Mobile endorses the Code of Corporate Practices and Conduct in the King II Report on Corporate Governance. Ongoing enhancement of corporate governance principles is a global movement, fully supported by the board, and the board will continue to adopt, as appropriate, existing and new principles which advance good practical corporate governance and add value to the groups business activities.
It must be noted that Mobile is an investment holding company, has no employees and is classified as the pyramid company of Trencor Ltd (Trencor) in terms of the Listings Requirements of the JSE Ltd (JSE).
The board is of the opinion that the group has, in all material respects and where relevant, complied with the Code during the year under review.
The salient features of the groups corporate governance are set out below.
The names and brief résumés of the directors appear here. The board currently comprises four non-executive directors, two of whom qualify as independent non-executive directors in terms of the King II Report.
There is a procedure for appointments to the board and such appointments are formal and transparent and a matter for the board as a whole.
A board effectiveness review was conducted in 2008 and the board is satisfied with the outcome of the process.
The directors have considerable experience and an excellent understanding of the groups business and all serve on the board of Trencor.
The board as a whole is satisfied that no one director or block of directors has undue power on decision-making.
All directors have access to the company secretary and are entitled to obtain independent professional advice, at the companys expense if required.
The board meets regularly on a scheduled quarterly basis and at such other times as circumstances may require. During the year ended 31 December 2008, five meetings were held and these were attended by all directors.
Board papers are timeously issued to all directors prior to each meeting and contain relevant detail to inform members of the financial position of the group.
Directors service contracts
None of the directors are bound by service contracts. In terms of the articles of association, not less than one-third of the directors are required to retire by rotation at each annual general meeting of the company and may offer themselves for re-election. The appointment of new directors during the year is required to be confirmed at the next annual general meeting and such new directors are required to retire at such annual general meeting, but may offer themselves for re-election.
No remuneration is paid to the directors and, accordingly, no remuneration committee has been established.
The number of shares held by the directors in the issued share capital of the company at 31 December 2008 and 2007 were as follows:
The audit committee consists of two independent non-executive directors and normally meets at least twice a year, prior to the finalisation of the groups interim results and reviewed annual results, and at such other times as may be required. The committee is primarily responsible for assisting the board in carrying out its duties in regard to accounting policies, internal controls and audit, financial reporting, identification and monitoring of risk, and the relationship with the external auditors.
In addition to the committee members, the chairman of the board and certain Trencor group executives are normally invited to attend meetings of the committee as observers. The external auditors attend all meetings and have direct and unrestricted access to the audit committee at all times.
During the year, the committee met on three occasions. The meetings were attended by both members.
In addition, the committee chairman meets separately with the external auditors on an ad-hoc basis.
The audit committee is satisfied that the external auditors are independent in the discharge of their duties. The use of the services of the external auditors for non-audit services requires prior approval by the committee.
The audit committee has reviewed the group annual financial statements and annual financial statements for the year ended 31 December 2008 and recommended that the said financial statements be approved.
There are no other sub-committees of the board. All other matters are considered by the full board.
The board is ultimately accountable and responsible for the performance and affairs of the group. In essence, it provides strategic direction to the group, monitors and evaluates performance and management of its subsidiaries and associate company, determines policies and processes to ensure effective risk management and internal controls, determines policies regarding communication and is responsible for ensuring an effective composition of the board.
Formal detailed terms of reference for the audit committee have been approved and implemented and will be reviewed by the board on a regular basis.
Responsibility for managing the groups risk lies with the board of directors. However, shareholders are referred to the report on corporate governance published in the accompanying Trencor annual report relating to its significant risk exposures which could have an effect on Mobile.
The board agreed a formal code of ethical conduct in 1998 which seeks to ensure high ethical standards. All directors are expected to strive at all times to adhere to this code, and to enhance the reputation of the group. The code is signed by all directors at least every three years.
Any transgression of the code is required to be brought to the attention of the audit committee. There was no transgression in the year under review.
A formal policy prohibits directors and officers from dealing in the companys shares, and those of Trencor, from the date of the end of an interim reporting period until after the interim results have been published and similarly from the end of the financial year until after the reviewed annual results have been published. Directors and officers are reminded of this policy prior to the commencement of any restricted period.
In addition, no dealing in the companys shares is permitted by any director or officer whilst in possession of information which could affect the price of the companys shares and which is not in the public domain.
Directors of the company and of its subsidiaries are required to obtain clearance from Mobiles chairman (and in the case of the chairman, or in the absence of the chairman, from the chairman of the audit committee) prior to dealing in the companys shares, and to timeously disclose to the company full details of any transaction for notification to and publication by the JSE.
Members of the board meet on an ad-hoc basis with institutional investors, investor analysts, individuals and members of the financial media. Discussions at such meetings are restricted to matters that are in the public domain.
Shareholders are informed, by means of press announcements and releases in South Africa and/or printed matter sent to such shareholders, of all relevant corporate matters and financial reporting as required in terms of prevailing legislation. Mobile also publishes a trading update in respect of the quarters ending March and September each year, in addition to the interim results and reviewed results announcements for the periods ending June and December respectively. In addition, such announcements are communicated via a broad range of channels in both the electronic and print media. The company maintains a corporate website (http://www.mobile-industries.net) containing financial and other information, including interactive interim, reviewed and annual results. The site has links to the website of Trencor and to its major entities.
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