Director induction and orientation
New directors and external committee members complete an
induction programme to improve their understanding of Eskom’s
legislative framework, governance processes, delegation of
authority and business operations. Continual training addresses
the needs of each director or group of directors. Directors are
briefed on new legislation and regulations. The induction and
training includes visits to certain business sites.
As a result of the capacity challenges facing the company,
additional board meetings were held during the year and these
are reflected in the table on the meeting schedule and attendance.
It should be pointed out that over and above these additional
board meetings, numerous board briefings and meetings of
the chairpersons of the board committees were also held on
a regular (at times weekly) basis. The purpose of the additional
briefing sessions and meetings of the committee chairpersons
was to keep directors informed of key developments as they
unfolded and to allow directors an opportunity to express their
views on the developments and strategies on an ongoing basis.
This called for the Eskom directors to commit significant additional
time to the business of Eskom during this critical period.
Directors’ remuneration
Please refer to note 43 in the annual financial
statements for details of directors’ remuneration.
Company secretarial function
Directors have unrestricted access to the advice and services of
the company secretary, and those of the secretariat department.
Directors may seek independent professional advice at Eskom’s
expense, should they deem this necessary.
The company secretary and those responsible for the assurance
functions in the Corporate Services division monitor Eskom’s
compliance with the PFMA, Companies Act and other relevant
legislation, and report to the board on these issues.
Board committees
Several committees assist the board in carrying out its
responsibilities. Their recommendations and reports to the board
ensure transparency and full disclosure of committee activities.
Each committee operates within terms of reference that set out
the composition, role, responsibilities and delegated authority of
the committee. The board from time to time sets up committees
for specific (ad hoc) purposes. All committees, except Exco,
comprise a majority of independent non-executive directors. An
independent non-executive director serves as chairman in each
case. Committee meeting attendance is reflected here.
In addition to the terms of reference, a board committee
exercises its delegated authority in accordance with
specific policies approved by the board from time to
time.
Audit committee
The committee comprises five independent nonexecutive
directors. Mr S Fakie attended for part of the
year as an external appointee. The committee monitors
that internal control is maintained to protect Eskom’s
interests and assets.
The committee also reviews any accounting and
auditing concerns raised by internal and external audit,
the annual financial statements, the interim reports, the
accompanying reports to shareholders, the preliminary
announcement of results and any other announcement
regarding the company’s results or other financial
information to be made public.
The committee ensures that an effective internal audit
function is in place and that the roles and functions of the
external audit and internal audit are sufficiently clarified
and co-ordinated to provide an objective overview of
the operational effectiveness of the company’s systems
of internal control, risk management, governance
and reporting. The committee also has to assess the
performance of the internal audit function, and the
adequacy of available internal audit resources.
The committee considers and makes recommendations on the
appointment and retention of the external auditors, the fees paid
and the terms of engagement, pre-approves the nature and extent
of any non-audit services and evaluates their independence,
objectivity and effectiveness.
The head of the corporate audit department and the external
auditors have unrestricted access to the chairman of the
committee and Eskom’s chairman. The committee reviews the
accuracy, reliability and credibility of statutory financial reporting.
It also reviews the annual financial statements and the Eskom
group annual report, as presented by management prior to
board approval.
Seven committee meetings were held during the review period.
They were also attended by the external auditors, the finance
director, the head of the corporate audit department, the
managing director of the corporate services division and relevant
company officials. |
