Corporate governance report

Governance framework and statement of compliance

Efforts to ensure that the group is managed in an efficient, responsible and ethical manner, in the interests of its stakeholders, is ongoing. Governance influences how the group's objectives are set and achieved, how risk is monitored and assessed and performance is optimised and in so doing plays a critical role in delivering sustainable value for shareholders.

The board is the focal point for and custodian of the group's corporate governance system and is ultimately accountable and responsible for the performance and affairs of the company. It strives to continually enhance the group's governance system, recognising that the achievement of a long-term sustainable business depends on stable, well-functioning and well-governed social, economic and governance practices.

The group's governance framework has been designed to promote a positive ethical culture and ensure compliance with applicable laws, regulations, non-binding rules, standards and frameworks and codes of best practice, including:

By carrying out its responsibilities within a framework of policies, procedures, controls and powers of execution, the board ensures that governance objectives are properly implemented, managed, reviewed and adjusted to ensure they are appropriately aligned and enable it to identify areas that need to be addressed, further entrenched or improved upon, where necessary.

The board, committees and management are responsible for embedding practices into the group's businesses, consistent with these principles.

Initiatives undertaken to enhance the governance framework during the reporting period, and which will remain areas of focus for the foreseeable future, included:

The principles and recommended practices contained in King IV™ are reviewed annually and recorded in a register, which is available on the group's website at (Stakeholder Relations/King IV™ Governance Register), demonstrating the group's implementation of the appropriate governance practices.

The board is satisfied that the company has satisfactorily applied the principles and recommended practices of King IV™ as are appropriate to its business.

Ethical leadership

The group:

The code of ethics and business conduct (the code), which applies to all directors and employees, is available on the group's website,, and raises awareness around ethics by providing clear guidelines on what are considered acceptable values and behaviour to guide day-to-day decision-making. Although the explicit values describe the core of ethical behaviour, they are not exhaustive of all the ethical norms that guide the behaviour.

The code is communicated to all employees during their induction. In addition to accepting the code, all employees undertake to declare conflicts of interest and gifts received.

The group applies a zero-tolerance approach to violations of the code and responds to contraventions by taking the necessary action, which can include disciplinary, civil and/or criminal action, as well as effecting improvements to the control environment.

In addition to the internal reporting mechanisms in place, there is an independently operated whistleblower alert line, managed by Whistle Blower Proprietary Limited, through which stakeholders can anonymously and confidentially report purported unethical or corrupt behaviour. The service, details of which can be found on the group's website,, is available seven days a week, 24 hours a day. All reported incidents are investigated and, where appropriate, action is taken.

In total, 12 calls were logged during the year under review, four of which were duplicates in that they related to the same issue at a specific hotel.

All calls were investigated, and the majority were found to be internal grievances and were dealt with in accordance with the group's internal grievance procedure. Of the remaining calls, none indicated a material breach in the required standard of ethical behaviour.

Governance structure

Audit (statutory and board)

S G Morris (chairman), F W J Kilbourn,

G G Huysamer, N Medupe

Risk (board)

N Medupe (chairman), G G Huysamer, S G Morris,
D Nathoo, V M Rague, A C Widegger,
M S Kobilski (divisional director)

Remuneration and nominations (board)

F W J Kilbourn (chairman), S G Morris, B T Ngcuka

Social and ethics (statutory and board)

M S P Marutlulle (chairman),
L G Siddo, A C Widegger

Executive Committee (Exco)

Chaired by chief executive officer

Management Development and Succession
Committee (Mandasco)

Chaired by chief executive officer

Transformation committee

Chaired by chief operating officer

Environmental sustainability steering committee

The board retains full and effective control of the group and is ultimately accountable and responsible for its performance. This includes responsibility for reviewing and guiding corporate strategy through the establishment of key policies and objectives, understanding the key risks faced by the group, determining the risk appetite, tolerance and preferences of the group and the processes in operation to mitigate these. The board has overall responsibility for the management of the group and for maximising shareholder value.

Assisting the board in carrying out its duties, promoting continued good governance and providing in-depth focus in specific areas, are the various board, executive and management committees depicted in the governance structure above. Each committee operates in accordance with board-approved terms of reference, which define their roles and responsibilities, comprises appropriately skilled members, allows for senior management participation and has access to specialist advice when considered necessary. Terms of reference are reviewed periodically and updated where necessary to ensure they are aligned with current best practice, as well as internal, market, legislative and regulatory requirements and, with the exception of the management committees, is chaired by an independent non-executive director.

