Week 32a ending Saturday 10 August
Ben Pieters - the Business Support Specialist
Constantly challenging ourselves to deliver more to our clients.
Ben Pieters - the Business Support Specialist
Constantly challenging ourselves to deliver more to our clients.
Welcome to 'Navigating GRC' your guide through the intricate landscape of Governance, Risk, and Compliance.
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Please note that we identify the author and the name of the publication the article appeared in, and directly extract aspects we believe would reflect the idea or thought expressed therein.
(Seems we again erred on the end date of the newsletters. To avoid this happening again we will from now on end a week on a Saturday and publish on a Monday, as usual.)
The Companies Act 71 of 2008 as amended (updated with July 2024 amendments)
Our publication of The Companies Act 71 of 2008 as amended (the "Act") is now available as a downloadable PDF.
The Act is and remains a cornerstone of commercial legislation in South Africa.
The amendments to the Companies Act 71 of 2008 as amended, as provided for in the Companies Amendment Bills, 2023 have been signed into law as Acts of Parliament on 25 July 2024.
The commencement dates of these Acts must still be announced in the Government Gazette.
These amendments mark a pivotal moment in enhancing our corporate governance framework, aiming to foster greater transparency, accountability, and efficiency within the business sector.
Key changes include streamlined reporting requirements, enhanced provisions for shareholder rights, and improved mechanisms for dispute resolution.
We encourage everyone with an interest in Company Law to buy the updated Act via our website to ensure compliance and leverage the new opportunities it presents.
This document is now available for purchase and immediate download at R199 including VAT - with an introductory price of only R175 plus VAT till the end of August 2024 - VAT via our online platform here.
Death threats for fighting construction mafias
Daniel Puchert writes in MyBroadBand that KwaZulu Natal public works and infrastructure MEC Martin Meyer said he will continue with his plans to oust construction mafias in the province despite the death threats made against him, the Sunday Times reports.
His plan includes meeting with legitimate business forums in the industry and establishing a task team. Meyer pointed out that the extortion of construction mafias affects both the public and private sectors, as many major construction companies will no longer take contracts in the province because of it.
Construction mafias, which call themselves “community business forums”, are a well-known problem in the industry, demanding a percentage of payment or a security fee from contractors working in areas in which they operate.
They do so under the premise of a legislative requirement that developers must subcontract 30% of public sector projects to local contractors.
“Let us be clear. The construction mafia is not there to help the people. They are not there to get money to share in the communities,” said Meyer.
Former Public Works and Infrastructure Minister Sihle Zikalala has blamed the mafias for the estimated R68 billion in economic costs to the South African economy.
Meyer is also looking towards community engagement and inclusion to tackle this problem, as they are the ones meant to benefit from the policies enabling construction mafias. However, Meyer says that it is also a law enforcement problem and demands a high level of engagement from the minister of police.
Trouble for private schools
Malcolm Libera reports in BusinessTech that tuition has beaten inflation, on average, every year since 2012, and one of the top financial concerns among South Africans in 2024 is the cost of school fees—with some private schools already flagging distress signs.
Tuition has beaten inflation, on average, every year since 2012, and one of the top financial concerns among South Africans in 2024 is the cost of school fees—with some private schools already flagging distress signs.
While South Africa’s low-income and middle classes have been hit with high costs of living, interest rates, and fuel prices, the rich and those who can afford private schools have not been immune to the prevailing conditions.
The financial pressures stemming from high interest rates and a sluggish economy have now impacted South African private schools, as some young families face financial strain.
The Curro Group manages 182 private schools across the country.
The group recorded a “credible operating performance,” generating strong cashflows during the 2023 financial year and maintaining a healthy financial position. However, the group highlighted a concerning trend across its schools. Enrolment numbers show that some parents are struggling due to the higher cost of living in South Africa.
The group said that young families have been hit hard by the rapid hikes in the cost of living in South Africa, resulting in a reduction in enrolments of learners in the youngest grades of primary schools.
Reports suggest that parents can anticipate fee increases of between 6% and 10% for both government and private schools. It’s not uncommon for school fees in South Africa to rise about 2.6% above inflation annually since 2012, except for 2021.
