Nominations committee report

Stephen Davidson Nominations Committee Chairman

The Nominations Committee considers the current Board to be very well balanced in terms of skills and experience. The gender diversity of the Board meets the Board's policy requirements by having two female members. As an international group, Datatec requires an international perspective at Board level and this is represented by a range of nationalities and geographic experience among the directors.

Stephen Davidson
Nominations Committee Chairman

The Nominations Committee's role is to review succession planning for executive and non-executive directors and to advise the Board on new appointments and the composition of Board committees. An important aspect of the committee's role is to ensure the Board's stated aims in terms of diversity are met and that the Board comprises a diverse and healthy balance of individuals and skills to optimise its performance in delivering against the Group's strategic objectives.

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Details of the Nominations Committee's constitution and operation are given on Nominations committee report.

During FY19, the Nominations Committee oversaw a substantial refreshment of the Board. Two long-serving non-executive directors, Chris Seabrooke and Nick Temple, both retired from the Board at the AGM in September 2018. Chris Seabrooke's retirement had been planned and he had stepped down as Chairman (and member) of the ARCC in May 2018 to be succeeded in that role by Johnson Njeke. Nick Temple's retirement was planned for August 2019 but it became clear ahead of the 2018 AGM that shareholders did not support his re-election to a sufficient extent so he retired a year earlier than planned. In October 2018, Funke Ighodaro resigned from the Board in accordance with the requirements of a new executive appointment.

On 1 June 2018, Ekta Singh-Bushell joined the board as an independent non-executive director. Her experience in the management and governance of technology is a valuable addition to the Board's collective skill set. Ekta was also appointed to the ARCC and to the Nominations Committee and became the senior independent director in succession to Nick Temple.

On 1 November 2018, Maya Makanjee joined the board as an independent non-executive director. Maya sits as an independent non-executive director on the boards of several notable listed South African companies. She is highly experienced in the fields of leadership, ethics, reputation management, diversity and inclusion, human resources, marketing, corporate communication, sustainability and public affairs. Maya was also appointed to the Remuneration Committee and to the Social and Ethics Committee.

Following these changes, the Board now comprises seven directors: two executives, the CEO and CFO; and five independent non-executive directors including the Chairman. The Nominations Committee considers the current Board to be very well balanced in terms of skills and experience. The gender diversity of the Board meets the Board's policy requirements by having two female members. As an international group, Datatec requires an international perspective at Board level and this is represented by a range of nationalities and geographic experience among the directors.

Committee structure

Committee structure

Diversity

In terms of gender diversity, the Nominations Committee has given priority to seeking female candidates to fill non-executive director vacancies. During FY19 the Board achieved its voluntary target of having two female directors on the Board. In terms of race diversity, it is Datatec's policy to promote race diversity at Board level. To maintain the diverse mix of race and culture, the Board has applied its diversity policy by appointing the two independent non-executive directors during FY19 and the Board is satisfied that this aim is being achieved. Annually, the Nominations Committee will discuss and agree proposed objectives, including, without limitation, the setting of voluntary targets for achieving diversity on the Board and recommend the same to the Board for approval and adoption.

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The policy on promotion of diversity at Board level is available on the website: www.datatec.com.

Independence and length of service

The Board is of the opinion that independence is a matter of a director's character and attitude of mind and is not compromised after any particular length of service. On the contrary, the Board believes that the quality of service of its directors increases over time and that this is particularly true in relation to the chairs of committees of the Board.

The Nominations Committee and the Board review the independence of the non-executive directors thoroughly each year and this review of independence takes into account the length of service as a factor to be carefully considered in the assessment of independence among other factors. The review process followed by the Nominations Committee and Board highlights issues such as whether a non-executive director has the ability to control or significantly influence management, controls a significant number of shares in the Company or any of its subsidiaries, has any contractual relationships with the Company or if the non-executive director is a member of a board of another company with one or more Datatec directors.

The Company will continue to review the independence of its non-executive directors and regularly engage with its stakeholders to ensure good governance.

Succession planning

Succession planning for the Board, management team and senior executives is the responsibility of the Board, assisted by the Nominations Committee. There is a formal succession plan in place for the Chairman, CEO, CFO, Board, Board Committee chairs and senior management that is reviewed annually by the Nominations Committee. The committee then reports to the Board, which determines if any action needs to be taken.

New appointments

A formal induction programme for directors is in place which comprises a presentation on responsibilities, familiarisation meetings and reviews of prior Board and committee meetings. Training is provided with regard to the Companies Act, JSE Listings Requirements and King IV™ Code. Code. The management appointments made by the Board ensure that the appointment of and delegation to management contribute to role clarity and effective exercise of authority and responsibilities.

Outlook

During the shareholder consultation undertaken by the Chairman following the 2018 AGM, shareholder views on the Board structure and succession were sought and discussed. Although the changes noted above have already resulted in a considerably renewed Board, the Nominations Committee will focus in FY20 on succession planning for the two non-executive directors who have tenures on the Board over nine years: Stephen Davidson and John McCartney.

Responding to shareholders' views on the ideal size for the Board, the Nominations Committee has already commenced a search for a sixth independent non-executive director to join the Board during FY20. This search will be directed towards Latin America and Asia as these two geographies form major parts of Datatec's business but are not currently represented on the Board.

Nominations Committee constitution and operation

The committee operates within defined terms of reference as set out in its charter which has been approved by the Board.

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The Nominations Committee charter is available on the Group’s website: www.datatec.com.

The Nominations Committee during FY19 consisted of the following independent non-executive directors:

  • Stephen Davidson (Chairman)
  • Funke Ighodaro (until 31 October 2018)
  • John McCartney
  • Chris Seabrooke (until 20 September 2018)
  • Ekta Singh-Bushell (from 1 November 2018)

Directors' attendance at Nominations Committee meetings during FY19 and subsequently to the date of this report (all meetings were scheduled) is as follows:


7 March
2018
  15 May
2018
  16 October
2018
  14 March
2019
 
SJ Davidson P   P   P   P  
JF McCartney P   P   P   P  
O Ighodaro P   A   P      
CS Seabrooke P   P          
E Singh-Bushell         P   P  

The Chief Executive Officer and Chief Financial Officer may be invited to attend the committee's meetings, but neither may take any part in decisions regarding their own succession. The committee is satisfied that it has met its responsibilities for the year with respect to its terms of reference.

The committee is responsible for making recommendations to the Board regarding the appointment of new executive and non-executive directors and makes recommendations on the composition of the Board generally. The committee ensures that director appointments are formal and transparent and oversees succession planning for the Board and senior management.

The committee reviews its performance annually by means of questionnaires completed by individual committee members and attendees which are then discussed at Board and committee meetings. These appraisals enable the committee to evaluate its effectiveness objectively and to conclude that it is operating effectively under the terms of reference set out in its charter.

The Chairman of the committee reports on the committee's activities at each Board meeting and will be available at the AGM to answer questions about the committee's work.