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GOVERNANCE > King IV Principles

KING IV
Principles

TASTE is in the process of implementing the recommendations of King IV and will ensure that these are completed during the 2019 financial year end. The applications and explanations thereof are provided in the table below:

Principle 1:

The Board should lead ethically and effectively.

1.a.i

Integrity: Good faith and best interest

The Board Charter imposes a duty on directors to at all times act in the best interest of the company, in good faith and with integrity, while adhering to all the relevant legal standards of conduct.

1.a.ii

Integrity: Conflicts of interest

In terms of the Board Charter, directors are required to avoid any conflict of interest between their personal affairs and that of the company or, where unavoidable, disclose any such conflict or potential incompatibility.

1.a.iii

Integrity: Ethics

 

The Board of Taste Holdings have prepared Guidelines for Ethical Conduct, and have elected a Social and Ethics Committee to give effect to the responsibility imposed on directors by the Board Charter, to ensure ethical performance of the company and its representatives beyond mere legal compliance. 

1.a.iv

Integrity: Ethical organisational culture

 

Taste Holdings has established a Social and Ethics Committee in terms of the provisions of the Board Charter. The terms of reference of the Social and Ethics Committee imposes both statutory and other duties on directors in this regard. 

1.b.i

Competence: Working knowledge

 

Directors sufficiently familiarise themselves with the general content of applicable laws, rules, codes and standards in order to be able to discharge their legal duties. In recent years, Taste has assembled a proficient executive team with considerable experience.

1.b.ii

Competence: Care, skill and diligence

 

All directors are expected to not only exhibit the degree of skill and care as may be reasonably expected from a person of their skill and experience, but also exercise both the care and skill any reasonable person would be expected to show in looking after their own affairs.

1.b.iii

Competence: Continuous development

 

Taste Holdings understands that directors need to continuously up skill themselves in order to lead effectively and support business growth. The Nominations committee have been tasked with the duty to oversee the development and implementation of continuing professional development programmes for directors.
The Board Charter specifically provides for formal induction programmes, assistance for inexperienced directors and regular briefings on changes in risks, laws and the environment to enable the Board to achieve this end.

 

1.c.i

Responsibility: Strategy, policy, plans, oversight /monitoring of implementation/execution and performance

 

Taste believes that good corporate governance, which includes transparency and Board accountability, is key to the integrity of our organisation and ability to manage risk and perform at optimum levels.

1.c.ii

Responsibility: Courage in risks and opportunities

 

Taste attempts to take risks by capturing opportunities in a responsible manner. To manage these risks, the Board instituted a risk management process with the objective of effectively balancing risk and reward, based on a philosophy aimed at maximising business opportunities and minimising adverse outcomes.

1.c.iv

Responsibility: Time and effort

 

The Board Charter imposes a strict duty on directors to attend Board and committee meetings, such that, a director is obliged to submit a formal apology and reasons if they are unable to attend a meeting. A director is also expected to prepare ahead of time for meetings, so that they will be able to contribute to the subject matter and make informed decisions.

1.d

Accountability: Execution of responsibilities

 

The Board is ultimately accountable for the effective control of the company, some responsibilities are delegated to the Board sub-committees.

1.e.i

Fairness: Stakeholder-inclusivity

 

The Board is very much aware of the importance of constructive and positive relationships with all stakeholders of the Group. The Board promotes the stakeholder-inclusive approach of governance and takes account of the impact of the company's operations on internal and external stakeholders.

1.e.ii

Fairness: Environment, society and future generations

 

Taste is mindful of conducting business in a way that protects the natural environment for future generations, while uplifting society at the same time. The Board performs its governance responsibilities within a framework of policies and controls which provide for effective risk assessment and management of our economic, environmental and social performance. 

1.f

Transparency

 

Taste is constantly striving towards a more accountable, transparent and consultative Board to serve the organisation and its needs ethically and effectively.

2

Effective leadership by ethical characteristics

 

The Board Charter compels the Board to provide effective leadership based on an ethical foundation when discharging its duties.

3

Arrangements for ethical and effective leadership

 

Taste Holdings have adopted a Code of Ethics and have elected a Social and Ethics Committee to ensure that the Board are held to account ethically. 
In accordance with the Board Charter, an assessment of the performance of the Board, chairman, individual directors and Board committees is to be done annually. However, due to the extensive Board changes in February 2018 a full assessment of the Board and sub-committees will be performed for the financial year ending February 2019.

 

 

Principle 2:

The Board should govern the ethics of the organisation in a way that supports the establishment of an ethical culture.

4

Responsibility for ethics

 

The Board has ensured that a code of conduct and ethics-related policies, through which ethical standards are clearly articulated, have been established and implemented. Mechanisms to encourage ethical behaviour such as the code of ethics, corporate citizenship policies and the whistle blower hotline were confirmed as adequate by the Social, Ethics and Transformation Committee.

5

Approval of ethics policy and code of conduct

 

The Board ensures that Taste Holdings has a Code of Ethics and related ethics policies, based on values as approved by the Board. The ethical performance of the company and its representatives is pro-actively and effectively managed and reported on.

6.a

Ensure interaction with stakeholders

 

The Board ensures compliance with the code of conduct is integrated into the strategy and operations of the company; i.e. the ethical organisational culture is reflected in the company's vision and mission; strategies and operations; its decisions and conduct; and the manner in which it treats its internal and external stakeholders.

6.b

Ensure key ethical risks are addressed

 

The Board ensures that ethical risks and opportunities are incorporated in the risk management process. The Social, Ethics and Transformation Committee monitors ethical behaviour in the Group. Where there is non-compliance with this code of conduct, disciplinary action is taken and consistently enforced across the Group to discourage a recurrence.

7.a

Arrangements: Publishing

 

The updated Code of Ethics is to be posted on the website once finalised.

7.b

Arrangements: Supplier and employee contracts

 

The updated Code of Ethics will apply to employees and suppliers, and will be incorporated by reference in supplier and employee contracts.

7.c

Arrangements: Induction and training

 

Taste Holdings ensures that its employees are acquainted with the company's Code of Conduct and ethics policies by including them in induction and training packs.

8

Management implementation and execution of codes of conduct and ethics policies

 

The Board ensures that the ethical performance of the company and its representatives is pro-actively and effectively managed and reported on.

9.a

Oversight: Application to employees and suppliers

 

Taste only works with suppliers who share our commitment to ethical sourcing. Starbucks is a world leader in responsible and sustainable coffee sourcing and community building.

9.b

Oversight: Sanctions and remedies when ethical standards breached

 

Tastes encourages employees to utilise the company's open door policy, and report breaches of ethical conduct verbally or in writing to a senior executive, or via the whistle-blowing facility.

9.c

Oversight: Whistle-blowing

 

Taste has aligned its whistle-blowing mechanisms and procedure of making protected disclosures with the Protected Disclosures Act. Taste's Code of Ethics encourages employees to attain guidance from a senior executive in this regard.

9.d

Oversight: Independent assessment / employees and stakeholders

 

The Social, Ethics and Transformation Committee monitors ethical behaviour in the Group.

10.a

Disclosure: Arrangements in place

 

Taste has provided an overview of its arrangements for governing and managing ethics in the ethics policy.

10.b

Disclosure: Key focus areas

 

There was a focus on fraudulent behaviour, safety and security and employment equity throughout the Group.

10.c

Disclosure: Measures of monitoring / outcomes addressed

 

The Social, Ethics and Transformation Committee are tasked with monitoring organisational ethics. They do so by ensuring there is compliance with the Code of Ethics and are also responsible for its enforcement. The Board must take the necessary steps to institute disciplinary action where there has been such a breach to set an example across the Group and discourage recurrence.

10.d

Disclosure: Planned future focus

 

The focus will remain on zero tolerance of fraudulent behaviour, safety and security and employment equity.

 

 

Principle 3:

The Board should ensure that the organisation is and is seen to be a responsible corporate citizen.

11

Responsibility of setting the direction for corporate citizenship

 

The Board considers not only financial performance, but also the impact of the company's operations on society and the environment.

12

Ensure compliance with Constitution, laws, standards and owns codes and policies

 

The Board ensures that the company performance and interaction with its stakeholders is guided by the Constitution and the Bill of Rights.

13

Oversight of congruency of purpose, values, strategy and conduct

 

The Board ensures that measurable corporate citizenship programmes and policies are developed and implemented. The Social, Ethics and Transformation Committee is mandated with ensuring that the company’s ethics performance is assessed, monitored, reported and disclosed.

14.a

Oversight and Monitoring: Workplace

 

Taste established a Social, Ethics and Transformation Committee in accordance with the requirements of the Companies Act. The Committee is tasked with overseeing and monitoring the company's health and safety, socio-economic development, human resource development, employment equity and transformation against set targets. 

14.b

Oversight and Monitoring: Economy

 

The Board protects, enhances and invests in the wellbeing of the economy, including economic transformation; prevention, detection and response to fraud and corruption, and responsible and transparent tax policy.

