LETTER: Board members must be free of any conflict of interest
The recent high court judgment declaring Dudu Myeni to be a “delinquent director” was a timely reminder to many of us that we assume onerous fiduciary responsibilities when we volunteer to accept positions as trustees, directors and curators. These fiduciary duties require of us that there is no conflict of interest — real or perceived — with our personal interests or with our responsibilities to any other person or organisation.
It is not only incumbent on all directors of all companies to ensure they do not accept appointment as a director with, and remuneration from, a company that is in competition with another company of which they are a director. It is equally incumbent upon directors to abide by the policies and uphold the principles of the company of which they are a director and not to accept any position with another company that might place them in conflict therewith.
The article on the front page of Business Day on June 9 referred to the nomination of a number of people to the board of directors of Standard Bank Group who occupy seats on the boards of, and receive remuneration from, fossil fuel companies such as Sasol, Exxaro, Ichor Coal, South 32 and BP.
It is becoming increasingly difficult for such companies to raise capital as we transition to a low-carbon economy, a trend that is certain to become more pronounced given the urgent need to dramatically reduce carbon emissions.
Standard Bank has now adopted certain policies pertaining to coal financing that may be incompatible with accepting a directorship on the bank’s board while enjoying a directorship of, and remuneration from, those companies in such circumstances.
I would suggest careful examination of fiduciary responsibilities when it comes to directorships on multiple boards to which such policies apply.
Trustee, Raith Foundation
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