Nampak’s hear-no-evil auditor policy
In the wake of corporate failures that were not prevented by auditing firms, shareholder votes are being ignored
"Since Pa fell off the Christmas tree" was the somewhat imprecise response given by one institutional investor when asked how long he had been voting on the reappointment of auditors at AGMs of JSE-listed companies. Remarkably, given how important the role of auditors has become in the wake of almost every major corporate event of the past three years, no-one seems to know for how long shareholders have been voting on their reappointment. Or on what grounds. Most seemed to assume it was a requirement, although no-one could say for sure if it was a requirement of the Companies Act or of the JSE. Piet Delport, professor of mercantile law at the University of Pretoria, thinks it may date all the way back to Britain’s 1948 Companies Act. As it happens, there is no requirement — in SA’s Companies Act or the JSE listings requirements — to give shareholders a vote on the reappointment of auditors. Section 90 of the Companies Act requires a company to (re)appoint an auditor each year at its...
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