The Board of directors of Vox Telecom (“the Board”) continues to be committed to applying best practice in terms of the principles of Corporate Governance. The Board confirms its commitment to the principles of fairness, accountability, responsibility and transparency as advocated in the second and third King Reports on Corporate Governance and has recently embraced the recommendations of the King III Report. Through this process, shareholders and other stakeholders may derive assurance that the Company is being ethically managed according to prudently determined risk parameters and in compliance with generally accepted corporate practices. The Board has implemented improved processes, additional controls, an internal audit and risk functions and appointed two independent non-executive directors, one who has been appointed as non–executive Chairman and Chairman of the Nominations Committee and the other as Chairman of the Audit and Remuneration Committee. Risk measurement procedures and assessment of parameters have been enhanced in the current year with the introduction of the internal Audit and Risk Committee.
The Board continues to ensure compliance with the following:
COMPOSITION OF THE BOARD
Vox Telecom has reconstituted its board of directors to more fully embrace the recommendations of the King III Report on Corporate Governance. The Board now consists of three executive and five non-executive directors. Of these, there are two independent directors being the non-executive Chairman and an independent non-executive director who has been appointed as chairman of the Audit and Remuneration Committee. The Board sits at least four times per annum and more frequently if necessary. The directors bring a wide range of diverse experience, diversity, insight and independence of judgment on issues of strategy, performance, resources and standards of conduct to the Board. The non-executive directors are of sufficient calibre for their views to carry significant weight in the Board’s decisions.
The constitution of the new Board is as follows:
Independent non-executive directors:
Non-executive directors:
Executive directors:
The Audit, Risk, Remuneration and Nominations Committees have been re-organized as follows:
Audit and Risk Committee:
Remuneration Committee:
Nominations Committee:
In accordance with the AltX Listings Requirements all of the directors of the Company are required to attend the Directors Induction Program. Most of the directors have already attended with the remainder booked for scheduled courses within the next 12 months.
BOARD APPOINTMENTS POLICY
All new appointments made to the Board are done formally and transparent and is considered as a matter for the Board as a whole, assisted where appropriate by the Nominations Committee of the Company. Once a decision is taken at a Board meeting to either fill a casual vacancy on the Board or to appoint additional directors, the Chairman will the then request the Remuneration and Nominations Committee to nominate a suitable candidate(s) provided that such appointment shall not exceed the maximum number directors permitted by the Company’s articles of association. Directors so appointed will remain in office only until the next Annual General Meeting of the Company, at which time the appointment will be confirmed by the shareholders.
The chairmen of the Remuneration and Nominations Committees are required to convene a meeting of the Committees for the purpose of identifying a suitable candidate(s) with the requisite strategic, analytical, communications and knowledge competence. Once identified and suitably verified the Committees will submit a proposal of nomination of the appropriate candidate(s) for appointment to the Board.
INDEPENDENCE OF THE BOARD
The role of the Chairman and the Chief Executive Officer is separated and the Board is chaired by an independent non-executive Chairman. The two independent non-executive directors are appointed under service contracts and their remuneration is not tied to Vox Telecom’s financial performance. Directors are entitled to ask questions of any personnel and have unrestricted access to all company documentation, information and property.
ROLE AND FUNCTION OF THE BOARD
The Board’s main responsibilities include strategy, acquisition and disinvestment policies, risk management, financing and Corporate Governance. In addition, the Board is accountable for relations with stakeholders and is responsible for creating, protecting and enhancing the Company’s wealth and resources, timely and transparent reporting and for acting at all times in the best interests of the Company and its shareholders. It is the responsibility of the Board to ensure a sound system of internal control to safeguard stakeholders’ interests and the Company’s assets.
BOARD COMMITTEES
APPOINTMENT OF AUDIT, RISK AND REMUNERATION COMMITTEE
In addition to the Audit Committee, the Board has established an internal Audit and Risk Committee comprising of the non-executive Chairman, the Chairman of the Audit Committee and an internal auditor. The internal auditor reports directly to this committee. The Board has thus fulfilled its’ commitment to shareholders of replacing the existing members of all committees with the appointment of two independent non-executive directors.
AUDIT COMMITTEE
The Company’s audit committee, which meets at least twice per year, consists of two independent non-executive directors and a representative of the designated advisor. The company secretary is in attendance at the meetings.
