Excellence in corporate reporting was recognised last night as Chartered Secretaries Southern Africa ("the Institute") in partnership with the JSE announced the winners to the 58th Annual Report Awards.
With sub-standard corporate governance practices being brought to the fore by the global financial crisis, the importance of good company reporting has increased exponentially and the Awards provide the platform for reward in this arena. Anglo Gold Ashanti scooped overall winner for 2009.
Sasol Limited won the Top 40 category, with Group 5 and Distribution and Warehousing Network taking the top ranking in the Mid Cap and Small Cap categories, respectively. The winner in the Fledgling category was Kelly Group, and in the AltX category Rolfes Technology took top honours. Other winners included Anglo Platinum for the SAPPI Award for the best sustainable reporting, Anglo Gold Ashanti for Human Capital Reporting and FNB Namibia for Regional Company. In the more recent non-listed category for state entities, the best annual report was adjudged once again to be SA Post Office's. Merit awards in recognition of good reporting went to Anglo Platinum, Bidvest, Barloworld, Netcare, Eqstra, Blue Financial Services, Barloworld, the Development Bank Southern Africa, and Standard Bank Namibia.
The Institute is the professional body representing governance professionals in the Southern Africa region, particularly Chartered Secretaries. CEO Stephen Sadie explains that the Institute's/JSE's Awards are the longest-standing such awards in the country having started in 1952, and the most highly recognised by industry at large. "The Institute holds the competition to encourage accurate and transparent financial reporting and full disclosure of all relevant information to shareholders, and comprise the benchmark for independent adjudication of compulsory company reporting." He adds that the Awards offer an opportunity for a peer-on-peer comparison in the measure of good corporate governance and risk management practices.
In addition to voluntary entries from South Africa, entries are further received from Botswana, Swaziland, Namibia and other African countries. Judging is carried out by a panel of independent experts from the Institute, the JSE and this year, from media sponsor Business Day. Sadie emphasises that the judging process is stringent. "In line with recommendations by the King reports in South Africa and imminent new legislation, the primary judging criterion is how well the annual reports integrate the triple bottom line - economic, environmental and social practices and reporting." Sadie currently sits on the King III committee.
He adds that judging is not limited to the face of the submission and says the main judging criterion is not be confused with a focus only on the 'softer corporate issues'. "The panel of judges is tough on submissions and hones in on more uncomfortable corporate matters that are either not reported at all or reported in insufficient detail."
Jill Parrat, President of the Institute and Group Secretary of Liberty Holdings, says the Institute is expending much effort in educating corporates that the involvement of governance professionals is critical in compiling an appropriate annual report and fulfilling the directors' responsibility of accountability to stakeholders for content.
She says: "By appointing a Chartered Secretary who has qualified through the Institute with an international qualification recognised in 70 countries, companies will gain the advantage of superior corporate governance practices and reporting." To ensure ongoing education of its Chartered Secretaries post graduation and help maintain their advantage among governance professionals, the Institute offers ongoing CPD courses and continuous technical support packages and updates as well as access to an in-house Technical Advisor at all times.
In 2009 the Awards' panel of judges has highlighted that small cap and AltX reporting needs significant improvement, with the obvious exception of the winners which stood out in these categories. The new category of Human Capital Reporting revealed a high standard amongst the larger corporates and some mid-cap size companies. The judges also reported significant headway in sustainability reporting which they felt "has come of age" among mid- to large-caps, with the smaller companies still needing to make progress in this regard.
Areas of concern highlighted by the panel included a general lack of focus on the macro-environment and industries in which entrants operate. In addition according to the judges, "many entrants still choose to omit, or gloss over, contingent liabilities in their annual reports". One judge commented: "There is a need to get back to basics in some instances, with the focus on an easily readable, transparent, understandable document more concentrated on quality of disclosure than on graphics that may hide a vacuum of substance."
Nicole Katz/Michèle Mackey
(011) 325 5944/082 497 9827
On behalf of:
Chartered Secretaries Southern Africa
Stephen Sadie, CEO 011 403 7953/ 079 494 2169
Jill Parratt, President
Issue date: 13 November 2009
FYI: The Institute is a division of the global Institute of Chartered Secretaries and Administrators (ICSA) which has more than 35 000 members and 27 500 students worldwide. ICSA is headquartered in London with additional divisions across the globe in Australia, Canada, China, Malaysia, New Zealand, Singapore and Zimbabwe. The Institute represents South Africa, Botswana, Lesotho, Namibia and Swaziland. Members (who are all Chartered Secretaries) work in public and private companies, corporate secretarial firms, legal practices, international accounting firms, tertiary institutions and the public sector.