Peregrine’s governance framework in based on accountability, transparency and integrity. The Board aims to integrate the creation of sustainable value into the Group’s strategy and to embed the principles of King IV into daily operations. It further recognises that good governance, achieved through focusing on the four outcomes under King IV, can enhance the long-term performance of the Group.

This report aims to assist stakeholders in assessing the Group’s approach to good governance in complying with King IV.

King IV defines Corporate Governance as the exercise of ethical and effective leadership towards achieving four advocated outcomes. The desired outcomes are listed below, in addition with the practices implemented and the progress made towards achieving the 17 principles. It is done on an “apply and explain” basis as recommended by King IV. This is the first year of application of King IV in the Group. The Group will continue to improve its application and reporting relating to Corporate Governance.

Principal number

Description

Notes on application

Governance outcome: Ethical Culture

1

Leadership: The Board should lead ethically and effectively.

The Board is committed to transparency, integrity, accountability and complying with the applicable laws and regulations. Ethical and effective leadership is entrenched in the Board’s decision- making and it also complies with the principles of the Code of Ethics.

2

Organizational ethics: The Board should govern the ethics of the organization in a way that supports the establishment of an ethical culture.

The Board is ultimately responsible for the corporate governance values within the Group although control is delegated to management in the daily operational management of the subsidiaries. Peregrine employees are required to subscribe to the Code of Ethics. The Code of Ethics has been communicated to all employees within each business and is available on the intranet. To give practical effect to the Code, an anonymous whistle-blowing process has been put in place in order to enhance the culture of responsible information disclosure, relating to other irregular conduct in the workplace and any contravention of the Code. To date no incidences have been reported.

3

Responsible Corporate Citizenship: The Board ensures that Peregrine is seen to be a responsible corporate citizen.

The Group remains committed to making a difference, in the medium to long-term, in the societies in which it operates. A strong emphasis remains on education centered initiatives. Employee’s wellness and training continues to also receive focus. The Group’s Socio-Economic Development initiatives are mentioned in the Transformation section of the report.

Governance outcome: Performance and Value Creation

4

Strategy and performance: The Board should appreciate that the organisation’s core purpose, its risk and opportunities, strategy, business model, performance and sustainable development are all inseparable elements of the value creation process.

The Board aims to integrate responsible corporate governance values and principles into the Group’s growth strategy and to embed risk management into daily operations and processes, in order to build a culture of sustainability. The Board further endeavors to ensure that these sustainable components form part of all strategic decisions, audits and assessments.

5

Reporting: The Board should ensure that reports issued by the organisation enable stakeholders to make informed assessments of the organisation’s performance, and its short, medium and long-term prospects.

The Audit Committee oversees the comprehensive compilation of the Integrated Report, including appointing individuals with the appropriate skill and experience to assist with its preparation. A review is undertaken by the Board prior to release of the Integrated Report.

Governance outcome: Adequate and Effective Control

6

Primary role and responsibilities of the Board: The Board should serve as the focal point and custodian of corporate governance in the organization.

The Board is the ultimate custodian of corporate governance. The Board Charter documents the roles and responsibilities of the Directors and an appropriate governance framework and related policies are in place to ensure the Group adheres to governance standards.

The Board meets at least quarterly with additional meetings being scheduled if required.

7

Composition of the Board: The Board should comprise the appropriate balance of knowledge, skills, experience, diversity and independence for it to discharge its governance role and responsibilities objectively and effectively.

The Board considers its composition in terms of its experience, skills, diversity, independence and its ability to discharge its roles and responsibilities on an annual basis. The Board confirms that all Directors as at the date of the Integrated Report had the necessary skills and experience to discharge their responsibilities in accordance with the Board Charter.

8

Committees of the Board: The Board should ensure that its arrangements for delegation within its own structures promote independent judgement, and assists with balance of power and the effective discharge of its duties.

The Board has established four sub-committees to assist the directors in fulfilling their duties and responsibilities. The Committees have formal charters and report to the Board regularly. Membership of the Committees are as recommended by King IV.

9

Evaluations of the performance of the Board: The Board should ensure that the evaluation of its own performance and that of its Committees, its chair and its individual members, support continued improvement in its performance and effectiveness.

The Directors are of the opinion that the Board and its sub-committees have discharged all of their responsibilities in terms of their respective charters. Assessments of the performance of the Executives have been conducted and no major issues have been identified.

10

Appointment and delegation to management: The Board should ensure that the appointment of, and delegation to, management contribute to role clarity and the effective exercise of authority and responsibilities.

The Board Charter provides for the Board’s responsibility of appointing the Chief Executive Officer and the approval of the corporate strategy and corporate governance.