The Committee’s responsibilities include reviewing the scope, quality, independence and objectivity of the statutory audit, ensuring the integrity of the Company’s accounting and financial reporting system, evaluating the effectiveness of the management functions of the Company and ensuring that appropriate systems are in place for monitoring risk, financial control, compliance with the law and codes of conduct and promoting the overall effectiveness of corporate governance within the Group. The external auditors will be invited to attend the Audit Committee meetings and have unrestricted access to both the Committee and its chairperson. The Committee advises on the appointment of the external auditors, the handling of non-audit functions by the auditors and fees in respect of non-audit services. The current auditors of the Company are Deloitte and Touché.
The Audit Committee has explicit authority to investigate any matter under its terms of reference and has access to all resources and information it requires in order to act on this authority. The Audit Committee is furthermore responsible for monitoring all contracts entered into by the Company in which any of the directors are either directly or indirectly beneficially interested so as to ensure that all such contracts are fair and reasonable and in the best interests of the Company.
The Audit Committee in conjunction with the recently established internal Audit and Risk Committee are responsible for ensuring that all risks associated with the Group’s operations are effectively managed in support of the creation and preservation of stakeholder value.
The Audit Committee also considers, on an annual basis, and satisfies itself regarding the appropriateness of the expertise and experience of the Chief Financial Officer of the Company.
INTERNAL AUDIT AND RISK COMMITTEE
This Committee meets at least twice per annum, consists of two independent non-executive directors and an internal auditor. The external auditors are in attendance at these meetings.
The Board has established the internal audit and risk function as an integral part of the Group’s system of governance. The purpose of this independent assurance function is to evaluate whether the nature and extent of business risks are being managed effectively within the context of business objectives. A system of internal control is one of the primary means of managing risk and consequently the evaluation of its effectiveness is central to the internal audit responsibilities.
The Group’s system of internal control comprises the policies, procedures and practices, as well as organisational culture that collectively support the Group’s effective operation in the pursuit of its objectives. This system of internal control enables the Group to respond to significant business risks, be they of an operational, financial, compliance or other nature, and is the direct responsibility of the Board and executive management within the Group.
The Group’s internal audit function is required to report, to the Group Audit Committee, on the effectiveness of the Company’s risk management process, system of internal controls and risks that may materialise or have materialised as a result of weaknesses in the system of controls. Any restriction on the scope of internal audit activities must be reported to the Audit Committee.
The assurance provided by the Group’s internal audit and risk function serves to assist the Vox Telecom Board in fulfilling its obligations to report annually to shareholders on the effectiveness of the Group’s system of internal control.
REMUNERATION COMMITTEE
The AltX Listings Requirements do not require a Remuneration Committee to be established. However, given the size of the business, this Committee is required and has therefore been appointed and has been in place for the last few years. The Remuneration Committee makes recommendations to the Board, within agreed terms of reference, on the Company’s framework of executive remuneration and its costs. The Committee strives to ensure that levels of remuneration are sufficient to attract and retain directors and senior management of the calibre required to ensure the successful running of the Company and for their contribution to Vox Telecom’s operating and financial performance.
BOARD AND COMMITTEE MEETINGS AND ATTENDANCE
The directors are properly briefed in respect of special business prior to board meetings and information is timeously provided so as to enable directors to give full consideration to all the issues being dealt with.
The following Board meetings were held during the period under review.
(Please click on table below to view a bigger image)
ACCOUNTING AND INTERNAL CONTROLS
The Board has established controls and procedures to ensure the accuracy and integrity of the accounting records and to provide reasonable assurance that assets are safeguarded from loss or unauthorised use and that the financial statements may be relied upon for maintaining accountability for assets and liabilities and preparing the financial statements. The Board acknowledges the continued growth of the Company over the past years and the need to rigorously review the adequacy of the accounting and internal controls and has implemented the recommendations of the external and internal auditors.
