OUR GOVERNANCE

Corporate governance aligned to King IV principles

Principle 9: EVALUATIONS OF THE PERFORMANCE OF THE BOARD

King IV principles and our activities
GOVERNING STRUCTURES AND DELEGATION
  • Principle 9 - The governing body should ensure that the evaluation of its own performance and that of its Committees, its chair, and its individual members, supports continued improvement in its performance and effectiveness
Outcomes
  • Effective governance structures
Evaluation and performance of the Board
  • Performance evaluation of the Board to assess effectiveness is conducted annually and recommendations are discussed and implemented in the subsequent year
Board and Committee evaluations

The Board is committed to continuous improvement and evaluates its performance. The Charter stipulates that the Board of Directors will conduct evaluations to determine whether the Board and its Committees are functioning effectively in terms of discharging their mandate as per the Board Charter and in line with leading practices on corporate governance. The Board evaluates its performance through a combination of both internal peer and external facilitated assessments.

In the year of review, the Board concentrated on implementing the recommendations of the external facilitator done in the previous year and engaged in performance reviews that were conducted by the Board Chairperson and Committee Chairpersons. The Board reviewed the recommendations of the past evaluation and embarked on implementing the following initiatives to address the areas of improvement:

Gender balance and diversity
  • The Board was reconstituted to strengthen its gender balance and diversity, covering varying competencies
  • The Board currently has three females on the Board, and this will also be reflected at all levels to ensure gender parity
Succession planning
  • The Board identified suitable replacements for the positions of Managing Director and Deputy Managing Director which have since been implemented
Channels for staff to obtain assistance with ethics issues
  • Following a recommendation to improvise channels for employees to engage the Board on ethical issues, channels have been created through which employees can engage with the Board on ethical issues:
    • An external firm was onboarded to create an ethics hotline through which anonymous reports on unethical behaviour can be reported without fear of victimisation
    • Continuous regional branch visits by the Board and EXCO to promote their interaction with staff as well as obtain feedback from members

Principle 10: EVALUATIONS OF THE PERFORMANCE OF THE BOARD

King IV principles and our activities
GOVERNING STRUCTURES AND DELEGATION
  • Principle 10 - The governing body should ensure that the appointment of, and delegation to, Management contributes to role clarity and the effective exercise of authority and responsibilities
Outcomes
  • Effective governance structures
Governance structure

The Fund’s governance structure is illustrated in the NSSF Governance Structure diagram and shows the interaction between the members and the Board, demonstrating how the Board Committee structure facilitates the relationship between the Board and the MD and indicates the flow of delegation from members. We have robust processes in place to ensure that the delegation flows through the Board and its Committees to the MD and EXCO into the organisation. At the same time, accountability flows upwards from the Fund to its members. This process helps to ensure alignment and open communication with our members and all our stakeholders.

Appointment and delegation to Management
  • Management, led by the MD, have the authority to manage and control the day-to-day affairs of the Fund in relation to matters other than those reserved for the Board
  • We have robust processes in place to ensure that the delegation flows through the Board and its Committees to the MD and EXCO into the organisation. At the same time, accountability flows upwards from the Fund to its members. This process helps to ensure alignment and open communication with our members and all our stakeholders
Board Chairman

The Chairman, Dr. Peter Kimbowa, is an Independent Non-Executive Director and was appointed on 1 September 2021.

The Chairman’s role includes:
  • Leading the Board and ensuring overall effectiveness, operating to the highest governance standards
  • Encouraging a culture of openness and debate to foster a high-performing and collegial team
  • Ensuring strategic issues, members and the relevant stakeholder views are regularly reviewed, understood, and responded to
  • Facilitating the relationship between the Board and the MD and providing oversight, guidance, advice, and leadership
  • Ensuring control over the quality and timeliness of information flow between the Board and Management
  • Setting agendas for meetings of the Board that focus on the strategic direction and performance of the Fund's business
  • Ensuring that adequate time is available for discussion on all agenda items
  • Leading the Board and individual Director Performance Assessments
  • Speaking and acting for the Board and representing the Board to members
Managing Director

The MD is the Chief Executive Officer of the Fund and is subject to the NSSF Act (amended) and to the general control of the Board on matters of policy, responsibility for running the day-to-day business of the Fund, general management, administration, and organisation of the Fund. He also ensures the strategies and policies set by the Board are implemented. The MD, Patrick Ayota, is the only Executive Director (ex officio member) on the Board and has been a Board member since December 2022.

