Page 53 - The Corporate Report Pack

The King Report and Code: An integral and important part of South Africa’s common law
parties thus making it binding on the parties to that contract. In my opinion, the decision by Mervyn King to include the JSE on his Committee and to ask the then Chairman of the JSE, Roy Anderson, and the doyen of the JSE, Max Borkum, to persuade the JSE to make the King I Report a listing requirement was one of the most important decisions that gave regulatory recognition to the King Report and Code. Roy Anderson did the JSE a favour in persuading them to adapt the King Code because today the JSE is seen to be the best stock exchange in the world. I have no doubt that Mervyn King and the Committee members could not have foreseen that the King Code in its three iterations to date would become both an integral and important part of South Africa’s common law.
What is South Africa’s common law?
South African law, in general, comprises common law and statutory law. South Africa’s common law is composed of the foundational Roman-Dutch legal principles as modified and interpreted by judicial precedent. The decisions of the High Court are binding on all lower courts, and in turn, the High Court is bound by decisions of the Constitutional Court. In addition, the High Court considers itself bound by its own decisions unless convinced that an earlier decision on the point in issue is patently wrong. Judicial decisions are thus themselves a source of law. Overarching this legal framework is the Constitution, against which all law must be measured for consistency, and which exerts a powerful influence over the development of the law.
A visit to http://www.elawnet.co.za/article_docs/ CASES_REFERRING_TO_THE_KING_REPORT. pdf will take you on a journey through the cases in the
various divisions of the High Court of South Africa, where judges have made reference to the King Report. With their judgements, the King Report and Code have been made part of South Africa’s common law.
When the task team dra ing King IV commenced their work, one of the important issues raised with Mervyn King, as Chairman, was the challenge to ensure that King IV was aligned to the now rmly entrenched common law principles taken from King I, King II and King III. I believe that we have achieved this and it is hoped that King IV (and the subsequent King Reports that will inevitably follow because the corporate milieu keeps changing) continue to enrich South Africa’s common law.
e King Report on Corporate Governance has been cited as ‘the most e ective summary of the best international practices in corporate governance’.3
It is the hope of the King Committee that King IV will continue the reputation of its predecessors of being one of South Africa’s most valuable assets of which we can all be so proud.
Michael Judin is a partner in the Johannesburg-based law rm of Judin Combrinck Inc. He is a member of the King Committee and also a member of the task team which drafted King IV.
He was the chairman of the subcommittee
on the chapter dealing with negotiation, mediation and arbitration as contained in King III.
He is also a non-executive director of, and legal adviser to, the American Chamber of Commerce in South Africa. He is the Co-Chairman of the Corporate Governance International Development Subcommittee of the American Bar Association’s Business Law section.
Author
3 Steve Banhegyi Management: Fresh Perspectives (Pearson Education South Africa 2007) 317.
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