The triple-blow food crisis
Seth Thorne reports in BusinessTech that South Africa is facing a deepening malnutrition crisis, characterised by a simultaneous prevalence of undernutrition, hidden hunger, and a high rate of obesity due to poor-quality diets.
The National Food and Nutrition Security Survey conducted by the Human Sciences Research Council from 2021 to 2023 covering data from over 34,500 households, represents the first in-depth, nationwide study on food and nutrition since 1994.
According to StatsSA, the worsening food security situation is closely linked to high unemployment rates, widespread poverty, and rising living costs. These factors collectively make food more expensive and less accessible to many South Africans.
The survey uncovered alarming rates of food insecurity across several provinces and revealed that nearly 50% of adult South Africans are either overweight or obese. This contrasts sharply with the national narrative of food security, underscoring the discrepancy between official data and ground realities.
Despite significant government investments in various policies and programmes aimed at improving food security the effectiveness of these interventions has been undermined by what some describe as ineffective and poorly coordinated government interventions.
Many low-income households are unable to afford nutritious food, with only 58.1% of surveyed households maintaining acceptable diets.
For a family of four, the available budget falls significantly short of the Food Poverty Line, leaving families with limited means to afford nutritious food – even when using grants from the government aimed at alleviating this, like the child support grant.
The SABC wants to launch a rival to Openview
Nkosinathi Ndlovu reports in TechCentral that the SABC is looking for a partner to help it launch its direct-to-the-home (DTH) satellite solution to rival eMedia’s popular Openview platform. The public broadcaster is pivoting to satellite to mitigate audience and revenue losses anticipated as a consequence of the proposed analogue switch-off on 31 December 2024.
“The analogue switch-off project has been hamstrung by the slow progress of registering indigent households as well as the procuring, manufacturing and installation of the much-needed set-top boxes. As a result, millions of South Africans have been deprived of their right to access broadcast television,” the SABC said.
“The slow progress of the analogue switch-off project has had a material impact on the SABC’s finances as it resulted in a loss of audiences in the affected provinces and a drop in revenue generation for the organisation.”
The SABC does not want to bear any of the capital costs involved with implementing the project.
“The SABC will provide access to diverse audiences, investing in content and marketing on the SABC platforms. The bidder is expected to cover the capital/cost of the turnkey solution,” it said.
Digital terrestrial television, the proposed replacement for analogue broadcasting in South Africa, appears to be failing before it’s even got off the ground. eMedia, for one, has said it’s dead in the water. Its lacklustre implementation has taken so long that broadcasting technology in other markets has moved onto newer technologies.
"We are now at a point where Digital terrestrial television (DTT) is archaic, expensive and will not work because television has evolved,” eMedia CEO Khalik Sherrif recently told communications regulator Icasa.
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Homeowners are still going solar
Nkosinathi Ndlovu reports in TechCentral that households are still installing rooftop solar despite South Africa’s now four-month-long reprieve from load shedding.
The second quarter of 2024 (April to June) saw 350.5MW of rooftop solar capacity added by South African households and businesses, compared to 240MW in the first quarter, according to GoSolr, a solar installation company.
“The last day we had load shedding was 28 March, and this is a very good opportunity for the solar industry to disassociate itself from load shedding,” said GoSolr CEO Andrew Middleton.
"Demand in 2024 is not as strong as it was last year but is growing, and one of the main drivers for this growth is the rising cost of grid-supplied electricity," said Middleton.
"Some municipalities have introduced controversial fixed-use tariffs, too, which, according to GoSolr, end up punishing those who use less electricity and benefiting those who use more. “It disincentivises people using electricity sparingly,” said Middleton.
“When demand for Eskom power goes down, it does not have the result of bringing prices down. Instead, it is pushing prices up because Eskom has fewer customers and must increase prices to cover its costs."
The freedom to generate power away from an increasingly expensive grid is not the only driver of solar adoption. Grid constraints – and the consequent power outages due to “load reduction” – are also driving the desire and ongoing risk mitigation for households and businesses to reduce their reliance on Eskom.
Rogues’ gallery headed for?Parliament
Velani Ludidi reports in Daily Maverick that In an unsurprising move that will shake South Africa’s political landscape, the uMkhonto Wesizwe (MK) party, the Government of National Unity’s official opposition, is reportedly planning to bring several controversial figures to Parliament.
