The first King Report on Corporate Governance for South Africa was released in 1994. Since then, the report has been updated twice - once in 2002 (King II), and again in 2009 (King III).
Each new draft has placed an increasing importance on the interrelationship between ethics and corporate governance. For King III, an ethics sub-committee was constituted to advise on good practice in the governance (and management) of ethics.
Prof. Willem Landman (Executive Director and former CEO of EthicsSA) chaired the ethics sub-committee for the King III Report (2009).
The following extract gives broad principles on the governance of ethics in organisations. More detailed practice guidelines will be issued by the Institute of Directors (IoD) during 2009.
Extract - King III Draft Report

Principle 2.4: The board should actively manage the company's ethics performance

35. Good corporate governance requires that the board takes responsibility for creating and sustaining an ethical corporate culture in the company.

36. The establishment and maintenance of an ethical corporate culture requires the governance of ethics, that is, that the board should ensure that the company has a well designed and properly implemented ethics management process consisting of the following four aspects:

36.1 Ethics risk and opportunity profile: The board should ensure that an ethics risk profile is compiled, reflecting the company's negative ethics risks (threats) as well as its positive ethics risk (opportunities). See chapter 4 on risk management.

36.2 Code of ethics: The board should ensure that a company code of ethics is developed, stipulating the ethical values or standards as well as more specific guidelines guiding the company in its internal and external stakeholders.

36.3 Integrating ethics: The board should ensure that the company's ethical standards (code of ethics and related ethics policies) are integrated into the company's strategies and operations. This requires, among others, ethical leadership, management practices, structures and offices, education and training, communication and advice, and prevention and detection of misconduct for example, through whistle-blowing.

36.4 Ethics performance reporting and disclosure: The board should assess the company's ethics performance, and report and disclose findings to internal and external stakeholders. Refer to chapter 5 for internal audit and chapter 6 for integrated sustainability reporting.

37. An ethical corporate culture will require that:

37.1 ethical practices for directors is a non-negotiable requirement;
37.2 the stewardship of a director is firstly towards the company and its shareholders. However, the director should appropriately take into account the interests of other stakeholders;
37.3 sound moral values and ethics are propagated by the conduct of individuals;
37.4 the effectiveness of free enterprise and the market economy demands responsibility and it is important that business activity is directed by people with integrity, fairness and vision;
37.5 because fair competition is fundamental to the free enterprise system directors support laws regulating restraints of trade, unfair practices, abuse or the unscrupulous use of economic power and avoidance of collusion; and
37.6 ethics can never become an excuse for poor performance.