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| CORPORATE GOVERNANCE
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| The board members, executive committee and staff members
of SA Eagle fully support and strive to abide by the recommendations of
the Code of Corporate Practices and Conduct included in the KING II Committee's
Report on Corporate Governance. |
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| BOARD OF DIRECTORS |
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| As the Board is ultimately accountable for the performance
and affairs of the Company, it is also responsible for the adoption of strategic
plans, monitoring of operational performance and management, ensuring an
effective risk management strategy and the compliance of applicable legislation
by the Company. |
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| During the next year the Board will adopt a charter setting
out all its responsibilities, bearing in mind the elements of Corporate
Governance as contained in the KING II Report, being: |
| LEADERSHIP |
- for efficiency and probity,
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- that is both transparent and accountable.
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| It is the intention of the Board to
biannually evaluate itself regarding compliance with Corporate Governance.
The objective of this exercise will be to improve Corporate Governance
enforcement within the Company. |
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| BOARD COMPOSITION |
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| The Board comprises four Non-Executive and two Executive
Directors who, with their experience, knowledge and skill, add to the successful
operation of the Company. Three of the Non-Executive Directors are independent. |
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| The Chairman, who is a Non-Executive Director, is by
definition not entirely independent as per the requirement of the KING II
Report, as he represents SA Eagle's ultimate holding company, but SA Eagle
does not perceive this to be a problem or conflict due to the fact that
SA Eagle operates independently from the holding company. |
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| The Board of Directors meets quarterly. All Directors
attend at least three meetings per year. Prior to the meetings, all board
members receive a comprehensive board pack with all the relevant documents
for board members to study in order to make informed decisions at the meetings. |
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| EXECUTIVE MANAGEMENT |
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| KING II proposes that there be an Executive Committee.
At SA Eagle the Executive Management assist the Managing Director, to whom
the daily running has been delegated by the Board, to efficiently and effectively
manage the Group and to enforce the strategic plans as approved by the Board. |
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| The Executive Management consists of the two Executive
Directors as well as four General Managers who represent the main business
and operational units in the Company. |
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| The main objective of Executive Management is to assist
the Managing Director to guide and control the overall direction of the
business of the Group and to act as a medium of communication and co-ordination
between the various business units. As the members of the Executive Management
committee also attend the Board Meetings, direct reporting and feedback
is given to the Board of Directors. |
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| Executive Management committee meetings are held once
a week. |
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| AUDIT COMMITTEE |
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| The objective of the Audit Committee is to assist the
Board in discharging its duties relating to the safeguarding of assets,
operation of adequate systems, control processes and the preparation of
accurate financial reporting and statements in compliance with all applicable
legal requirements and accounting standards. |
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| The Audit Committee meets quarterly with the internal
and external auditors and management to review the effectiveness of internal
controls. All the members are financially literate and no relationships
exist that could interfere with the members independence from management.
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| The responsibilities include inter alia the review of
the full year's financial statements prior to the submission to the Board.
The Audit Committee ensures that the annual financial statements of SA Eagle
and the subsidiary companies are a true and fair presentation of the financial
position at year-end. The reporting on the results of the operations, changes
in equity and cash flows for the year-end are all prepared in accordance
with the South African Statements of Generally Accepted Accounting Practice
in South Africa. |
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| The Audit Committee consists of three Non-Executive Directors
and is chaired by Mr Joe Pamensky, a Non-Executive Director. |
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| REMUNERATION COMMITTEE |
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| The formally appointed Remuneration Committee is there
to establish a transparent procedure to determine the policy and approach
the Company should follow with regard to remuneration and the determination
of the remuneration packages for the Directors and Senior Executives, taking
cognisance of market related packages, skill, experience and to avoid potential
conflicts of interest. |
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| The Remuneration Committee consists of two Non-Executive
Directors and is chaired by Mr Patrick O'Sullivan. |
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| The financial statements include the details of Executive
and Non-Executive Directors' earnings and other benefits in accordance with
the requirements of the Companies Act 1973 and the JSE Listings Requirements. |
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| INVESTMENT COMMITTEE |
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| The objective of the Investment Committee is to ensure
that appropriate and timely decisions are taken with regard to the investment
of Company funds. The Committee sets the guidelines and principles for the
Company to follow and takes advice where appropriate from external investment
professionals. |
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| The Committee consists of two Executive Directors and
one Non-Executive Director, Mr Peter Martin, who is also the chairman. The
Committee meets quarterly and has a direct reporting function to the Board. |
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| INTERNAL AUDIT |
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| The mission of the Internal Audit Department is to provide
independent, objective assurance and consulting services designed to add
value and improve SA Eagle's operations. It helps SA Eagle to accomplish
its objectives by bringing a systematic, disciplined approach to evaluate
and improve the effectiveness of risk management, control and governance
processes. |
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| Internal Audit is independent from management and staffed
by qualified and experienced individuals, with the head of the department
reporting directly to the Managing Director and the Audit Committee. Internal
Audit submits reports to and attends the Audit Committee meetings. |
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| The Internal Audit Department liaises closely with the
external auditors in the planning, execution and communication of the results
of their work. |
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| BUSINESS RISK MANAGEMENT |
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| The Business Risk Committee performs the duty of identifying
corporate accountability and associated risks in terms of management and
reporting. The Committee enforces risk control policies and strategies and
has an accompanying evaluation function. |
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| The Committee monitors external developments relating
to its functions, identifies if any emerging or prospective impacts exist
and deals with these appropriately. |
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| EMPLOYMENT EQUITY |
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| The Employment Equity Policy, which was adopted within
the Company two years ago, is progressing successfully. The Company's General
Manager of People Management, Mr Clifford Zungu, is satisfied with the progress
that the Company has made with regard to Employment Equity. |
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| The policy is a work in progress that is constantly updated
to keep abreast of the Company's needs as well as that of legislation and
other influencing factors. It therefore reflects the need to operate in
a constantly changing society with the aim being to achieve the following
objectives: |
- promoting equal opportunity and fair treatment in the employment
practices through elimination of unfair discrimination; and
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- implementing affirmative action measures to redress the disadvantages
in employment practices experienced by designated groups, in order to
ensure equitable representation in all occupational levels and categories
in the workforce. (Refer to this website for the employee profile table.)
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| Where there are equally suitable candidates applying
for a specific position, the candidate from the designated group within
the ambit of SA Eagle's Employment Equity Policy is chosen. |
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| The vigorous recruitment and selection process and targeted
training strategy enabled the Company to improve the organisation's skills
levels and employee demographic mix in all occupational categories. These
initiatives will be further enhanced by involvement and participation in
the Inseta Leadership and Executive Programme to be initiated in 2003. |
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| CODE OF BUSINESS CONDUCT |
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| The Company has introduced a Code of Business Conduct
that applies throughout the Group and ensures that best business practices
are applied on a constant basis. The code is distributed to all employees
of the Company and its subsidiaries and prescribes the ethical standards
required of employees in their interaction with one another and all stakeholders. |
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| The Company also subscribes to the Industry Code of Conduct
and Ethics that was published by The South African Insurance Association
during 2002. |
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