14.c

Oversight and Monitoring: Society

 

Taste Holdings understands its place as a responsible corporate citizen in the broader scheme of society. To achieve its aims, Taste have implemented a community development program in partnership with Just Footprints Foundation. The programme focuses on establishing social infrastructure and supporting children suffering from serious life-threatening diseases and life challenges. Within the workplace, Taste endeavours to recruit employees from deprived and local communities to create jobs and transfer skills where possible.

14.d

Oversight and Monitoring: Environment

 

Both the Board Charter and the Code of Ethics impose a duty on the Board to monitor the impact of its business activities on the environment. The ethics policy provides guidelines on how to achieve a balance in protecting the environment and society on the one hand, while furthering the business interests on the other. These include:

  • Conducting operations in a manner that minimises adverse environmental impact, and which protects the health and safety of employees and the public
  • Recognising and responding to community concerns about operations, raw materials and chemicals
  • Promoting the principle of sustainable development in the managing of operations and strive for continuous improvement in health, safety and environmental performance
  • Integrating health, safety, and environmental considerations into planning for new products and processes.

15.a

Disclosure: Arrangements in place

 

The Board ensures that collaborative efforts with stakeholders are embarked upon to promote ethical conduct and good corporate citizenship. The Social, Ethics and Transformation Committee reviews and recommend any corporate citizenship policies to the Board for approval. 

15.b

Disclosure: Key focus areas

 

A Key area in relation to corporate citizenship is corporate social development

15.c

Disclosure: Measures of monitoring / outcomes addressed

 

The Social, Ethics and Transformation Committee is tasked with overseeing and monitoring the company's health and safety, socio-economic development, human resource development, employment equity and transformation against set targets. 

15.d

Disclosure: Planned future focus

 

Planned areas of future focus which will be the continued upliftment of individuals from previously disadvantaged backgrounds, the areas where the Group operates.

 

 

Principle 4: The Board should appreciate that the organisation's core purpose, its risks and opportunities, strategy, business model, performance and sustainable development are all inseparable elements of the value creation process.

1

Responsibility of setting the direction for realisation of core purpose and values

 

The Board Charter states that the primary function of the Board is to steer and set the company’s strategic direction and to exercise prudent control over the company and its affairs. The Board informs and approves strategy, as opposed to being a passive recipient of strategy as proposed by management.

2

Management's formulation and development of strategy

 

The Board contributes to and approves the strategy of the company as presented by management; satisfying itself that all material risks in the strategy and business plans have been duly considered and addressed by management; 

3.a

Approval of strategy: Timelines and parameters

 

The Group strategy is a Board matter which is discussed quarterly at Board meetings and a separate Board strategy session, held once a year. The timelines are monitored and reported on quarterly.

3.b

Approval of strategy: Risks and opportunities

 

Taste has elected an Audit and Risk Committee that is independent and will objectively monitor the company’s risk management performance on behalf of the Board ensure that the company implements its risk management plan and framework.
However, the Board is ultimately responsible for approving risk management policies and takes into consideration the concerns and priorities of the wider stakeholder environment in its strategic guidance and decision-making process.

3.c

Approval of strategy: Resources

 

Resources flow through Taste in the form of financial, human, intellectual, social and relationship, natural and manufactured capitals. The Board decides on how the capitals are prioritised, mixed and allocated to operations, new projects and stakeholder returns.

3.d

Approval of strategy: Stakeholders

 

The Board takes account of the legitimate interests and expectations of its stakeholders in its decision-making in the best interests of the company. The Board strives to achieve the appropriate balance between its various stakeholder Groupings, in the best interests of the company.

3.e

Approval of strategy: Consequence to various forms of capitals

 

The various forms of capital as required form part of strategy, as required.

3.f

Approval of strategy: Interconnectivity and inter-dependence of the above

 

The Board satisfies itself that the strategy will result in sustainable outcomes for the company, taking account of the concept of “people, planet and profit”. It considers sustainability as a business opportunity that guides the formulation of strategy.

4

Approval of operational plans and key performance measures

 

The Board approves the policies and strategic operational plans developed by management. Strategy is translated into key performance and risk areas (including finance, ethics, compliance and sustainability); and the associated performance measures are identified and clear.

5

Management's implementation and execution of operational plans

 

The Board delegates responsibilities to management which is reviewed annually. The various committees assist the Board in implementing policy frameworks and operations on a macro level.

6

Oversight of strategy and operational plans implementation against key performance measures

 

Strategy is translated into key performance and risk areas and the associated performance target measures are identified and clear. The Audit Committee is responsible for the pro-active and effective management of risk in the company.

7

Oversight of continual assessments and responses to negative consequences of activities and outputs

 

The Board continually assesses, and responsibly responds to, the negative consequences of its activities and outputs on people, planet and profits, and the capitals which it uses and affects.

8

Financial oversight (specifically going concern; solvency and liquidity)

 

When preparing annual financial statements, the directors are required to make an assessment of the company and Group’s ability to continue as a going concern, and to disclose significant risks of material uncertainty over the company and Group’s ability to continue as a going concern if applicable.

 

 

Principle 5: The Board should ensure that reports issued by the organisation enable stakeholders to make informed assessments of the organisation's performance, and its short, medium and long term prospects.

9

Responsibility of setting the direction for approach and conduct of the organisation's reporting

 

The Board accepts its obligation to ensure the integrity of the Integrated Annual Report as imposed on it by the Board Charter. The Board gathers information through risk management processes, strategy workshops and stakeholder engagement.

10

Approval of the reporting framework

 

The Board, assisted by the Audit and Risk Committee, assumes responsibility for the Integrated Annual Report, annual financial statements and all other statutory reporting on key matters affecting the Group and its stakeholders. The Board believes the Group has materially reported in accordance with the International Integrated Annual Reporting Council (IIRC) Framework in the Integrated Annual Report.

11

Oversight that all reporting requirements met

 

The Integrated Annual Report accords with the Companies Act, No 71 of 2008 (Companies Act), the JSE Listings Requirements and the recommendations of the King Report on Governance for South Africa (“King IV”). The annual financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”).

12

Oversight of Integrated Annual Report

Taste’s Board of directors and management have endorsed the IR framework’s concepts, guiding principles and content elements. The Board reviews the Integrated Annual Report and annual financial statements before these are published to confirm that the Integrated Annual Report addresses all material issues, whether positive or negative.

13

Approval of management's basis of determining materiality

Taste aims to ensure the content of the reports are balanced. To do this, the Group reports on all the internal and external factors that would have an impact on the company's performance and value creation, in the short, medium and long term.

14

Ensure integrity of reports

The company has controls to enable it to verify and safeguard the integrity of its Integrated Annual Report. The Audit Committee reviews and oversees Taste’s Integrated Annual Reporting.

15.a

Oversight of publishing's accessible by stakeholders: Governance Report

The Integrated Annual Report for 2018 contains and explains the governance details required in terms on the King IV code and will be available on the website: www.tasteholdings.co.za.

15.b

Oversight of publishing's accessible by stakeholders: Integrated Annual Report

The Integrated Annual Report is available on the website www.tasteholdings.co.za

15.c

Oversight of publishing's accessible by stakeholders: Annual Financial Statements and other external reports

 

The Integrated Annual Report goes into detail about the annual financial statements, explaining and publishing excerpts from the financial statements.

 

 

Principle 6: The Board should serve as the focal point and custodian of corporate governance in the organisation.

1.a

Leadership role: Steering organisation and setting the strategic direction

The Board sets the tone for the governance of the company by steering the organisation and setting its strategic direction.

1.b

Leadership role: Approval of policy and plan

 

The Board approves policy as presented by management and plans to give effect to the direction intended that will result in sustainable outcomes for the company, taking account of the concept of "people, planet and profit"

1.c

Leadership role: Oversight and monitoring of implementation and execution

 

The Board oversees and monitors implementation and execution of the strategy by management.

1.d

Leadership role: Accountability / reporting and disclosure

The Board holds itself accountable and allows others to hold it to account by assuming responsibility for reporting and through other means such as director rotation.

2

Board charter

The Board has a well drafted charter, the provisions of which will at all times be subject to all statutory and regulatory requirements, including the company’s memorandum of incorporation.

3

Approval of protocol for independent, external professional advice

 

The Board members may to take independent professional advice in connection with their duties at company cost following a Board approved procedure. The committees of the Board may also seek independent professional advice in connection with their duties at the cost of the company by following a Board approved procedure.

4

Approval of protocol of engagement with management

 

The directors are entitled to have access, at reasonable times, to all relevant company information and to management. Such access shall be arranged through the chairman of the Board or the chief executive officer. 

5.a

Disclosure: Number of meetings and attendance

 

The Board holds at least four meetings per financial year. Attendance of the meetings is disclosed in the Integrated Annual Report.

5.b

Disclosure: Fulfilment of responsibilities in accordance with charter

 

The performance of the Board is evaluated annually in accordance with the Board Charter, and the results are disclosed in the Integrated Annual Report. No formal evaluation was performed during the financial year ending February 2018 due to the extensive changes to the Board members.

 

 

Principle 7:

The Board should comprise the appropriate balance of knowledge, skills, experience, diversity and independence for it to discharge its governance role and responsibilities objectively and effectively.