Corporation Secretary

The Corporation Secretary, Ms. Agnes Tibayeita Isharaza was appointed by the Minister of Finance, Planning and Economic Development in line with Section 41 of the NSSF Act and has been in the role since 1 April 2019. In addition to any other functions conferred upon her by the Minister and the Board, the Corporation Secretary has the custody of the seal of the Fund and is responsible for:

  • Ensuring crucial information flows within the Board and its Board Committees and between Management and the Board
  • Taking minutes of the meetings of the Board and any of its Committees and Subcommittees
  • Keeping the records of all transactions of the Fund
  • The provision of legal advice on all Fund activities
  • Advising the Board on all governance matters
  • Keeping the Board aware of relevant changes in legislation and corporate governance best practice

As of 1 July 2022, the title of the Corporation Secretary changed to Chief Legal Officer/Corporation Secretary. Responsibilities and accountabilities remain the same.

Principles 11-13:
Functional Governance Areas

King IV principles and our activities
FUNCTIONAL GOVERNANCE AREAS
  • Principle 11 – The governing body should govern risk in a way that supports the organisation in setting and achieving strategic objectives
  • Principle 12 – The governing body should govern technology and information in a way that supports the organisation in setting and achieving its strategic objectives
  • Principle 13 – The governing body should govern compliance with applicable laws and adopted, non-binding rules, codes and standards in a way that supports the organisation in being ethical and a good corporate citizen
Risk governance
  • The Board of trustees is mandated to ensure good corporate governance and effective risk management in the Fund. The Board exercises this mandate through its Committees which include the Investments and Project Monitoring Committee, Finance Committee, Staff Administration and Corporate Affairs Committee, and the ARC, which oversees risk management and the integrity of financial reporting
  • Through the ongoing materiality determination process, material matters, and emerging risks are identified which could significantly impact the Fund's business model and ability to deliver value in the short-, medium- and long-term
Read more about our risk and opportunity management
Technology and information governance
  • As part of the Board Charter, the Board has oversight of the Information and Technology Policy, systems, and strategies. The Finance Committee is mandated to assist the Board in fulfilling its oversight responsibility for technology governance
  • With the accelerated digitalisation strategy and ongoing quest to improve efficiency of operational processes and communication through automation and use of digital platforms, the Fund has invested heavily in information security
  • The Fund has implemented the Pension Administration System (OctoPAS)
Compliance governance
  • The Fund is committed to complying with all the relevant legislation, especially prudential regulation
  • The Board oversees compliance with legislation, regulations, and codes of best practice governing the retirement benefits sector through the Audit, Risk and Assurance Committee
  • The Board has established policies and processes to guide legal compliance and delivery of services
See Regulators Report
Outcomes
Desired outcome:

Adequate and effective controls through risk, technology and information, compliance, and assurance governance.

Risk governance
  • Risk management is regarded as an integral part of business activities
  • Effective risk management protects and creates value for the Fund in identifying both risks and opportunities
  • Cyber Security and Information security risk is an integral part of the business
  • To achieve effective risk management, and a robust control environment, the three lines of defence model is a key component to ensure a clear separation of roles between risk-taking functions and risk-control functions
Technology and information governance
  • Appropriate preventative, detective, and corrective controls have been implemented, and the strength of the security infrastructure is continuously evaluated through penetration tests and vulnerability assessments
  • Uninterrupted IT services and system stability
Compliance governance
  • The Fund continuously monitors the status of regulatory relationships to enhance proactive engagement across key regulatory changes and areas of focus
  • Highest standards of sound governance, including transparency, accountability and fairness to its members, the Regulators, and all our stakeholders
  • Management continuously monitors its compliance with the key regulations through its quarterly reports to the Board
Summary of the arrangements for governing risk and opportunities, technology, information, and compliance
  • The ARC assumes responsibility for the governance of risk and opportunity management and compliance
  • ARC, on behalf of the Board, ensures oversight over the governance of risk by setting the direction for how the Fund’s risk and opportunity management should be approached and addressed
  • Risk appetite dashboard includes both risks and opportunities and is set to ensure that the company achieves its strategic and financial objectives
  • Enterprise-wide Risk Management Framework and policy
  • Combined Assurance Model
  • A Board approved Compliance Management Policy and Manual
  • Compliance monitoring.
  • The Finance Committee assumes responsibility for technology and information governance
  • Formalised IT governance strategy
  • IT Governance Framework
  • IT governance audits
Key areas of focus during the reporting period
Measures taken to monitor risk and opportunity management, technology, information, and compliance and how the outcomes were addressed
  • Independent assessment of top risks on a regular basis by the Board
  • Oversight of the Strategic Risk Register
  • The Board oversees implementation of Strategic Projects
  • The Board receives summary reports from the ARC and Finance Committee
  • The Board monitors key legislative and regulatory obligations and Fund compliance thereof
Planned areas of future focus
Principle 14: Remuneration Governance