The concept of corporate governance, as explained in governance codes around the world — including the current King V™ Report on Corporate Governance for South Africa 2025¹ (“King V™”) — has not appealed to everyone. This short paper does not seek to defend or criticise the concept. It is enough to recognise that corporate governance is now an ever-present reality that cannot be ignored. Resistance to governance codes is probably driven, at least in part, by a lack of understanding of the thinking and fundamental principles that underpin them. After more than 35 years in corporate corridors and boardrooms, I have seen enough to be convinced that, when approached properly, governance can add significant value to both organisations and their leadership.

That having been said, there is a critical feature of King V™ that I believe members of governing bodies in this country need to fully understand and appreciate. Not only is this one of the fundamental differences between King V™ and its predecessors, but it also implies very real consequences for those who choose to ignore it.

While much attention has focused on the reduction of principles, the emphasis on systems value creation and the standardisation of disclosure, the most profound implication may be the enhanced accountability now placed on governing bodies through the King V™ Disclosure Framework.

For the first time, any organisation claiming application of King V™, including non-listed entities, is required to publish a completed Disclosure Framework and the governing body is required to approve and assume accountability for the disclosures made therein.

The Framework is not presented as a mere reporting template. King V™ expressly states that it is not a substitute for judgement and that the governing body should apply its mind to ensure that all material information is disclosed to enable stakeholders to make an informed assessment of the quality of governance within the organisation.

More than a Governance Checklist

Under previous governance reporting approaches, organisations often published narrative explanations describing how governance practices were applied. Critics frequently referred to such disclosures as boilerplate statements that were difficult to compare and often impossible to verify.

The King V™ Disclosure Framework seeks to change this. It requires governing bodies not only to explain where recommended practices have not been adopted, but also to make specific declarations regarding their satisfaction with the effectiveness of governance arrangements across the thirteen principles. In addition, the governing body is ultimately required to provide a concluding statement that, in its opinion, the application of the principles and implementation of recommended practices have realised value for the organisation within its economic, social and environmental context.

This moves governance disclosure beyond description and closer to affirmation.

A Parallel with Financial Statement Responsibility

The emerging governance landscape bears a striking resemblance to the responsibility statements that directors routinely approve in annual financial statements of companies.

When directors approve financial statements, they are not simply accepting management’s assurances. They are confirming that they have exercised appropriate oversight and are satisfied that the financial statements fairly present the affairs of the organisation.

Similarly, under King V™, governing bodies are being asked to express satisfaction regarding the effectiveness of governance measures and the achievement of governance outcomes. Although the Disclosure Framework does not create a new statutory duty, it creates a public record of what the governing body considered, assessed and concluded.

In practice, these declarations may increasingly be scrutinised by regulators, investors, stakeholders, litigants and the media whenever governance failures occur.

Why Governing Bodies Should Take Notice

King V™ itself recognises that the governing body should be able to substantiate its conclusions regarding governance outcomes with reference to the principles and recommended practices if called upon to do so.

This is perhaps the most important sentence in the entire governance disclosure regime.

It suggests that a governing body should be capable of demonstrating:

• What measures were implemented to support each principle.
• How the effectiveness of those measures was assessed.
• What evidence informed the governing body’s satisfaction.
• Why the governing body concluded that value was being created through governance.

Should a major governance failure subsequently occur—such as an ethics breach, compliance collapse, material control failure, strategic misstep, cyber incident or sustainability controversy—stakeholders may understandably ask how the governing body reached its earlier conclusions.

The risk is not necessarily that members of governing bodies will automatically incur legal liability. Rather, the risk is that governing bodies may struggle to defend public statements that cannot be supported by simultaneous evidence.

The Global Direction of Travel

The King V™ developments are consistent with international governance trends.

Globally, governing bodies are increasingly expected to provide positive statements regarding internal controls, risk management, sustainability reporting, climate-related disclosures, culture and governance effectiveness. In several jurisdictions, regulators have moved from voluntary disclosure towards attestation, assurance and direct board accountability.

King V™ appears to align South African governance with this broader international movement by requiring a more structured and visible demonstration of governing body oversight and accountability.

Importantly, governance disclosures are becoming less about what structures exist and more about whether those structures are effective.

Limiting the Risk: What Governing Bodies Should Do

The answer is not to become defensive or cautious in disclosure. Rather, governing bodies should strengthen the discipline that supports their disclosures.

A prudent governing body should consider:

1. Establishing a Formal Evidence Base

Each disclosure statement in the Framework should be linked to documented evidence that supports the governing body’s conclusion.

Examples may include:

• Board evaluations.
• Committee reports.
• Internal audit findings.
• Assurance reports.
• Risk assessments.
• Ethics and culture metrics.
• Governance self-assessments.
• Independent reviews where appropriate.

2. Performing Principle-by-Principle Assessments

Before approving the Disclosure Framework, the governing body should systematically assess each principle against predetermined criteria and evidence.

The question should not be:

“Do we have a policy?”

Rather:

“Are we satisfied that the objective of the principle has been achieved, and what evidence supports that conclusion?”

3. Enhancing Board Deliberations

Minutes should demonstrate that governing body members actively considered the disclosures and challenged management’s assumptions where necessary.
A robust disclosure process should evidence genuine application of mind rather than a compliance exercise.

4. Using Independent Assurance Strategically

Governing bodies may increasingly seek internal audit, governance specialists or external assurance providers to evaluate selected areas of governance where the governing body intends making affirmative statements.

Although King V™ does not mandate assurance over the Disclosure Framework, independent validation may become a valuable risk mitigation tool.

5. Treating the Disclosure Framework as a Governance Process

The Framework should not be completed shortly before publication of the annual report.

Instead, the required evidence should be accumulated throughout the reporting period as part of an ongoing governance monitoring process.

Conclusion

The King V™ Disclosure Framework may ultimately prove to be one of the most consequential governance developments in South Africa’s corporate governance history.

By requiring governing bodies to approve specific declarations and to conclude publicly that governance efforts have realised value, King V™ elevates governance disclosure from a descriptive exercise to an accountability mechanism.

This should not be viewed as an additional compliance burden. Rather, it is an invitation for governing bodies to strengthen the quality of their oversight, the rigour of their assessments and the evidence supporting their conclusions.

Those governing bodies that approach the Disclosure Framework with intentionality, discipline and demonstrable evidence are unlikely to face difficulty. Those that regard it as a reporting formality may discover that the most significant risk is not the governance failure itself, but the inability to justify the assurances they previously gave to stakeholders.

Annamarie van der Merwe
Executive Chair
FluidRock Governance Group
July 2026

Advocate Annamarie van der Merwe (B.Iuris, LLB, LLM) has been a corporate lawyer and company secretary of companies in the listed environment for more than 35 years, advising numerous governing bodies on matters of compliance and good governance. She was a longstanding member of the King Committee on Corporate Governance for South Africa and was actively involved in the writing of most of the King Reports and, in particular, the preparation of the King IV Report as part of a dedicated task team mandated by the King Committee for this purpose. Annamarie more recently acted as technical contributor to the King V Report, on request from the Committee. She is a regular presenter of workshops to directors, executives, and company secretaries on a wide range of governance and legal topics. Annamarie is a member of the JSE Advisory Committee and fulfils the role of executive Chair of FluidRock Governance Group while also serving as a non-executive director of a number of companies, including Pick n Pay Stores Limited, the Bureau for Food and Agricultural Policy NPC (Board Chair), Vastfontein Community Transformation NPC (Board Chair) and Aros NPC.