SA CORPORATE REAL ESTATE FUND MANAGERS LIMITED
| Directorate :: Administration :: Management of the Fund :: Statement on Corporate Governance |
SA Corporate is managed by SA Corporate Fund Managers Limited, a company approved by the Registrar of Unit Trusts to manage the fund.
THE DIRECTORS OF THIS COMPANY
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| Benjamin Monaheng Kodisang (39 years) CA(SA) South African Chairman, Non-Executive Director (non-independent due to being Managing Director of Old Mutual Property Investment) Member of the Investment Committee Member of the Nomination & Remuneration Committee
Ben was appointed Managing Director of Old Mutual Investment Group Property Investments in 2005. He is immediate past President of the South African Property Owners Association (SAPOA). Ben also serves on other boards linked to his role as Managing Director of Old Mutual Investment Group Property Investments.
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 | Leonard Brett van Niekerk (38 years) B.Comm (Hons) South Africa Managing Director, Executive Director Invited to attend the Nomination & Remuneration Committee meetings Invited to attend the Risk, Audit & Compliance Committee meetings Invited to attend the Investment Committee meetings
Len has over 12 years investment experience, the last 10 of which covers real estate. He worked at Standard Bank's Economics Division before moving to the Bank's stock broking business as the listed real estate analyst where Len was consistently rated by investment institutions among the top 2 property analysts for 4 years. Len moved to Old Mutual Investment Group South Africa (OMIGSA) in 2006 as Head of Quoted Property overseeing the research and asset management of various listed property funds. He joined Old Mutual Investments in August 2009 at the time he was appointed as Managing Director.
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| Zaida Adams (31 years) CA (SA) South African Executive Director: Finance Invited to attend the Risk, Audit & Compliance Committee meetings Invited to attend the Investment Committee meetings
Zaida started her career in properties in 2005 as the Property Accountant for Allan Gray, before moving to Standard Bank as the Financial Manager of Fountainhead Property Trust in 2007. The Allan Gray Property Trust/Fountainhead Property Trust is a listed unit trust (PUT) with assets under management totalling just over R7 billion. She has 5 years financial management experience in the property industry. She joined Old Mutual Investments in August 2008 before her appointment as Finance Director.
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| Kenneth John Forbes (60 years) CA(SA) South African Non-Executive Director (independent) Member of the Investment Committee
Ken has over 25 years experience in the township development business, mostly in the industrial, commercial and resort sectors. He is currently a Director of Tongaat Hulett Developments (Pty) Limited. |
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| Ian Michael Groves (65 years) CA(SA) South African Non-Executive Director (independent) Chairman of the Risk, Audit & Compliance Committee
Mike has over 35 years business experience in the shipping industry. He is a director of, inter alia: Grindrod Limited, Grindrod Bank Limited and Value Group Limited and is the past Chief Executive Officer of Grindrod Limited. |
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| Ipeleng Nonkululeko Mkhari (35 years) B Soc. Science South African Non-Executive Director (not independent due to being a director of Old Mutual Property Investments)
Ipeleng is the Chief Operations Officer of Motseng Investment Holdings.
A pioneering entrepreneur, she established the first black woman owned CCTV business and subsequently co-founded Motseng Investment Holdings, a diversified group in 1998.
She sits on all boards of Motseng group subsidiaries and various other boards, amongst them: KAP International, Old Mutual Property Investments and South African Women's Entrepreneurs Network.
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 | Sayed Hoosen Mia (64 years) MBA (USA), PMD (Harvard), MAP (Wits), University Teachers Diploma (UDW) South African Non-Executive Director (independent) Chairman of the Investment Committee
Sayed has 25 years experience in the insurance industry at various levels. He is Chairman of the SGM group of companies (48 property companies), Chairman of the Mashura Financial Services (Pty) Ltd (Sharia compliant insurance) and on the board and trustee of the University of the Western Cape and member of many welfare and community associations.
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| Louisa Madiako Mojela (53 years) B.Comm. (NUL) South African Non-Executive Director(independent)@
Louisa is a founder member and Group CEO of Women Investment Portfolio Holdings Limited (WIPHOLD), which was the first women owned company to be listed on the JSE. She was honoured in May 2000 in Venice, Italy as one of 40 women from different continents and countries as "The Leading Women Entrepreneur of the World" for 2000. In 2008, Louisa was recognised as one of South Africa's most influential women in business and government. In May 2009, Louisa was the winner of the Inaugural African Business Leadership Award 2009 in Dakar, Senegal by the African Development Bank (AfDB). She is a director of several boards including: ABB South Africa Proprietary Limited, Distell Group Limited, USB-ED, Sasol Mining and Sun International Limited.