EMPLOYMENT DEVELOPMENT AND EMPLOYMENT EQUITY
The Company strives to promote a culture that provides all employees with opportunities to advance to their optimal levels of career development. The Company upholds and supports the objectives of the Employment Equity Act and has an established Employment Equity Plan through its main operating subsidiaries. The Company furthermore strives to provide a secure, healthy and participative social and working environment for its staff and associates. The Group upholds and supports the objectives of the Employment Equity Act No 55 of 1993. Vox Telecom has implemented various initiatives that provide opportunities for all levels of staff, and in so doing continues to strengthen its positioning as an employer of choice, whilst at the same time enhancing its participation in making South Africa more internationally competitive. The Group’s employment policies are designed to provide equal opportunities, without discrimination, to all employees.
In addition, the key operating subsidiaries of DataPro (Proprietary) Limited, Amvia (Proprietary) Limited and Orion Telecom (Proprietary) Limited have all achieved Black Economic Empowerment (BEE) ratings of Level 5, Level 3 and Level 5, respectively. A rating for Vox Telecom Limited will also be sought in the new financial year.
COMMUNICATION WITH SHAREHOLDERS
Vox Telecom is committed to ongoing and effective communication with its stakeholders. It subscribes to a policy of open and timeous dissemination of information in line with the requirements and guidelines of the JSE and the principles of good corporate governance and manages these through its in-house investor relations programme.
INSIDER TRADING
The Company enforces a restricted period for dealing in its shares, in terms of which any dealings in shares by all directors and senior personnel is disallowed by the board from the time that the reporting period has elapsed to the time that results are released and at any time that such individuals are aware of un-published price sensitive information, whether the Company is trading under cautionary announcement as a result of such information or not.
COMPANY SECRETARY
The company secretary is required to provide the members of the Board with guidance and advice regarding their responsibilities, duties and powers and to ensure that the Board is aware of all legislation relevant to or affecting the affairs of the Company. The company secretary is required to ensure that the Company complies with all applicable legislation regarding the affairs of the Company, including the necessary recording of meetings of the Board, board committees and shareholders of the Company and ensuring that proper procedures are followed in all board matters. The directors have unfettered access to the company secretary. It requires a decision of the Board as a whole to remove the company secretary, should this become necessary.
CODE OF ETHICS
The Board subscribes to the highest level of professionalism and integrity in conducting its business and dealing with all its stakeholders.
In adhering to its code of ethics, the board is guided by the following broad principles:
The Board continues to ensure compliance with the following:
COMPOSITION OF THE BOARD
Vox Telecom has reconstituted its board of directors to more fully embrace the recommendations of the King III Report on Corporate Governance. The Board now consists of three executive and five non-executive directors. Of these, there are two independent directors being the non-executive Chairman and an independent non-executive director who has been appointed as chairman of the Audit and Remuneration Committee. The Board sits at least four times per annum and more frequently if necessary. The directors bring a wide range of diverse experience, diversity, insight and independence of judgment on issues of strategy, performance, resources and standards of conduct to the Board. The non-executive directors are of sufficient calibre for their views to carry significant weight in the Board’s decisions.
The constitution of the new Board is as follows:
Independent non-executive directors:
- V Cuba (Chairman)
- D Wallace
Non-executive directors:
- R T Dalais
- P Joubert
- E Röth
Executive directors:
- A P van Marken (Chief Executive Officer)
- D G Reed (Group Managing Director)
- C M von Holdt (Chief Financial Officer)
The Audit, Risk, Remuneration and Nominations Committees have been re-organized as follows:
Audit and Risk Committee:
- D Wallace (Chairman)
- V Cuba
Remuneration Committee:
- D Wallace (Chairman)
- V Cuba
- R T Dalais
Nominations Committee:
- V Cuba (Chairman)
- D Wallace
- P Joubert
In accordance with the AltX Listings Requirements all of the directors of the Company are required to attend the Directors Induction Program. Most of the directors have already attended with the remainder booked for scheduled courses within the next 12 months.
BOARD APPOINTMENTS POLICY
All new appointments made to the Board are done formally and transparent and is considered as a matter for the Board as a whole, assisted where appropriate by the Nominations Committee of the Company. Once a decision is taken at a Board meeting to either fill a casual vacancy on the Board or to appoint additional directors, the Chairman will the then request the Remuneration and Nominations Committee to nominate a suitable candidate(s) provided that such appointment shall not exceed the maximum number directors permitted by the Company’s articles of association. Directors so appointed will remain in office only until the next Annual General Meeting of the Company, at which time the appointment will be confirmed by the shareholders.
