African Investor Relations

In South Africa the private sector came to the party in sponsoring the formulation of a new corporate governance code. It’s good for PR and your logo belongs to the IODSA website forever. For the accounting firms the prospect of referral work is high. The model is good. It’s what you would call a win-win situation. So why no similar initiatives in Kenya and Nigeria?

Here are the sponsors to the online corporate governance appraisal initiative in South Africa:-

Note that South African Government also has a hand through the SITA.

Have a look at the IOD Kenya website in Kenya. There are no corporate sponsors to the IOD Kenya. Yet every year one of the greatest corporate events is when the top companies in East Africa are awarded their prizes by a large accounting firm. Much pomp and ceremony. Where’s the substance? These winning companies are chosen largely by the movement in their price which itself is a result of the volatility in a market where information availability is imperfect.

The IOD Kenya website has one upcoming event. There is nothing on the blog. There are many subjects to blog about in Kenya. Especially relating to corporate governance.  The website does not instill confidence in the role of the organisation. It should.

I would love to get an insight as to why the Kenyan and Nigerian markets have not adopted the same approach as the South African companies. They all have corporate governance codes, they all have compelling needs to improve corporate governance, they have private sector critical mass to underwrite any of these initiatives on a sustainable basis. Is it a case that the persons running these organisations are incompetent and cannot garner support or is it a collective case of “we couldn’t give a s…” ? The regulators certainly aren’t taking the lead.

The same has happened in Zimbabwe. The much trumpeted new corporate governance code for Zimbabwe has fallen in a heap. There’s no money, executives are busy.

Is it the absence of human resources? Are business environments too corrupt in Kenya and Nigeria to address this issue at all? Not sure – would love to hear your views. In Zimbabwe companies are under severe strain and the issue of corporate governance at the top level has yet to be resolved so there is an excuse – or a real reason to take governance seriously – depends on what your outlook on life is.

The silent cost to this is lower equity valuations.

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I love the Institute of Directors in South Africa. They are dynamic, young and good looking but most of all when you become a member you get more than your fair share of value back. They are not covering the practice of investor relations enough in their initiatives but this is made up for by the other excellent initiatives that they are launching. Like the one below.

Overview

The IoDSA Accelerated Directorship Programme (ADP) addresses all aspects of directorship. The programme is designed to meet the existing and emerging needs of directors. Through case studies, facilitator knowledge and experience as well as group discussion, the programme is interactive and provides delegates with practical tools for immediate implementation. The ADP promotes excellence in corporate governance and is presented by facilitators who are leaders in their field with local and or international expertise.

Objectives

•       Provides a comprehensive foundation of the roles and responsibilities of a director and issues relating to corporate governance.

•       Overview of strategy and the management of risk from a governance perspective to avoid personal liability.

•       Enable non-financial directors to ask probing questions in relation to the information presented.

•       Understand the financial position and performance of the company.

•       Understand the roles and responsibilities associated with an organisation’s ethics management programme.

•       Consider current issues for directors and boards.

•       Provide opportunity for participants to put their knowledge into practice.

Benefits

•       Understand duties and responsibilities as a director.

•       Act in accordance with corporate governance standards and expectations.

•       Improve effectiveness of the board and add value.

•       Increase confidence in the boardroom.

•       Reduce personal and company risk, enhance reputations and improve organisational effectiveness.

•       Discuss boardroom issues in confidence and share experiences with peers.

•       Increase and expand networking opportunities.

Who will benefit from the programme

In South Africa’s rapidly changing environment as companies face increasing competition and ever more regulatory and legal requirements, it is essential that existing directors and new directors can understand and evaluate key strategic issues and trends.

Admission Requirements

Programme Selection Process and Criteria

•       Potential candidates must complete the registration form which includes a letter of motivation.

•       Potential candidates must attach a copy of their CM27.

•       Registrations are put before the IoDSA Director Development panel for acceptance onto the ADP.

•       The panel consists of the IoDSA’s Chief Executive and Department Heads.

•       Potential candidates must hold a current Director / Board position.

Duration

•       Full time: 5 Full Days

Assessment

•       Board Simulation – Delegates participate in a simulated board meeting and will be observed and critiqued by an IoDSA observer. Feedback is provided during the simulation.

•       One Assignment – The Assignment is due after the programme and the due date will be communicated on the first day of the programme.

Certification

Designation

Participants who are members of the IoDSA, who attend all workshop sessions and who complete the ADP assessments successfully, will receive a Certificate in Directorship, hold the designation of the IoDSA Certified Director and will be entitled to use the IoDSA post-nominals Cert. Dir.

Awards received for completion include the ADP Certificate should a delegate complete and be successful on all assessments.

To be awarded the ADP Certificate, the requirements are:

Attendance and Assessment

Attending all sessions on the programme and successful completion of both the board simulation and the assignment within the stipulated time frames.

Grading

Gradings for the Certificate are:

•       Pass with order of merit

•       Pass

•       Unsuccessful on this occasion

Members who have been awarded the Certificate are entitled to use the IoDSA post-nominals Cert. Dir.

Programme Continuous Professional Development Potential

A participant is required to do the following to retain his or her Cert. Dir. designation:

1.     Retain annual membership to the IoDSA.

2.     Attend any 3 IoDSA member events or Director Development Programmes per year.

For further information & registration click here

Portia Gumede

Institute of Directors in Southern Africa
Tel (011)  430 9900   Fax (011)  444 7907

Email:   portiag@iodsa.co.za

Presentation fees

Jhb: IoDSA Members  –  R17 356.50

Non Members –  R20 737.50 (includes a 1 year membership to the IoDSA

Includes: VAT, Course Material, Refreshments & Finger Lunch

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As predicted the delivery of the new corporate governance code has been moved to October 2010 from the planned May delivery. This timetable is still tight given how quickly time flies. Apparently the initiative is being funded by US$3.5m which appears sufficient to mobilise the required level of resources and focus everyone’s attentions.

Zimbabwe executives do not have the time to donate to an initiative of this nature. Neither do they have the ability to rent seek from services and products related to governance after the event (unlike the accounting firms in South Africa who have a significant critical mass to which to market their products and services). I hope therefore that part of the US$3.5m is set aside to pay executives for their insight into what is relevant for Zimbabwe given their personal insights and experiences. They should not participate in one off events either, they need to be involved on the whole process. There are enough grey haired executives still around to add value and insight. Part of the problem of with the last corporate governance initiative was that senior executives handed down the responsibilities of input to spring chicken staff. The result was that no one bought into the process.

On our part we have offered an interactive website solution to the IOD to harness the power of the web to solicit, receive and manage feedback from a diverse range of stakeholders in Zimbabwe’s capital markets. We look forward to their response. Unless the Internet is used as a focus of input and interactivity the levels of outreach expected of an initiative of this nature will not be met.

We will also provide input into the process as the King III code is remarkably light on hard and fast recommendations on using technology to communicate. We will also push for more checklists in the Zim code to provide directors some form of practical guidance.

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