Management accepts the rights of Altron’s shareholders as the true owners of the company and understands its own role as trustees on behalf of the shareholders. Corporate governance provides guidance and oversight as the company seeks to find a balance between conformance with governance principles and superior levels of performance in terms of a sustainable return on shareholders’ investments.
The 2002 King Report on Corporate Governance for South Africa (King II), created an open environment for institutional activism, to which Altron responded by actively managing and reporting on the non-financial aspects of the company’s performance through the corporate governance and corporate responsibility reports. In 2009, Altron again qualified for the JSE’s Social Responsibility Investment (SRI) Index.
On 1 March 2010, the 2009 King Report on Corporate Governance for South Africa (King III) came into effect, guiding the directorship in further maturing its approach to the governance of Altron. King III moves away from the ‘comply or else’ philosophy of King II to an ‘apply or explain’ approach in order to prevent the mindless compliance approach to corporate governance.
In terms of King III, the directorship needs to look beyond the interests of the company’s directors and shareholders, taking into account the concerns and issues of its wider stakeholder environment, such as customers, suppliers, employees, custodians of environmental concerns, etc. King III requires that long-term social, environmental and economic interests should be balanced with the primary need to maximise the profits of the company.
Altron applies the principles of good governance in accordance with the Global Reporting Initiative (GRI) guidelines. As part of the group’s commitment to sustainability, we have also engaged in several other governance initiatives. We are signatories to the UN Global Compact, The Copenhagen Communique (climate change) and have also been admitted to the Shariah Index, thereby accommodating otherwise excluded investors. Where the directors have found recommended practices are not in the best interests of Altron, this report follows King III in explaining the reasons for an alternative approach to governance of the issue.
Considering the integrated nature of this report, we have attempted to deal with each important aspect of governance only once, where it best applies. Certain aspects not covered in this report will be cross-referenced to where they receive detailed treatment.