NEWSMAKER
SA rules might have averted Steinhoff crisis
Less scrutiny of execs under German system, says Mervyn King
South Africa's Mr Corporate Governance, former judge Mervyn King, says the Steinhoff debacle might have been prevented if the company had been listed in South Africa instead of Germany. The South African global retailer has a secondary listing on the JSE, but its primary listing is in Frankfurt, where a two-tier board system applies. This means that executive and nonexecutive directors sit on different boards, unlike the South African system where they sit on the same board. King says Steinhoff's executive directors would have been exposed to more rigorous scrutiny in South Africa's unitary board system, which is not applicable in Frankfurt. "It [the Steinhoff collapse] may not have happened because the nonexecutive directors would have been better placed to eyeball the executives and ask them about what is in the pack," he says. The "pack" refers to the information that executive directors prepare for the nonexecutive directors. Information about operational issues, acquisitions, d...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.