The autonomy of directors of black economic empowerment companies.
Ntshebe, Sibusiso Sizila Sibulelo.
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This study focused on the conflicts that are faced by directors appointed by BEE-shareholders to the board of directors of a company. The focus of the study was on the conflict that arises when the expectations of the BEE-shareholder that appoints these directors are not in line with the duties imposed upon these directors by law. The study considered whether these directors are there to act as agents of the BEE-shareholder that had appointed them and how autonomous are these directors in the performance of their duties. The main aim of this study was to establish a standard prescribed by law that is expected of these directors and to consider the expectations of the general public as to what is expected of these directors. The purpose of the study was to establish whether a conflict does exist and to get an understanding of the nature of the conflict. The outcome of the study would be to develop recommendations as to how to best address the conflict. The research study contained both quantitative and qualitative enquires. Data was collected by means of a questionnaire. The sampling technique that was used was “accidental or availability non-probability sampling”. Due to time constraints and limited resources, the study could not be conducted on a representative sample as the respondents were predominantly from the Durban Metropolitan area and Bizana in the Eastern Cape Province. The study revealed that predominantly the respondents agree with the prescriptions of law that BEE-representative directors owe a fiduciary duty to the company. The study revealed that the respondents also agreed with the legal standpoint that these directors should prioritise the interests of the company before any other interests including the interests of the BEE shareholders whom they represent. However, the majority of the respondents also believed that BEE shareholders had the right to instruct these directors how they must discharge their duties as directors and these directors were accountable to the BEE shareholders. The study revealed that there was a disparity between the expectations of BEE shareholders and the provisions of law, as most of the respondents were BEE Beneficiaries thus being part of a BEE shareholder. From the findings of the study, a corporate governance policy on this issue was formulated as part of the objectives of the study. Another recommendation was for a further study to be conducted to better understand the disparities identified in this study in order to formulate a solution for that problem.