The chairmen of the Remuneration and Nominations Committees are required to convene a meeting of the Committees for the purpose of identifying a suitable candidate(s) with the requisite strategic, analytical, communications and knowledge competence. Once identified and suitably verified the Committees will submit a proposal of nomination of the appropriate candidate(s) for appointment to the Board.
INDEPENDENCE OF THE BOARD
The role of the Chairman and the Chief Executive Officer is separated and the Board is chaired by an independent non-executive Chairman. The two independent non-executive directors are appointed under service contracts and their remuneration is not tied to Vox Telecom’s financial performance. Directors are entitled to ask questions of any personnel and have unrestricted access to all company documentation, information and property.
ROLE AND FUNCTION OF THE BOARD
The Board’s main responsibilities include strategy, acquisition and disinvestment policies, risk management, financing and Corporate Governance. In addition, the Board is accountable for relations with stakeholders and is responsible for creating, protecting and enhancing the Company’s wealth and resources, timely and transparent reporting and for acting at all times in the best interests of the Company and its shareholders. It is the responsibility of the Board to ensure a sound system of internal control to safeguard stakeholders’ interests and the Company’s assets.
BOARD COMMITTEES
APPOINTMENT OF AUDIT, RISK AND REMUNERATION COMMITTEE
In addition to the Audit Committee, the Board has established an internal Audit and Risk Committee comprising of the non-executive Chairman, the Chairman of the Audit Committee and an internal auditor. The internal auditor reports directly to this committee. The Board has thus fulfilled its’ commitment to shareholders of replacing the existing members of all committees with the appointment of two independent non-executive directors.
AUDIT COMMITTEE
The Company’s audit committee, which meets at least twice per year, consists of two independent non-executive directors and a representative of the designated advisor. The company secretary is in attendance at the meetings.
The Committee’s responsibilities include reviewing the scope, quality, independence and objectivity of the statutory audit, ensuring the integrity of the Company’s accounting and financial reporting system, evaluating the effectiveness of the management functions of the Company and ensuring that appropriate systems are in place for monitoring risk, financial control, compliance with the law and codes of conduct and promoting the overall effectiveness of corporate governance within the Group. The external auditors will be invited to attend the Audit Committee meetings and have unrestricted access to both the Committee and its chairperson. The Committee advises on the appointment of the external auditors, the handling of non-audit functions by the auditors and fees in respect of non-audit services. The current auditors of the Company are Deloitte and Touché.
The Audit Committee has explicit authority to investigate any matter under its terms of reference and has access to all resources and information it requires in order to act on this authority. The Audit Committee is furthermore responsible for monitoring all contracts entered into by the Company in which any of the directors are either directly or indirectly beneficially interested so as to ensure that all such contracts are fair and reasonable and in the best interests of the Company.
The Audit Committee in conjunction with the recently established internal Audit and Risk Committee are responsible for ensuring that all risks associated with the Group’s operations are effectively managed in support of the creation and preservation of stakeholder value.
The Audit Committee also considers, on an annual basis, and satisfies itself regarding the appropriateness of the expertise and experience of the Chief Financial Officer of the Company.
INTERNAL AUDIT AND RISK COMMITTEE
This Committee meets at least twice per annum, consists of two independent non-executive directors and an internal auditor. The external auditors are in attendance at these meetings.
The Board has established the internal audit and risk function as an integral part of the Group’s system of governance. The purpose of this independent assurance function is to evaluate whether the nature and extent of business risks are being managed effectively within the context of business objectives. A system of internal control is one of the primary means of managing risk and consequently the evaluation of its effectiveness is central to the internal audit responsibilities.
The Group’s system of internal control comprises the policies, procedures and practices, as well as organisational culture that collectively support the Group’s effective operation in the pursuit of its objectives. This system of internal control enables the Group to respond to significant business risks, be they of an operational, financial, compliance or other nature, and is the direct responsibility of the Board and executive management within the Group.
The Group’s internal audit function is required to report, to the Group Audit Committee, on the effectiveness of the Company’s risk management process, system of internal controls and risks that may materialise or have materialised as a result of weaknesses in the system of controls. Any restriction on the scope of internal audit activities must be reported to the Audit Committee.
The assurance provided by the Group’s internal audit and risk function serves to assist the Vox Telecom Board in fulfilling its obligations to report annually to shareholders on the effectiveness of the Group’s system of internal control.