Various informal committees may be established for the purpose of gathering of information, agreeing on and tracking actions, and where necessary, escalating findings or recommendations to decision-making forums.

The board

The board operates in accordance with a formally approved charter that, in addition to setting out the processes and practices that have been adopted to assist it in the effective discharge of its responsibilities, defines the roles and responsibilities of the board and its directors, as well as its composition and ensures that board activities conform to sound corporate governance principles and comply with applicable legislation. It also sets out the division of responsibilities to ensure a balance of power and authority so that no one individual has unfettered powers of decision-making. No changes were effected to the charter during the year under review.

All board members are aware of their collective, as well as individual, responsibilities.

In carrying out their duties, directors are required to:

The board conducts its chartered responsibilities through workplans set to timelines.

Primary areas of focus include monitoring, reviewing and implementing matters of a strategic, financial, non-financial (including governance, compliance, ethics, sustainability and social responsibility) and operational nature.

The board takes the lead in guiding the group's strategic direction, ethics, governance processes, operating, financial, as well as non-financial performance.

Each group operating subsidiary company is governed by a board of directors established in accordance with the laws of the country in which it operates, which meet as required. Certain members of Exco serve as directors on these boards and report to the board on their activities at each meeting.


The board may, in accordance with the memorandum of incorporation (Mol), comprise a minimum of four directors and a maximum of 12 directors, the majority of whom must be non-executive directors (NEDs). The majority of the NEDs must be independent, as defined in King IV™. The board currently comprises 10 members, six of whom are independent and three of whom are executive.

The chief executive officer (CEO), chief financial officer (CFO) and chief operating officer (COO) serve as the executive directors (EDs) on the board.

Each of the NEDs are individuals of high calibre, with sound credibility, who possess the requisite knowledge, skills and experience to make a meaningful contribution to and ensure the effective leadership of the company. All directors participate actively in board deliberations and decision-making processes.

Alastair Dooley resigned as CFO, member of the board and risk committee on 9 March 2020 and was replaced by Dhanisha Nathoo in all of these roles.


Independence of long-serving NEDs is reviewed annually to ensure that they can continue to be classified as independent.

The process of gauging independence includes, in addition to participation at meetings, an assessment of the director's independence of behaviour and judgement and whether there is an interest, involvement, position, association or relationship which, when judged from the perspective of a reasonable and informed third party, is likely to influence unduly or cause bias in decision-making and the ability to act independently.

Part of the process requires disclosure by each director of external associations and/or relationships. At its most recent assessment, the board concluded that:

Appointment, rotation and retirement

The policy on selection and appointment of directors to the board and gender diversity sets out the process around the selection and recommendation of candidates for appointment to the board, which is formal and transparent and a matter for the board as a whole, assisted where appropriate by the remuneration and nominations committee (Remcom). Appointments are made on merit against objective criteria, having regard to suitability for the role, board balance and composition, required mix of skills, background, knowledge, experience and expertise required and taking independence, diversity and gender into account. All potential board appointees are subject to a fit and proper test, in accordance with the JSE Listings Requirements, and all appointments are subject to shareholder approval.

NEDs have no fixed term of appointment or service contract. In accordance with the group's Mol, at least one-third of the NEDs retire by rotation at the group's annual general meeting. The directors so retiring may, if eligible, offer themselves for re-election.

EDs are full-time salaried employees engaged on the group's standard terms and conditions of employment, which may be terminated on three months' notice. Termination of an ED's employment contract will result in resignation from the board and its committees.

EDs do not receive fees for their services as a director on the board or member of the board and statutory committees and do not retire by rotation at the annual general meeting.

Newly appointed directors retire at the first annual general meeting following their appointment and make themselves available for re-appointment by shareholders.

The retirement age for a NED is 70 years, subject to review at the discretion of the board, and 65 years for an ED.

Despite having reached retirement age, the board wishes to continue to avail itself of the services of Mr Morris, as he continues to be a valuable member who contributes meaningfully to board and committee deliberations and on the basis that his independence, which is reviewed annually, continues.

