Podcast
Questions and Answers
What year was King Code first published?
What year was King Code first published?
1994
What is the latest edition of King code?
What is the latest edition of King code?
King IV
The King Code provides ethical guidelines for only South African based companies.
The King Code provides ethical guidelines for only South African based companies.
False (B)
King Code IV is an Internationally acclaimed report.
King Code IV is an Internationally acclaimed report.
Who was the chair of the South African committee that drafted the King Code?
Who was the chair of the South African committee that drafted the King Code?
The King Code provides [BLANK], [BLANK] and [BLANK] for good and ethical corporate governance.
The King Code provides [BLANK], [BLANK] and [BLANK] for good and ethical corporate governance.
The board of directors is elected by the shareholders of the company.
The board of directors is elected by the shareholders of the company.
The board of directors is responsible for only managing the affairs of the company.
The board of directors is responsible for only managing the affairs of the company.
The board of directors has a legal obligation to act in the best interests of the company and an ethical duty to direct it in a responsible, professional and transparent manner.
The board of directors has a legal obligation to act in the best interests of the company and an ethical duty to direct it in a responsible, professional and transparent manner.
The board is accountable for the ethical conduct of the company.
The board is accountable for the ethical conduct of the company.
What is the principle, based on the King Code, behind the ethical corporate culture?
What is the principle, based on the King Code, behind the ethical corporate culture?
Company ethical conduct is not only required from corporate leadership, but should exist throughout the company.
Company ethical conduct is not only required from corporate leadership, but should exist throughout the company.
King IV stipulates that the board should be responsible for creating an ethical corporate culture within the company.
King IV stipulates that the board should be responsible for creating an ethical corporate culture within the company.
King IV stipulate that the company’s ethical standards must be determined without a code of conduct.
King IV stipulate that the company’s ethical standards must be determined without a code of conduct.
The company’s ethical standards must be adhered to by all members of the company.
The company’s ethical standards must be adhered to by all members of the company.
King IV suggests that the company’s ethical standards should be integrated into all the company’s strategies and operations, to ensure that they are not isolated principles.
King IV suggests that the company’s ethical standards should be integrated into all the company’s strategies and operations, to ensure that they are not isolated principles.
Company ethical performance need not be monitored.
Company ethical performance need not be monitored.
King IV advises the company to comply with applicable laws.
King IV advises the company to comply with applicable laws.
Sustainability is defined as the ability to maintain [BLANK] social and environmental resources.
Sustainability is defined as the ability to maintain [BLANK] social and environmental resources.
King IV encourages companies to consider the interests of society.
King IV encourages companies to consider the interests of society.
King IV promotes the idea that the board should appreciate the inseparability of strategy, risk, and performance when it concerns sustainability.
King IV promotes the idea that the board should appreciate the inseparability of strategy, risk, and performance when it concerns sustainability.
Sustainability, based on King IV, is the sole responsibility of the board of directors.
Sustainability, based on King IV, is the sole responsibility of the board of directors.
King IV suggests that the company’s strategy should be aligned with its sustainability policy.
King IV suggests that the company’s strategy should be aligned with its sustainability policy.
King IV emphasizes the importance of considering the interests of the company’s stakeholders.
King IV emphasizes the importance of considering the interests of the company’s stakeholders.
Company strategy, according to King IV, should look to profit, people and planet and ensure sustainability.
Company strategy, according to King IV, should look to profit, people and planet and ensure sustainability.
Corporate citizenship stems from the idea that companies are citizens of the countries in which they operate.
Corporate citizenship stems from the idea that companies are citizens of the countries in which they operate.
Companies are expected to adhere to a different standard of ethical behavior than citizens, as they are part of the corporate world.
Companies are expected to adhere to a different standard of ethical behavior than citizens, as they are part of the corporate world.
King IV requires the company to operate in an ethical, responsible and sustainable manner.
King IV requires the company to operate in an ethical, responsible and sustainable manner.
King IV suggests that the board should ensure that the company is seen to be a responsible corporate citizen.
King IV suggests that the board should ensure that the company is seen to be a responsible corporate citizen.
Integrated reporting requires companies to solely focus on financial performance.
Integrated reporting requires companies to solely focus on financial performance.
Companies are now expected to report annually on social, economic and environmental performance.
Companies are now expected to report annually on social, economic and environmental performance.
