INTRODUCTION AND PURPOSE

1. The Board of Directors of Communicare is the prime custodian of the Company's system of corporate governance and is ultimately accountable and responsible for the performance and affairs of Communicare;
2. Good corporate governance is regarded as critical to the success of the Company and the Board is unreservedly committed to applying the fundamental principles of good governance – discipline, accountability, responsibility, fairness, transparency, integrity, independence, and social responsibility – in all dealings by, in respect of, and on behalf of, the Company;
3. The Board accordingly embraces the principles of good governance as set out in the 2002 King report on Corporate Governance for South Africa (“King II”) and the Companies Act, 19 7 3 as amended;
4. This Board Charter defines the governance parameters within which the Board exists, sets out the specific responsibilities to be discharged by the Board and Directors collectively, as well as certain roles and responsibilities incumbent upon Directors as individuals;
5. The Board Charter of Communicare is endorsed by all Directors and serves to identify, define and record the responsibilities, functions and composition of the Board of Directors of Communicare and to provide a reference tool for new and serving Directors;
6. The Board Charter shall be reviewed by the Board as and when necessary but at least once every three years to ensure that it remains relevant to the business objectives of the Company;
7. The Board Charter shall constitute an integral part of each Director's letter of appointment.

PRIMARY OBJECTIVE OF THE BOARD

The primary objective of the Board is to institute and maintain

• sound corporate governance;
• strategic initiatives; and
• disciplined oversight;

in order to achieve the Mission and Purpose of the organization in a responsible, efficient and honest manner and to ensure the continuation of a sustainable organisation able to provide the services of the Company to future generations.

To this end it is responsible for setting the strategic direction and context of the organisation, as described in its Mission Statement, Code of Ethics, Ethos Statement, and Code of Management, and by focussing on issues critical for its successful execution such as staffing, performance and risk management.

RESPONSIBILITIES AND ACCOUNTABILITIES OF THE BOARD

1. To exercise leadership, enterprise, integrity and judgement in directing the Company so as to achieve the Mission and the Purpose of the organisation and at all times to act in the best interests of the Company in a manner based on transparency, independence , accountability, fairness and responsibility;
2. To determine, review and align all the business operations with the Mission and Purpose of the organisation and to do so on an annual basis;
3. To give strategic direction to the organisation in consultation with senior management;
4. To select and recruit the Chief Executive Officer and all senior executives; to determine their levels of remuneration and to consider and approve their broad key result objectives.
5. To regularly review the performance and compensation of the Chief Executive Officer;
6. To approve and review the Chief Executive Officer's and senior executives' succession plans;
7. To ensure the effective use of all the resources of the organisation.
8. To be the vehicle of last resort for complainants both internal and external to the organisation;
9. To maintain the discipline of assessing the performance of board members as individuals and as a group and to do so on a regular basis, measuring performance against each Director's individual responsibilities, the strategic objectives of the Company and the demands and challenges of the South African context;
10. To continually monitor the exercise of delegated power by management and ensure that effective goal-setting and programme monitoring is undertaken by management and communicated regularly to the Board;
11. To appoint Board members and to ensure that the Board reflects the demographics of the Western Cape while including members with the requisite skills, knowledge and competence able to fulfil the organisation's purpose;
12. To approve induction programmes for new Board members and on-going education programmes;
13. To set and approve the remuneration of Directors which must be transparent and fair and to do so guided by the principle that whilst the levels of remuneration should be sufficient to attract and retain the calibre of Directors needed to run the Company successfully, the Board should avoid paying more than is necessary for this purpose bearing in mind the Company's Section 21 and Non-Profit Organisation status. Executive Directors will receive no additional fees but will be paid as employees of the Company in accordance with their contracts of employment. Attendance of a Board meeting shall be the criterion for the payment of the relevant Director's fee;
14. To set in place mechanisms to monitor and manage all risks to the organisation; to review these risks regularly and to take the necessary steps to contain and alleviate such risks;
15. To establish internal controls and set materiality levels ensuring that the reserve powers of the Board are clearly defined;
16. To fulfil all fiduciary responsibilities as required by the Companies Act and other relevant legislation;
17. To advise on significant financial matters and to ensure that full accountability for all financial matters is undertaken by management;
18. To ensure that a comprehensive system of policies and procedures is in place and that appropriate governance structures exist to ensure the smooth, efficient and prudent stewardship of the Company;
19. To exercise objective judgement on the business affairs of the Company, independent from management but with sufficient management information to enable a proper and informed assessment to be made;
20. To identify and monitor non-financial aspects relevant to the Company and ensure the Company acts responsibly towards all relevant stakeholders having a legitimate interest in the organisation;
21. To have the power to delegate to any board member, senior manager or committee specific powers by means of a board mandate;
22. To ensure compliance by the Company with all relevant laws and regulations, audit and accounting principles, the Company's Code of Ethics and with its stated Ethos, and such other principles as may be established by the Board from time to time.

