendations to the board in this regard. The aim of these evaluations is to assist the board and its committees to constantly improve effectiveness and identify any areas for director education.

The board assessed the performance of its committees in 2009. The chairman reported the findings at the board meeting in March 2010. The evaluations assessed performance in terms of structure, process and effectiveness. Individual questionnaires were completed, the results tabulated, and feedback discussed by each committee. No major areas of concern were highlighted other than the increasing information needs of members due to the changing regulatory landscape.

In 2010, the board engaged an external facilitator to perform an independent review of its performance. The process is under way and feedback will be provided to the board in the second quarter of 2011. The outcomes will be used to benchmark board practices and development.

The performance of the group chairman and chief executive is assessed annually, and their remuneration determined accordingly. View the remuneration report.

Education and induction

Ongoing board education remains a focus. The directors are kept abreast of all applicable legislation and regulations, changes to rules, standards and codes, as well as relevant sector developments that could affect the group and its operations. The directors' education programme continued to focus on business issues and additional time was scheduled outside of board meetings for sessions on pertinent issues for the board and its committees. The programme was supplemented by external courses and on-site visits where relevant.

On appointment, each new director receives a governance manual that includes all relevant governance information such as mandates, management structures, significant reports, important legislation and policies. One-on-one meetings are scheduled with management to introduce new directors to the company and its operations. The group secretary is responsible for the induction and ongoing training of directors. If an inexperienced director is appointed to the board, mentorship would be considered.

Board committees

Each board committee's mandate sets out the role, responsibilities, scope of authority, composition and procedures to be followed. All board committee mandates were reviewed in 2010 to take into account amendments to relevant legislation and the new requirements of the King Code.

Group audit committee

Member	Feb	Mar	Apr	May	Jun	Aug	Oct	Nov
RMW Dunne (chairman) ¹	√	√	√	√	√	√	√	√
MJ Shaw²	√	√	√	√	–	–	–	–
TS Gcabashe³	√	√	√	√	√	√	√	√
Lord Smith⁴	√	√	√	√	√	√	√	√
EM Woods⁵	√	√	√	√	√	√	√	√

¹	Appointed to the committee 3 December 2009 and appointed chairman 27 May 2010.
²	Retired as chairman and director 27 May 2010.
³	Appointed to the committee 1 May 2008.
⁴	Appointed to the committee 1 January 2009.
⁵	Appointed to the committee 22 May 2008.
√	= Attendance
–	= Not applicable

Although the new Companies Act and the King Code require shareholders to elect the members of the audit committee at each annual general meeting, the new Companies Act provides an exemption to banks and bank controlling companies. The audit committee is constituted in terms of the Banks Act. The Banks Act requires the board to appoint at least three independent non-executives to the committee and stipulates that the chairman of the board may not be a member of the committee.

In accordance with the Banks Act, the board has appointed the members of the committee, which is comprised solely of independent non-executive directors. Details of members including their professional qualifications are set out in the board of directors of this report.

The role of the group audit committee is to review the group's financial position and make recommendations to the board on all financial matters, risks, internal financial controls, fraud and IT risks relevant to financial reporting. This includes assessing the integrity and effectiveness of accounting, financial, compliance, sustainability and other control systems. The committee has a constructive working relationship with the chief audit officer who has access to committee members as required. The committee also ensures effective communication between the board, management, internal auditors, external auditors and regulators.

The committee's terms of reference sets out various categories of responsibilities, including the following:

–	review and approve the group audit plan with the joint auditors, with specific reference to the proposed audit scope, approach to group risk activities and the audit fee;
–	assess annually the work done by the external auditors to ensure their independence and effectiveness;
–	meet with external auditors to discuss audit findings and consider detailed internal audit reports with the internal auditors;
–	oversee the appointment of external auditors, their terms of engagement and fees;
–	evaluate annually the role, independence and effectiveness of the internal audit function in the overall context of the group's risk management system;
–	consider the appointment or dismissal of the chief audit officer and head of compliance;
–	review the accounting policies adopted by the group and all proposed changes in accounting policies and practices;
–	consider the adequacy of disclosures to ensure shareholders and stakeholders remain appropriately informed about financial matters and the reasons for variations in ratios reported in published documentation;
–	review the effectiveness of financial management including the management of financial risks, the quality of internal accounting control systems and reports produced by financial management;
–	review and approve the internal audit mandate;
–	review significant differences of opinion between management and the internal audit function and report such differences;
–	ensure the group applies a combined assurance model to provide a coordinated approach to all assurance activities;
–	review the group compliance plan, with specific reference to the procedures for identifying regulatory risks and controlling their impact on the group, and ensure that the group's policy complies with relevant regulatory and legal requirements;
–	ensure compliance with all legal, regulatory and accounting standards;
–	monitor ethical conduct;
–	review reports and activities of the financial crime department to ensure the mitigation and control of all fraud and related risks, including but not limited to implementing appropriate "whistleblower" mechanisms and ensuring that financial crime is adequately managed in the group;
–	ensure the use of technology and related techniques to improve audit coverage and audit efficiency and oversee IT risks as they relate to financial reporting;
–	monitor the relationship between external auditors and the company;
–	remain up to date with regulations and new developments in reporting;
–	review and make recommendations on any potentially material conflicts of interest;
–	consider the appropriateness of the financial statements and accounting practices of the group;
–	consider the effectiveness of the group's internal financial controls;
–	hold periodic sessions with internal audit in the absence of management; and
–	recommend approval of the annual integrated report to the board and assure the integrity of the information in the report.