6

Responsibility for its composition

 

The Board regulates the structure and arrangement of its composition by taking into account its size, diversity, and skills requirements when assessing the performance of the directors annually.

7.a

Member number: Appropriate mix of knowledge, skill and experience

 

When determining the number of directors to serve on the Board, the knowledge, skills and resources required as appropriate to the business of the company is considered.

7.b

Member number: Appropriate mix of executive, non-executive and independent non-executive

 

The Board comprises three executive directors and five non-executive directors, of which four are independent.

7.c

Member number: Sufficient number

 

Taste has a sufficient number of members that qualify to serve on the committees of the Board, namely: the Audit and Risk Committee, a Remuneration and Nominations Committee and a Social and Ethics Committee.

7.d

Member number: Securing a quorum

 

The quorum necessary for the transaction of business is fixed by the Memorandum of Incorporation which requires a majority of directors.

7.e

Member number: Regulatory requirements

 

The Board considers all relevant factors when determining the requited number of members.

7.f

Member number: Diversity

 

The Board considers its diversity on an annual basis. Are diversity targets in place?

8

Majority of non-executive members

The Board comprises a majority of non-executive directors.

9

Minimum of two executive members

 

The Board has a minimum of two executive directors - the CEO and the director responsible for finance.

10

Member diversity

 

Taste is committed to creating a more diverse Board by considering race and gender to improve its insight, skills and experience base. The Board Charter imposes a duty to assess these criteria annually.
The chairman of the Board has mentioned in the Integrated Annual Report that the transformation process is well underway.

11

Setting race and gender targets

 

The Board comprises of a diverse Group of directors. There is a race and gender diversity policy in place with set gender and diversity targets, at Board level and throughout the Group.

12

Periodic and staggered rotation of members

 

In accordance with the company’s Memorandum of Incorporation, one-third of the directors are required to retire at each annual general meeting and may offer themselves for re-election.

13

Succession planning

Taste has developed succession plans, supported by a talent review process to assist in identifying, mentoring and developing future candidates. 

14

Approval of candidates for election as members

 

To ensure a formal and transparent appointment process, any new appointment of a Director is considered by the Board as a whole, on the recommendation of the Nomination Committee.

15

Formal and transparent process of nomination, election and appointment

 

A formal procedure for appointments to the Board is in place. The nominations committee responsibilities include setting the criteria for Board nominations, identifying, evaluating and recommending to the Board suitable candidates for appointment to the Board, as well as succession planning.

16.a

Nomination consideration: Knowledge, skill and experience

 

The Remuneration and Nominations Committee assist with the identification of suitably skilled and experienced candidates for appointment to the Board.

16.b

Nomination consideration: Diversity

 

The Nomination Committee reviews the composition of Board committees and makes recommendations to the Board with regard to their composition, taking into account factors such as diversity and skills and the need to create a balanced distribution of power.

16.c

Nomination consideration: Fit and proper

 

Whether a candidate meets the appropriate fit and proper criteria is a consideration when appointing candidates to the Board.

17

Consideration of the nomination for re-election

 

The Board is satisfied with the contribution by its directors as well as the attendance of meetings by the members of the Board and its committees.

18

Declaration of professional commitments and sufficiency of time

 

The director’s complete declarations annually providing details of their professional commitments. The annual meeting calendar is approved by the Board members. The Board does not require any statements with reference to availability of time as the directors understand their duties to the Board.

19

Independent background and qualification checks

 

The nominations committee recommends eligibility of prospective directors on the basis of past performance, contribution and business judgement.

20

AGM disclosure of election candidates

 

A brief CV of each director standing for election or re-election at the annual general meeting (AGM) accompanies the notice of the AGM and appears in the annual Integrated Annual Report.

21

Formal letter of appointment

 

The terms and conditions for serving as a member of the Board are in a letter of appointment.

22

Member induction

 

An induction process exists for the directors.

23

Mentorship and governance training

 

An induction process exists for executive directors but not a formal development program. Inexperienced directors will be assisted, with the guidance of the chairman, to participate in mentoring programmes where available. The need for continuing professional development programmes is identified as part of the annual assessment of the performance of the directors.

24

Programme of professional development and regular briefings

Professional development and regular briefings on legal and corporate governance developments, and risks and changes in the external environment of the organisation, is provided to the members of the Board from time to time. Members attend such professional development programmes as deemed necessary by the chairman based on the outcome of the annual assessment of the director’s performance. 

25

Declaration of all financial, economic and other interests

 

No contracts in which directors or officers of the company or Group had an interest and that significantly affected the affairs or business of the company or any of its subsidiaries were entered into during the year. All directors are to advise the Company Secretary of any changes to their Declarations of Interest.

26

Conflict of interest declaration at start of every meeting

 

Real or perceived conflicts of interest are disclosed to the Board at each meeting and if required, are managed appropriately. No such conflicts were identified or reported during the financial year ended February 2018.

27

Review of independence of non-executive members

 

Non-executive directors that are classified as 'independent' by the company is subjected to an annual evaluation of their independence by the chairperson and the Board.

28.a

Member independence: Provider of financial capital

 

The provision of financial capital is a consideration when directors assess their independence.

28.b

Member independence: Participates in share-based incentive scheme

 

To avoid any conflict of interest, non-executive directors do not and will not participate in any share based incentive scheme or any other incentive scheme that the Group may implement.

28.c

Member independence: Material personal investor

 

The Board has an approved Trading in Shares Policy in terms of which dealing in the company’s shares by directors and employees is prohibited during closed periods. Directors may also not deal in the company’s shares without first advising and obtaining clearance from the chairperson of the Board.

28.d

Member independence: Executive (or related) in preceding three years

 

No independent non-executive member of the Board has been in the employ of the company in the previous three years.

28.e

Member independence: External auditor (key member) in preceding three years

 

No member of the Board has been a key member of the audit team of the external audit firm, during the preceding three financial years

28.f

Member independence: Ongoing professional adviser

 

No director on the Board is a significant or ongoing professional adviser to the company.

28.g

Member independence: Member of Board and/or executive of a significant customer or supplier

 

No independent director of the Board is an executive manager of the company or a significant customer or supplier of the company.

28.h

Member independence: Member of Board and/or executive of a related party

 

No independent director is a Board member or executive of another company which is a related party to the company.

28.i

Member independence: Remuneration contingent on organisation performance

 

While Taste attempts to align members of the Board's remuneration with the performance of the organisation, it also seeks to strike a balance by rewarding individual members for performance.

29

Condition of independent non-executive member serving for longer than nine years

 

The Board Charter stipulates that the independence of all independent non-executive directors will be assessed on an annual basis with a specific focus on the independence of independent non-executive directors who have served for more than nine years and the outcome of such assessments will be reported on in the Integrated Annual Report. None of the Board members have served for longer than nine years on the Board.

30.a

Disclosure: Appropriate mix of knowledge, skill, experience, diversity and independence

 

The Board assesses its composition during its appraisal and is satisfied that its composition reflects an appropriate mix of knowledge, skills, experience, diversity and independence.

30.b

Disclosure: Gender and race targets

 

Taste has committed itself to transforming its Board to becoming more diverse in terms of race and gender. It has a gender and race diversity policy to give effect to its intentions. 

30.c

Disclosure: Categorisation of executive and non-executive

 

The categorisation of the Board is disclosed in the Integrated Annual Report.

30.d

Disclosure: Categorisation of independence (and on members serving longer than nine years)

 

No member has been on the Board for a period of nine years, or longer.

30.e

Disclosure: Qualification and experience

 

The qualifications and experience of various Board members are specified in the Integrated Annual Report.

30.f

Disclosure: Length of service

 

The period of service of Board members is disclosed in the Integrated Annual Report.

30.g

Disclosure: Age

 

The age of each member of the Board is disclosed in the Integrated Annual Report.

30.h

Disclosure: Other Board and professional positions

 

The professional positions held by the members of the Board are briefly disclosed in the Integrated Annual Report.

30.i

Disclosure: Reasons for removal, resignation or retirement

 

No Board member was removed or retired. The reasons for the resignation of directors was not disclosed.

31

Independent non-executive chair

 

The chairman is an independent non-executive director.

32.a

Lead independent: Leads in absence of the chair

 

The Board has appointed an independent non-executive member as the lead independent to lead in the absence of the chair.

32.b

Lead independent: Sounding Board for the chair

 

The lead independent is a sounding Board for the chair.

32.c

Lead independent: Intermediary between chair and members, if necessary

 

The lead independent is an intermediary between chair and members, if necessary.

32.d

Lead independent: Dealing with shareholders' concerns

 

The lead independent deals with shareholders’ concerns, in the absence of the chairman.

32.e

Lead independent: Strengthens independence in absence of non-independent chair

 

Not applicable as the chair is independent.

32.f

Lead independent: Leads where chair has a conflict of interest

 

The lead independent leads where the chair has a conflict of interest.

32.g

Lead independent: Leads performance appraisal of chair

 

The lead independent leads the performance appraisal of the chair.

33

Chair's and lead independent's role, responsibilities and term in charter

 

The chair's role, responsibilities and term in office, as well as that of the lead independent, are documented in the Board Charter.