The Board members have full access to management and all Group information. In addition, the Board is entitled, at the cost of the Group to seek independent professional advice in the fulfilment of their duties.

The Board is satisfied that the Group is appropriately resourced and that its delegation to management contributes to an effective arrangement by which authority and responsibilities are exercised.

11

Risk governance: The Board should govern risk in a way that supports the organization in setting achieving its strategic objectives.

The Group Risk and Compliance Committee, comprising representatives from all subsidiaries, is governed by a formal Charter which sets out its composition, roles and responsibilities. The role is primarily to assist the Board in executing its responsibilities relating to risk management. The Audit and the Risk and Compliance Committees assist the Board with the governance of risk. The Board is acutely aware of the importance of risk management as it is linked to the strategy, performance and sustainability of the Group. The Group Risk and Compliance Committee implements a process whereby risks to the sustainability of the Group businesses are identified and managed within acceptable parameters. The Audit- and Group Risk and Compliance Committees delegates the duty to management to continuously identify, assess, mitigate and manage risks within the risk profile of the Group.

12

Technology and information governance: The Board should govern technology and information in a way that supports the organization setting and achieving its strategic objectives.

Information Technology governance is an integral objective in the Group’s holistic approach to governance.

The Board is assisted by the Group Risk and Compliance Committee in order to oversee the governance of IT. An IT Management Forum, headed by the Chief Information Officer, reviews on-going business requirements within the areas of Information Technology. The IT Management Forum is governed by its Charter and an internal IT control framework is in place. The Board is aware of the importance of IT and its relation to the strategy of the Group.

The Group Chief Information Officer is a member of the Group Risk and Compliance Committee.

13

Compliance governance: The Board should govern compliance with applicable laws and adopted, non-binding rules, codes and standards in a way that supports the organisation being ethical and a good corporate citizen.

The Board is assisted by the Group Risk and Compliance Committee in order to oversee the governance of compliance. In addition the Group has established a Group Legal and Compliance Committee to ensure that regulatory frameworks are adhered to. The Group Legal and Compliance Committee is responsible for assisting in compliance functions which are managed by dedicated Compliance Committees within the subsidiaries. The Group Risk and Compliance Committee oversees the compliance strategy of the Group and oversees the effective implementation of the Group’s compliance framework. The Compliance function is an integral part of the Group’s risk management function and reports to the Group Chief Risk Officer and the Board.

During the year under review there were no material or repeated regulatory penalties, sanctions or fines for contravention of, or non-compliance with, the Group’s statutory obligations.

14

Remuneration governance: The Board should ensure that the organisation remunerates fairly, responsibly and transparently so as to promote the achievement of strategic objectives and positive outcomes in the short, medium and long term.

The Board is assisted by the Group Remuneration Committee in order to oversee the governance of all remuneration matters, in accordance with the Group Remuneration Charter. The Group Remuneration Committee ensures that the Group’s remuneration policy is aligned with the Group’s strategy and it approves and reviews the remuneration of Executive Directors. The Remuneration Committee takes into account the comments received from shareholders in respect of previous reports. The remuneration policy and the remuneration implementation report are put to the shareholders for approval through non-binding advisory votes.

The Board believes that the remuneration policy is equitable. The remuneration of the Non-Executive Directors is put to shareholders for approval by way of a special resolution.

A review of both Executive and Non-Executive remuneration was undertaken post year end and the outcome is incorporated in the report of the Group Remuneration Committee.

15

Assurance: The Board should ensure that assurance services and functions enable an effective control environment, and that theses support the integrity of information for internal decision-making and of the organisation’s external reports.

The Group has an effective Audit Committee comprising of independent Non-Executive Directors who are appointed annually at the Company’s Annual General Meeting. The Group Audit Committee is chaired by an independent Non-Executive Director and it oversees the comprehensive compilation of the Integrated Report.

The Group Audit Committee obtains combined assurance from the external auditors, internal auditors and management and ensures that the combined assurance received is adequate to address all material risks.

The Group Audit Committee is satisfied with the competency and independence of the external auditor, Deloitte and Touche, who performed the audit for the year.

Governance outcome: Trust, Good Reputation and Legitimacy

16

Stakeholders: In the execution of its governance role and responsibilities, the governing body should adopt a stakeholder inclusive approach that balances the needs interests and expectations of material stakeholders in the best interest of the organisation over time.

The Board understands the importance of reputational risk and therefore continually engages with stakeholders of the Group.

The Group has identified its stakeholder groups and is actively evaluating and managing their reasonable needs and expectations.

17

Responsible investing: The Board ensures that responsible investment is practiced to promote the good governance and the creation of value by the companies in which it invests.

Responsible investment in a sustainable and responsible manner is key to the long-term success of the Group.