The committee is responsible for the internal control framework, which is the group's three lines of defence model overlaid by the group's corporate governance framework. The three lines of defence model seeks to separate the relevant duties and ensure independent reporting lines to underpin effective internal control and risk management. More detail is provided on this and the combined assurance model in the risk and capital management section.

Internal financial controls are in place to ensure the integrity of the group's qualitative and quantitative financial information, which is used by a variety of stakeholders. The group financial director is ultimately responsible for implementing and maintaining internal financial controls.

Assurance of the effectiveness of internal financial controls is achieved through:

–	management confirmation that the financial governance controls and internal financial controls supporting the assertions in the financial statements operated effectively during the year, which was the case for the year ended 31 December 2010 (this attestation will become a quarterly discipline in 2011); and
–	coordinated audit work by the internal and external auditors as part of their annual risk-based audit plans.

The group has a formal policy on non-audit fees, which is regularly reviewed and approved by the committee. The purpose of this policy is to ensure that the independence and objectivity of the auditors is not impaired. Non-audit services are approved in terms of the policy and reported to the committee on a quarterly basis. The committee chairman approves, on a case-by-case basis, all significant services outside the scope of the pre-approved audit plan, and any engagements beyond a threshold amount are subject to approval by the committee. The independence of the auditors and availability of alternative service providers are key factors in granting approval. The split between audit fees and fees for non-audit services is set out in note 27.13.

The committee considers reports from group internal audit on any weaknesses in controls that have been identified, including financial controls, and considers corrective actions to be implemented by management to prevent such losses recurring. This takes place on an ongoing basis. The group internal audit mandate is not approved by the board as the board has delegated this to the committee.

The audit committee reviews financial information to be published by the group. In addition, the content of the annual integrated report was reviewed by the committee and the content recommended to the board. Going forward, consideration will be given to the distribution of a summarised integrated report as permitted in terms of the new Companies Act.

The group audit committee has complied with its mandate in the year under review, as well as its legal and regulatory responsibilities. For further discussion on these activities, reference should be made to the audit committee report.

Group risk and capital management committee

Member	Mar		May	Aug	Nov
MJD Ruck (chairman)¹	√	√	√	√	√
MJ Shaw²	√	√	√	–	–
DDB Band	√	√	√	√	√
DE Cooper³	√	√	√	–	–
RMW Dunne	√	√	√	√	√
Yagan Liu⁴	√	√	√	√	√
SJ Macozoma	√	A	√	√	√
RP Menell⁵	√	√	√	√	√
TMF Phaswana	√	√	√	√	√
Kaisheng Yang⁶	√	√	√	√	–
Hongli Zhang⁷	–	–	–	–	√

¹	Appointed chairman 27 May 2010.
²	Retired as director and chairman 27 May 2010.
³	Retired as director 27 May 2010.
⁴	Alternate to Hongli Zhang.
⁵	Resigned as director 4 February 2011.
⁶	Resigned as director 8 October 2010.
⁷	Appointed as director 8 October 2010.
√	= Attendance
A	= Apology
–	= Not applicable

The board is ultimately responsible for risk and capital management. The main purpose of the group risk and capital management committee is to provide independent and objective oversight of risk and capital management in the group. A number of management committees help the committee to fulfil its mandate.

The committee reviews and assesses the integrity of risk control systems and ensures that risk policies and strategies are managed effectively and contribute to a culture of discipline and control that reduces the opportunity for fraud. Assurance on the effectiveness of the risk management processes is provided to the committee through management reporting.

