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King iv report - Coggle Diagram
King iv report
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OBJECTIVES OF KING IV
- Promote responsible corporate governance as integral to running the company and delivering governance outcomes such as:
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- Broaden (increase) the acceptance of the King IV Report by making it accessible and fit for implementation across a variety of sectors and organisational types.
- Reinforce corporate governance as a holistic and interrelated set of arrangements to be understood and implemented in an integrated manner;
- Encourage transparent and meaningful reporting to stakeholders; and
- Present corporate governance as concerned with not only structure and process, but also with ethical consciousness and behaviour.
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Application regime
“Comply or explain” conveys that the principles and practices recommended by the code must be the focus of the organisation’s corporate governance. However, if the directors consider that compliance with a particular recommendation is not in the best interests of the company then the directors are at liberty not to comply but must explain the reason behind their decision.
“Comply or else” conveys that organisations, etc., must adhere to the rules and if they don’t, they will be punished.
“Apply or explain” as indicated above, “apply or explain” is simply a variation of the “comply or explain” basis. In the opinion of the King III committee (and other similar international bodies), the word “comply” is too strong and inflexible. Using the word “apply” suggests a more accommodating, non-prescriptive approach. Thus King III was founded on the “apply or explain” basis.
King III identified two application regimes “comply or else” or “comply or explain” and described a variation of the latter, i.e. “apply or explain”.