The group acknowledges the importance of diversity as a contributor to board effectiveness and supports the principles and objectives of diversity at board level. While no voluntary targets have been set, Remcom considers race and diversity and the promotion thereof on an annual basis. Currently, the board comprises six (60%) persons of colour, four (40%) of whom are female.

The strong representation of tourism industry expertise and experience blends well with the diversity of experience in other areas and serves to strengthen the board's collective business acumen.

As such, the board is satisfied that it possesses the appropriate mix of knowledge, skills, experience, diversity and independence to discharge its responsibilities.

Where a vacancy arises, or there is a requirement for an additional board appointment, consideration will be given to recommending for appointment a person of colour and/or female, on the basis that suitable candidates are available and with due regard to the mix of skills and experience currently represented and required.

Having considered the suitability of the directors retiring by rotation and being available for re-election, the board has resolved to put the directors, whose brief curricula vitae are set out in Who governs us, forward to shareholders for re-election.

Board leadership

Responsibility for running the board and for running the group's business are two critical functions. To ensure effective governance, the roles of the chairman and CEO are distinct from one another. Separation of these roles ensures a clear division of responsibilities, which is necessary to ensure a balance of power and authority, so that no one individual has unfettered powers of decision-making.

Chairman of the board and lead independent director (LID)

The chairman is responsible for setting the ethical tone for the company, ensuring the integrity and effectiveness of the board's governance processes, acting as the link between the board and management and providing leadership and vision in a manner that serves to enhance shareholder value and ensure the long-term sustainability of the company. The chairman's responsibilities are as detailed in the board charter.

Where the elected chairman is not considered to be independent, the board, in line with the recommendations of King IV™ and the JSE Listings Requirements, will appoint a LID to strengthen independence on the board and provide leadership and advice in matters where there may be an actual or perceived conflict of interest. The LID's responsibilities are as detailed in the board charter.

The chairman and LID are elected annually.

The board is comfortable that Messrs Ngcuka and Kilbourn are able to effectively carry out their respective duties and has accordingly re-elected them as chairman and LID for the ensuing year.


The CEO is appointed by the board and serves as the link between management and the board, ensuring the group's day-to-day business affairs are effectively managed.

The CEO's responsibilities are as detailed in the board charter and his job description and includes, inter alia:

Board meetings and procedures

Meeting dates are established in advance of each calendar year. The board works to a formal agenda prepared by the company secretary, in consultation with the chairman. Board packs containing the meeting agenda and relevant supporting documentation are circulated in advance of each meeting to allow sufficient time for preparation.

Where a director is not able to attend a meeting, he/she informs the chairman of the board or relevant committee, as well as the company secretary of this, together with the reason for his/her absence.

Directors may, when they are unable to attend in person, participate electronically via video and/or teleconferencing facilities and, where appropriate, make submissions on matters to be tabled for discussion, which submissions are recorded at the meeting. Decisions taken between scheduled board meetings, as provided for in the group's Mol, are tabled for noting at the subsequent board meeting.

Details of the type and number of meetings held during the year under review, as well as individual director attendance, are set out in the table below.

Board and committee meeting schedule and attendance

   Board       AGM       AC        R&NC       RC       SEC       Ad hoc – Rights   
offer and BEE   
Number of meetings    5        1       3        3       3       2       11       
A W Dooley   3+      1+      2*+     –        2+      –        1     
G G Huysamer   5        1        3        –        3        –        11       
F W J Kilbourn   5        1        3        3        3        –        11       
N Medupe   5        1        3        –        3        –        –       
B T Ngcuka   5        1        –        3        –        –        –       
M S P Marutlulle   4      0      –        –        –        2        –       
S G Morris   5        1        3        3        3        –        11       
V M Rague   5        1        –        –        3        –        –       
K I M Shongwe   1+      0+      –        –        1+      0+      –       
L G Siddo   5        1        –        –        –        2        –       
A C Widegger   5        1        3*      3*      3        2        11*     
D Nathoo   2#      0#      1*#     –        1#       –        10*#    
* By invitation
Not a member
+ Resigned
# Appointed 9 March

Meeting dates

14 August 2019

7 November 2019

19 February 2020

25 March 2020

20 May 2020

Annual general meeting date

7 November 2019

Induction and ongoing training and development

To assist them in the effective discharge of their responsibilities, directors are afforded the benefit of an induction programme tailored to their individual needs and aimed at broadening their understanding of the company and the business environment within which it operates.

