THE Institute of Directors (IoD) Lesotho will next month launch the country’s first corporate governance code.
Dubbed the Mohlomi Corporate Governance Code, the document borrows its name and values from Chief Mohlomi, the advisor to the Basotho nation founder, King Moshoeshoe I.
IoD Lesotho chief executive officer (CEO), Chaka Nkofo this week told the Lesotho Times that the code would lay the foundation for a robust framework for good corporate governance standards and guidelines for Lesotho corporates.
He said the development of the governance code was also in line with the efficient and effective fulfilment of the IoD Lesotho’s mandate of leading good corporate governance advocacy across Lesotho’s socio-economic landscape.
IoD Lesotho is a membership- based, non-profit organisation (NGO) established in 2004. Since inception, the organisation has struggled to attract membership.
Mr Nkofo said the launch date was in line with the Basotho year, which traditionally commences in August to signal the end of winter and the beginning of the ploughing season “Selemo”.
“The launch of the Mohlomi Corporate Governance Code will be on 11 August 2021,” Mr Nkofo said.
“The code will provide a robust framework for good corporate governance standards and guidelines for Lesotho, documenting the values and principles that the Basotho nation was founded on.
“This will further enhance companies and organisations’ propensity to adhere to the laws of Lesotho and best business practices broadly. Institutional investors will also commit to impactful investments aligned to sustainable socio-economic development.”
With the advent of the code, the usual practice for both private and state-owned entities of having to train their directors and executives outside the country would be a thing of the past.
“Directors in Lesotho were trained on governance principles that did not take into cognisance our local context. Ultimately, some of the principles learnt were never tested and monitored on their applicability for Lesotho.”
Although the work on the code was finalised in 2020, its launch was delayed by Covid-19 induced lockdowns, he said.
“We have also developed a strategy to bolster participation and engagement of the corporate sector (regulators, private companies, state-owned-entities) in the launch of the Mohlomi Corporate Governance Code through corporate sponsorship packages. These range from platinum (the most prestigious) to bronze (the most rudimentary). Comprehensive details about the event will be provided as the date nears.”
The code was developed with the financial assistance of the African Development Bank (AfDB) and through the facilitation and support of the Ministry of Finance.
Although the code will be launched next month, it will only become effective from 11 March 2022, to coincide with the Mosheshoe’s Day celebrations.
This is to provide a six-month window period for clients to familiarise themselves with it before implementation.