Good, clean governance
Global rankings in democracy and governance usually position African countries towards the bottom of the scale on both accounts, and this is often used to explain the continent’s lack of development and inability to attract foreign investment.
The Centre for Corporate Governance in Africa of the University of Stellenbosch Business School (USB) believes that good governance is the key to achieving a brighter African future. It is focusing on research-based activities to explore the link between governance, democracy and sustainability.
Daniel Malan, Head of the Centre, explains: “We have found that by building healthy and stable institutions – both in the private and the public sector – democracy, human development and sustainability can be promoted.”
The Centre has made significant contributions to the theory and practice of good governance. Milestones include the following:
‘Carrots and Sticks’
The Centre collaborated with KPMG, the UN Environment Programme (Unep) and the Global Reporting Initiative (GRI) on a major new work in the field of sustainability reporting, Carrots and Sticks – Promoting transparency and sustainability. It was launched in Amsterdam at the end of May 2010.
A review of standards and legislation in 30 countries was undertaken for this update on the publication’s 2006 edition. It provides readers with an easy reference and overview of basic legislative and voluntary requirements, in a format that allows comparison of approaches across regions and countries.
Corporate Governance Rating Matrix
The Centre developed a new system of rating listed companies on the Johannesburg Stock Exchange (JSE) for the Public Investment Corporation (PIC), the largest fund manager in South Africa.
Launched in April 2010, the PIC Corporate Governance Rating Matrix evaluates companies in terms of their governance, social and environmental performance and their standards of disclosure. It covers the top 40 companies on the JSE, and plans are afoot to extend it to the top 100 companies by 2011.
“The PIC owns more than 10% of all the shares traded on the JSE. The new matrix enables it to promote the fundamental principles of good corporate governance – honesty, transparency, accountability and responsibility,” says Malan.
‘Building a Better Life for All’
The Centre hosted the Building a Better Life for All conference in Cape Town in April 2010. This event brought together international and local corporations, academics and representatives of civil society to debate the importance of good governance for a sustainable African future.
Some of South Africa’s leading commentators on both the economy and governance issues spoke at the conference, including Gill Marcus, Governor of the Reserve Bank, and Bobby Godsell, Co-chairman of Business Leadership. The keynote address was provided via video link by Nobel Peace Prize winner Martti Ahtisaari, a former president of Finland and UN undersecretary-general.
UN Global Compact
The Centre will be conducting research destined for the UN Global Compact, the world’s largest voluntary corporate citizenship initiative. The focus will be on anti-corruption initiatives in African countries.
African case studies
In 2009, the Centre held a case study competition with the aim of getting research material on corporate governance from the African continent. This resulted in 10 African case studies being developed, which are available for download free of charge on its website, at www.governance.usb.ac.za.
Future prospects
Malan is optimistic about the prospects for less corruption and more good governance. “There is growing support for the idea that everything is not about profit, that people and the planet matter too. It’s a question of keeping up the momentum.”