The number of directors who have stepped down in recent months at Comair [JSE:COM] is in line with the airline group's commitment to full compliance with the principles of the King IV report on corporate governance, the JSE-listed aviation company told Fin24 on Thursday.
This comes after concerns were raised that the longstanding tenure of some directors "might" have led to a compromise of the independence of the board. That is why it has now acted to address the issue, Comair said.
Comair operates its own low-cost brand, kulula.com, as well as British Airways in South Africa as part of a licence agreement.
On Thursday it was announced that Pieter Van Hoven has resigned as an independent non-executive director and lead independent director of the company with immediate effect and that Derek Borer will be resigning as company secretary with effect from February 15, 2020.
Already in August 2019, it was announced that Van Hoven decided to retire as chairperson of the board at the AGM at the end of October 2019, but that he would continue to serve on the board as an independent non-executive director. Van Hoven had been the chair of the board for about eight years.
Lindsay Ralphs, who is also the CEO of Bidvest, replaced Van Hoven as Comair chair at the group's AGM and Van der Hoven remained on the board as a non-executive director. Ralphs was initially appointed as a non-executive director of Comair in July 2019.
Earlier this week it was announced that Rodney Sacks, a long-standing non-executive director, resigned with immediate effect. At that time it was said that Borer, who was an alternative non-executive director to Sacks, also resigned from the board with immediate effect. No mention was mentioned then about him resigning as company secretary as well.
On January 2, 2020 Comair announced that Martin Moritz resigned as a non-executive director and deputy chair of the company, effective from December 31, 2019. Early in December 2019 Dr Piet Welgemoed resigned as an independent non-executive director of the company with immediate effective. Van der Hoven was then appointed to fill his place.
In June 2019 it was announced that Phuti Mahanyele-Dabengwa resigned as a non-executive independent director and member of the audit and risk committee of the company "for personal reasons". In July Naspers announced the appointment of Mahanyele-Dabengwa to the global Naspers management team as CEO, South Africa and reporting directly to Bob van Dijk, Group CEO of Naspers.
In May 2019, Erik Venter resigned as CEO of Comair and a director of the company with effect from the end of July. He resigned for personal reasons after having been with the company for 23 years. In February Sean Doyle resigned as an independent non-executive director with immediate effect.
Fin24 reported in early November that concerns were raised at Comair's annual general meeting (AGM) about the long tenure of board members. A resolution was approved at the AGM that directors who served for a period of nine years or longer would be required to retire on an annual basis and if eligible, could stand for re-election.
At the AGM, director of strategic leadership consultancy Metaco and a Comair shareholder Danny Tuckwood questioned why Borer, Comair's company secretary, had been standing in as an alternate director. Comair responded to Fin24 at the time that, although King IV on governance does not prohibit the company secretary from serving on the board as well, it is not desirable and would be addressed.
Metaco, which was acquired by Comair in July 2018, is involved in litigation against Comair. Metaco accuses Comair of reneging on the agreement and "grinding it (Metaco) into the ground in the process". Since the matter is sub judice, Comair preferred not to comment on it at the time.
In May 2019 the Comair board announced the appointed joint CEOs Glenn Orsmond and Wrenelle Stander to take over from July 31, 2019. However, in December 2019 the company announced that, as from December 15, 2019 Stander would assume the role of group CEO, while Orsmond would assume the role of CEO of the airline divisions.
Fin24 reported early in December that, according to Comair, it is still too early to speculate about what will happen to outstanding payments it is owed by South African Airways (SAA) as part of a R1.1bn legal settlement.
Comair has so far maintained an unbroken 72 years of profitability.
"Comair's focus remains on consistent, sustainable performance and shareholder value, despite difficult economic circumstances," the company told Fin24 on Thursday.