The company’s integrated report needs to be comprehensive and should include both positive and negative impacts.
The company’s integrated report needs to be comprehensive and should include both positive and negative impacts.
King IV requires the board to ensure the integrity of the integrated report.
King IV requires the board to ensure the integrity of the integrated report.
Public and state owned companies are required to appoint a social and ethics committee
Public and state owned companies are required to appoint a social and ethics committee
The social and ethics committee is to be made up of at least three directors, who must all be non-executives.
The social and ethics committee is to be made up of at least three directors, who must all be non-executives.
The committee’s primary function is to monitor all of the company’s activities.
The committee’s primary function is to monitor all of the company’s activities.
The social and ethics committee is required to report to the shareholders at the Annual General Meeting.
The social and ethics committee is required to report to the shareholders at the Annual General Meeting.
The requirement for a social and ethics committee is part of the King IV guidelines
The requirement for a social and ethics committee is part of the King IV guidelines
The board of directors has an ethical duty to ensure that the company does not operate in a reckless manner or take on unnecessary risks.
The board of directors has an ethical duty to ensure that the company does not operate in a reckless manner or take on unnecessary risks.
The board is responsible for governing and controlling risk, and is not accountable for unethical behaviour in the company.
The board is responsible for governing and controlling risk, and is not accountable for unethical behaviour in the company.
The board should ensure that effective processes are in place, to uncover fraud, corruption, unethical behaviour, and any other irregularities that could be risky to the company.
The board should ensure that effective processes are in place, to uncover fraud, corruption, unethical behaviour, and any other irregularities that could be risky to the company.
The board is responsible for governing risk within the company.
The board is responsible for governing risk within the company.
A key principle of King IV is to ensure that the board's performance is evaluated every year.
A key principle of King IV is to ensure that the board's performance is evaluated every year.
The board evaluation should be conducted by every member of the board.
The board evaluation should be conducted by every member of the board.
King IV recommends that the board’s performance evaluations should be used to identify training needs.
King IV recommends that the board’s performance evaluations should be used to identify training needs.
King IV suggests that the results of the board’s performance evaluation should be disclosed in the company's Integrated Report.
King IV suggests that the results of the board’s performance evaluation should be disclosed in the company's Integrated Report.
The results of the board’s performance evaluation should be considered when a director is nominated for re-appointment.
The results of the board’s performance evaluation should be considered when a director is nominated for re-appointment.
The results of the board's performance evaluation should be considered when determining director remuneration.
The results of the board's performance evaluation should be considered when determining director remuneration.
King IV recommends an independent remuneration committee, to assist the board with remuneration policy.
King IV recommends an independent remuneration committee, to assist the board with remuneration policy.
Remuneration should be considered based on company performance.
Remuneration should be considered based on company performance.
King IV suggests that companies should disclose the salaries of their three highest-paid employees and the director’s remuneration.
King IV suggests that companies should disclose the salaries of their three highest-paid employees and the director’s remuneration.
The remuneration policy for executive directors should be determined by the company’s board.
The remuneration policy for executive directors should be determined by the company’s board.
The remuneration policy should be presented to the shareholders for their vote.
The remuneration policy should be presented to the shareholders for their vote.
Flashcards
What are Non-current Assets?
What are Non-current Assets?
Non-current assets are assets that are expected to be used for more than one year. Examples include property, plant, and equipment (PPE), and intangible assets like goodwill.
What are Intangible Assets?
What are Intangible Assets?
Intangible assets are non-physical assets that have a value but are not tangible. Examples include patents, copyrights, and goodwill.
What are Current Assets?
What are Current Assets?
Current assets are assets that are expected to be used or converted to cash within one year. Examples include inventories, trade receivables, cash, and short-term loans and advances.
What are Inventories?
What are Inventories?
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What are Trade Receivables?
What are Trade Receivables?
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What is Cash and Bank Balances?
What is Cash and Bank Balances?
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What are Short-term Loans and Advances?
What are Short-term Loans and Advances?
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What is Revenue from Operations?
What is Revenue from Operations?
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What is Other Income?
What is Other Income?
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What is Cost of Materials Consumed?
What is Cost of Materials Consumed?
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What is Cost of Inventory of Finished Goods?
What is Cost of Inventory of Finished Goods?
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What is Employee Benefit Expense?
