Statement of commitment to good governance and assurance

Chairman’s statement on corporate governance

Datatec believes that good corporate governance contributes to enhanced accountability, fairness and transparency. Good governance exists in an environment where roles and responsibilities are clearly defined, forums are conducive to robust debate and performance is regularly reviewed. We outline our progress and describe our governance efforts over the next few pages.

The Datatec board is committed to providing effective leadership to the Group. The board embraces the principles of ethical leadership in setting and implementing Datatec's strategy and is guided by the principles of the King IV™* Report on Corporate Governance in South Africa ("King IV™"), the Companies Act, 2008 ("Companies Act"), the JSE Listings Requirements and all other applicable laws, standards and codes.

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A King IV™ compliance schedule can be found at www.datatec.com.

The board exercises independent judgement on all issues reserved for its review and approval, while simultaneously considering the needs of stakeholders, and takes full responsibility for the management, direction and performance of the Group.

COMBINED ASSURANCE GUIDE

To ensure we make and execute good decisions, which are transparently in the interest of Datatec, its shareholders and other stakeholders, the board works continuously to maintain and develop its governance framework.

Stephen Davidson
Chairman

Datatec combined assurance model

A combined assurance framework for monitoring and evaluating the effectiveness of the Group's internal controls is in place throughout the Group. This framework deploys and co-ordinates internal and external assurance providers to report on the effectiveness or otherwise of the internal controls.

The combined assurance model is designed to ensure optimisation of the assurance coverage obtained from management, internal assurance providers and external assurance providers on the risk areas affecting the Group. Within Datatec, there are a number of assurance providers that either directly or indirectly provide the Board and management with certain assurances over the effectiveness of those controls that mitigate the risks as identified during the risk assessment process. Collectively, the activities of these assurance providers are referred to as the combined assurance framework.

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For more information on the combined assurance model, please refer to the risk report.

Application of King IV™

Good corporate governance as envisaged in King IV™ is both pivotal and integral to every critical aspect of value creation. As such, the complete impact of the board's application of King IV™, as it relates to governance and how it affects value creation, cannot be captured through a single-section disclosure. Accordingly, in the various sections of this Integrated report, we have endeavoured to demonstrate how the board applies the principles of King IV™ to govern, create, sustain and grow value for the Group as well as achieve the intended outcomes of the King IV™ Code. This theme will be one that is reflected in this integrated report and subsequent ones.

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Further information on the Group's application of King IV™ can be found on www.datatec.com.


Board confirmation

The Board acknowledges its responsibility for the integrity of this report.

The directors confirm they have collectively assessed the content and believe it addresses the material matters that substantively affect the organisation’s ability to create value over the short, medium and long term and is a fair representation of the integrated performance of the Group.

* Copyright and trademarks are owned by the Institute of Directors in Southern Africa NPC and all of its rights are reserved.

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Key Company information

Datatec Limited registration number: 1994/005004/06

ISIN: ZAE000017745

JSE Main Board: Computer Services

Listing date: 1994

Share code: DTC

Shares in issue at 28 February 2019: 219 200 000 (of which 14 315 held in treasury)

Feedback from Datatec’s shareholder engagement roadshows has been used to identify matters to report on.

The Audit, Risk and Compliance Committee, which has oversight responsibility for the Integrated Report, has applied its mind to the preparation and presentation of the report. It has concluded that the report has been presented in accordance with the IIRC and recommended the report for approval by the Board of directors.

The Board has therefore approved the 2019 Integrated Report for release to stakeholders.

The Board is committed to providing effective leadership to the Group and fully embraces the principle of ethical leadership in setting and implementing the strategy and Group’s approach to governance, guided by principles of King IV™.

In addition, the Board takes full responsibility for the management, direction and performance of the Group by exercising independent judgement on all issues reserved for its review and approval while taking cognisance of the needs of stakeholders.

Datatec is committed to maintaining the highest standards of ethics and business conduct. The Group has a Code of Conduct (“the Code”) detailing the standards expected from all Datatec employees, including addressing specific matters such as bribery and corruption. The Code is uniformly applied across all divisions.

Ethics

The Code is founded on the 10 principles of the United Nations Global Compact and the OECD policy guidelines for preventing corruption. It is reviewed annually.

All Datatec employees are required to undertake annual training on the Code. Westcon International and Logicalis organise this training through an annual online programme which is also utilised by Datatec Financial Services and Datatec head office employees. Analysys Mason has an annual employee briefing session.

The Datatec Social and Ethics Committee and the Datatec Audit, Risk and Compliance Committee monitor implementation of the Code. The divisions are required to report any unethical or fraudulent conduct in contravention of the Code to the Datatec Audit, Risk and Compliance Committee and the Datatec Social and Ethics Committee and to provide formal semi-annual assurance to the Board on these matters.

Information available in the risk report.


The Group has a whistleblowing hotline for anonymous reporting of any unethical conduct. Westcon International and Logicalis also operate separate whistleblowing hotlines for their employees. All the hotlines are operated by third-party suppliers independently of the Group and divisions.

Any complaints received via the hotlines or any other means are investigated in accordance with the Group's procedures for investigating complaints. These procedures are under the direction of the Audit, Risk and Compliance Committee and the results of any investigations are reported to the Audit, Risk and Compliance Committee. No significant incidents of unethical behaviour were reported at Group or divisional level during the year.

Our values

Our business philosophy has its roots in an entrepreneurial culture. We are committed to being ethical, honest, socially responsible corporate citizens and strive to be an employer of choice, attracting, developing and retaining talented people.

We value business partnerships and we work towards creating shareholder value by developing a best-in-class portfolio of actively managed businesses operating in the high-value, fast growing sectors of the ICT market.

Datatec
values