34

Chair not to be CEO, and also not of CEO of preceding three years

 

The chairman has not been the CEO of the company at any time.

35

Review of chair's ability to effectively perform duties

 

The Board is satisfied that the chairman is able to perform his duties effectively. The various professional positions that the Chairman of the Group holds are outlined in the Integrated Annual Report. 

36.a

Chair: Audit committee

The chair of the Board is not a member of the Audit Committee. However, the chairman has a standing invitation to attend meetings of the committee. 

36.b

Chair: Remuneration Committee

 

The chairperson of the Board is not the chairperson of the Remuneration Committee.

36.c

Chair: Nomination committee

 

The chairperson is the chairman of the Nominations Committee.

36.d

Chair: Risk Committee

 

The Chairman of the Board is neither a member nor the chair of the Risk Committee.

36.e

Chair: Social and ethics committee

 

The chairman of the Social and Ethics Committee is Adrian Maizey, a non-executive director.

37

Chair's succession plan

 

The chairman, together with the Board, ensures a proper succession plan for the position of chairman

38.a

Disclosure: Chair's independence

 

Grant Pattison is an Independent Non-Executive Director

38.b

Disclosure: Lead independent

 

A lead independent director has been appointed.

 

 

Principle 8:

The Board should ensure that its arrangements for delegation within its own structures promote independent judgement, and assist with balance of power and the effective discharge of its duties.

39

Determine need for delegation to committees

 

The Board delegates certain authority to various committees to assist in the execution of its duties, powers and authorities, but without abdicating its own responsibilities. These delegated limits of authority are reviewed annually by the Board to ensure they remain aligned to the Group's operational efficiency.

40

Responsibility defaults to Board

 

A delegation by the Board of its responsibilities to a Committee will not by or of itself constitute a discharge of the Board’s accountability.

41

Delegation to an individual Board member

 

Delegation of a specific task to individual members of the Board should recorded in minutes of Board meetings. The nature and extent of the responsibilities delegated, decision-making authority and the duration of the delegation is included in the record. 

42

Delegation by formal terms of reference

 

The Board delegates to its committees in the respective Terms of References of each committee which are reviewed annually or as required.

43.a

Terms of reference: Composition

 

All Board Committee's Terms of References deal with: composition; objectives, purpose and activities; delegated authorities - including the extent of power to make decisions; tenure; and reporting mechanism to the Board.

43.b

Terms of reference: Roles, responsibilities and functions

 

The role and responsibilities of the committees are set out in the Terms of References.

43.c

Terms of reference: Delegated authority

 

Authority has been delegated by the Board to the various committees for making responsible decisions on behalf of the Group, which are ultimately reviewed and approved by the Board and its shareholders.
Each committee’s Terms of Reference set out the delegated authority in respect of decision-making, responsibility and fulfilment of its duties.

43.d

Terms of reference: Tenure

 

One third of the Board members are re-elected at the annual general meeting by shareholders.

43.e

Terms of reference: Reporting

 

Each committee’s Terms of Reference detail the process for reporting to the Board.

43.f

Terms of reference: Access to resources and information

 

In fulfilling its duties, each committee is authorised to seek any information it requires from a director or employee of the organisation. If necessary for investigative purposes, the committee may, subject to approval, obtain independent professional or legal advice. 

43.g

Terms of reference: Meeting procedures

 

Each committee clearly sets out the meeting procedures and the frequency of meetings in its Terms of Reference. 

43.h

Terms of reference: Performance appraisal

 

The remuneration and nominations committee recommends to the Board the process for evaluating the Board, directors, chairs of committees, the committees themselves and the Company Secretary.

44.a

Committee roles and responsibilities: Collaboration

 

The Board is satisfied with the allocation of roles and associated responsibilities and reviews this when the Terms of Reference’s are reviewed.

44.b

Committee roles and responsibilities: Complementary approach

 

The Board is satisfied that where more than one committee has jurisdiction to deal with a similar matter, the specific role and positioning of each committee in relation to such matters is defined to ensure complementary rather than competing approaches.

44.c

Committee roles and responsibilities: Balanced member power distribution

 

Our Board Charter demonstrates that there is a clear balance of power and authority at Board level and that no one director has unfettered powers.

45

Ensure necessary knowledge, skills and experience on committees

 

The Board is satisfied that each committee, as a whole, has the necessary knowledge, skills, experience and capacity to execute its duties effectively.

46

Minimum of three members per committee

 

Each committee has a minimum of three independent non- executive members.

47

Executive and senior management representation at committee meetings

 

The Terms of Reference prescribe that certain members of the executive and senior management should be invited to attend committee meetings either by standing invitation or on an ad hoc-basis to provide pertinent information and insights in their areas of responsibility.

48

Board member attendance at committee meetings

 

The Terms of Reference of all the committees make provision for invitation and attendance at meetings by other members with the prior consent of the chairman. No attendee will have the right to vote at such a meeting.

49

No discharge of Board accountability by delegation of responsibility

 

The Board takes ultimate responsibility for decisions even though it delegates to management and its committees.

50.a

Disclosure: Roles, responsibilities and functions

 

The Board Charter and committee Terms of References contain the overall role and associated responsibilities and functions of the Board and each committee of the Board.

50.b

Disclosure: Composition

 

The composition of the Board and its committees as well as the qualifications and experience of the members are disclosed in the Integrated Annual Report.

50.c

Disclosure: Regular external advisers or invitees to attend meetings

 

The names and details of any external advisers who regularly attend or are invited to attend committee meetings are disclosed in the Integrated Annual Report.

50.d

Disclosure: Key focus areas

 

The key areas of focus during the reporting period are set out in the Integrated Annual Report.

50.e

Disclosure: Number of meetings and attendance

 

The number of meetings and attendance is disclosed in the Integrated Annual Report.

50.f

Disclosure: Fulfilment of responsibilities in accordance with terms of reference

 

The disclosure of whether the Board and its committees are satisfied that they fulfilled their responsibilities in accordance with the Board Charter and Terms of References for the reporting period is contained in the Integrated Annual Report.

51.a

Independent oversight: Effectiveness of assurance functions and services

 

The Audit Committee engages the external auditors to provide assurance on the summarised financial information.

51.b

Independent oversight: Integrity of annual financial statements and other external reports

 

The Audit and Risk Committee provides independent oversight and oversees the integrity of the annual financial statements and, to the extent delegated by the Board, as well as other external reports issued by the company including the Integrated Annual Report.

52

Audit Committee accountability regarding statutory duties

 

The Audit and Risk Committee is accountable for its statutory duties and those duties set out in its Terms of Reference.

53

Delegation of risk governance to audit committee

 

The Terms of Reference of the Audit and Risk Committee set out its responsibilities regarding risk management.

54

Oversight by Audit Committee of financial and other risks affecting integrity of external reports

 

The Audit and Risk Committee specifically has oversight of financial reporting risks, internal financial controls, fraud risks as these relate to financial reporting and IT risks as these relate to internal reporting.

55

Audit Committee member's financial literacy, skills and experience

Audit and Risk Committee members collectively have knowledge skills and experience to exercise their duties. The biographies of Audit and Risk Committee members are set out in the Integrated Annual Report.

56

Audit Committee composed of independent and non-executive Board members

 

All members of the Audit and Risk Committee are independent non-executive directors.

57

Board appoints Audit Committee chair

 

The chairperson of the Audit and Risk Committee is an independent non-executive director and not the chairperson of Board.

58

Annual meeting of Audit Committee with internal and external auditors

 

The Audit Committee meets with the external and internal auditors without management being present at least once a year.

59.a.i

Audit Committee disclosure: External auditor independence; Non-audit services

 

The satisfaction of the Audit and Risk Committee with the independence of the external auditors and non-audit services performed is detailed in the Integrated Annual Report under the report of the Audit and Risk Committee.

59.a.ii

Audit Committee disclosure: External auditor independence; Tenure

 

The external auditor, Grant Thornton Johannesburg is considered independent. The audit partner rotates off the audit after five years in terms of JSE Listings Requirements and the firm ensures adequate succession planning is in place.

59.a.iii

Audit Committee disclosure: External auditor independence; Partner rotation

 

The rotation of the designated external audit partner is detailed in the Integrated Annual Report.

59.a.iv

Audit Committee disclosure: External auditor independence; Familiarity risk

 

The Audit and Risk Committee has satisfied itself through enquiry that the audit partner, Serena Ho, is independent.

59.b

Audit Committee disclosure: Significant matters

 

The report of the Audit and Risk Committee contains details of significant matters that have been considered in the annual financial statements.

59.c

Audit Committee disclosure: External audit quality

 

The Audit and Risk Committee members are satisfied with the quality of work produced by the external auditors and are not aware of any adverse quality indicators.

59.d

Audit Committee disclosure: Effectiveness of chief audit executive and internal audit arrangements

 

The Audit and Risk Committee sets out the committee’s view on the internal financial controls of the Group. There were no material issues noted in the financial year. The Audit and Risk Committee report includes the committee’s assessment of the financial knowledge, expertise and experience of the chief financial officer.

