Corporate Governance

ACTOWERS is listed on the Alternative Exchange (AltX) of the JSE Limited ( JSE). The Board of Directors (the Board) is committed to ensuring that the Group adheres to the highest standards of corporate governance in the conduct of its business and is committed to the principles of openness, integrity and accountability. The Board supports the principles contained in the Code of Corporate Practices and Conduct recommended by the 2002 King Report on Corporate Governance for South Africa (King II) as well as the Listings Requirements of the JSE.

Improvements made during the past year and plans for the year ahead
The Board’s governance policies and procedures are continually updated to ensure ongoing adherence to the Listings Requirements of the JSE, King II and current legislation. During the period under review, the following enhancements were made to the Board’s governance framework:

• the Audit Committee charter was aligned with the requirements of the promulgated Corporate Laws Amendment Act 24 of 2006 (CLAA);
• a Risk Committee was constituted by the Board on 19 February 2009 to monitor risks;
• a Remuneration Committee was constituted by the Board on 19 February 2009;
• an Acquisition Committee was constituted by the Board on 11 March 2009 to evaluate future acquisitions;
• a non-audit services policy was formalised by the Audit Committee and approved by the Board; and
• the Board appointed an additional Independent Director and member of the Audit and Risk Committees to ensure that the company is fully compliant with the CLAA.

Statement of compliance
The Listings Requirements of the JSE require that listed companies report on the extent to which they comply with the principles incorporated in King II. The Directors, to the best of their knowledge and belief, are of the opinion that throughout the accounting period under review, the company has substantially applied the principles of King II in terms of the Board’s governance framework, other than King II’s recommendation that the roles of the Chairman and the Chief Executive Officer be separated, although this separation is not required in terms of the Listings Requirements of the JSE for AltX companies.

ACTOWERS has further reviewed the rules and regulations of the Listings Requirements of the JSE and is satisfied that it complied in all material respects with these regulations.

The Board of Directors
ACTOWERS has a unitary Board structure with six Directors, including three Executive Directors and three Non- Executive Directors. Two of the three Non-Executive Directors are independent in terms of the guidelines outlined in the JSE Listings Requirements and the CLAA.

The Board is governed by a formal Board Charter setting out composition, processes and responsibilities. The primary responsibilities of the Board include regular review of the strategic direction of investment decisions and performance against approved plans, budgets and best practice standards. The Board retains full and effective control of the Group and decisions on material matters are reserved for the Board. The Board is also responsible for monitoring the activities of the executive management.

Chairman and Chief Executive Officer
The Chairman and Chief Executive Officer is Chris Krüger. Chris leads the Board and is responsible for representing the Board to shareholders. He is further responsible, with the assistance of the other Executive Directors and management, for the running of the day-to-day business of the Group, for the implementation of policies and strategies adopted by the Board and takes full responsibility for all operations.

The Directors are experienced business people and are required to exercise leadership, enterprise, integrity and judgement based on the principles of good governance.

Retirement and re-election of directors
One third of the Directors are subject, by rotation, to retirement and re-election at the Annual General Meeting in terms of the company’s Articles of Association, David van Staden and Jacques de Villiers, being eligible, have offered themselves for re-election. The biographical details for each of the Directors are set out on page 8 of the Annual Report.

Board Committees
While the Board remains accountable and responsible for the performance and affairs of the company, it delegates to management and Board Committees certain functions to assist it to properly discharge its duties. The Board had one Committee during the period under review and recently formed two additional Board Committees, namely the Remuneration Committee and the Acquisition Committee. The Chairman of the Audit Committee reports at each scheduled meeting to the Board and members attend all Annual General Meetings to answer questions raised by shareholders.

Audit Committee
The Audit Committee was chaired by Dr Ruben Richards until his retirement on 28 August 2008. Mitesh Patel was appointed as the Chairman of the Audit Committee with effect from 9 September 2008. A Risk Committee was subsequently formed by the Board. The Audit Committee was attended by the Financial Director, the Independent Auditors and the Designated Adviser, who attended by invitation. The Audit Committee was formed for the purposes of monitoring and reviewing:

• the effectiveness of the Group’s information systems and other systems of internal control;
• the effectiveness of the internal audit function;
• the reports of both the external and internal auditors;
• the Annual Report and specifically the Annual Financial Statements included therein;
• the accounting policies of the Group and any proposed revisions thereto;
• the external audit findings, reports and fees and the approval thereof;
• ensuring that non-audit services will not be obtained from the external auditors where the provisions of such services could impair audit independence; and
• compliance with applicable legislation and requirements of regulatory authorities.

The Audit Committee has set the principles for recommending the firm of external auditors for non-audit services. A separate disclosure is made in note 19 of the Annual Financial Statements of the amounts paid for audit services. The Audit Committee has satisfied its responsibilities during the year in accordance with its formal Terms of Reference.

Risk Committee
Mitesh Patel (Chairman), Vuyisa Nkonyeni, Martin Potgieter and Jacques de Villiers are the members of the Risk Committee. The Committee was constituted on 19 February 2009 and as a result, no meeting was held during the period under review. The Committee is mandated to assist the Board in the discharge of its duties relating to corporate accountability and the associated risk in terms of management, assurance and reporting. The Committee will review and assess the integrity of the risk control systems and ensure that the risk policies and strategies are effectively managed.