THE COMPOSITION OF THE BOARD

1. The constitution of the Board is governed by the Company's Articles and Memorandum of Association presently a minimum of 8 members and a maximum of 25 members;
2. In determining the optimum composition of the Board, the Board shall seek to ensure that it collectively contains the skills, experience, mix of personalities and diversity in regard to race, age and gender as considered against the demographics of the Western Cape and the services the Company provides, with the overriding objective of ensuring sound performance;
3. Irrespective of a Director's special expertise or knowledge, and regardless of whether a Director is an executive or non-executive Director, all members of the Board recognise that they are collectively responsible for the performance of the Company.

THE TENURE OF BOARD MEMBERS

1. The termination of an employment contract of an executive Director will result ipso facto in the termination of his or her membership of the Board unless the Board determines otherwise;
2. Non-executive Directors are appointed for a three year term and may make themselves available for re-election for further such terms after a formal appraisal of their performance at least 6 months prior to the conclusion of each term in a manner deemed appropriate by the Board. It is recognised that because of the nature of the company where housing and other projects tend to span a number of years, longer terms of office by Directors may be required;
3. At every Annual General Meeting one third of the total of Directors, excluding all Executive Directors and rounded down to the nearest whole number if necessary, must retire from office but may make themselves available for re-election provided they submit to an agreed performance assessment programme and receive a positive evaluation. In the event that no director has been in office for a minimum of three years, or for three Annual General Meetings, at least one Non-executive Director must retire from office and may stand for re-election in terms of 5.2.

THE DUTIES OF DIRECTORS

1. To act in good faith and in a professional manner having due regard to his or her fiduciary duties and responsibilities to the Company;
2. To use their best endeavours to attend all Board meetings, to read all necessary documentation and prepare themselves thoroughly in advance of Board meetings; to participate fully, frankly, independently and constructively in Board discussions and other activities and to bring the benefit of their particular knowledge, skills and abilities to Board discussions;
3. To accept appointment to Board portfolio's and be active participants of these committees;
4. To take an independent position in what he or she believes to be the best interests of the Company while being clear that he or she has no authority to act outside of a specific mandate arising from a Board decision;
5. To act with the degree of care, diligence and skill that may reasonably be expected from a person of his or her knowledge and experience;
6. To make sensible, informed and socially responsible business decisions and to contribute an independent, value-adding view to Board deliberations;
7. To conduct him or herself according to the highest ethical standards and sound practical sense and to demonstrate a broad, clear and unfettered perspective on issues facing the Company;
8. To demonstrate an adequate level of functional knowledge and /or relevant expertise in the sphere of financial, legal, commercial, risk, information technology, human capital development, housing and social housing, social/community development, marketing and sales and corporate governance issues;
9. To understand the legal and fiduciary responsibilities incumbent on Directors and an ability to discharge those responsibilities suitably;
10. To demonstrate an unequivocal commitment to furthering the interests of the Company in achieving its goals and objectives and allowing sufficient capacity and time to handle the responsibilities of being a Director;
11. To act within the scope of authority as prescribed by the Memorandum and Articles of Association of the Company;
12. To inform the Chairperson immediately should he or she become aware of any act of perceived bad corporate governance and to ensure that the matter be raised at the first Board meeting thereafter;
13. To declare to the Board via the Chairperson any actual, suspected or potential conflict of interest which may exist or be thought to exist in relation to particular items of business, as soon as they become aware of such conflict or potential conflict. In addition, it is expected that every Director will take any necessary and reasonable measures to try to resolve the conflict and comply with the legal requirement on disclosing interests and adhere to the restrictions on voting;
14. To refrain from making improper use of information gained through the position of Director and from taking improper advantage of the position of Director;
15. To recuse themselves from discussion or decisions on matters in which they have a conflict of interest unless the other directors who do not have a material personal interest in the matter have passed a resolution that states that those directors are satisfied that the interest should not disqualify the director from voting or being present;
16. To undergo, on appointment, an induction programme aimed at facilitating their understanding of the organisation, their responsibilities as Directors and the business and social environment and markets within which the Company operates;
17. To support the letter and spirit of Board decisions without limiting the right to record a dissenting view;
18. To keep Board information, discussions, deliberations and decisions that are not publicly known confidential and not use information gained through the Board for their, or their employer's, interest.