59.e

Audit Committee disclosure: Financial controls

 

The Audit and Risk Committee is required to disclose in the Integrated Annual Report any undue, unexpected or unusual risks and the committee's view on the effectiveness of the risk controls. None were detected during the financial year ended February 2018.

59.f

Audit Committee disclosure: Effectiveness of CFO and finance function

 

The Audit and Risk Committee’s views on the effectiveness of the CFO and the finance function is expressed in the Integrated Annual Report under the Audit and Risk Committee's report.

59.g

Audit Committee disclosure: Combined assurance

 

The arrangements in place for combined assurance and the Audit and Risk Committee’s views on its effectiveness are disclosed in the Integrated Annual Report under the report of the Audit and Risk Committee.

60.a

Oversight committee of Board: Nomination, election and appointment

 

The Nominations Committee identifies and participates in selecting Board members.

60.b

Oversight committee of Board: Succession planning

 

The Nominations Committee oversees a formal succession plan for the Board, CEO and certain senior executive appointments.

60.c

Oversight committee of Board: Performance evaluation

 

Taste has delegated the responsibility of determining how the Board's performance will be evaluated to the Remuneration and Nominations Committee, which also has oversight of the conduct of the evaluation.

61

Oversight committee of Board: Composition

 

The majority of members of the Nominations Committee are independent.

62

Risk governance committee

 

This Audit and Risk Committee meets a minimum of three times a year, with special meetings called as and when required.

63

Joint membership where Risk Committee is separate to Audit Committee

 

The company has a combined Audit and Risk Committee as per the Corporate Governance Report in the Integrated Annual Report.

64

Risk governance committee: Composition

 

The Audit and Risk Committee comprises three independent non-executive directors. The CEO and CFO attend meetings by invitation and do not have a vote. The external auditor also attends meetings by invitation. 

65

Remuneration Committee

 

There is a combined Remuneration and Nominations Committee.

66

Remuneration Committee: Composition

 

The Remuneration Committee comprises three independent non-executive directors. The CEO attends portions of these meetings by invitation but does not have a vote.

67

Remuneration Committee: Independent non-executive member as chair

 

Neil Brimacombe is the Chairman of the Remuneration Committee is an independent non-executive director.

68

Social and Ethics Committee

 

Taste established a Social, Ethics and Transformation Committee in accordance with the requirements of the Companies Act. 

69

Social and Ethics Committee: Statutory and delegated duties

 

The responsibilities of the Social and Ethics Committee are detailed in its Terms of Reference, which include its duties per the Companies Act, 2008, the JSE Listings Requirements and King IV, and other responsibilities allocated to it by the Board.

70

Social and Ethics Committee: Composition

 

The Social and Ethics Committee is composed of a majority of independent non-executive directors as well as a prescribed officer. The CEO and CFO are permanent invitees of the committee.

 

 

Principle 9:

The Board should ensure that the evaluation of its own performance and that of its committees, its chair and its individual members, support continued improvement in its performance and effectiveness.

71

Responsibility for performance evaluations

 

The Board is conscious of its responsibility to evaluate its own performance, the performance of its subcommittees, of its chair and of the Company Secretary. It has delegated the responsibility of determining how these evaluations are conducted to the Remuneration and Nominations Committee, which also has oversight of the conduct of the evaluation. Evaluations of the Board and sub-committees were not performed for the financial year ended February 2018 due to the extensive changes to the Board in February 2018.

72

Responsibility of chair's performance evaluation

The Board Charter stipulates that an annual assessment of the performance of the Board, chairman, individual directors and Board committees will be done. An overview of the evaluation process, results and action plans is disclosed in the Integrated Annual Report. Evaluations of the Board and sub-committees were not performed for the financial year ended February 2018 due to the extensive changes to the Board in February 2018.

73

Formal process of performance evaluation at least every two years

Evaluations of the Board and sub-committees were not performed for the financial year ended February 2018 due to the extensive changes to the Board in February 2018. However these are normally done annually.

74

Every alternate year a consideration, reflection and discussion of performance

An assessment of Board and director performance will not take place this year as there have been numerous changes to the Board. A full assessment will be performed for financial year ending February 2019.

75.a

Disclosure: Description of evaluations undertaken

A full assessment will be performed for financial year ending February 2019 by an independent service provider.

75.b

Disclosure: Results

The Board was satisfied with its composition and skills and knowledge mix. The Board was further satisfied with the running of the meetings and the role players.

75.c

Disclosure: Satisfaction of performance and effectiveness improvement

Evaluations of the Board and sub-committees were not performed for the financial year ended February 2018 due to the extensive changes to the Board in February 2018.

 

 

Principle 10:

The Board should ensure that the appointment of, and delegation to, management contribute to role clarity and the effective exercise of authority and responsibilities.

76

Appointment of CEO

The Board appoints the CEO.

77

CEO responsibility

The CEO and the executive committee are responsible for the implementation and execution of the strategy and the ongoing management of the business.

78

CEO accountability

The CEO is accountable to the Board.

79

CEO not a member of remuneration, audit or nomination committees

The CEO is not a member of the Board committees but may be invited to such meetings.

80

CEO's additional professional positions

Any additional professional positions held by the CEO are disclosed in the Integrated Annual Report.

81

CEO succession plan

Succession planning for the CEO is in place, and the Board is satisfied that there are sufficient measures in place to ensure continuity.

82

CEO performance evaluation

The evaluation of the CEO is delegated to the Remuneration Committee and is performed annually. The performance targets are the financial targets, at divisional or brand level, that are agreed to annually by the Board. Evaluation of the CEO was not performed for the financial year ended February 2018 due to the CEO being appointed in February 2018.

83.a

Disclosure: Notice period and contractual termination

This forms part of the terms of the CEO’s contract and is determined by the Remuneration and Nominations Committee.

83.b

Disclosure: Other professional commitments

Other professional commitments of the CEO, including membership of Boards outside the organisation are disclosed in the Integrated Annual Report.

83.c

Disclosure: Existence of CEO succession plan

The Board reviews the talent and succession plan for senior and executive management, including the CEO, on an annual basis.

84

Reservation and delegation of powers

The Board has a decision making framework which details the matters which can be approved at management level and those which require Board approval.

85

Authority framework

The Board implements a formal delegation of authority framework which is reviewed on an annual basis.

86

Delegation of appointment of executives

Board appointments are recommended to the Board for review by the Nominations Committee. These appointments are then approved by shareholders at the annual general meeting.

87.a

Key management: Competence and authority

The Board delegates the evaluation of the executive team to the Remuneration Committee.

87.b

Key management: Adequately resourced

The Board, via the Remuneration and Nominations Committee, provides input regarding senior management appointments, remuneration and succession plans.

88

Executive / key personnel succession plan

Succession planning has been considered for executive management and other key positions to provide continuity of leadership.

89

Disclosure: Satisfaction of delegated authority

The Board is satisfied that the delegation of authority framework contributes to role clarity and effective exercising of authority and responsibilities.

90

Professional and independent guidance on corporate governance

The Company Secretary assists the Board with corporate governance and its legal duties and may also access external legal advice.

91

Appointment of a Company Secretary

iThemba Governance and Statutory Solutions (Pty) Limited (iThemba), represented by Claire Middlemiss, is appointed as the Company Secretary of Taste.

92

Approval of corporate governance arrangements

The Board has an appointed Company Secretary.

93

Necessary authority of Company Secretary

The office of the Company Secretary is empowered and the position carries the necessary authority.

94

Approval and oversight of Company Secretary

The role and function of the Company Secretary is formalised and approved by the Board.

95

Responsibility for removal of Company Secretary

The Company Secretary is appointed and removed by Board.

96

Unfettered access to Board / not a member

The Board is satisfied that an arm’s length relationship exists between the Company Secretary and the Board. The Company Secretary is independent and has unrestricted access to the Board. The Company Secretary is not a member of the Board but attends Board meetings in the discharge of the Company Secretary’s functions and maintains records of meetings.

97

Company Secretary reporting lines

The Company Secretary reports directly to the Board on statutory matters and in relation to her other duties.

98

Company Secretary: Annual performance evaluation

In terms of the JSE Listings Requirements the Board considers and satisfies itself on an annual basis on the competence, qualifications and experience of the Company Secretary to carry out the required responsibilities.

99

Disclosure: Effectiveness of arrangements

The Board has in place the arrangements for accessing professional corporate governance advice.

 

 

Principle 11:

The Board should govern risk in a way that supports the organisation in setting and achieving strategic objectives.

1.a

Responsibility of setting the direction for risk governance as it pertains to strategy

The Board's responsibility for risk governance is expressed in the Board Charter and Risk Policy and Plan.

1.b

Responsibility of setting the direction for risk governance as it pertains to achievement of organisational objectives

The Board delegates matters of risk to the Audit and Risk Committee but remains ultimately responsible. The Board considers both risk and opportunities when evaluating risks.

2

Treat risk as integral to decisions and duties

Taste’s Risk Policy maintains that it is committed to effective risk management in pursuit of its strategic objectives, with the ultimate aim to grow value sustainably for all stakeholders by entrenching risk management into key decision-making processes.