The company shares the responsibility of ensuring directors are equipped with the necessary skills to effectively carry out their duties and, when it is deemed appropriate, directors can avail themselves of continuing professional development programmes.

Succession plan

The board:

Information and communication

Directors have:

Group strategy

Strategy, risk, performance and sustainability are inseparable. The board assumes responsibility for:

Progress on the implementation and achievement of the group's strategic objectives is monitored on an ongoing basis and is reported at each meeting of the board and Exco. COVID-19 and the resultant lockdown interrupted the implementation of certain strategic objectives and resulted in an ongoing review and adjustment, where appropriate, of the current objectives, to see the company through the current situation and the medium to long term.

Evaluation of the board, chairman, CEO and company secretary

Board effectiveness is regularly assessed by way of a self-assessment. Where a director's performance is not considered satisfactory, the board will not recommend him/her for re-election.

The board is satisfied that it operates effectively, is suitably constituted, possesses the appropriate skills, experience and expertise and that it has discharged its responsibilities as detailed in the board charter and annual work plan.

The chairman

The LID assesses the performance and leadership of the chairman in an informal manner.


The chairman of the board, in consultation with the NEDs, assesses the performance of the CEO.

Company secretary

The appointment and removal of the company secretary is a matter for the board as a whole.

The group company secretary ensures statutory and legal compliance, as well as adherence to the JSE Listings Requirements and relevant governance principles. She is responsible for guiding the board in discharging its responsibilities, assumes responsibility for administering the proceedings and affairs of the board, monitors directors' dealings in securities, ensures adherence to closed periods, communicates with stakeholders and liaises with the group's transfer secretary and sponsor.

Melanie van Heerden is an admitted attorney, notary and conveyancer, holding BCom and LLB degrees, with 18 years' post-qualification experience. Her academic and professional qualifications were externally verified prior to appointment.

In accordance with both the JSE Listings Requirements and King IV™, the performance and independence of the company secretary is evaluated annually. The board, while evaluating her performance and interactions with the directors individually and the board as a whole, concluded that Mrs van Heerden is suitably qualified and experienced and is satisfied that she demonstrates the requisite competence to continue to hold the office of group company secretary. The board is furthermore satisfied that the arrangements in place for providing corporate governance services are effective.

Board, statutory and management committees

A number of board, statutory and management committees have been established to assist with the balance of power and the execution of the board's responsibilities, as well as facilitate efficient decision-making and promote independent judgement.

Delegation in no way relieves the board from discharging its duties and it remains ultimately accountable for the performance and affairs of the company. The delegated responsibility and the powers, limits and authorities attached to board committees are determined and approved by the board, from time to time.

Each committee, with the exception of the management committees, is chaired by an independent NED who reports on the activities and recommendations made by the committee at the board meeting immediately following the committee meeting. Minutes of all board and statutory committee meetings, save for Remcom, are tabled for noting by the board. The group company secretary serves as secretary for all the committees.

Additional meetings may be convened when necessary to address urgent matters falling within the committee's scope of responsibility. No such meetings were held during the year.

The board regularly assesses the composition of the committees to ensure that each possesses the appropriate balance of skills, knowledge and experience, as well as the need for additional committees, to assist it in carrying out its duties and meeting its statutory and other legal requirements. The following changes in committee composition took place during the year under review:

As with the board, the effectiveness of each committee is considered at regular intervals and entails a self-assessment. Any areas identified as requiring improvement are considered and the appropriate measures put in place.

The board is satisfied that each committee operates effectively and has discharged the responsibilities detailed in their respective terms of reference, at the intervals indicated in the annual work plan.

The chairmen of the respective committees attend the annual general meeting to respond to any questions shareholders may raise with regard to matters falling within their respective committee mandates.

The CEO chairs the Exco and Mandasco, which have been established to assist him in the discharge of the responsibilities delegated to him by the board.

The board has four standing committees – audit, Remcom, risk and SEC.

