The Mandela Rhodes Foundation: African Leadership Development

Corporate Governance: General introduction

"Corporate governance" is a system of checks and balances between the Board of Trustees, Exco and management that should produce an efficiently functioning foundation, ideally geared to produce long-term value. All corporate governance systems throughout the world are the product of a series of legal, regulatory and best practice elements.

The Mandela Rhodes Foundation

Board of Trustees

The Board of Trustees is responsible for the good governance of The Mandela Rhodes Foundation. The delegation of authority to the Executive Committee in no way absolves the Board of Trustees of its responsibility for their decisions and actions. The Board of Trustees has collective responsibility to provide effective governance and as such the Trustees must remain independent and objective, serving the interests of the Foundation as a whole. The Board of Trustees meets once a year. Pursuant to its commitment to high governance, the Board of Trustees appointed three committees - Executive, Finance and Audit Risk and Investment, made up of independent outsiders of high standing as well as Trustees of the Foundation and management.

Executive Committee

The Mandela Rhodes Executive Committee performs an important supporting, facilitative and monitoring role in relation to the overall management of the Mandela Rhodes Foundation. Mandated by the Board of Trustees, it takes its decision within the Board policy framework as well as makes policy recommendations for Board consideration. It also acts as an important point of reference for the Chief Executive, providing the CEO with the opportunity for ongoing engagement regarding key organisational developments. The Executive Committee holds monthly telephone conference calls.

Finance, Audit & Risk Committee

The Finance, Audit & Risk Committee is focused on The Mandela Rhodes Foundation and its related activities. By virtue of its profile, the key concern of this committee is to manage the reputational risk and so called collateral damage that may be caused to the Foundation if appropriate steps are not taken to ensure adequate coverage of all such entities and structures. The Trustees acknowledge that this is an evolving situation and priority will be given to identifying all such entities and structures and including them in the ambit of the committee after due consideration of the facts. Meetings are held at least three times per annum.

Investment Committee

The IC establishes the investment objectives and the investment philosophy for the Endowment fund and monitors the implementation and adherence to the same by the duly appointed Investment Managers mandated to manage the portfolio(s) of assets. Such investment objectives and philosophy are informed by the objectives of the MRF. Resultant Investment Mandates shall, in aggregate, represent an appropriate level of expected return and degrees of risk and may vary over time, depending on the extent to which the desired MRF Programmes' spending policy has to be funded from the Endowment fund as opposed to being directly funded from donations or other sources.

The IC from time to time determines the suitable selection, appointment and termination of asset managers needed to achieve the investment objectives. Security and rate of return being equal, certain other criteria are used by the IC to ensure that investment choices are made with due social conscience, in line with the stated principles of the MRF.

Code of ethics

Corporate governance calls for three factors - Accountability, safeguarding the interests of the stakeholders and the donors and transparency in decision-making.

Implementation of corporate governance depends upon laying down explicit codes, which the organisation is supposed to observe. These codes, however, can only be a guideline. Ultimately effective corporate governance depends on the commitment of the people in the organisation. Corporate governance depends upon two factors. The first is the commitment of the management to the principle of integrity and transparency in business operations. The second is the legal and the administrative framework created by the government.

Senior management

The values of uncompromising integrity, compliance with applicable laws, fair, accurate and timely disclosure are the cornerstones of The Mandela Rhodes Foundation's relationships with its Scholars, donors and other stakeholders.

It is the MRF's policy that its employees are held to the highest standard of honesty and ethical conduct when conducting the affairs of the Foundation. The purpose of this code of ethics is to establish policies and guidelines that ensure and/or promote;

Honest and ethical conduct, including the ethical handling of conflicts of actual or apparent conflicts of interest between personal and professional relationships
Full, fair, accurate, timely and understandable disclosure in reports and documents required to be filed by the MRF with, or submitted to, the statutory bodies, bankers and shareholders
Compliance with applicable laws, rules and regulations
Prompt internal reporting of violations of this Code and accountability for adherence to this Code

Honest and ethical conduct

All employees are obliged to;

Conduct their personal and professional affairs in a way that avoids both actual and apparent conflicts of interest between their interests and the interests of the organisation.
Refrain from engaging in any activity that would compromise their professional ethics or otherwise prejudice their ability to carry out their duties on behalf of the Mandela Rhodes Foundation.
Provide a mechanism for members of the finance committee to inform senior management of deviations in practice from policies and procedures governing honest and ethical behaviour.
Demonstrate their personal support for such policies and procedures through periodic communication reinforcing these ethical standards throughout the finance organisation.
Refrain from disclosing confidential information acquired in the course of their work except where authorised, unless legally obligated to do so.
Refrain from using or appearing to use confidential information acquired in the course of their work for unethical or illegal advantage, either personally or indirectly through others.

Full and fair disclosure in financial records and reports

Public communications about material events or developments concerning the Foundation are required to be complete, fair, accurate and broadly disseminated to the public in accordance with all applicable legal and regulatory requirements.

If management becomes aware of material information that affects the disclosures made or to be made by the Foundation in its statutory filings or submissions or other public communications, he or she should promptly bring such information to the attention of the Foundation personnel responsible for preparing such disclosures.
Senior Executives should oversee the establishment and management of the Foundation's internal controls and disclosure controls and procedures to enable and ensure that;
Material financial and non-financial information concerning the Foundation be

fully and accurately disclosed on a timely basis and;
broadly disseminated in accordance with all applicable legal and regulatory requirements.

The Foundation's consolidated financial statements and the notes thereto present fairly, in all material respects, the financial position, results of operations and cash flows of the company as of and for the period(s) indicated in conformity with accounting principles generally accepted and established Foundation financial policy; and
Senior management bring to the attention of Exco and the Finance and Audit Risk Committee any information, of which they are aware, concerning i) significant deficiencies in the design or operation of internal controls which could adversely affect the company's ability to record, process, summarise and report financial and non-financial information concerning the company or ii) any fraud, whether or not material, that involves management or other employees who have a significant role in the company's reporting, disclosure or internal controls.

Compliance with applicable laws, rules and regulations

All employees are required to comply and strictly adhere to all applicable laws, rules and regulations. To ensure such compliance, Senior Executives will establish and maintain mechanisms to;

Educate members of the accounting division about any law, regulation or administration procedure that affects the operation of the finance organisation and the Foundation generally.
Monitor the compliance of the finance organisation with any applicable law, regulation or administrative procedure.

Prompt internal reporting of violations of this code

Senior Executives are required to identify, promptly report and correct, any violation of this Code, the Foundation's Code of Business Conduct and Ethics relating to all employees, management and Trustees, or any law, rule or regulation applicable to the Foundation. Senior Executives must report any such violations to the Foundation's Finance, Audit & Risk Committee.

Accountability for adherence to this Code

The Mandela Rhodes Foundation will take appropriate disciplinary actions for violations of this Code. Such disciplinary actions include, but are not limited to, penalties and demotions and even dismissals.

Amendments and waivers of this Code

Any change to or waiver of this Code may only be made with the approval of the Board of Trustees of The Mandela Rhodes Foundation, or a committee designated thereby. Any such change or waiver shall be made public.