The group risk and capital management committee complied with its mandate in the year under review. Four scheduled meetings were held and one additional ad hoc meeting was called.

The risk management report, which sets out the group's framework for risk and capital management.

Group credit committee

Member	Mar	May	Aug	Nov
TMF Phaswana (chairman)¹	√	√	√	√
DE Cooper²	√	√	–	–
DDB Band	√	√	√	√
AG Gain³	√	√	√	√
RC Irvine³	√	√	√	√
Yagan Liu⁴	√	√	√	√
SJ Macozoma	√	√	√	√
JH Maree³	√	√	A	√
SP Ridley³	√	√	√	√
MJD Ruck	√	√	√	√
PJ Smith³	√	√	√	√
J van der Velden³	√	√	√	A
Kaisheng Yang⁵	√	√	√	–
Hongli Zhang⁶	–	–	–	√

¹	Appointed chairman 27 May 2010.
²	Retired as director and chairman 27 May 2010.
³	Executive members.
⁴	Alternate to Hongli Zhang.
⁵	Resigned as director 8 October 2010.
⁶	Appointed as director 8 October 2010.
√	= Attendance
A	= Apology
–	= Not applicable

The group credit committee, whose role it was to ensure that effective frameworks for credit governance were in place across the group, complied with its mandate for the year under review.

Following discussions, the board agreed a proposal to combine the role for oversight of credit risk with the work undertaken by the group risk and capital management committee. This was to eliminate the duplication of work between the two committees. The group risk and capital management committee will now assume responsibility for all issues previously overseen by the group credit committee, including reporting to the group audit committee on group credit portfolios, adequacy of credit impairments and the status of non-performing loans.

The large exposure credit committee approves credit facilities in accordance with regulatory requirements for SBSA. This committee will continue to operate in terms of guidance received from the Registrar of Banks in South Africa, including the composition which includes three non-executive directors of SBSA, and SBSA business and risk heads, namely the chief executive, financial director, chief risk officer and head of credit.

Directors’ affairs committee

Member	Mar	May	Aug	Nov
TMF Phaswana (chairman)¹	√	√	√	√
DE Cooper²	√	√	–	–
DDB Band	√	√	√	√
Yagan Liu³	√	√	√	√
SJ Macozoma	√	√	√	√
MC Ramaphosa	√	A	√	A
Kaisheng Yang⁴	√	√	√	–
Hongli Zhang⁵	–	–	–	√

¹	Appointed chairman 27 May 2010.
²	Retired as director and chairman 27 May 2010.
³	Alternate to Hongli Zhang.
⁴	Resigned as director 8 October 2010.
⁵	Appointed as director 8 October 2010.
√	= Attendance
A	= Apology
–	= Not applicable

This committee helps the board determine and evaluate the adequacy, efficiency and appropriateness of corporate governance structures and practices in the group. The directors' affairs committee also functions as the nominations committee for directors of the group. As such, its role is to identify, evaluate and recommend nominees to the board and board committees, to ensure the board is able to fulfil its obligations. The committee also assesses the effectiveness of the board and its committees against their respective mandates.

The committee reviews pertinent issues and the potential impact on the group and the communities in which the group operates, to ensure that the group remains a responsible corporate citizen.

The committee oversees the induction, development and ongoing education of directors.

The directors' affairs committee is responsible for considering and approving share awards to black managers in terms of the group's Tutuwa initiative. The allocation committee, a management committee chaired by non-executive director Saki Macozoma, recommends allocations for approval.

The directors' affairs committee complied with its mandate in the year under review.

Group transformation committee

Member	Feb	May	July	Nov
SJ Macozoma (chairman)	√	√	√	√
DE Cooper¹	√	A	–	–
KP Kalyan	√	√	√	√
JH Maree²	√	√	√	√
AC Nissen	√	√	√	√
TMF Phaswana	√	√	√	√
SK Tshabalala²	√	√	√	√

¹	Retired as director 27 May 2010.
²	Executive member.
√	= Attendance
A	= Apology
–	= Not applicable

This committee oversees the group's transformation initiatives and provides guidance on appropriate approaches. The committee monitors developments on an ongoing basis to ensure compliance with evolving legislation and related regulations. A key focus is monitoring of progress against transformation targets. In 2010 the committee was kept abreast of developments in relation to industry codes, and specifically the process of aligning the Department of Trade and Industry's Codes of Good Practice for Broad-based Black Economic Empowerment (dti codes) with the financial sector charter.

The transformation committee complied with its mandate in the year under review.

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