Governance

• Governance overview
• The Board
• Board committees
• Remuneration
• Accountability & control
• Corporate Ethics
• Shareholder Relations
• Contact Audit Committee
• Frequently Asked Questions

Related links

• King III questions and answers
• Responsibilities of the Board

The Board

The Board has a charter setting out its policies, roles and responsibilities in the execution of its mandate:

• to direct the Group towards the achievement of the Massmart vision;
• to be accountable for the development and execution of the Group’s strategy, operating performance and financial results, all practised within the Group’s Governance Authorities which describe the specific levels of authority and required approvals for all major decisions at both Group and Divisional level;
• to clarify which executive position, committee or board needs to be consulted prior to taking the decision, which body makes the decision and which bodies should thereafter be informed of the decision; and
• to be responsible for its own composition, the appointment of the Chairman and the Chief Executive Officer, and the constitution and composition of its sub-committees.

Role of all directors is to bring independent judgment and experience to the Board’s deliberations and decisions. They are encouraged to take independent advice, at the Company’s cost, for the proper execution of their duties and responsibilities, and also have direct, unfettered access to the Group’s external auditors, professional advisers and to the advice and services of the Company Secretary. Independent directors have unrestricted access to any executive, manager or employee in the Group.

The Board comprises two executive directors, four independent non-executive directors and three non-executive directors.

