| OUR COMMITMENT |
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The Sun International group remains committed to and
endorses the application of the principles recommended
in the King II Code of Corporate Practices and Conduct.
The board is satisfied that the company is compliant with
the Code in most material respects and with the related
Listings Requirements of the JSE Limited (JSE), the extent
of which is dealt with under appropriate sections
throughout this report.
The board remains mindful of the need to achieve a balance
between conformance and performance, leadership and
control, thereby fostering an entrepreneurial culture within
acceptable risk levels, aimed at promoting value creation,
at all times observing the group's broader obligations to
society in terms of environmental, economic and social
sustainability, and acknowledges that transformation at all
levels is a fundamental business imperative.
The group's commitment to these principles is evidenced
by, inter alia, the following achievements during the year
in terms of which the company: |
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continued to be ranked highly amongst South Africa's
Top 200 JSE companies for its contribution to broad
based empowerment in the Financial Mail's Empowerdex
Top Empowerment Companies; |
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was again selected as one of South Africa's Top 100
companies of 2006 in the Sunday Times Business
Times survey; |
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was ranked number 5 in the Financial Mail Top
Companies 2007 report; |
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was awarded the first Chairman's Award for its
commitment to environmental and sustainable
business practice in the annual IMVELO Awards, in
recognition for its commitment, achievement and
contribution to responsible tourism; |
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was selected as a finalist in the 'Excellent Category' for
the 2007 Excellence in Corporate Reporting Survey
Awards; |
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was nominated as one of South Africa's Top Empowered
Companies for 2006/07 by Impumelelo as a result of its
contribution to B-BBEE and Transformation. |
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| BOARD OF DIRECTORS |
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| The board is the focal point of the company's corporate
governance system and is ultimately accountable and
responsible for the key governance processes and the
performance and affairs of the company. The board strives
to provide leadership and vision to the company in a
manner that will enhance shareholder value and ensure its
long term sustainable development and growth. |
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| Board charter |
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| The board adopted a charter in 2002 which regulates how
business is to be conducted by the board in accordance
with the principles of good corporate governance. The
charter is reviewed and updated, where necessary, by the
board on an annual basis. Compliance with the terms of
the charter and the company's memorandum and articles
of association form an integral part of each director's
conditions of appointment. |
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| The charter regulates and deals with, inter alia: |
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board leadership, and defines the separate responsibilities
of the chairman and the chief executive; |
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board composition, procedures, pre-requisites and
competencies for membership, size and composition
of the board, period of office, reward, induction and
succession planning; |
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the role and responsibilities of the board, which includes
the adoption of strategic plans, the monitoring of
management's implementation of board plans and
strategies, the delegation of powers and duties to
management and the determination of policy processes
to ensure the integrity of management and internal
controls; |
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board governance processes, including board procedures
and matters requiring annual and regular review; |
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board committees, including delegation of authority
(but not responsibility) and the requirements for
transparency and full disclosure by the committees; |
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matters specifically reserved for the board of a financial,
administrative and manpower nature; |
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identification of major risks and the process of risk
management and effectiveness of the process; |
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procedures for board meetings, frequency, quorum,
agendas, board papers, conflicts of interest and minutes; |
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share dealings; |
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board, committee and individual evaluations and
performance; and |
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the role and responsibility of the company secretary. |
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| The charter stipulates that the operation of the board and
the executive responsibility for the running of the
company's business should be two key and separate tasks
and that there should be a clear division of responsibilities
at the head of the company to ensure a balance of power
and authority, ensuring that no individual or block of
individuals has unfettered powers of decision making or
can dominate the board's decision taking. |
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| Board chairman |
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The board is chaired by Mr Buddy Hawton, an independent
non-executive director. The chairman of the board is
responsible, inter alia, for ensuring the integrity and
effectiveness of the board's governance processes, and is
subject to annual election from amongst its members.
Mr Hawton has, following the recommendation of
the remuneration and nomination committee after an
evaluation of his performance, been re-elected chairman of
the board for a further term, the annual re-election being a
requirement of the company's articles
of association. |
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| Board composition |
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Sun International has a unitary board structure comprising a
mix of executive and non-executive directors. Procedures for
appointment to the board are formal and transparent and a
matter for the board as a whole. The board is assisted in this
process by the remuneration and nomination committee.
In making their recommendations, the remuneration and
nomination committee applies the pre-requisites for board
membership as set out in the
board charter.
The board presently comprises two executive and 13
non-executive directors, of whom eight are considered
independent in terms of the definitions contained in the
Code. The non-executive directors have the necessary
skills and experience, as is evidenced from their CVs, to provide judgement independent of
management on material board issues. The composition
of the board appears oin this annual
report. There have been no changes in the directorate
during the financial year and to the date of this report. |
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| Chief executive and delegation of authority |
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The board's governance and management functions are
linked through the chief executive, who is tasked with the
running of the business and the implementation of the
policies and strategies adopted by the board. All board
authority conferred on management is delegated through
the chief executive and the accountability of management
is considered to be the authority and the accountability of
the chief executive. Appropriate and uniform controls and processes are in place within the company and the group
and are communicated to management to ensure the
monitoring of the application of levels of authority
throughout the group particularly in the areas of capital
expenditure, contracts, procurement and
human resources.