Audit committee

The audit committee is a statutory committee whose members are appointed annually by the shareholders and which also serves as the audit committee for the group subsidiary companies. Members are elected annually in accordance with the Companies Act and King IV™ by shareholders, on the recommendation of the board. It assists the board in the discharge of its statutory duties, as well as other duties assigned to it by the board.

The committee meets at least three times a year and comprises four members, all of whom are independent NEDs who are financially literate and have the necessary business and financial acumen to carry out the committee's responsibilities. The CEO, CFO, lead external audit partner and internal audit partner attend committee meetings by invitation, but do not vote on any matters tabled for discussion.

Its responsibilities include:

The internal and external auditors have unrestricted access to the committee through the chairman.

Meetings and activities

The three meetings held during the year focused on:

The external and internal auditors and representatives from senior management meet at least annually with the committee independently of one another to report back and discuss any issues relevant to the audit process. During its meeting with management, the committee, in addition to discussing issues relevant to the audit, considered the quality and effectiveness of the external audit function and concluded that it was satisfied with the performance and level of services rendered by the external auditor.

On the basis that the auditor does not function in the role of management, does not audit its own work or serve in an advocacy role for the company, the committee concluded that the non-audit work performed did not impair the independence of the auditors.

Furthermore, notwithstanding that KPMG has served as the group's auditors since 1986, the committee is satisfied that KPMG has acted with unimpaired independence.

The board, on the recommendation of the audit committee, has therefore nominated KPMG for reappointment as the group's registered auditor for the ensuing year, with Dwight Thompson, who has served as the group's engagement partner for three years, as the engagement partner at the forthcoming annual general meeting.

Both the external and internal audit partners attend the annual general meeting to respond to any questions shareholders may raise.


Remcom comprises three NEDs, including the chairman and the LID. The LID serves as chairman of the committee. The CEO attends meetings by invitation, but does not have a vote on matters to be decided upon nor does he participate in the decision-making process relevant to his remuneration.

The chairman of the board drives the nomination process and leads the nomination portion of meetings.

The committee assists the board in discharging its responsibilities for:

Remcom is responsible for:

Meetings and activities

The committee met three times during the year and focused on:

Details on how Remcom discharged its responsibilities can be found in the remuneration report.

Risk committee

Risk appetite and tolerance are fundamental concepts setting the context for determining the group's strategic objectives and are informed by the group's risk culture and details the risks the group can or is prepared to take and which are to be avoided.

The board determines the group's risk appetite and tolerance levels, while management assumes responsibility for implementing and monitoring the processes of risk management and for the integration thereof into the day-to-day activities of the company.

The group's enterprise risk management process encompasses the review, identification, quantification, prioritisation, response to and monitoring of the consequences of both internal and external risks and also accounts for new and emerging risks and opportunities. It also promotes ownership of risk areas and accountability for risk management. Risk and control procedures are developed, and enhanced upon, on an ongoing basis to improve risk identification, assessment and monitoring. Risks are assessed in terms of potential impact and likelihood. Inherent risk is determined with reference to an evaluation of impact and probability and its significance to the business, while residual risk is determined with reference to the mitigating strategies in place.

The committee meets at least three times a year and is responsible for ensuring that the company has implemented an effective policy and plan for risk management that will enhance the group's ability to achieve its strategic objectives and determining the group's risk appetite and tolerance levels.

Four of the seven members are independent NEDs, and the remaining members are Exco representatives. All members have the necessary risk management skills and experience required to discharge the committee's responsibilities.

The chairman of the board is not a member of the committee.

Role and responsibilities

The risk committee assists the board in discharging its responsibilities associated with risk management by reviewing the effectiveness of the processes and procedures adopted by management in relation to identifying, evaluating, documenting, managing, monitoring and reporting on risks and the assurance provided thereon.

It is the committee's responsibility to ensure that an effective policy and plan for risk management, that will enhance the group's ability to achieve its strategic objectives, has been implemented.

Responsibilities include:

Key focus areas include the management, rather than elimination, of risk, and ensuring comprehensive, timely and relevant disclosure with regard to risks facing the company as no risk management system or combined assurance provided can give absolute certainty that the risks the company faces are fully understood and can be avoided. While the committee assumes responsibility for overseeing the risk management programme in place for the group, management is responsible for identifying and evaluating strategic and operational risks and opportunities, putting the necessary mitigating strategies in place, allocating responsibility, formulation of a risk management plan and monitoring compliance against the plan.Exco supports the committee in discharging its responsibilities.