About Massmart Non-executive Directors

		Mark J Lamberti Appointed 1 August 1988. Chairmain of the Board and Chairman of the Nominations Committee. Following progress through a multi-functional retail career that began in 1975, Mark was appointed Managing Director of the ailing six-store Makro chain in 1988. After successful repositioning of the chain, he founded Massmart in 1990 to pursue an aggressive growth strategy in high-volume, low gross margin, low-expense retailing and wholesaling. In 1996, he was appointed Executive Chairman of Massmart and from July 2003 CEO and Deputy Chairman of the Board. At the end of June 2007 he relinquished his executive role to become non-executive Chairman. His role as architect and leader of Massmart has been widely recognised with numerous awards including that of the Ernst & Young South African Entrepreneur of the Year in 2001. Mark currently serves as Chief Executive Officer of Transaction Capital (Pty) Limited. He has been Chairman of Business Against Crime South Africa, and is a director and executive committee member of Business Leadership South Africa. His commitment to education has led to his involvement as a benefactor, director or adviser to a number of educational institutions, including the Wits Business School where he is an Honorary Professor.
		JP Suarez Appointed 20 June 2011. Senior Vice President of International Business Development for Walmart International and member of the Social and Ethics Committee. John Peter (JP) Suarez is the Senior Vice President of International Business Development for Walmart International. He joined the company in 2004 as Vice President and General Counsel for Sam’s Club. Prior to being named to his current position in 2011, JP was Senior Vice President and General Counsel for Walmart International. His previous experience includes serving as the United States EPA Assistant Administrator for Enforcement and Compliance, acting as a federal and state prosecutor, and working as Chief Enforcement Officer over New Jersey’s gaming industry. JP graduated from the University of Pennsylvania Law School, where he was an Articles Editor for the law review. He completed his undergraduate studies at Tufts University, where he received a B.A. in English and Drama, with honours in both majors.
		Jeffery Davis Appointed 20 June 2011. Walmart Inc.’s Senior Vice-President Finance & Treasurer. Jeffery Davis is Walmart International’s Senior Vice-President Finance & Treasury and has responsibility for treasury operations, capital markets, investor relations and risk management. He joined Walmart in 2006 as Vice President of Finance for the Walmart U.S. health and wellness merchandise unit. Previously Senior Vice President of Finance and Strategy, Operations, for Walmart U.S., he also served as Chief Financial Officer for Lakeland Tours, LLC, where he led its acquisition growth strategy. Prior to that, Jeffery was Chief Financial Officer for McKesson General Medical and he held a number of financial leadership roles at the Hillman Co, a private investment holding company. He also spent four years at KPMG Peat Marwick as an audit supervisor. He obtained his BS Accounting at the Pennsylvania State University and then completed his EMBA at the University of Pittsburgh, PA, USA.
		Chris Seabrooke Appointed 1 February 2000. Deputy Chairman of the Board and Lead Independent Director, Chairman of the Audit and Risk Committee, Chairman of the Remuneration Committee and a member of the Nominations Committee. Chris has, over the years, been a director of over 20 stock exchange-listed companies. He is currently CEO of Sabvest Limited (JSE), Chairman of Metrofile Holdings Limited and Set Point Group Limited (JSE), and a director of Datatec Limited (JSE/AIM), Net1 UEPS Technologies Inc (Nasdaq/JSE) and Brait S.A. (Luxembourg/London/JSE). He is also Chairman of the Alternative Equity Partners Fund and a director of a number of unlisted companies locally and internationally. He is a former Chairman of the South African State Theatre and former Deputy Chairman of both the inaugural National Arts Council of South Africa and the founding board of Business & Arts South Africa.
		Dr Nolulamo (Lulu) Gwagwa Appointed 1 November 2006. Member of the Audit and Risk Committee. Lulu is Chief Operating Officer of Lereko Investments (Pty) Limited. She was Deputy Director General in the National Department of Public Works, responsible for establishing the national public works programme, and completed a five-year term as the CEO of the Independent Development Trust. She has served on various Government commissions, and is a non-executive director of FirstRand Limited, the Development Bank of Southern Africa and Sun International Limited.
		Phumzile Langeni Appointed 25 August 2004. Chairperson of the Social and Ethics Committee and member of the Audit and Risk Committee. Phumzile is the Executive Chairperson of Afropulse Group (Pty) Limited, a women-led investment, investor relations and corporate advisory house. She was previously the economic adviser to the Minister of Minerals and Energy, and an executive director of dual-listed junior platinum miner, Anooraq Resources. Phumzile is a non-executive chairperson of Astrapak Limited, a non-executive director of Imperial Holdings Limited, Peermont Global (Pty) Limited, the Mineworkers Investment Company (Pty) Limited, Transaction Capital (Pty) Limited and a member of the Port Regulator.
		Dave Cheesewright Appointed 23 Nov 2011 as an alternate director to Doug McMillon, JP Suarez and Jeff Davies. President and Chief Executive Officer - Walmart EMEA Dave Cheesewright is the President and Chief Executive Officer for Walmart EMEA. He leads Walmart’s retail operations and oversees business development in Europe, the Middle East, Africa and Canada. Dave’s career spans more than 20 years across the international retail and manufacturing sectors. Prior to his current role, he was President and Chief Executive Officer of Walmart’s Canadian operation, and previously Chief Operating Officer of ASDA, Walmart’s operation in the United Kingdom. He joined ASDA in 1999, holding senior positions over a nine-year period. Before his careers with ASDA and Walmart, Dave held a range of leadership positions in the United Kingdom with Mars Confectionery, the world’s leading confectionary company.
About Massmart Executive Directors
		Grant Pattison (41) BSc (Eng) (Hons) (UCT) Appointed 7 December 2004. Executive Officer and member of the Social and Ethics Committee. Grant graduated from the University of Cape Town as an electrical engineer. After four years with the Anglo American group and two years consulting with The Monitor Group, Grant joined Massmart as Executive Assistant to the Executive Chairman in 1998. He has since held various positions within the Group, including Managing Director of Massdiscounters and Group Commercial Executive. He joined the Executive Committee in 2000 and the Board in 2004, becoming Deputy Chief Executive Officer in 2005, Chief Executive Officer Designate in 2006 and Chief Executive Officer on 1 July 2007.
		Guy Hayward (47) BCom, CTA (UCT), CA(SA) Appointed 15 May 2001. Chief Operating Officer. Guy graduated from the University of Cape Town in 1986 and, after serving articles with Deloitte Haskins & Sells, qualified as a Chartered Accountant in 1989. During the 1990s he held senior financial roles at Malbak and CNA Gallo in South Africa and at Goldman Sachs in London. He joined Massmart as Group Financial Executive in 2000 and was appointed Chief Financial Officer in 2001. Guy is also a Governor of Hilton College. On 7 May 2012 Guy was appointed as Chief Operating Officer.
		Ilan Zwarenstein (37) Financial Director BCom, BAcc, CA(SA) Ilan graduated from the University of the Witwatersrand in 1997. After completing his articles in 2000, he remained with Grant Thornton where he served as a manager in Corporate Finance and in Audit. In February 2003, Ilan was appointed as a partner at Grant Thornton. He joined Massmart at the end of 2005 as Group Finance Executive and was appointed Company Secretary in 2006. In May 2012, Ilan was appointed as Financial Director.

