Cyril Ramaphosa's rise in political standing has brought to light the conflicts of interest that can result from holding a position on the board's of several companies. As such, the number two in SA politics has had to reevaluate his business interests, resigning from several directorship positions.
Sitting down with ITWeb to discuss these divided loyalties and the impact they have on business, Inoxico CEO, Andre St"urmer, stressed the importance of having access to information about individual associated relationships.
According to St"urmer, the new Companies Act of 2008 made a significant impact on corporate SA in terms of the duties of directors and the liabilities they would face should they neglect these duties. "This information is very important, especially in the interaction between the public and the private sector," he said. "In the SA environment today, we have a very deep degree of conflict of interest risk."
Inoxico conducted research in this area, based on the positions held by the directors of SA's 20 largest companies. "We found that in the largest 20 companies in SA, on average, each director sits on another 14 external boards," he said of the findings.
"Association Matrix is a tool designed for today's issues around governance, fraud and corruption risks in the supply chain," said St"urmer, adding that while it does have a fraud and corruption element to it, it is primarily a governance tool. Introduced in October 2012, the tool incorporates an analysis and interface layer and takes the data provided by the client and relates it to Inoxico's database, he said. "That is big data at work," noted St"urmer. The Director Singularity Index, part of Association Matrix, provides a view of a director's interests outside of their primary organisation.
"We are originally a credit bureau but that is not the way that we position ourselves in the market," he said, adding that as a credit bureau, Inoxico has access to the same kind of information as other bureaus.
"Traditionally the bureau industry is dominated by consumer data, but we have built up a database on companies and directors, which is cleaner and more up-to-date than the average database out there," said St"urmer, continuing that they have developed clever ways of relating data sets and enriching the data by adding various components to it.
"We have been innovative in understanding what the clients use our data for," said St"urmer. "The tool allows for more powerful interaction between the client and the intelligence. Once it is in place it enables easy monitoring," he said, noting it has been publicly endorsed by the Institute of Directors.
"This tool is built in a way that proactively and preemptively tells you about all the relationships in your supply chain," he concludes. "It brings transparency into your supply chain, which is where things often go wrong."
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