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| Musa Moses Ngcobo (35 years) Non-executive director(independent)
Musa is Chairman of the South African Property Owners Association (SAPOA) Transformation Committee, and serves on the Property Sector Charter Council. His foundation in property was gained at DTZ Leadenhall both at operational and strategic levels. He is CEO and co-founder of Kensani Properties - a subsidiary of Kensani Capital a leading diversified BBBEE investment holding company. Musa is also a Non-Executive Director of SAPOA and is currently CEO of NEO Africa Properties. |
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| Kevin Matthew Roman
Kevin Roman is a Shareholder and Group Chief Executive Officer of Hermans & Roman Property Solutions (Pty) Ltd, a company with property management and property related services as its core business, operating on a national basis in South Africa. He is a specialist in the development and implementation of strategic objectives, property management, asset utilisation and development facilitation. He has 20 years experience in property management and related services.
Kevin is a Non-Executive Director of the South African Property Owners Association (SAPOA), Non-Executive Director and Deputy Chair of the Cape Town Partnership, Chairman of the South African Council of Shopping Centres (SACSC's) Western Cape Chapter, and National Committee Member of the SACSC. He is also Chairman of the Shopping Centre Security Initiative (SCSI) in the Western Cape.
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| Ebrahim Suleman Seedat (58 years) F.I.M.F.O. CA(SA) South African Non-Executive Director (independent) Member of the Nomination & Remuneration Committee Member of the Risk, Audit & Compliance Committee
Ebrahim has extensive local government experience of which the last 13 years have been in property with particular emphasis on the listed property sector. He is currently the Senior Manager (Investment) of eThekwini Municipality. |
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| William John Swain (69 years) CA(SA) (Date appointed 23 May 2007) Non-Executive Director (independent) Chairman of the Nomination and Remuneration Committee Member of the Risk, Audit & Compliance Committee
John is a director of Mr Price Group Limited and Chairman of The Sharks (Pty) Limited. Other previous listed company directorships held include BOE Limited, Commercial Finance Company Limited and Congella Federation Limited. He is a past partner of Ernst & Young.
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| Wayne Clifford van der Vent (45 years) B.A. (Law) Non-Executive Director (not independent, due to being employed by the PIC, the Fund's largest unitholder)
Wayne is Head of the Property Investment Division of the Public Investment Corporation (PIC) which manages a growth portfolio of properties owned by the Government Employees Pension Fund (GEPF). He is a member of the PIC's Executive Committee and serves in a non executive capacity on a number of corporate boards, including ACSA, Community Property Company, Advent Asset Management and Pareto Limited.
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| Amelia Beattie (39 years) B.Comm Alternate to B.M. Kodisang Member of the Investment Committee Member of the Risk, Audit & Compliance Committee
Amelia is Chief Operating Officer of Old Mutual Investment Group Property Investments. She has 11 years experience in the property business and is the National Chairperson of Women's Property Network and on the National Council for SAPOA. She also serves various boards of companies' local and international; business ventures.
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| Nic Corbishley (55 years) B.A. (Geography & Economics); Master of City and Regional Planning South African Member Royal Institute of Chartered Surveyors (British) Alternate to M.M. Ngcobo
Nic is a Director and shareholder of Neoafrica Properties and has been instrumental in refining and executing the company's strategy. He has had 25 years experience in the South African Property Industry gaining considerable knowledge and experience at board level in property finance, investment, development and asset management.
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| Gugu Phumzile Mthethwa (34 years) CA (SA) South African Alternate to L.M. Mojela
Gugu is the Investment Executive at WIPHOLD. She is a non-executive board member of Distell Group Limited, ABB South Africa (Pty) Limited, MCG Industries (Pty) Limited and Landis+Gyr (Pty) Limited. She is also an audit committee member of Distell Group, ABB South Africa and Landis+Gyr. |
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| Panos Zagaretos (33 years) B.Sc (QS), M.Sc (QS): Real Estate Investment (Date appointed 23 May 2007) Alternate to W.C. van der Vent
Panos is an Investment Manager in the PIC's Property Investment Division, having joined the company in 2004 as a development manager. He holds a B.Sc in Quantity Surveying and a Masters in Real Estate Investment from the University of the Witwatersrand. He trained as a Quantity Surveyor, gaining experience in a broad range of development, finance and investment aspects both nationally and internationally. He serves on the Board of Pareto,CBS Property Group and JIA Piazza Park. He also serves on the Commercial Board Committee of ACSA.