Remuneration Committee
Vuyisa Nkonyeni (Chairman), Mitesh Patel and Martin Potgieter are the members of the Remuneration Committee. The Committee was constituted on 19 February 2009 and as a result, no meeting was held during the period under review. The Committee is authorised to approve Executive Directors’ remuneration that is fair and competitive and will also review the Executive Directors’ recommendations for Non-Executive Directors’ fees and Committee fee structures against market data.

Acquisition Committee
Jacques de Villiers and David van Staden are the members of the Acquisition Committee. The Designated Adviser will attend meetings by invitation. The Committee was constituted on 11 March 2009 and as a result, no meeting was held during the period under review. The Committee will discuss any possible acquisitions that would enhance growth in the Group.

Board and Committee meeting attendance
The Board and Audit Committee meets at least four times a year. Additional meetings were convened to consider specific business issues which arose between scheduled meetings. Representatives of the appointed Designated Adviser attend all Board and Audit Committee meetings. The Company Secretary acts as secretary to the Board and its Committees and attends all meetings.

Details of the attendance at meetings are provided in the table below.

Director	Status	Board	Audit Committee
CJJ Krüger	Executive	7/7#
J de Villiers	Executive	7/7	6/6+
DM van Staden	Executive	7/7
RR Richards	Non-Executive	4/7*	3/6*
MM Patel	Independent Non-Executive	3/7**	3/6**
V Nkonyeni	Independent Non-Executive	1/7~	0/6~
MM Potgieter	Independent Non-Executive	1/7+	0/6++
# Chairman * Retired from the Board with effect from 28 August 2008 ** Appointed to the Board on 9 September 2008 ~ Appointed to the Board on 31 January 2009 + Attended by invitation ++ Appointed to the Board on 3 March 2009

Appointments to the Board
The Board has adopted a policy on the procedures for the appointment of Directors. Directors will be appointed on the basis of skill, acumen, experience and level of contribution to and impact on the activities of the Group. Directors are invited to assist with the identification and nomination of potential candidates. The Non-Executive Directors of the Board propose suitable candidates for consideration by the Board.

Closed periods
A closed period is exercised by the Directors from the date of the reporting period until the Group’s results are published on SENS. Additional closed periods are enforced as required in terms of any corporate activity or when Directors are in possession of price sensitive information. The Company Secretary ensures that all Directors are aware of the legislation regulating insider trading.

Interests of directors
The direct and indirect beneficial interests of Directors in the company’s securities as at 28 February 2009 are set out in note 5 on page 25 of the Annual Report. There were no changes in the Directors’ interests in the share capital of the company between 28 February 2009 and the date of the Notice of Annual General Meeting contained in this Annual Report. A record of Directors’ dealings and clearance provided in terms of the Listings Requirements of the JSE is retained by the Company Secretary.

Directors ’ share dealings
Directors may not deal in the company’s shares without first advising and obtaining written clearance from the Chairman and the Financial Director. The Chairman and Financial Director may not deal in the company’s shares without first advising and obtaining clearance from the Board. No Director or executive may trade in ACTOWERS shares during closed periods as defined in the JSE Listings Requirements. The Directors of the company keep the Company Secretary advised of all their dealings in securities and a written record is contained thereof.

Interests in contracts
During the year ended 28 February 2009, other than Mr Chris Krüger’s interest in JK Shelters disclosed in note 25 to the Annual Financial Statements, no other Director had a significant interest in any contract or arrangement entered into by the company or its subsidiaries.

Directors are required to inform the Board timeously of conflicts or potential conflicts of interests they may have in relation to particular items of business and recuse themselves from discussions or decisions on matters in which they have a conflicting interest.

The register of interests of Directors in contracts in terms of Section 234 of the Companies Act 61 of 1973, as amended, is updated at every Board meeting.

Company secretary
The appointment and removal of the Company Secretary is a matter for the Board as a whole. The Company Secretary advises the Board on the appropriate procedures for the management of meetings and the implementation of governance procedures, and is further responsible for providing the Board collectively, and each Director individually, with guidance on the discharge of their responsibilities in terms of the legislation and regulatory requirements applicable to South Africa. The Company Secretary monitors Directors’ dealings in securities and ensures adherence to closed periods for share trading.

Communication
The Board ensures that material matters of interest and concern to shareholders and other stakeholders are addressed in the company’s public disclosure and communication. In this regard the Board ensures that the Group provides adequate transparency on all pertinent matters. The Chief Executive Officer and Financial Director meet with shareholders and analysts as well as with the financial press in order to ensure accurate reporting of company matters. All pertinent company announcements are placed on the company website.

The Board further encourages shareholders to attend its Annual General Meeting, notice of which is contained in this Annual Report, where shareholders have the opportunity to put questions to the Board and the Chairman of the Audit Committee.

The company’s website provides the latest and historical financial and other information, including the Annual Reports.

Employment equity
An affirmative action programme forms part of the Group’s business plan. The Group offers equal opportunities to all employees. It seeks to provide a work environment in which individuals of ability and commitment are able to develop their careers regardless of their background, race, religion or gender.

The Group fully supports the government’s initiative to achieve greater equity in the workplace and management of all Group companies is fully committed to complying with the Employment Equity Act of 1998 (as amended).

Going concern
The Annual Financial Statements set out in this Annual Report have been prepared in accordance with International Financial Reporting Standards. They are based on appropriate accounting policies that have been consistently applied.

The Directors report that, after making enquiries, they have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the Group continues to adopt the going concern basis in preparing the Annual Financial Statements.