3

Approval of risk policies

The Board, on recommendation of the Audit and Risk Committee reviews the risk appetite framework and risk register regularly.

4.a

Risk appetite

The Audit and Risk Committee reviews and confirms the company’s levels of risk tolerance and its risk profile at least twice a year.

4.b

Loss limit

The limit of the potential loss that the organisation has the capacity to tolerate is included in the Risk Tolerance Framework.

5

Delegation of implementation and execution of risk management

The Board's risk policy and plan is implemented by management by means of risk management systems and processes.

6.a

Oversight of risk management: Assessment - triple context and capitals

 

The Audit and Risk Committee reviews and discusses the Group risk register, which is aggregated from the risk registers prepared by the risk officers of the company.

6.b

Oversight of risk management: Assessment - potential upsides and opportunities

 

The Board has instituted a risk management process with the objective of effectively balancing risk and reward, based on a philosophy aimed at maximising business opportunities and minimising adverse outcomes.

6.c

Oversight of risk management: Assessment - dependence on resources and relationships

 

The Board constantly evaluates its dependence on resources and relationships as represented in the various forms of capital. Further information can be obtained from the annual Integrated Annual Report.

6.d

Oversight of risk management: Risk responses

 

Taste's Risk Committee has delegated the implementation of appropriate risk responses to its management.

6.e

Oversight of risk management: Continuity arrangements

 

The Board delegates the monitoring of business continuity arrangements to the Audit and Risk Committee.

6.f

Oversight of risk management: Integration

 

The Audit and Risk Committee oversee that the risk management plan is widely disseminated throughout the company and integrated in the day-to-day activities of the company.

7

Periodic independent assurance on effectiveness

The Audit and Risk Committee ensures that appropriate checks and balances are in place to ensure robust, independent and efficient audit processes.

8

Disclosure: Nature and extent of risks and opportunities

The Audit and Risk Committee reviews and confirms the company’s levels of risk tolerance and its risk profile at least twice a year. The Integrated Annual Report sets out the material risks and opportunities identified by the business.

9.a

Disclosure: Arrangements in place

The Group is satisfied that an appropriate risk management function is in place,

9.b

Disclosure: Key focus areas

Risks and material matters are fully disclosed in the Integrated Annual Report.

9.c

Disclosure: Actions to monitor effectiveness

Effective risk management processes are in place. Any control weaknesses that are identified are addressed by management.

9.d

Disclosure: Planned future focus

Risk identified as per the updated risk register are planned focus areas.

 

 

Principle 12:

The Board should govern technology and information in a way that supports the organisation setting and achieving its strategic objectives.

10

Responsibility of setting the direction for approach to technology and information

The Board delegates the oversight of IT and information management to the Audit and Risk Committee. The Board is advised of any material issues.

11

Approval of technology and information policies

The Board is responsible for the pro-active and effective governance of information technology, it monitors the performance of the company against agreed objectives and reviews the performance of executive management against defined objectives and other applicable performance standards.

12

Delegation of implementation and execution of technology and information

Management is responsible for the implementation of all the structures, processes and mechanisms for the IT and information governance.

13.a

Technology and information oversight: Integration

The Board through the Audit and Risk Committee and management ensures that the IT and information management is integrated with the company's strategic and business processes. 

13.b

Technology and information oversight: Risk management

 

The Audit and Risk Committee assists the Board in carrying out its IT governance responsibilities by ensuring that IT risks are adequately addressed through its risk management and monitoring processes. Taste’s IT is audited in terms of ISO 2700 and 2701 standards. 

13.c

Technology and information oversight: Arrangements for business resilience

Management regularly demonstrates to the Board that the company has adequate business resilience arrangements in place for disaster recovery.

13.d

Technology and information oversight: Proactive monitoring to identify and respond

Significant IT risks are identified and monitored by the IT department through various cybersecurity testing processes.

13.e

Technology and information oversight: Performance management of third-party and outsourced services

Taste has in-house IT services.

13.f

Technology and information oversight: Value assessment

The Board oversees the value delivery of IT and monitors the return on investment from significant IT projects.

13.g

Technology and information oversight: Disposal of obsolete technology and information

Taste responsibly disposes obsolete technology and information

13.h

Technology and information oversight: Ethics

Ethical and responsible use of technology and information is important for the business. Taste is fully prepared for compliance with the Protection of Personal Information (POPI) Act. 

13.i

Technology and information oversight: Legislative compliance

The Board ensures that the company complies with IT laws and that IT related rules, codes and standards are considered.

14.a

Oversight of information management: Sustain and enhance intellectual capital

The Board, through the Audit and Risk Committee, oversees the leveraging of information to sustain and enhance Taste's intellectual capital.

14.b

Oversight of information management: Confidentiality, integrity and availability

An Information Security Management System is in place

14.c

Oversight of information management: Privacy of personal information

The Board ensures all personal information is treated by the company as an important business asset and is identified. Taste is fully prepared for the implementation of the Protection of Personal Information (POPI) Act.

14.d

Oversight of information management: Security

Security is continually monitored and any major security incidents are reported to the Audit and Risk Committee. 

15.a

Oversight of technology management: Achievement of strategic and operational objectives

Behind our customer interfaces, Taste is an increasingly technology driven business. Business strategies and objectives and the role of IT in achieving them are clear.

15.b

Oversight of technology management: Sourcing risk

Taste utilises in-house technology and does not utilise third parties.

15.c

Oversight of technology management: Monitoring and responses to technology developments

The IT department monitors, manages and responds to technology developments.

16

Periodic independent assurance on effectiveness

The Board receives updates on IT risks from the CIO at least twice a year. All risks presented in the year were deemed to be within defined tolerance levels and not considered material.

17.a

Disclosure: Arrangements in place

Arrangements for governing and managing technology and information are disclosed in the Integrated Annual Report.

17.b

Disclosure: Key focus areas

Key IT focus areas are cybersecurity and disaster recovery.

17.c

Disclosure: Actions to monitor effectiveness

IT Risks are included in the Risk Register and monitored.

17.d

Disclosure: Planned future focus

Planned future IT focus areas are cybersecurity and disaster recovery.

 

 

Principle 13:

The Board should govern compliance with applicable laws and adopted, non-binding rules, codes and standards in a way that supports the organisation being ethical and a good corporate citizen.

18

Responsibility of setting the direction for approach to compliance governance

The company is subject to, and remains compliant with, the JSE Listings Requirements, the Companies Act, No 71 of 2008 (Companies Act) and the King Report on Governance for South Africa (“King IV”). Management regularly monitors the Group’s compliance with the Franchise Association’s code of conduct. The Terms of Reference for the Audit and Risk Committee intend to ensure compliance with governance recommendations and statutory requirements.

19

Approval of compliance policies

The company strives to adhere to all relevant national laws and codes that are binding including rules such as those of the JSE.

20

Delegation of implementation and execution of compliance management

The responsibility for implementation and execution of effective compliance management is delegated to management.

21.a

Oversight of compliance: Understanding

Compliance with applicable laws is understood not only in terms of the obligations that they create, but also for the rights and protection that they afford.

21.b

Oversight of compliance: Interrelation

Compliance is monitored across Taste’s regulatory universe and examined for applicable laws that interact with it.

21.c

Oversight of compliance: Continual monitoring

The Board continually monitors the company's compliance with applicable laws, rules, codes and standards. The Company Secretary advises the Board and its committees on issues, including compliance with Group policies and procedures, statutory regulations and relevant governance principles and recommendations.

22

Periodic independent assurance on effectiveness

The Board considers the need to receive periodic independent assurance on the effectiveness of compliance management.

23.a

Disclosure: Arrangements in place

The company has identified legislation which is most relevant for it and continuously monitors compliance to such legislation by tracking any changes to legislation

23.b

Disclosure: Key focus areas

To continuously monitor compliance to necessary legislation by tracking any changes to legislation.

23.c

Disclosure: Actions to monitor effectiveness

During the period the company did not have any areas of noncompliance that required specific remedial action.

23.d

Disclosure: Planned future focus

Tp continuously monitor compliance to such legislation by tracking any changes to legislation

24

Disclosure: Material or repeated regulatory penalties

No regulatory penalties, sanctions or fines for contraventions or non-compliance with statutory obligations were imposed on the company or any of its directors or officers.

25

Disclosure: Environmental compliance

During the reporting period, no significant environmental grievances, fines or sanctions were received

 

 

Principle 14:

The Board should ensure that the organisation remunerates fairly, responsibly and transparently so as to promote the achievement of strategic objectives and positive outcomes in the short, medium and long term.

26

Responsibility of setting the direction for approach to remuneration governance

The Board is responsible for the governance of remuneration and on how remuneration should be approached. The Board has delegated the responsibility for overseeing all elements of remuneration, including the remuneration philosophy and policy, and the implementation of the policy to the Remuneration and Nominations Committee.

27

Approval of remuneration policies

Taste's Remuneration and Nomination Committee is tasked by the Board to independently approve and oversee the implementation of a remuneration policy that will encourage the achievement of Taste's remuneration philosophy and policy. 

