Attendance by all directors at Massmart’s annual general meeting is strongly encouraged while attendance for Board Committee Chairpersons is compulsory.

At the November 2009 Massmart annual general meeting the Chairpersons of the Remuneration and Nominations, Audit and Risk Committees were in attendance, as were the Board Chairman, CEO and CFO. In total, 10 non-executive directors attended the annual general meeting.

The notice for any general meeting of shareholders includes an explanation of the reason for, and the effects of, any proposed special resolutions. The Company’s transfer secretaries attend every general meeting of shareholders to assist with the recording of shareholders’ attendance and to tally the votes. The Chairman confirms with the meeting that votes will be counted by way of poll, ie all votes are counted, rather than by way of a show of hands.


Annual General Meeting

08h30 Wednesday
24 November 2010
Massmart House
16 Peltier Drive
Sunninghill Ext 6


Annually the Group seeks, and obtains, the approval of the shareholders in general meeting to purchase Massmart shares. This authority – valid until the following year’s annual general meeting and subject to the Listings Requirements of the JSE – allows the Group to purchase its own shares up to a maximum of 15% of the issued shares, at a price not greater than 10% above the preceding five-day weighted average. Shareholders have been asked to renew this authority at the forthcoming November 2010 annual general meeting.

During the year to June 2010 no Massmart shares were purchased on the open market by a Massmart subsidiary. The amount and timing of any future purchases will be determined by the Board and are dependent on the Board’s view on the intrinsic value of Massmart shares, the ruling market price from time to time, the Group’s cash position and future cash requirements, and prevailing market conditions.

The Massmart Employee Share Trust acquires shares from time to time on the JSE open-market to mitigate the dilution caused by the Company issuing new shares when options are exercised by participants. During this financial year, the Massmart Employee Share Trust purchased 1.2 million shares for R137.2 million which were utilised to meet vesting share options.


No director, executive or employee may deal, directly or indirectly, in Massmart shares where that person may be aware of unpublished price-sensitive information. There are strict closed periods during which all directors, executives and employees are not allowed to deal in Massmart shares. The periods begin one month prior to the end of each reporting date (these reporting dates being December and June) and end on the public release of the Group results. A closed period also applies from the date when Massmart issues a cautionary announcement.

In addition, all directors, executives and employees, and their associates as defined by the JSE, are not allowed to deal in Massmart shares in the final hour of trading on the JSE. All share dealings by a director, executive or employee must be authorised by either the Chief Executive Officer or Chief Financial Officer. Any dealings by the Chief Executive Officer are authorised by the Chairman, and dealings by the Chief Financial Officer are authorised by the Chief Executive Officer.


Contact the Massmart Ethics Line

FreeCall 0800 20 32 46
SMS ‘please call me’ to 32846 (R1 each)
FreeFax 0800 00 77 88

Do what is right, fair, honest and legal!


Massmart is committed to achieving the highest standards of ethical behaviour and continued its strong emphasis on promoting awareness of, and compliance with, Massmart’s Code of Ethical Practice.

Massmart maintains an independently run Ethics Line by Deloitte Tip Offs Anonymous to which any third party, member of staff or supplier may report a suspected unethical practice. All calls are investigated by Risk Officers within the Group, most of whom are certified Ethics Officers. Ethics investigations are undertaken when deemed necessary by Massmart Internal Audit including the use of certified Ethics Officers. Call and trends are monitored and acted upon by the Group Ethics Committee and call statistics are presented to the Audit Committee annually. Total calls and reports for the year under review were 13% higher than the previous year (see table alongside). Deloitte Tip-offs Anonymous has been certified by the External Whistle-blowing Hotline Services Provider Standard E01.1.1.

Massmart regularly communicates its Code of Ethical Practice to suppliers and service providers, and attempts to ensure that they comply with our ethical standards. This is achieved in various ways: suppliers and service providers are invited to make use of the independently managed ethics reporting line; and Massmart’s formal trading agreements detail ethical practices that suppliers are expected to uphold (some examples: that suppliers are expected to abide by the laws and regulations of the country; that all products and services comply with legal and safety standards; and that Massmart will not tolerate the use of child labour practices or the use of illegal labour).

Massmart applies the same code of ethics and values at all subsidiaries, including non-South African stores or businesses that it operates from.

The CEO of Massmart regularly communicates with suppliers and reinforces Massmart’s commitment to high standards of ethical conduct and its expectations of the same from suppliers.

Massmart maintains a close relationship with the Ethics Institute of South Africa and recently sponsored a survey of ethics effectiveness in itself and numerous other JSE companies through the Ethics Institute.

The appointment of Ethics Officers in all Divisions and the formulation and regular meeting of the Group Ethics Forum have ensured the continued focus on the consistent application of ethics practice and training in the organisation.

Massmart Ethics Line

  Total calls and report
July 100
August 93
September 114
October 127
November 130
December 74
January 79
February 123
March 121
April 93
May 101
June 88
Total 1,243
Anonymous calls 12.7%
Increase in total calls over last year 36.3%


Monitoring and achieving legal and regulatory compliance across the Group has always been a fundamental tenet of our business model. King III however, requires that the compliance process should be more formal with clear responsibilities and reporting. To this end, the Finance Directors in each Division are now the Compliance Officers (and Risk Officers) and have been formally tasked with ensuring that their respective Divisions monitor and comply with all regulations and legislation.

Compliance across the Group is exercised as follows:

  • The environment is monitored, formally and informally, via several sources including specifically-appointed service providers that review all proposed or impending legislation and regulations, as well as non-executive directors, and contacts with government bodies, supplier bodies, and consumer groups.
  • Depending upon where the response to the impending legislation can most efficiently and effectively be addressed, the task would fall to one of the trading Forums (Food, Liquor, General Merchandise, Cellular) or functional Forums (TIP, Finance) or even the Group ExCo. The members of these forums are also tasked with keeping their respective Divisions apprised of intentions to support the role of the Divisional Compliance Officers.
  • Ongoing compliance is monitored and tested through various means including Internal Audit, external audit and third-party service providers. Reports from these entities are presented to both the Risk and Audit Committees.

The Group Compliance Officer is an in-house legal resource at Massmart Corporate who is a qualified lawyer and reports to the Company Secretary, and ultimately to the CFO.

The impending legislation that may have a potentially material impact on the Group includes:

  • Consumer Protection Act (CPA);
  • Regulation of Interception of Communications and Provision of Communication-Related Information Act (RICA);
  • Payment Card Industry Data Security Standard (PCI);
  • Protection of Personal Information Act (PPI Act); and
  • Occupational Health and Safety Act (OHASA).

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