Meetings and activities

Three meetings were held during the year with particular focus being given to:

In light of the fact that the overall risk landscape will have changed during and post-COVID-19, the annual review of the ERR was deferred beyond the current financial year when it is anticipated that the effect of the pandemic will have stabilised somewhat.

The material issues in key risks and opportunities provide further detail on the material risks the company faces.

Managing the changes in the risk environment particularly insofar as they relate to cyber security, data privacy, sustainability, legal compliance and communicable, contagious and infectious diseases will continue to be areas of focus going forward.

The committee confirms its satisfaction that the group's risks are being managed appropriately and is comfortable with the risk management processes adopted by management.

Social and ethics committee (SEC)

The SEC is a statutory committee of the board responsible for monitoring compliance with relevant social, ethical and legal requirements, as well as best practice codes, organisational ethics, social and economic development, responsible corporate citizenship, environmental sustainability and stakeholder relationships, and as a board committee in respect of the responsibilities delegated to it by the board.

The SEC meets twice a year and comprises three members, an independent non-executive chair and two of whom are EDs.

The report detailing how the SEC has discharged its responsibilities in this regard appears in the social and relationship capital.

Ad hoc committee – BEE and rights offer committee

The BEE and rights offer committee was an ad hoc committee mandated by the board to consider options and make recommendations relating to the:

The committee comprised three independent NEDs, Messrs Huysamer, Kilbourn and Morris with Mr Widegger and Ms Nathoo attending meetings as invitees.

A total of 11 meetings were held between December 2019 and June 2020.

Management committees


Exco is the most senior executive decision-making body within the group and assists the CEO in the implementation of strategies and policies adopted by the board, managing the group's day-to-day operations, as well as its overall performance and discharging the obligations delegated to the CEO by the board.

Exco comprises 11 members, is chaired by the CEO and meets at least quarterly.

Dhanisha Nathoo was appointed as CFO and member of Exco with effect from 9 March 2020 following the resignation of Alastair Dooley.

Exco is specifically responsible for:

Exco met formally on three occasions during the year. The pronouncement of strict lockdown protocols commencing 27 March 2020 to minimise the spread of COVID-19 in South Africa, including the closure of all shops and businesses (except for pharmacies, laboratories, banks, the JSE, supermarkets, petrol stations and healthcare providers) and similarly strict lockdown protocols implemented in the other African countries where the group operates, resulted in the temporary closure of the group's 62 hotels. In response and with a view to navigating the company through the challenges presented by the lockdown Exco was reconstituted as the COVID Rapid Response Team (CRRT) to include the general managers: operations and head of property and development. The CRRT met eight times between March and June 2020 to specifically:

Management Development and Succession Committee (Mandasco)

Mandasco meets at least quarterly and comprises nine members, including the CEO, who serves as chairman, the COO and divisional directors and general managers: operations, divisional director: HR and group talent manager.

The committee is responsible for ensuring that:

The various programmes in place saw the following appointments being made during the year under review:

Governance processes

Combined assurance

The group, in its implementation of combined assurance, has identified a number of roleplayers who, when taken as a whole, enable an effective control environment, support the integrity of information used for internal decision-making and support the integrity of the group's external reports.

The key differentiating factor between these roleplayers is their levels of independence from the group's operational activities and the company itself.

The various lines of defence distinguish between:

First line of

Management – including strategy development and implementation, performance measurement, risk management, company control and monitoring of compliance to laws and regulations

Second line of

Corporate (specialist) functions and management committee oversight – the risk and compliance management structures of the company, such as risk management, compliance officers, occupational health and safety, legal services and internal control units

Third line of

Independent assurance – made up of internal audit, IT audit, forensic audit (reactive), external audit and occasionally external regulators, sustainability and environmental auditors, actuaries as is appropriate to the company. These structures are largely independent of the operational activities of the company and provide assurance to the board

Fourth line of

Oversight structures – made up of the overarching oversight structures in the company, including the board and its oversight committees such as audit, risk, SEC and Remcom

Risk management system

Risk management is an integral part of management processes. The group's effectiveness is enhanced when risk management is part of the culture and is embedded in its daily practices and business processes. Risk management focuses on the relationship between risk and its impact on achieving objectives.