What is Employee Benefit Expense?
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What is Change in Inventory of Finished Goods?
What is Change in Inventory of Finished Goods?
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What is Finance Cost?
What is Finance Cost?
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What are Other Expenses?
What are Other Expenses?
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What is the King Code?
What is the King Code?
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Who is the Board of Directors?
Who is the Board of Directors?
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What does the King Code say about Ethical Leadership?
What does the King Code say about Ethical Leadership?
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What does King Code IV state about Ethical Corporate Culture?
What does King Code IV state about Ethical Corporate Culture?
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What is Sustainability as per King Code IV?
What is Sustainability as per King Code IV?
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What does King Code IV say about Corporate Citizenship?
What does King Code IV say about Corporate Citizenship?
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What is Integrated Reporting?
What is Integrated Reporting?
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What is the Social and Ethics Committee?
What is the Social and Ethics Committee?
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What is Risk Governance?
What is Risk Governance?
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What are Directors' Performance Evaluations?
What are Directors' Performance Evaluations?
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What is Directors' Remuneration?
What is Directors' Remuneration?
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Study Notes
King Code IV - Overview
- King Code IV is an internationally acclaimed report on good corporate governance.
- It was created in 1994 by a South African committee chaired by Mervyn King.
- The latest edition (King IV) became effective on April 1, 2017.
- The report has undergone significant changes since its first edition.
King Code IV - Ethical Behaviour
- The King Code emphasizes ethical conduct throughout the entire company, not just leadership.
- The board of directors is responsible for managing the company ethically and transparently.
- The board should provide effective leadership built on an ethical foundation.
- The board should ensure an ethical corporate culture is actively built, promoted, and sustained within the company.
- Ethical standards should be formulated into a code of conduct for all members.
- The company's code of conduct and ethical standards should be integrated into strategies, operations, and performance evaluation processes.
- Ethical performance should be assessed, monitored, reported, and disclosed.
- The board must ensure the company complies with all applicable laws.
King Code IV - Corporate Citizenship
- Companies are expected to uphold the same ethical standards as ordinary citizens in the countries where they operate.
- The board should ensure the company, both in action and perception, embodies a responsible corporate citizen.
King Code IV - Sustainability
- Sustainability is defined as maintaining economic, social, and environmental resources.
- King IV emphasizes that strategy, risk, performance, and sustainability are interconnected and must be considered holistically.
- The company's strategy should align with its sustainability objectives, consider stakeholder interests, and achieve sustainable results.
King Code IV - Integrated Reporting
- Integrated reporting expands accountability beyond financial performance, including the social and environmental performance impact of the company.
- The company should ensure the integrity of the integrated report, disclosing both positive and negative impacts and revealing plans to improve positives and mitigate negatives.
King Code IV - Social and Ethics Committee
- A social and ethics committee, composed of at least three directors, including an independent non-executive director, is required for public and state-owned companies.
- Its primary function is to monitor the company's social and economic development, corporate citizenship, environmental performance, consumer relations, and employment-related matters.
- This committee is expected to report its findings to shareholders annually at the AGM.
King Code IV - Risk Governance
- The board is responsible for effectively governing, managing, and controlling risks.
- This includes ensuring that the company doesn't engage in reckless behaviours or take excessive risks.
- Effective processes and systems should be in place to uncover and address fraud, corruption, and unethical behaviour.
- The board should be responsible for risk governance.
King Code IV - Directors' Performance Evaluation
- Directors' performances are evaluated annually with policies in place to ensure accountability and transparency.
- Evaluations must include evaluations of board, committee, and individual director performance.
- Performance evaluations should be carried out by a chairman or an independent service provider.
- Evaluation results should identify training needs, be included in integrated reports, and be considered in director re-appointments and remuneration decisions.
King Code IV - Directors' Remuneration
- Directors' remuneration policies must ensure fair and ethical treatment.
- A remuneration committee should be established to assist the board in setting and administering remuneration policies.
- Remuneration should be linked to executive contributions to the company performance.
- The compensation of individual directors and top-earning employees must be disclosed.
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Description
Explore the King Code IV, an essential framework for corporate governance established in 1994 by Mervyn King and updated in 2017. This quiz covers its emphasis on ethical conduct and the responsibilities of the board of directors in fostering an ethical corporate culture. Test your understanding of its principles and impact on modern governance.