Board authority is delegated by way of written board
resolutions. Levels of authority and materiality have been
established and are reviewed annually by the board and
the remuneration and nomination committee.
The executive directors are individually mandated
and held accountable for: |
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the implementation of the strategies and key policies
determined by the board; |
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managing and monitoring the business and affairs of
the company in accordance with approved business
plans and budgets; |
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prioritising the allocation of capital and other resources;
and |
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establishing best management and operating practices. |
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| Succession planning |
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| Succession planning for the purposes of identifying,
developing and advancing future leaders and executives
of the group is an ongoing element of the board's
responsibility which is carried out through the remuneration
and nomination committee. |
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| Board and committee evaluations |
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| The board evaluates its own performance, processes and
procedures in terms of a self-evaluation process every two
years. The last evaluation took place in 2006. Through the
remuneration and nomination committee, the board
informally appraises the performance of the board
chairman. The board chairman evaluates the contribution
of each individual non-executive director. The
remuneration and nomination committee, through the
board chairman, is required to appraise the performance
of the chief executive. The results of this appraisal are
considered by the remuneration and nomination
committee in the evaluation of and the determination
of the remuneration of the chief executive. Board
committees are also reviewed by way of self-evaluations
every two years. The last evaluation of the committees
also took place in 2006. Action plans to improve
outcomes, where necessary, or to implement suggestions
for improvements made by the directors or committee
members, have been put in place in terms of best practice. |
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| Directors’ period of office and retirement |
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| In terms of the company's articles, new directors may only
hold office until the next annual general meeting at which
they will be required to retire and offer themselves for reelection.
Directors are subject to retirement by rotation at
least once in every three years. The retirement age for an
executive director is 60, and for a non-executive director,
70, subject to review by the board and the remuneration
and nomination committee. |
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| Induction of directors |
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| On appointment all directors are provided with an
induction programme and materials aimed at broadening
their understanding of the group and the business
environment and markets in which the group operates.
This process is carried out over a period of time and
includes the provision of background material, meetings
with senior management and regular visits to the group's
operations. The group secretary plays a role in the
induction of new directors. All directors are expected
to keep abreast of changes and trends in the business and
in the group's environments and markets, including
changes and trends in the economic, political, social and
legal climate. |
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| Access to company information and
confidentiality |
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| Procedures are in place, through the board chairman and
the company secretary, enabling the directors to have
access, at reasonable times, to all relevant company
information and to senior management, to assist them in
the discharge of their duties and responsibilities and to
enable them to take informed decisions. Directors are
expected to strictly observe the provisions of the statutes
applicable to the use and confidentiality of information. |
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| Independent professional advice and
company secretary |
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A procedure is in place for directors to take independent
professional advice, for the furtherance of their duties,
if necessary, at the company's expense, subject to prior
notification to the board chairman or the company secretary.
The company secretary provides a central source of advice
to the board on the requirements of the Code and
corporate governance and, in addition to the company
secretary's statutory and other duties, provides the board
as a whole, directors individually, and the committees with
guidance as to how their responsibilities should be
discharged in the best interests of the company. The appointment and removal of the company secretary is a
matter for the board as a whole. |
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| Directors’ and officers’ liability insurance |
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| Directors’ and officers’ liability insurance cover is in place in the case of any claims being brought against them. |
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| Conflicts of interest |
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| Directors are required to inform the board of any conflicts
or potential conflicts of interest which they may have in
relation to particular items of business. Directors are
required to recuse themselves from discussions or
decisions on those matters where they have conflicts
or potential conflicts of interest and the board may, if
it deems appropriate, request a director to recuse
himself/herself from the meeting for the duration of the
matter under discussion. |
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| Board meetings |
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A minimum of four board meetings is scheduled per
financial year to consider, deal with and review, inter alia,
strategic and key issues, financial issues, quarterly
operational performance, and any specific proposals for
capital expenditure relative to the company and the group.
In addition, the board holds a strategy meeting with
executive management on an annual basis to determine
strategic direction and to consider plans proposed by
management for the achievement thereof. Progress
against the strategic plan is monitored by the board on a
quarterly basis.
Additional board meetings are convened on an ad hoc basis,
if necessary, to deal with extraordinary issues of importance
which may require urgent attention or decision.
Directors are required to use their best endeavours to attend
board meetings and to prepare thoroughly therefor and are
expected to participate fully, frankly and constructively in
discussions and to bring the benefit of their particular
knowledge and expertise to the
board meetings.
Non-executive directors meet without executive directors
present at the time of board meetings, as necessary.
Six board meetings were held during the 2007 financial
year and a further three since then and to the date of this
report. Details of attendance by each director are as follows: |
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