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
King Code IV is an Internationally acclaimed report.
King Code IV is an Internationally acclaimed report.
Signup and view all the answers
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?
Signup and view all the answers
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.
Signup and view all the answers
The board of directors is elected by the shareholders of the company.
The board of directors is elected by the shareholders of the company.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
The board is accountable for the ethical conduct of the company.
The board is accountable for the ethical conduct of the company.
Signup and view all the answers
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?
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
Company ethical performance need not be monitored.
Company ethical performance need not be monitored.
Signup and view all the answers
King IV advises the company to comply with applicable laws.
King IV advises the company to comply with applicable laws.
Signup and view all the answers
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.
Signup and view all the answers
King IV encourages companies to consider the interests of society.
King IV encourages companies to consider the interests of society.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
Integrated reporting requires companies to solely focus on financial performance.
Integrated reporting requires companies to solely focus on financial performance.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
The board is responsible for governing risk within the company.
The board is responsible for governing risk within the company.
Signup and view all the answers
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.
Signup and view all the answers
The board evaluation should be conducted by every member of the board.
The board evaluation should be conducted by every member of the board.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
Remuneration should be considered based on company performance.
Remuneration should be considered based on company performance.
Signup and view all the answers
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.
Signup and view all the answers
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.
Signup and view all the answers
The remuneration policy should be presented to the shareholders for their vote.
The remuneration policy should be presented to the shareholders for their vote.
Signup and view all the answers
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.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Related Documents
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.
