corporate governance
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the _Perishable Products Export Control Board
- Identifies relevant legislation, policies and best practice
- Indicates, where applicable, a management action plan, due date and responsible party. The legal compliance register is a standing agenda item for the Risk Management Committee (RISCO) and is considered and discussed at each RISCO meeting; and
- Provides an overview of the relevant sections of legislation the PPECB must comply with and the required actions that ensure compliance with key legislation. During the period under review, the PPECB continued with its focus on ensuring compliance with the Protection of Personal Information Act (Act No. 4 of 2013) (POPIA). During the 2020/2021 financial year, a POPIA implementation plan was drafted after key risks were identified following a personal information impact assessment. During the period under review, the PPECB completed the key action items listed on the implementation plan at the end of December 2022. There are two remaining action items, one being monitored by the Executive Management Committee (EXCO), and the other action item forms part of the data assurance project. POPIA compliance remains an ongoing focus area for the PPECB. During the period of review, the PPECB’s risk environment was impacted by a Presidential Proclamation transferring certain powers and functions under the APS Act and PPEC Act, in so far as those functions fall within the border law enforcement area, to the Minister of Home Affairs, who is the cabinet member responsible for the Border Management Authority Act (Act No. 2 of 2020) (BMA). The PPECB engaged with the Commissioners of the BMA, and a draft implementation protocol was provided to the BMA for review.
The Board’s approach to corporate governance is based on the fact that sound governance is essential to creating a sustainable business.
As part of the Board’s commitment to being a responsible corporate citizen, the PPECB appointed a service provider with the main objective of determining the PPECB’s corporate carbon footprint, which was calculated for all PPECB offices, the Laboratory and travelling. The report indicated that electricity and business travel were the main contributors to green house gas (GHG) emissions. A draft environmental, social, and governance (ESG) action plan was circulated to EXCO members as well as the PPECB Innovation Forum for consideration and input. Once input is consolidated, a final action plan will be submitted to EXCO and the Board for approval. Actions will be monitored and outcomes will be reported on at each EXCO and Board meeting. The development of an ESG dashboard is a future focus area.
The new PPECB Board’s term commenced on 1 February 2023. An induction programme was held for the new PPECB Board on 27 and 28 March 2023, which included training on supply chain management and legal and corporate governance. The induction programme included an overview of the structure, finances and operations of the PPECB as well as each EXCO member’s areas of responsibility. Mentorship and development will be a focus area for the new Board members.
The > PPECB’s Board Members and its _Sub-committees
The PPECB is a statutory body constituted in accordance with Section 4 of the PPEC Act. The PPECB Board comprises ten non-executive Board members representing the industries in which the PPECB operates. An independent non-executive member has not been appointed as a lead independent. Such an appointment is not provided for in the PPEC Act.
The PPECB Board members are appointed by and are accountable to the Minister of Agriculture, Land Reform and Rural Development. They represent seven of the largest export groups as determined by export volume, as well as a member designated by the Minister of Agriculture, Land Reform and Rural Development. As such, the majority of the non-executive Board members and Chairperson of the PPECB Board cannot be categorised as independent, as recommended by principle seven of the King IV Report on Corporate Governance for South Africa 2016 (King IV). In terms of the PPEC Act, Board members serve for a period of three years.
To discharge its duties more effectively, the Board has approved and delegated authority of specific matters to two Board committees, an Audit Committee and a Human Resources Committee, where social and ethics matters are considered and discussed. Information and Communications Technology (ICT) strategic projects and risks was a standing agenda item for the Audit Committee, and now the Board. The Chief Information Officer (CIO) reports directly to the Board regarding all matters relating to ICT. The sub-committees serve under written and approved charters, which are reviewed and updated annually. To determine whether the Board discharges its duties effectively, an independent service provider was appointed to evaluate the performance of the Board, Audit Committee, Chairperson of the Board, Chief Executive Officer (CEO), Chief Financial Officer (CFO) and company secretary in line with the King IV Report. The Board obtained an overall score of 4.2 which indicates the Board’s performance as ‘Good’. However, the Board recognised the need for ICT expertise at Board level. Following this, the Board received training on ICT governance, including the Board’s responsibilities in respect of technology and information governance. An ICT consultant was appointed to advise the Board in respect of ICT matters.
The Chairpersons of the Board, Audit Committee and Human Resources Committee are satisfied that they have fulfilled their responsibilities in accordance with the relevant charters for the reporting period. The Chairpersons of these sub-committees are responsible for relaying all proposals agreed upon by the sub-committees to the Board for approval or otherwise.
