The corporate governance landscape is poised for substantive refinement with the introduction of the Draft King V Code, a proposed update to the widely adopted King IV Report on Corporate Governance. Issued by the Institute of Directors in South Africa (IoDSA) on 24 February 2025, the draft was released for public consultation, with comments due by 4 April 2025. The King V Draft is intended to build on the established framework of King IV, enhancing usability, responding to evolving governance challenges, and promoting more uniform and transparent disclosure practices across sectors.
The King Codes have, for decades, served as Africa’s leading non-legislative standards for ethical corporate conduct and sustainable leadership. While not legally enforceable, these Codes are influential in judicial and commercial settings and are often used as reference points in assessing board accountability, stakeholder engagement, and enterprise governance standards.
The King V Draft seeks to modernise the governance framework by incorporating recent developments in corporate oversight, including trends in sustainability reporting, remuneration policy, and technology-driven governance risks. Rather than overhauling the existing structure, the draft offers an evolutionary revision that enhances the applicability and interpretability of existing principles while introducing tools to improve disclosure and stakeholder comparability.
Among the key innovations in the King V Draft is the segmentation of its content into distinct modules accessible via individual web pages. This deconstructed presentation replaces the single consolidated report structure of King IV, allowing users to access specific topics more efficiently. Such modularity is likely to improve practical usage by boards, executives, and compliance officers.
In a deliberate effort to improve accessibility and interpretive clarity, the draft code has been rewritten using plain language, supplemented by a modernised glossary to clarify governance terminology. This is intended to reduce reliance on legal or technical intermediaries and empower direct engagement with the Code by a wider audience, including SMEs and non-listed entities.
One of the most notable changes is the distinction between core governance principles and supplementary best practices. Under the proposed framework, essential practices will remain within the King V Code itself, while supplementary recommendations will be published separately in guidance documents. This reorganisation is designed to avoid conflating baseline expectations with aspirational standards, thereby providing clearer guidance on minimum compliance expectations.
In terms of disclosure obligations, the King V Draft adopts a “disclose and explain” regime. It presumes that companies apply the principles of good governance and shifts the burden onto them to disclose any departures. Where recommended practices have not been adopted, entities must provide narrative justifications and contextual explanations. This approach affirms a commitment to transparency and ensures that disclosures remain substantively informative rather than merely technical or formalistic.
To support this new approach, the draft introduces a Disclosure Template, a structured reporting tool designed to streamline and standardise how organisations disclose their governance practices. The template outlines each principle, alongside columns for indicating exceptions and providing explanatory narratives. This is expected to strengthen consistency in governance reporting across various sectors and enhance comparability for investors, regulators, and other stakeholders.
While the King V Code does not carry statutory authority, its provisions continue to carry significant weight in both corporate conduct and judicial interpretation. African courts have in the past viewed serious departures from the Code as indicative of governance failures, particularly in evaluating board fiduciary duties, risk oversight, and organisational accountability. As such, adherence to the King Code remains a critical component of prudent risk management and reputational integrity.
The release of the King V Draft signals an important step forward in Africa’s corporate governance journey. Its refinements reflect not only legal and commercial evolution, but also the broader societal expectation that organisations act with integrity, transparency, and accountability. With public commentary now closed, the finalised version is expected to clarify its implementation timeline and confirm its alignment with broader ESG and digital governance reforms.
Organisations would be well advised to begin assessing their governance frameworks in anticipation of King V’s formal adoption. Early engagement with the standardised disclosure regime, alongside internal alignment of board governance practices, may offer a competitive advantage in a regulatory environment that increasingly prizes principled leadership and ethical corporate stewardship.