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ADMINISTRATION
Old Mutual Investment Group Property Investments (Pty) Ltd (OMIGPI) has been contracted to provide ongoing asset management and property management of the portfolio.
PROPERTY ASSET MANAGER, PROPERTY MANAGER, AND GROUP SECRETARY (REGISTERED OFFICE) Old Mutual Investment Group Property Investments (Pty) Ltd Marriott at Kingsmead
AUDITORS
TRANSFER SECRETARIES | TRUSTEES
SPONSORS 3rd Floor, Corporate Place, Nedbank Sandton 135 Rivonia Road Sandown, 2196 PO Box 1144 Johannesburg 2000
BANKERS |
MANAGEMENT COMPANY AND COMMITTEE STRUCTURES
As required by Collective Investment Schemes Control Act, No. 45 of 2002, SA Corporate Real Estate Fund has an external management company. SA Corporate Real Estate Fund Managers Limited, a subsidiary of Old Mutual Investment Group Property Investments (Pty) Ltd (OMIGPI) has been appointed as the manager of the fund.
The board of directors of the management company has established the following committees, viz: an Investment Committee, a Risk, Audit and Compliance Committee, a Nomination and Remuneration Committee and a BEE transformation committee.
Management fee
The Fund pays a service fee to the management company amounting to 0,4% per annum of the total market capitalisation of the Fund, calculated monthly on the average daily closing unit price of the Fund as recorded by the JSE Limited, plus total long term borrowings.
The management company has contracted with OMIGPI in respect of the asset management of the Group as well as the property management of the portfolio.
In terms of the contract, OMIGPI attends to the day to day property management of the portfolio, the financial and accounting related responsibilities and the statutory secretarial responsibilities, the costs of which are borne by the property companies and Fund.
STATEMENT ON CORPORATE GOVERNANCE
Introduction
The board of directors of SA Corporate Real Estate Fund Managers Limited, the management company of the SA Corporate Group, endorses and has adopted and applied the Code of Corporate Practices and Conduct as set out in the King II Report. In supporting the Code, the directors are committed to conducting the business affairs of the Group with the utmost good faith, highest level of ethics and in accordance with generally acceptable practices within the constraints of industry norms, thus ensuring timely, relevant and meaningful reporting to unitholders and other stakeholders.
The directors have accordingly established mechanisms and policies relevant to the Group's business operations and business risks. The board's procedures and policies, summarised below, reflect the environment in which the board operates in compliance with the principles of the Code.
Board of directors and committees
The board has developed and adopted a charter, allowing for the specific responsibilities of the board to be delegated effectively, ensuring unitholders' value is preserved and enhanced. The salient terms of the board charter are set out below:
Nominations policy
The composition of the board, including its size, diversity, demographics and continuity is considered and reviewed by the Nomination and Remuneration Committee.
The board consists of four executive directors and nine non-executive directors, of which five are considered to be independent. The board holds a voluntary Annual General Meeting of the Fund's unitholders to allow for the appointment of two directors who are elected by the unitholders of the Fund. The members of the board bring a wealth of experience and ensure independent debate on matters of strategy, policies, progress and performance.
Procedures for appointment to the board are formal. The board as a whole approves the appointment of new directors. Background checks are done prior to the appointment of new directors and include enquiries as to possible disqualifications. All directors, executive and non-executive, when appointed are inducted according to a program in order to make them au fait with the workings of the Group, it's businesses and it's strategies. In this way they are better able to fulfil their fiduciary duties and financial responsibilities as directors.
Directors attendance
The board meets at least quarterly with additional meetings being held as necessary. During the period under review four meetings were held. The following current directors missed one meeting each: Ms L. Mojela and Mr W. van der Vent.
