The board and its committees

The ultimate responsibility for ensuring full and effective control of the group’s businesses rests with the board of KAP. The company has adopted a decentralised approach to the management of its day-today divisional operations, subject to compliance by the divisions with the group control and approvals framework and the systems and governance policies set by the board. There are defined reporting lines from divisional management level to the board, to facilitate effective monitoring by the board of compliance by the divisions with group and divisional policies.

Save where pre-approved materiality levels apply, decisions on material matters are reserved for the board, including but not limited to decisions on the allocation of capital resources, the authorisation of capital expenditure, property transactions, borrowings and investments. Decisions are made by the board taking into account the legitimate interests and expectations of stakeholders and the sustainability of the group’s operations. The detailed responsibilities and powers of the board are contained in a formal charter, which is available on the group’s website at www.kap.co.za, together with the corporate governance report.

The group’s policy is to reward all employees fairly for their individual and joint contributions in the execution of KAP’s business strategy and delivery of the group’s operating and financial performance. KAP’s remuneration philosophy is to remunerate all employees fairly, responsibly and transparently in a market-related and competitive manner in order to attract, motivate and retain a competent workforce. To facilitate this, the board has established a human resources and remuneration committee, which operates within defined terms of reference and authority granted to it by the board. The divisional human resources and remuneration committees report to the KAP human resources and remuneration committee that in turn, reports to the group’s main board.

Compliance with legal, best practice guidelines and regulatory requirements

The group applies King IV, which operates on an “apply and explain” basis. Explanations as to how the group has applied the 16 King IV principles are contained within the corporate governance report and the King IV application schedule, available on the group’s website at www.kap.co.za.

KAP Industrial Holdings Limited has met its reporting requirements relating to King IV, the Listing Requirements of the JSE and the 2008 Companies Act (as amended) together with the Companies Regulations (jointly “the Act”).

King IV

The application by the group of the principles contained in King IV, has served to further strengthen the group’s approach to corporate governace and, in the field of remuneration, has served to emphasise the necessity for fair, responsible and transparent remuneration. The robust committee and reporting structures in place across the group underpin the group’s commitment to sound corporate governance and afford stakeholders the assurance that the group’s businesses are managed responsibly.

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