The PPECB has implemented a digital board portal which provides efficiency in preparing and providing meeting packs. The board portal provides the Board and EXCO members with a secure platform to access all meeting documents, approvals and submissions and enables meeting participants to collaborate by sharing annotations. Chairpersons are able to electronically sign meeting minutes once approved and once an alert for signature has been issued. Notices, agendas and documentation pertaining to the Board and sub-committee meetings are distributed via the board portal. Minutes of all RISCO, EXCO, Committee and Board meetings are taken and are approved at the first and subsequent meetings. Where necessary, decisions can be taken between these meetings by round-robin resolutions on the portal. These round robin resolutions are ratified at the subsequent EXCO, RISCO, Committee or Board meeting. All hard copy minutes and resolutions are stored in fireproof safes at the PPECB or at off-site storage facilities. Electronic copies are stored within the portal and in secured folders with restricted access
Chairperson
The Board appoints the Chairperson, who is responsible for the effective functioning of the Board. The Chairperson’s primary duties include:
- Providing overall leadership to the Board;
- Presiding over Board meetings, ensuring they function smoothly and managing conflicts of interest;
- Ensuring that Board members receive professional advice when needed;
- Serving as an informal link between Board members and the EXCO team, as well as providing support and advice while respecting executive responsibility;
- Serving as the link between the PPECB Board and the Minister of Agriculture, Land Reform and Rural Development; and
- Ensuring that regular and objective appraisals are administered to assess the Board’s effectiveness.
Chief Executive Officer (CEO)
The CEO was appointed by the Board in terms of Section 13 of the PPEC Act and is entrusted with the power to manage and control the work authorised by the Board and to exercise supervision over the other officers and employees of the Board.
The Chairperson of the Board evaluated the performance of the CEO by analysing the agreed key performance areas and subsequently reported on it prior to the Board meeting in June 2023, following the previous reporting period. Should either party wish to terminate the employment agreement before the termination date, a three-month written notice period is applicable.
Even though the CEO’s employment contract has been renewed for a second term, succession planning for the CEO remains a focus area and is managed in terms of the PPECB talent framework. Succession planning has been implemented by ensuring that the COO or CFO can take over the role at short notice. When the CEO is required to travel abroad for an extended period, the COO, CFO or CIO are appointed to act in the position of CEO and fulfil all CEO duties accordingly.
The CEO is a member of the Institute of Directors Southern Africa (IoDSA) and a country council member of the Produce Marketing Association (PMA).
The Board is satisfied that it has determined the appropriate delegation of authority to ensure that management and the CEO are empowered to manage the day-today activities of the PPECB. The PPECB acts in accordance with a Board-approved delegation of authority framework, which stipulates the levels of authority for the CEO, EXCO and senior managers.
Business Conduct
The PPECB Board endeavours to lead ethically, effectively and with integrity. It has adopted a code of conduct, which the Board approved. The EXCO and the RISCO monitor compliance with this code at all times. During the period under review, the PPECB values were reviewed and changed. The code of conduct will be updated to reflect the changes made.
The PPECB has an independently-managed fraud and ethics hotline to monitor and promote awareness of potentially unethical employee behaviour. Ethics hotline calls and the investigation of such calls are reported to the Audit Committee. During the reporting period, the PPECB created awareness through articles on Corporate LAN Advertising (CLA), the PPECB’s communication tool in respect of the ethics hotline, declarations of interest, internal data privacy policy, document retention and workplace gossip. New employees receive training on the POPIA as part of induction.
The PPECB has a Board member and employee declaration of interest and gift policy to ensure that Board members and employees act in good faith. The employee declaration of interest policy was amended to include disclosing personal relationships with suppliers or customers while there is a simultaneous business relationship. Employees and Board members are required to disclose any interests on an annual basis and as these arise. Board members are also required to disclose any interests relating to agenda items of a particular meeting. Such disclosures must be made before discussing the agenda item and in writing on the attendance/declaration register, which is circulated at every committee and Board meeting. Declarations of interest was included in the Board induction programme.
The PPECB’s EXCO accepts its responsibility to address matters of significant concern for all stakeholders, taking into account the need for accountability.
Agricultural Portfolio Committee
The PPECB’s strategic plan and budget for the following year are tabled at the April meeting, while its financial results and annual report for the preceding year are tabled at the September meeting. The oversight role that the Portfolio Committee plays forms part of the PPECB’s overall governance.
Executive Management Committee (EXCO)
Operational Management Committee (MANCO)
MANCO meetings provide a platform to communicate and share information on day-to-day operational matters at a senior management level. These meetings are held bi-monthly or as required.
While the MANCO does not have any specific authority delegated to it, it remains an important middle-management forum that contributes to decision-making in the organisation.
Any organisational ethics outcomes may be addressed by the RISCO or at the MANCO meetings and, where appropriate, directly with employees. All legal, company secretarial and corporate governance matters are managed by the in-house Legal and Corporate Governance Manager, with the assistance of an Assistant Legal Advisor and Junior Legal Advisor, all of whom are suitably qualified employees.
The Legal and Corporate Governance Manager ensures that the Board and Board members have access to professional guidance on corporate governance and legal matters. The Legal and Corporate Governance Manager also coordinates the functioning of the Board and its sub-committees and contracts with external specialist service providers on legal or corporate governance matters, if required.
The Legal and Corporate Governance Manager fulfils the role of a company secretary for the Board and its committees.
The PPECB has various written policies and procedures supporting management and employees for the day-to-day functioning of the business. The PPECB Board approves organisational policies, and the relevant departmental general managers approve operational policies. The Board approves organisational policies and operational procedures are approved by the appropriate departmental EXCO member.
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