The Company Secretary (who is subject to a ‘fit and proper’ test) assists the Board in fulfilling its functions, is empowered by the Board to perform his duties and directly or indirectly:

• assists the Chairman, CEO and CFO with induction of new directors
• assists the Board with director orientation, development and education
• ensures that the Group complies with all legislation applicable/relevant to Massmart
• monitors the legal and regulatory environment and communicates new legislation and any changes to existing
• legislation relevant to the Board and the Divisions
• provides the Board with a central source of guidance and assistance

Retirement

All directors retire by rotation every three years. Unless requested by the Board to serve a further term, retiring directors are not proposed for re-election by the shareholders. Shareholders must ratify the initial appointment of each director at the first annual general meeting of shareholders following that director’s appointment.

Board process

The Board meets four times a year and on an ad hoc basis should a particular issue demand its attention. In addition, the Board meets annually to formally consider and approve the strategies of the Massmart Divisions and Group.

The Board's authority is devolved sequentially through the Massmart Executive Committee, the Divisional Boards and the Divisional Executive Committees, as formally prescribed by the Massmart Governance Authorities. In addition, the Board has delegated certain specific responsibilities to three Board Committees. These Committees assist the Board and directors in discharging their duties and responsibilities under King III and the Governance Authorities. Full transparency of the Committees' deliberations is encouraged and the minutes of all Committee meetings are included in the formal Board papers at the ensuing Board meeting. All directors are welcome to attend any Board Committee or Divisional Board meetings.

The Massmart Governance Authorities describe the specific levels of authority and required approvals for all major decisions at both Group and Divisional level. It clarifies which executive position, Committee or Board needs to be consulted prior to taking the decision, which body makes the decision and which bodies should thereafter be informed of the decision. Where appropriate, it now includes the Walmart position on the decision.

The Board works to a formal agenda that covers strategy, structure, operating performance, growth initiatives, sustainability, investor relations, risk and governance, and any other key activities of the Group. An annual agenda structure ensures that other areas including IT and compliance are addressed. Formal Board papers are prepared for every discussion item on the meeting's agenda and are distributed timeously to Board members.

Evaluation

Annually in September, the Remuneration and Nominations Committee facilitates a comprehensive formal performance evaluation of the CEO, comprising a self-evaluation, a questionnaire evaluating the CEO by every non-executive director, and an appraisal of the CEO by each of his direct reports using a different questionnaire. The Board Chairman provides the summary and feedback of the above to the CEO and he is encouraged to probe and debate any aspect of the evaluation with the Board.

At the same time, all Board members complete a detailed Board self-assessment, covering the composition, duties, responsibilities, process and effectiveness of the Board. Similarly, all Board Committee members complete detailed self-assessments covering the same aspects of their committees. The results of these assessments are collated by the Company Secretary and sent in summarised form to the respective Board and Committee Chairpersons for a formal written response. The summarised results together with the Chairpersons' written responses are included in the Board papers at the November meeting.

Finally, all Board members formally assess the Chairman's performance and the Deputy Chairman provides the feedback. These assessments are approached in a constructive manner and provide valuable input that enhances the effectiveness of the Chairman, the Board and its Committees.