28.a

Policy objectives: Attract, motivate, reward and retain

The remuneration policy aims to enable the attraction and retention of skilled resources and results in rewards aligned with shareholder interests. The policy is designed to attract, motivate, reward and retain human capital.

28.b

Policy objectives: Achieve strategic objectives within risk appetite

Remuneration policies and practices are aligned with company strategy. The Remuneration Committee ensures that the mix of fixed and variable pay, in cash, shares and other elements, meets the company's needs and strategic objectives.

28.c

Policy objectives: Positive outcomes

The Group’s remuneration policy is aimed at driving a high-performance culture that creates sustainable value for shareholders.
The Group’s remuneration policy uses performance measures that support positive outcomes across the economic, social and environmental context in which the organisation operates.

28.d

Policy objectives: Ethical culture and responsible corporate citizenship

Taste has formulated a Remuneration Policy designed to give effect to the remuneration strategy, support the business objectives within the larger operating environment and offer a balanced remuneration mix in line with its values.

29.a

Policy provision: Fair executive remuneration

Remuneration level disclosures are available in the remuneration policy in the Integrated Annual Report.

29.b

Policy provision: Performance measures

The main purpose of our remuneration policy and structure is to align management and shareholder interests. Remuneration performance measures are disclosed in the remuneration policy in the Integrated Annual Report.

29.c

Policy provision: Voting by shareholders

The Remuneration Policy is tabled for non-binding shareholder approval at the annual general meeting, as well as the Remuneration Implementation Report.

30.a

Policy elements: Base salary including benefits

The Remuneration Report, published in the Integrated Annual Report expands on:

  • Our remuneration philosophy
  • Base remuneration policy
  • Retention and incentive policy
  • Short-term cash incentive programme
  • Long-term share incentive scheme
  • Disclosure of remuneration

30.b

Policy elements: Variable remuneration

Taste achieve what we believe is fair and competitive remuneration through combining fixed and performance-enhancing incentives with the aim of attracting and retaining competent and experienced employees. There is, therefore, a trade-off between incentives linked solely to Group performance and objectives linked solely to individual performance. We seek to strike an appropriate balance between the two.

30.c

Policy elements: Termination payments

There is a Remuneration Policy in place which includes payments on termination of employment.

30.d

Policy elements: Sign-on, retention and restraint payments

There is a Remuneration Policy in place which includes sign-on, retention and restraint payments.

30.e

Policy elements: Pre-vesting and post-vesting forfeiture of remuneration

There is a Remuneration Policy in place which includes a policy regarding pre / post vesting forfeiture of remuneration.

30.f

Policy elements: Commissions and allowances

There is a Remuneration Policy in place which includes commissions and allowances.

30.g

Policy elements: Non-executive members fees

Directors’ fees comprise of an annual fee. Full disclosure of all fees paid to directors for their services is made in the Integrated Annual Report.

31

Oversight of implementation and execution of remuneration policy

The Remuneration Committee ensures that Taste remunerates directors and executives fairly and responsibly, and that the disclosure of director and executive remuneration is accurate, complete and transparent.

32.a

Remuneration Report: Background statement

The Remuneration Report is included in the Integrated Annual Report.

32.b

Remuneration Report: Overview of remuneration policy

The Remuneration Policy is included in the Integrated Annual Report.

32.c

Remuneration Report: Implementation

Details of directors’ fees and remuneration are fully disclosed in the financial statements.

33.a

Background Statement: Internal and external factors

The Remuneration Report is included in the Integrated Annual Report.

33.b

Background Statement: Voting results

A non-binding advisory vote was passed by shareholders at the previous annual general meeting on the Remuneration Report.

33.c

Background Statement: Key focus areas

The Remuneration Committee's key focus areas are described in the Integrated Annual Report.

33.d

Background Statement: Consultants

External remuneration specialist companies are requested to present to the Remuneration Committee as required.

33.e

Background Statement: Remuneration Committee view

The Remuneration Committee evaluated the effectiveness of the remuneration policy during the financial year ended February 2018.

33.f

Background Statement: Planned future focus

Planned future focus areas for remuneration are to remunerate responsibly and fairly.

34.a

Overview: Remuneration elements

The Remuneration Policy is based on the total rewards strategy and integrates key elements that attract, motivate and retain human capital to achieve the desired business results, namely: compensation, benefits, performance, recognition, learning and development.

34.b

Overview: Contractual obligation of termination payments

What contractual obligations could results in payments on termination of employment / office?

34.c

Overview: Performance measurement

The Group’s Remuneration Policy uses performance measures that support positive outcomes across the economic, social and environmental context in which the organisation operates.

34.d

Overview: Executive remuneration scenario analysis

The Remuneration Report is included in the Integrated Annual Report.

34.e

Overview: Fair and responsible executive remuneration

The annual pay increase of the executive directors is directly related to individual performance ratings and aligned to the annual increase ranges per performance rating as determined by the committee and applied consistently across the Group.
Participation in the long-term incentive schemes is limited to senior executives. The long-term incentive schemes are regularly reviewed and enhanced to align with evolving best practice locally and internationally, based on engagement with major shareholders.

34.f

Overview: Remuneration benchmarking

The Remuneration Committee selects an appropriate comparative Group when comparing remuneration levels.

34.g

Overview: Basis of non-executive member fees

The Remuneration Report is included in the Integrated Annual Report.

34.h

Overview: Public access to remuneration policy

The Remuneration Report is included in the Integrated Annual Report.

35.a.i

Implementation: Table of total executive remuneration elements

 

The Remuneration Report is included in the Integrated Annual Report.

35.a.ii

Implementation: Table of executive variable remuneration incentive schemes

 

The Remuneration Report is included in the Integrated Annual Report.

35.a.iii

Implementation: Table of executive variable remuneration realised

 

The Remuneration Report is included in the Integrated Annual Report.

35.b

Implementation: Performance measures and realisation

 

The Remuneration Committee ensures that remuneration levels reflect the contribution of senior executives and executive directors. The committee is satisfied that recorded performance measures that govern vesting of incentives are accurate.

35.c

Implementation: Termination payments

There were no payments made on termination of employment this year.

35.d

Implementation: Remuneration policy deviations

Taste did not deviate from the Remuneration Policy during the reporting period.

36

Shareholder approval by special resolution of non-executive directors fees

Non-executive fees are approved by shareholders annually in advance by special resolution at the annual general meeting.

37

Non-binding advisory votes by shareholders at annual general meeting

Shareholders pass a non-binding advisory vote on the company's remuneration policy at the annual general meeting every year.

38.a

25% or more dissenting vote: Engagement process

There is a shareholder communication process in place to ascertain the reasons for dissenting votes if the remuneration policy is voted against by 25% or more of the shareholders.

38.b

25% or more dissenting vote: Appropriate corrective response

There is a shareholder communication process in place to ascertain the reasons for dissenting votes if the remuneration policy is voted against by 25% or more of the shareholders.

39.a

Disclosure where 25% or more dissenting vote: Engagement

There is a shareholder communication process in place to ascertain the reasons for dissenting votes if the remuneration policy is voted against by 25% or more of the shareholders.

39.b

Disclosure where 25% or more dissenting vote: Corrective steps taken

This was not required to date. There is a shareholder communication process in place to ascertain the reasons for dissenting votes if the remuneration policy is voted against by 25% or more of the shareholders.

 

 

Principle 15: The Board should ensure that assurance services and functions enable an effective control environment, and that these support the integrity of information for internal decision-making and of the organisation's external reports.

40.a

Audit Committee oversight responsibility: Effective internal control environment

The Audit and Risk Committee ensures that a combined assurance model is applied to provide a co-ordinated approach to all assurance activities.

40.b

Audit Committee oversight responsibility: Integrity of information

The Audit and Risk Committee oversees the assurance process which is aimed at providing information of the highest integrity used for internal decision-making by management, the Board and its committees.

40.c

Audit Committee oversight responsibility: Integrity of external reports

The Board assumes responsibility for the integrity of external reports issued by the organisation and sets the direction for how assurance of these should be approached and addressed.

41

Satisfactory application of combined assurance model

Combined assurance is overseen by the Board and the Audit and Risk Committee. The Combined assurance received is appropriate to address all the significant risks facing the Group; and monitors the relationship between the external assurance providers, internal assurance providers and the company.

42.a

Oversight of combined assurance model in regard significant risks and material matters: Organisation's line functions

The Group Risk Officer and the Audit and Risk Committee owns and manages risk and is responsible for designing and implementing the risk management process and monitoring thereof.  The Group Risk Officer has responsibility for reporting on risk to the executive committee, Audit and Risk Committee and Board of directors at intervals determined by the Board.

42.b

Oversight of combined assurance model in regard significant risks and material matters: Organisation's specialist functions

The Group legal, compliance and risk management functions and relevant policies facilitate risk management and compliance in the Group. Compliance functions within each business manage the compliance to policies and processes.
The Risk Committee owns and manages risk and is responsible for designing and implementing the risk management process and monitoring thereof. The Risk Committee regularly reviews the Group’s risks to ensure mitigation strategies are being implemented and are effective.
The Executive and Investment committee and the Company Secretary ensure compliance and disclosure. The Group is in the process of appointing an internal audit function.