The group's risk management system includes the establishment of various policies, strategies, processes, procedures and tools for identifying, measuring, monitoring, managing and reporting all material risks and opportunities to which the group is exposed. The ERM framework sets out the key principles that guide the implementation of risk and capital management at all levels. It provides the necessary foundations and organisational arrangements for managing risk within the group by promoting ownership of risk areas and accountability for risk management, and illustrates how risk management should be embedded in all business units to ensure effective risk management strategies are integrated in all work contexts.

Internal control system

The internal control system acts as an enabler for the delivery of effective governance and to demonstrate that adequate internal controls are in place and operating satisfactorily.

The group's internal control system outlines the various elements influencing and contributing to a sound internal control environment to ensure adequate control over operations, compliance and financial reporting.

It has been designed to assist the board, Exco and senior management and provides reasonable assurance from a control perspective that the business is being operated consistently within the:

Internal audit

The internal audit function provides independent, objective assurance to the board in respect of the effectiveness of its governance, risk management and internal controls. The function, which is outsourced, complies with the Institute of Internal Auditors for the Professional Practice of Internal Auditing and Code of Ethics, and operates within approved terms of reference. It follows a risk-based approach, evaluating significant business, strategic and control risks, and the internal audit plan is informed by the strategy and risks of the group. This assists management in the development and implementation of effective internal controls and in ensuring the adequacy of controls to address the risk of material misstatement of financial results.

The head of internal audit reports functionally to the audit committee and administratively to the CFO. Internal audit has unrestricted access to the CEO, CFO, as well as the chairman of the audit committee.

Audits are conducted in accordance with the International Standards for the Professional Practice of Internal Auditing, with hotels being audited roughly once every three years, unless circumstances dictate otherwise. Reports are presented at each audit committee meeting and are prepared in accordance with a defined set of audit criteria which highlight audit area ratings per hotel and summarise internal audit activities. Corrective action is taken where significant internal control weaknesses are identified and follow-up audits may be conducted if deemed necessary.

Based on the results of the 17 internal audit reviews completed during the year, which yielded an average score of 93% (2019: 90%), the internal audit function and the audit committee concluded that the overall operational internal control effectiveness is excellent.

The audit committee reviews the effectiveness of the internal audit function to ensure that adequate, objective internal audit assurance standards and procedures exist and annually approves the internal audit plan and budget for the ensuing year.

Where mandated by the audit committee, internal audit carries out special assignments. No such assignments were undertaken during the year under review. The committee has, however, commissioned a cyber security assessment aimed at providing the company with:

The audit committee:

Non-audit services

The policy for the provision of non-audit services by external audit provides guidelines on the audit, audit-related, tax and other non-audit services that the external auditor may and may not provide.

All non-audit services performed by the external auditor must be pre-approved by the audit committee in order to ensure that the provision of such services does not impair the external auditor's independence.

Dealing in securities and insider trading

The company has a board-approved policy on dealing in company securities, which requires prior written clearance before dealing in company shares.

Dealing in company shares must be approved as follows:

All dealings in securities are effected through the office of the group company secretary and published via the group's sponsor on the JSE's Stock Exchange News Service.

The company has the following closed periods:

Conflicts of interest and other directorships

Declaration of interests in contracts and other companies, and details of other directorships, is a standing item on the board and Exco agenda in addition to making an annual written declaration in this regard.

Directors are required to recuse themselves from discussions on those matters where they are, or may potentially be, conflicted after they have provided any material information relating to the matter.

EDs may, with the chairman's permission, having due regard to whether the appointment may conflict with the business of the company and/or have a negative impact on their ability to effectively meet their responsibilities, accept external board appointments.

While no limitations are imposed on the number of other appointments directors may accept, they are required to engage with the chairman with regard to their external appointments in order to ensure that acceptance of the additional appointments will not impact their ability to devote sufficient time to the company.

The chairman of the board is satisfied that the NEDs have devoted the requisite amount of time to discharge their responsibilities to the company and that no director has a material interest in any contract entered into by the company.

Anti-bribery and corruption

The group's zero-tolerance approach to all forms of bribery and corruption applies to all business relationships and requires everyone to work against corruption in all its forms, including extortion and bribery.