Adding to the controversy is the inclusion of individuals who appear to have close familial ties to the MK party leadership. The proposed list submitted to Parliament suggests that the new members may include relatives of the party’s parliamentary chief whip, Sihle Ngubane, and a relative of party leader Jacob Zuma.
The implications of these connections have fuelled accusations of nepotism and have exacerbated tensions within the party.
The MK party had made headlines for abruptly removing more than a dozen MPs, ostensibly to make way for figures like Molefe – a move that outraged?many in the party.
The sudden and drastic purge has led to allegations of cronyism and internal power struggles.
Speaking on behalf of the MK party, Nhlamulo Ndhela alleged that the MK party’s IEC list had been compromised by saboteurs who populated it with friends, family members and neighbours.
Ndhela defended the decision to replace the MPs, stating that those affected were aware of their impending removal and were advised not to proceed with their swearing-in. What a mess! More like a circus. Lack of governance for all to see.
Assassinations are a national crisis
Assassinations of professionals working against corruption are not a new development in SA. However, attacks on senior people in business are a more recent development.
Many grassroots activists have been assassinated after getting in the way of the enrichment of local political gangsters.
The bulk of the political killings have been driven by contestation over positions, power and opportunities for enrichment within the ANC, and to a lesser extent between a set of political parties including the ANC, IFP and NFP.
That is where the long-standing capacity for assassination within the taxi business metastasised into politics, and then beyond.
Most studies largely depend on media and police reports, and neither the media nor the police report every assassination. Both frequently operate with an implicit hierarchy in the value accorded to people’s lives, which is structured by race, class and spatial location.
It is not uncommon for the police to fail to act against assassins and the people they are working for even when there is clear evidence of criminal conduct. Non-compliance with legal and regulatory frameworks occurs daily. It is indeed a national crisis.
The reality of power cuts
Kirsten Minnaar writes in MyBroadBand that load-shedding has hit telcos hard, and even though Eskom has had a more stable electricity supply recently, the industry now has to battle load reduction.? This was according to Association for Comms & Technology (ACT) CEO Nomvuyiso Batyi.
There has been an uninterrupted power supply since 26 March, which marks over four months of suspended load-shedding.
Batyi explained that although the situation is not as bad as it has been at the height of load-shedding, operators are still diverting millions of rand into keeping network infrastructure powered through periods of load-reduction.
“The municipal infrastructure has diminished. There are pockets where load-reduction is happening and others where the infrastructure, due to the load-shedding that happened before, just trips for no reason at all,” Batyi said.
Load-shedding occurs when the national grid can’t generate enough electricity to meet demand.
Load-reduction, on the other hand, is used by Eskom in specific areas to protect transformers from overloading when there’s enough electricity available.
Eskom said that managing the morning and evening peaks has become increasingly difficult for the utility, which threatens to push Eskom to reintroduce rotational power cuts. Unfortunately, all households have to plan this, avoiding the inevitable risk of being without electricity.
Discovery Miles more valuable than cash
Shaun Jacobs reports in MyBroadBand that Discovery Miles is more valuable than cash as a currency due to the added discounts and benefits clients receive when using the rewards currency to purchase goods and services.
Vitality members are set to earn more than 10 billion Discovery Miles in 2024, equivalent to a potential rand value of around R1.4 billion. Discovery Bank launched Discovery Miles in 2019, based on the Vitality Money financial wellness programme.
The model creates a win-win for clients and Discovery, with better financial behaviour rewarded with lower interest rates on loans or boosted savings rates. Discovery Miles is designed to provide an immediate reward for behaviours that benefit clients in the long term, effectively bringing forward gratification.
Longer-term rewards, such as free flights with Vitality Travel, are used to ensure the sustainability of good habits.
Members earn Discovery Miles from millions of Healthy food items purchased, workouts, driving well, weekly exercise, drive and financial goals.
To help members make long-term behavioural changes that will benefit their health, Vitality has “got to trick the brain” by bringing rewards typically felt in the long term into the present. I do not think that a single household will turn up its nose for these benefits.
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