REMUNERATION COMMITTEE
The AltX Listings Requirements do not require a Remuneration Committee to be established. However, given the size of the business, this Committee is required and has therefore been appointed and has been in place for the last few years. The Remuneration Committee makes recommendations to the Board, within agreed terms of reference, on the Company’s framework of executive remuneration and its costs. The Committee strives to ensure that levels of remuneration are sufficient to attract and retain directors and senior management of the calibre required to ensure the successful running of the Company and for their contribution to Vox Telecom’s operating and financial performance.
BOARD AND COMMITTEE MEETINGS AND ATTENDANCE
The directors are properly briefed in respect of special business prior to board meetings and information is timeously provided so as to enable directors to give full consideration to all the issues being dealt with.
The following Board meetings were held during the period under review.
(Please click on table below to view a bigger image)
ACCOUNTING AND INTERNAL CONTROLS
The Board has established controls and procedures to ensure the accuracy and integrity of the accounting records and to provide reasonable assurance that assets are safeguarded from loss or unauthorised use and that the financial statements may be relied upon for maintaining accountability for assets and liabilities and preparing the financial statements. The Board acknowledges the continued growth of the Company over the past years and the need to rigorously review the adequacy of the accounting and internal controls and has implemented the recommendations of the external and internal auditors.
EMPLOYMENT DEVELOPMENT AND EMPLOYMENT EQUITY
The Company strives to promote a culture that provides all employees with opportunities to advance to their optimal levels of career development. The Company upholds and supports the objectives of the Employment Equity Act and has an established Employment Equity Plan through its main operating subsidiaries. The Company furthermore strives to provide a secure, healthy and participative social and working environment for its staff and associates. The Group upholds and supports the objectives of the Employment Equity Act No 55 of 1993. Vox Telecom has implemented various initiatives that provide opportunities for all levels of staff, and in so doing continues to strengthen its positioning as an employer of choice, whilst at the same time enhancing its participation in making South Africa more internationally competitive. The Group’s employment policies are designed to provide equal opportunities, without discrimination, to all employees.
In addition, the key operating subsidiaries of DataPro (Proprietary) Limited, Amvia (Proprietary) Limited and Orion Telecom (Proprietary) Limited have all achieved Black Economic Empowerment (BEE) ratings of Level 5, Level 3 and Level 5, respectively. A rating for Vox Telecom Limited will also be sought in the new financial year.
COMMUNICATION WITH SHAREHOLDERS
Vox Telecom is committed to ongoing and effective communication with its stakeholders. It subscribes to a policy of open and timeous dissemination of information in line with the requirements and guidelines of the JSE and the principles of good corporate governance and manages these through its in-house investor relations programme.
INSIDER TRADING
The Company enforces a restricted period for dealing in its shares, in terms of which any dealings in shares by all directors and senior personnel is disallowed by the board from the time that the reporting period has elapsed to the time that results are released and at any time that such individuals are aware of un-published price sensitive information, whether the Company is trading under cautionary announcement as a result of such information or not.
COMPANY SECRETARY
The company secretary is required to provide the members of the Board with guidance and advice regarding their responsibilities, duties and powers and to ensure that the Board is aware of all legislation relevant to or affecting the affairs of the Company. The company secretary is required to ensure that the Company complies with all applicable legislation regarding the affairs of the Company, including the necessary recording of meetings of the Board, board committees and shareholders of the Company and ensuring that proper procedures are followed in all board matters. The directors have unfettered access to the company secretary. It requires a decision of the Board as a whole to remove the company secretary, should this become necessary.
CODE OF ETHICS
The Board subscribes to the highest level of professionalism and integrity in conducting its business and dealing with all its stakeholders.
In adhering to its code of ethics, the board is guided by the following broad principles:
- Businesses should operate and compete in accordance with the principles of free enterprise;
- Free enterprise is constrained by the observance of relevant legislation and generally accepted principles regarding ethical behaviour in business;
- Ethical behaviour is predicated on the concept of utmost good faith and characterised by integrity, reliability and a commitment to avoid harm;
- Business activities will benefit all participants through a fair exchange of value or satisfaction of need; and
- Equivalent standards of ethical behaviour are expected from individuals and companies with whom business is conducted.