JOHANNESBURG – Results from the 2018 Corporate Governance Index report released yesterday by the Institute of Internal Auditors SA (IIA SA) showed that the country continues to struggle with engendering good governance.
The study found that just 48 percent of the chief audit executives (CAE) thought ethics were an “integral part” of the workplace.
Only 35 percent of CAEs said they had adequate resources to enable them to do their jobs properly.
A lowly 24 percent agreed that their leaders were familiar with and used the integrated reporting principles in their value creation process.
IIA SA chief executive Claudelle von Eck said the audit profession had come under greater scrutiny due to recent controversies.
“The questions about ethics saw a significant decline in the scores. This could be attributed to the scandals that have, in turn, triggered more intense conversations around governance,” Von Eck said.
The country has seen a spike in governance lapses from the corporate sector.
Steinhoff market value plunged more than 90 percent in the past year after “accounting irregularities” shocked corporate South Africa.
More recently, the SA Reserve Bank applied for the liquidation of VBS Mutual Bank after R1.9 billion was brazenly syphoned in three years, with bank executives at the forefront of the looting.
Governance expert Mervyn King said the state of corporate governance was not as dire as many thought.
“There are 400 companies listed on the JSE and how many scandals have they been involved in? Just two (Steinhoff and Oakbay Resources).”
The survey found that only 6percent of those in government agreed their organisation possessed “suitable human resource capital to execute its strategy effectively and optimally”.