The giving and receiving of bribes and facilitation of payments, as well as the making of political donations are strictly forbidden.

The stringent procedures prescribed by these policies are implemented throughout the group and the group-wide monitoring process requires a register of gifts, including hospitality, to be kept by the group company secretary.

In compliance with section 159 of the Companies Act, the company has established and maintains a system to receive whistleblowing disclosures. All reports are investigated and dealt with confidentially. Availability of the system is published on the group's website at The Whistleblower Alertline, which is operated by an independent third party, enables internal and external stakeholders to report any suspected activity anonymously.


The group recognises the critical role that compliance plays in both the governance and sustainability of its business. Compliance is accordingly built into the fabric of its governance frameworks and structures.

The company has a strong culture of compliance and is committed to conducting its business in accordance with applicable laws, rules and regulations, as well as codes and standards that have been adopted by the group.

The governance and compliance function monitors and assesses compliance with, and the impact of, applicable laws and regulations on the business. Governance developments are monitored on an ongoing basis to ensure adherence to local regulatory requirements.

Compliance and compliance risks are monitored and tracked by the governance and compliance function and management.

The board, through the SEC and risk committee, monitors compliance and compliance risks by means of committee reports. Where required, external experts are engaged to assist and advise.

The board is informed of regulatory changes, non-binding standards and codes that may have an impact on the group.

Areas of focus during the year included:

Planned areas of focus for the forthcoming year include:

Information technology (IT)

IT is integrated into the business and is an important enabler both in the enhancement and advancement of the group's objectives and position as a leader in its field.

The board is ultimately responsible for IT governance (ITG) and the strategic alignment of IT with the group's performance and achievement of its strategic objectives. It has delegated responsibility to implement the ITG framework to management under the oversight of the audit committee where ITG is a standing item on the audit committee agenda.

IT policies and procedures cover, inter alia, the use and safeguarding of the group's information and IT systems, use of social media, disaster recovery plans, as well as the regular updating and improvement of IT technology.

The divisional director: IT, who reports directly to the CFO, is responsible for IT operations within the group, specifically the implementation of business-focused IT strategies and ensuring proper system security, data integrity and business continuity.

She is furthermore responsible for consolidating feedback relating to the performance of IT within the company, so that reactive or proactive steps may be taken to ensure that the company derives the maximum value from IT, while at the same time managing its risks and ensuring that the IT function is focused on IT investment initiatives, internal engagement to promote collaborative IT planning and the promotion of IT effectively to capitalise on economies of scale across the group.

Areas of focus included:

Future focus areas include:

The board is satisfied that ITG is being addressed appropriately and is suitably aligned to the achievement of the group's objectives and that the systems of internal control over IT are adequate and effective and that there has not been a material breakdown in the functioning of the internal control systems during the year under review.


The group is, in the ordinary course of business, subject to legal proceedings, which for a number of reasons, including risks and uncertainties, cannot be reliably predicted.

It is not, and has not during the year under review, been involved in any legal or arbitration proceedings that will or may have a material effect on the operations or financial position of the company, nor are there any such known proceedings pending.


The group's sponsor, Nedbank Corporate and Investment Banking, advises the board on compliance with the JSE Listings Requirements.

Stakeholder engagement

The group is committed to the timeous and transparent reporting of relevant matters to its stakeholders as required by the Companies Act, the JSE Listings Requirements and best practice guidelines, recognising that its long-term sustainability objectives are supported through engaging with stakeholders to address matters of mutual interest. Continuous engagement with key stakeholders takes place to promote the achievement of the group's business objectives and support economically, socially and environmentally sustainable practices. The group aims to treat all its stakeholders fairly and strives to enhance and develop services and communication channels to meet their expectations.

The board, as ultimate custodian of stakeholder relations, has delegated responsibility for proactively dealing with the group's various stakeholders to the executive and divisional directors, group company secretary, hotels and outsourced public relations function.

Various methods of engagement have been adopted and include face-to-face meetings, results presentations with major institutional shareholders after the release of results, hosting investor and analyst sessions, the annual general meeting, engaging with the broader stakeholder community through its marketing efforts, advertising via various social media platforms, directly with guests via guest questionnaires and with local communities through various corporate social initiatives.

General investor interaction during closed periods is limited to discussions on strategy and/or historical, publicly available information.