Sub-Committees of the Board
The board is responsible for the strategic direction of the Group, maintains full and effective control of the Group and is ultimately responsible for ensuring that the business is a going concern. To assist the board in effectively discharging its responsibilities the following committees have been put in place:
- Nomination and Remuneration Committee
This committee is mandated to monitor and review the remuneration of executive and non-executive directors. In addition, this committee, on an ongoing basis, assesses the mix of skills, experience and diversity of the board. This committee is chaired by an independent non-executive director, and includes a further three non-executive directors. The CEO is invited to attend these meetings. This committee meets at least twice per annum and there were no absences from meetings during 2007.
- Investment Committee
This committee comprises three executive directors and three non-executive directors. This committee meets quarterly and reports directly to the board. This committee is responsible, inter-alia, for considering acquisition and disposal of properties and executing the investment strategy of the Group. The executive director in charge of finance is invited to attend these meetings. The only absence during the year was Mr K Forbes (one absence).
- Risk, Audit and Compliance Committee
This committee comprises three independent non-executive directors and is chaired by an independent non-executive director. The Group's CEO, the executive director in charge of finance and the independent auditors are invited to these meetings. This committee meets at least three times per annum. This committee's responsibilities include, inter-alia:
- Monitoring compliance with applicable legislation and requirements of regulatory authorities.
- Reviewing policies relating to risk management, financial and internal controls, accounting policies, reporting and disclosure.
- Reviewing and reporting on external audit findings, reports, audit fees and appointments.
- With regard to risk management this committee is required to assist in identifying, assessing, managing and monitoring the risks to which the business is exposed to.
Notwithstanding the above committee's responsibility with regard to risk management, the directors acknowledge that risk management is ultimately a board responsibility. To this end, the directors are of the opinion that adequate accounting records are maintained, that there are no significant deficiencies in the existing system of internal controls and that all major insurable risks have been insured. There were no absences from meetings during the year.
- BEE and Transformation Committee
During 2007 a committee was established to encourage meaningful BEE transformation in the Group in line with the national transformation agenda envisaged for BBBEE as set out in the Department of Trade and Industry Black Economic Empowerment Codes (“DTI BEE Codes”) and proposed in the Property Sector Charter (“PSC”), which is visible and based on moral motivation and sound economic rationale. The board now comprises 46% black members.
The committee consists of two executive directors, three non-executive directors, and is chaired by the chairman of the board. There were no absences from meetings during 2007.
The Group and the Management Company, having contracted out the property management and property asset management of the Fund and the underlying fixed property companies to OMIGPI has no direct employees. Accordingly, the Group has no worker participation or affirmative action programmes. The board does, however, support and encourage its service providers and OMIGPI to adhere to these recommended practices.
Communications with stakeholders and unitholders
The Group is committed to effective communication with stakeholders and unitholders. To this end various policies governing communication with interested parties are in place, having regard to the dissemination of quality, complete, accurate and reliable information. In the interest of enhancing communication and maintaining relationships with unitholders the management company continues to hold a voluntary Annual General Meeting of the Fund. In addition to the Annual General Meeting, the annual financial report, and interim results announcements, management hold regular presentations to investors, analysts, the press and other stakeholders. Newsletters containing information on acquisitions or current events and market conditions are released on SENS and distributed to the database whenever it is appropriate. In 2007, there were 23 news releases on SENS.
Share dealings
All dealings by directors are regulated by the JSE Listings Requirements. A communication policy, which is reviewed annually by the board, is in place and governs the communication of all market sensitive information and share dealings. Closed periods include the period from 1 January until the release of the final results in late February, and from 1 July until the release of the interim results in late August.
The board of directors of SA Corporate Real Estate Fund Managers Limited, the management company of the SA Corporate Real Estate Fund, endorses and has adopted and applied the Code of Corporate Practices and Conduct as set out in the King II Report. In supporting the Code, the directors are committed to conducting the business affairs of the Group with the utmost good faith, highest level of ethics and in accordance with generally acceptable practices within the constraints of industry norms, thus ensuring timely, relevant and meaningful reporting to unitholders and other stakeholders.
Directors' responsibility and going concern
It is the directors' responsibility to prepare financial statements that fairly present the state of affairs of the Group.
The external auditors are responsible for the independent auditing and reporting on the financial statements. The directors are of the opinion that adequate accounting records are maintained and that no major deficiencies exist in the system of internal controls, which controls are subject to ongoing review and improvement.
The directors are of the opinion that the Group has adequate resources and funding facilities to continue in operation for the foreseeable future and the financial statements have accordingly been prepared on a going concern basis. The external auditors concur in this respect with the directors.