42.c

Oversight of combined assurance model in regard significant risks and material matters: Internal assurance service providers

The Group is in the process of appointing an internal audit function.

42.d

Oversight of combined assurance model in regard significant risks and material matters: Independent external assurance service providers

Grant Thornton Johannesburg is the external auditor nominated by the Board to provide external assurance.

42.e

Oversight of combined assurance model in regard significant risks and material matters: Other external assurance service providers

The board receives assurance in regard significant risks and material matters from external assurance providers, as required.

42.f

Oversight of combined assurance model in regard significant risks and material matters: Regulatory inspectors

The board receives assurance in regard significant risks and material matters from external assurance providers/regulatory inspectors, as required.

43

Assessment of effectiveness

The Board is satisfied that the combined assurance model is effective to ensure the integrity of the Group’s external reports.

44

Responsibility of setting the direction for approach to assurance of integrity of external reports

The Board assumes responsibility for the integrity of external reports issued by the organisation and sets the direction for how assurance of these should be approached and addressed.

45.a

Assurance requirement: Underlying data and processes

Legal requirements are considered when taking into account the assurance to be applied to underlying data used to prepare and present reports.

45.b

Assurance requirement: Suited for intended audience

Consideration is given to the intended audience to ensure that it provides them with the necessary information to make informed decisions, and to the measurement or evaluation of the underlying subject matter of the report.

45.c

Assurance requirement: Measurement or evaluation criteria

The specification of applicable criteria for the measurement or evaluation of the underlying subject matter of the report is determined by the Board in accordance with the legal guidelines and management's recommendations.

46

Satisfaction of integrity of external reports

The Board is satisfied that the combined assurance model is effective to ensure the integrity of the Group’s external reports.

47.a

Disclosure: Nature, scope and extent of assurance provision

See the Audit and Risk Report in the Integrated Annual Report, as well as the Integrated Annual Report itself for the assurance functions, services and processes underlying the preparation and presentation of the report.

47.b

Disclosure: Integrity statement

See the director's statement of responsibility in the Integrated Annual Report.

48

Responsibility of setting the direction for internal audit arrangements

During this year, an internal audit function will be established. 

49

Approval of internal audit charter

During this year, an internal audit charter will be established. 

50

Internal audit: Ensure necessary skills and resources

During this year, an internal audit function will be established. 

51

CAE: Ensure independence of function

A Chief Audit Executive has not been appointed. During this year, an internal audit function will be established.

52

CAE: Approval of appointment

 

A Chief Audit Executive has not been appointed. During this year, an internal audit function will be established.

53

CAE: Access to the chair of audit committee

A Chief Audit Executive has not been appointed. During this year, an internal audit function will be established.

54

CAE: Not a member of executive committee (independence)

A Chief Audit Executive has not been appointed. During this year, an internal audit function will be established.

55

CAE: Clarity of role when co-sources or outsourced

A Chief Audit Executive has not been appointed. During this year, an internal audit function will be established.

56

CAE: Lines of reporting, chair of Audit Committee and executive management

A Chief Audit Executive has not been appointed. During this year, an internal audit function will be established.

57

CAE: Responsibility for removal

A Chief Audit Executive has not been appointed. During this year, an internal audit function will be established.

58.a

Ongoing monitoring: Risk-based internal audit plan

During this year, a risk-based internal audit plan will be established. 

58.b

Ongoing monitoring: Organisational risk profile

The risk profile of the business is regularly reviewed by the Audit and Risk Committee.

59

Internal audit: Statement of effectiveness, risk management and control processes

See the Audit and Risk Committee's Report in the Integrated Annual Report.

60

Internal audit: External, independent quality review

During this year, an internal audit function will be established. 

61

Internal audit: Conformance with a recognised industry code of ethics

During this year, an internal audit function will be established. 

 

 

Principle 16: In the execution of its governance role and responsibilities, the Board should adopt a stakeholder-inclusive approach that balances the needs, interests and expectations of material stakeholders in the best interests of the organisation over time.

1

Responsibility of setting the direction for approach to stakeholder relationships

The Group follows a Board-endorsed stakeholder engagement programme. It describes the principles and practices applied in interacting with shareholders and investors.

2

Approval of stakeholder relationship policies

The Group follows a Board-endorsed stakeholder engagement programme. It describes the principles and practices applied in interacting with shareholders and investors.

3

Delegation of implementation and execution of stakeholder relationship management

Management develops a strategy and formulates policies for the management of relationships with each stakeholder grouping.

4.a

Oversight of stakeholder relationship management: Identification methodologies

Primary stakeholder groups have been identified that are most likely to influence the Group’s ability to create sustainable shareholder value.

4.b

Oversight of stakeholder relationship management: Material stakeholders

Stakeholder engagement is described in detail in the Integrated Annual Report.

4.c

Oversight of stakeholder relationship management: Stakeholder risks

Stakeholder matters are delegated to the Social and Ethics Committee which monitors them as part of its responsibilities. Stakeholder risks form an integral part of the company's risk management.

4.d

Oversight of stakeholder relationship management: Engagement and communication mechanisms

The company engages with stakeholders by using various formal and informal engagement methods as well as various dispute resolution mechanisms that are available. The Board ensures that disputes are resolved as effectively, efficiently and expeditiously as possible.

4.e

Oversight of stakeholder relationship management: Measurement and response

Board members are responsible for monitoring and assessing Taste’s reputation in the marketplace.

5.a

Disclosure: Arrangements in place

See Stakeholder Engagement in the Integrated Annual Report in relation to arrangements for engagement with stakeholders.

5.b

Disclosure: Key focus areas

The key areas of focus are disclosed in the Integrated Annual Report.

5.c

Disclosure: Effectiveness of arrangements

The Integrated Annual Report discloses the nature of the company's dealings with stakeholders and the outcomes of these dealings when appropriate.

5.d

Disclosure: Planned future focus

Stakeholder engagement and management is a standing item on the agenda of the Social and Ethics Committee and remains a focus area.

6

Oversight of stakeholder relationship management: Shareholders

The Board encourages shareholders to attend its annual general meeting, notice of which is contained in the Integrated Annual Report, where shareholders have the opportunity to put questions to the Board and the chairpersons of the Board committees.

7

AGM: Directors availability for shareholders' queries

The notice of AGM is published on the Group’s website and, where required, notifications are sent to shareholders. Members of the Board and executive management are available at the AGM, should shareholders wish to engage with them.

8

AGM: Attendance of external audit partner

The external audit partner attends the AGM.

9

The Board must ensure equitable treatment of shareholders

All shareholders, including minorities, are treated equitably. There is a shareholder which holds 64,5% of issued shares.

10

AGM: Minutes of listed companies available to public

The minutes of the AGM's are available upon request from the Company Secretary.

11

Responsibility of setting the direction for approach to relationships and exercise of power

The Board assumes responsibility for governance across the Group by setting the direction for how the relationships and exercise of power within the Group should be approached and conducted. The Group is committed to creating and maintaining inclusive, honest and mutually beneficial relationships with its stakeholders. 

12

Approval of Group relational and authority framework

Taste does not have subsidiary boards.

13

Subsidiary Board approval of adoption and implementation of relational and authority framework

The Board ensures that the Group's subsidiaries are included in the development of the Group governance framework.

14

Group governance framework: Ensure non-conflict with legislative requirements, standards, codes or polices

The Board constantly monitors, through the Company Secretary, that the Group governance framework does not conflict with the memoranda of incorporation, delegations of authority, shareholder agreements, Board charters, Board committee Terms of Reference, and related policies and agreements within the Group.

15

Group governance framework: Recognition of subsidiaries as separate and independent juristic person

The Board of directors recognises the statutory and fiduciary duties of the directors of a subsidiary company and in particular their duty to act in the best interests of the subsidiary company at all times.

16.a

Group governance framework: Rights and roles of holding company

The updated Group governance framework will be implemented during the year.

16.b

Group governance framework: Delegation by subsidiary Board to holding company Board committee

The updated Group governance framework will be implemented during the year.

16.c

Group governance framework: Extent of adoption of holding company policies

The updated Group governance framework will be implemented during the year.

16.d

Group governance framework: Holding company election of directors to subsidiary Boards

Where appropriate, the company will consult with the shareholders of the subsidiary company before nominating a director or directors to the subsidiary company Board in order to ensure that any candidates nominated meet the minimum requirements of the Board of the subsidiary company as to skills, experience, background and other relevant attributes.

16.e

Group governance framework: Breach of legal duty by directors on multiple Group Boards

The Board is aware of the risk of breaching legal duty in relation to the use of information obtained while acting as director of one company in the Group for the purposes of another company and will put measures in place to provide guidance on this.

17

Group governance framework: Ensure Group wide implementation

The updated Group governance framework will be implemented during the year.

18

Holding company disclosure: Overview of Group governance framework

The updated Group governance framework will be implemented during the year.

19

Subsidiary disclosure: Responsibilities delegated to holding company Board committees and extent of adopted policies and procedures

The updated Group governance framework will be implemented during the year.

 

 

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