South Africa’s pioneering journey in corporate governance, launched more than three decades ago with the King Code in 1994, is poised for its next chapter. On 24 February, the King Committee, in collaboration with the Institute of Directors in South Africa (IoDSA), unveiled the draft King V Code on Corporate Governance, inviting public comment.
The latest iteration of the Code builds on the globally admired King IV, introduced in 2016, refining its principles to address contemporary challenges.
The King V draft weaves together local legislative shifts, such as recent amendments to the Companies Act, and global trends, such as advancements in sustainability reporting and the impact of technology.
Ansie Ramalho, the chairperson of the King Committee, says these updates are essential to keep governance standards robust and relevant. “Corporate governance is a critical tool for strengthening public and private institutions, to the benefit of the entire economy,” she notes.
Since its inception under Mervyn King, a renowned corporate attorney and arbitrator, the King Code has evolved to reflect such shifts, ensuring it remains a dynamic framework rather than a static rulebook.
This adaptability is evident in King V’s response to the rise of digital tools and the growing emphasis on environmental, social, and governance factors. By integrating these elements, the draft aligns with an “integrated thinking” approach, recognising the interconnectedness of economic, social, and environmental systems. This holistic perspective sets King V apart, reinforcing its relevance in a world where businesses are increasingly judged by their societal impact.
More accessible
A feature of King V is its commitment to accessibility. The draft pares down the 17 principles of King IV to a leaner set of 12, using plain language to demystify governance for a broader audience. This streamlining extends to its presentation: gone are the heavy graphics and design flourishes of past iterations, a deliberate choice to aid reading-impaired individuals and align with regulatory drafting norms. The Code will now stand alone, decoupled from the broader report format of King IV, with supporting documents – such as a glossary and disclosure template – accessible via a single IoDSA webpage featuring intuitive navigation tabs.
This user-friendly redesign reflects a core objective: making governance principles easier to interpret and apply across diverse organisations, from state-owned enterprises to SMEs. “Simplifying the Code will render it more accessible to a wider range of stakeholders,” Ramalho explains. The removal of the King IV app, replaced by freely downloadable PDFs, further democratises access, ensuring that even smaller entities can engage with the framework without technological barriers.
Disclosure template
Beyond simplification, King V introduces a standardised disclosure template – a practical tool designed to boost transparency and comparability. “This is helpful to regulators, shareholders, and other users of reports on corporate governance,” says Parmi Natesan, the chief executive of IoDSA.
The template enables organisations to monitor their practices internally and articulate them clearly on an “apply and explain” basis, a hallmark of the King Codes that balances flexibility with accountability. This innovation promises to level the playing field, allowing stakeholders to assess governance practices consistently, whether for a listed company, a non-profit, or an institutional investor like a pension fund.
The continuity with King IV’s foundational principles – responsibility, accountability, fairness, and transparency – ensures that organisations already aligned with the earlier code can transition smoothly. “There are no significant deviations from King IV,” says Ramalho.
King V’s scope remains ambitiously broad, extending beyond the corporate boardrooms of listed companies to encompass state-owned enterprises, local government bodies, non-profits, and institutional investors, such as life insurers and retirement funds.
The release of the draft marks the start of a consultation process. Business leaders, government officials, and the public are invited to submit feedback via an online form on the IoDSA website, with submissions due by the close of business on Friday, 4 April.
IoDSA encourages commentators to review the King V information document for further context on the changes before submitting comments. Click on the following links to access the King V Draft documents: draft King V Code, King V glossary ,and King V disclosure template.