THE ROLE OF THE CHAIRPERSON

1. The Board's philosophy of leadership is based on the principle that the control of the Board and the executive responsibility for the running of the business are two separate and distinct tasks. There is accordingly a clear division between the role of the Chairperson of the Board and the Chief Executive Officer so as to ensure an appropriate balance of power is maintained within the organisation;
2. The Board shall be led by an independent non-executive who shall preside over meetings of the Board and be responsible for ensuring the integrity and effectiveness of the Board governance process. The role of the Chairperson is regarded as critical to good governance;
3. The Chairperson shall be appointed annually by the majority of the Board;
4. The Chairperson shall be responsible for maintaining regular dialogue with the Chief Executive Officer over all operational matters and will consult with the remainder of the Board promptly over any matter that gives him or her cause for concern;
5. The Chairperson must ensure the efficient organisation and conduct of the Board and will act as facilitator at meetings of the Board to ensure that no director dominates the discussion, that relevant discussion takes place, that opinions of all Directors relevant to the subject under discussion are solicited and freely expressed, and that all Board discussion leads to appropriate decisions;
6. The Chairperson will seek consensus in the Board but may, where considered necessary, call for a vote in which event the decision of an ordinary majority of the Board shall prevail;
7. The Chairperson must facilitate Board discussions to ensure core issues facing Communicare are addressed. In part he or she will do this by briefing all Directors in relation to issues arising at Board meetings, through facilitating the effective contribution and ongoing development of all Directors and by promoting consultative and respectful relations between Board members and between the Board and management;
8. The Chairperson must demonstrate a good understanding as Chairperson of the meeting of the content of the meeting pack and the issues to be deliberated at the meeting.

BOARD GOVERNANCE

1. The Board shall meet on a monthly basis unless decided otherwise but will meet at least 10 times in each financial year, and may convene additional meetings as and when necessary. The conduct of the meetings shall be governed by the Articles of Association;
2. The Board may form such committees as may be necessary to facilitate efficient decision-making and to assist the Board in the execution of its duties. The Board presently has the following standing committees: The Property and Maintenance Committee; the Audit Committee; the Remuneration Committee ; the Insurance Committee, the Social Housing and Community Development Committee;
3. Each committee shall be established with formal terms of reference which shall determine inter alia the membership, purpose, powers and authority of the committee, the scope of its mandate and its relationship to the Board;
4. The Board shall consider whether the business of the Company requires that it develops a formal conflicts of interest policy in terms of which conflicts are defined and appropriate conduct for dealing with conflicts is prescribed. In the absence of such policy Directors must inform the Board of any actual, suspected or potential conflict of interests they may have in relation to particular items of business, as soon as they become aware of such conflict or potential conflict;
5. The Board shall approve a procedure in terms of which any Director may take independent professional advice, at the expense of the Company, where there is doubt as to whether a proposed course of action is consistent with his or her fiduciary duties and responsibilities. This action should only be initiated after taking all reasonable steps to consult other board members and senior management as appropriate, and after seeking the advice of the Company's auditors.

THE BOARD'S RELATIONSHIP WITH MANAGEMENT

1. Responsibility for the day to day management and administration of Communicare is delegated by the Board of Directors to the Chief Executive Officer assisted by the executive team;
2. The Chief Executive Officer manages Communicare in accordance with the strategy, plans and delegations approved by the Board;
3. The Board insures that appropriate procedures are in place to assess the management's performance.

ACCESS TO INFORMATION

1. Directors may access such information and seek such independent advice as they individually or collectively consider necessary to fulfil their responsibilities and permit independent judgement in decision making;
2. Directors will be entitled to access members of the senior management via the Chief Executive Officer at any time to request relevant and additional information or seek explanations;
3. Directors will have access to internal and external auditors, without management being present, to seek explanations or additional information;
4. Directors may seek independent professional advice with the Chairperson's consent, which will not be unreasonably withheld or delayed, and which will be at the company's expense (see 7.6 above).

REVIEW OF BOARD PERFORMANCE

1. The performance of the Board is to be reviewed annually by the Chairperson. The evaluation will review the Board's role; review the Board's processes and committees to support that role; and review the Board's performance.
2. A review of each Director's performance will be undertaken in a manner to be decided by the Board at least six months prior to the Director standing for re-election.