Governance and Leadership

How we are governed

All medical schemes in South Africa are governed by the Act. The Scheme Rules are developed in accordance with the Act and approved annually by the CMS.

Additional governance guidance is taken from the King IV Report on Corporate Governance for South Africa 2016 (King IV). These governance codes set the standard for good corporate governance in South Africa and are recognised as best practice internationally. The King IV Report defines corporate governance as the exercise of ethical and effective leadership by boards to achieve the following governance outcomes:

  • An ethical culture;
  • Good performance;
  • Effective control; and
  • Legitimacy.

The DHMS Trustees embrace the principles of King IV in achieving optimal governance outcomes for the Scheme and within the Scheme environment. The Trustees are required to lead ethically and effectively, and each Trustee (individually and collectively as part of the Board) should cultivate the characteristics of integrity, competence, responsibility, accountability, fairness and transparency, and exhibit them in their conduct.

DHMS is governed by an independent Board of Trustees, which is responsible for the oversight of the business of the Scheme. The Trustees hold the decision-making power of the Scheme and are ultimately responsible for oversight of the Scheme’s material matters, the development and implementation of the Scheme’s strategy and the sound management of its business, including Scheme policies.

The Board’s overriding objective is to ensure that the best interests of Scheme members are served equitably and in the context of the sustainability of DHMS. The Trustees are accountable to the Scheme’s members.

According to the Scheme Rules, the affairs of the Scheme must be managed according to these Rules by a Board of fit and proper members (i.e. with the requisite character, integrity, skill, competence, financial soundness and ability to exercise a fiduciary duty) of at least five and a maximum of eight Trustees.

Trustees serve a term of three years and are eligible for subsequent re-election or re-appointment, but may not serve more than two consecutive terms.

At least 50% of Trustees on the Board are elected by members at any given time, which means that the Scheme has no influence over the re-election of these Trustees. In terms of its limited succession planning ability, the Board may also appoint additional Trustees to fill knowledge, experience and skills gaps if required or re-appoint a Trustee, taking into account their performance and the skills and knowledge that are required on the Board.

In addition, the Trustees have access to professional advice, both inside and outside the Scheme to inform the proper execution of their duties, and may obtain such external or other independent professional advice as they consider necessary.

To ensure effective leadership, the Trustees dedicate a significant amount of time and effort to their fiduciary duties, well beyond meeting attendance requirements.

The Board comprises independent, highly skilled professionals with diverse skills, experience, background and gender. This brings multiple perspectives to bear in discussion and debate, ensuring robust oversight and strategic decision-making. Our Trustees have expertise in legal, actuarial, accounting, economics, governance, clinical, financial, financial reporting, investment and human resources.

Chairperson

Neil Morrison

BSc (Hons) Physics, MA (Economics)

Constitution of our Board and Board Committees

The role of the Trustees is to:
  • Evaluate, direct and monitor the Scheme’s strategy, ensuring that it is aligned with the purpose and value drivers of the Scheme, and the legitimate interests and expectations of stakeholders;
  • Review the sustainability of the Scheme and evaluate whether the services offered by the Administrator and Managed Care Provider meet the needs of the Scheme and its members, and offer value for money;
  • Monitor innovation and oversee the improvement of all levels of the Scheme’s operations;
  • Monitor adherence to the Scheme Rules and the provisions of the Act in the day-to-day running of the Scheme’s affairs; and
  • Consider stakeholder perceptions and their impact on the Scheme’s reputation.

At all times, the Trustees are required to act with due care, diligence, skill and good faith in the best interests of the Scheme and its members. Measures are in place to assess any conflicts of interest that may arise, and the Trustees act in terms of best practice governance and any relevant legal requirements in managing these.

The duties of the Trustees, as set out in the Act and Scheme Rules, are to:
  • Take all reasonable steps to ensure that the interests of beneficiaries, in terms of the Scheme Rules and the provisions of the Act, are protected at all times while acting with impartiality in respect of all beneficiaries;
  • Ensure the proper and sound management of the Scheme by applying sound business principles to ensure its financial position is sound;
  • Take all reasonable steps to protect the confidentiality of medical records concerning the state of health of the Scheme’s members, and ensure that the Scheme Rules, operations and administration comply with the provisions of the Act and all other applicable laws;
  • Oversee and direct the management of the Scheme’s outsourced activities performed by the Administrator and Managed Care Provider;
  • Appoint, evaluate and delegate oversight functions to the Principal Officer;
  • Ensure that proper control systems and record keeping are employed by and on behalf of the Scheme; and
  • Ensure that adequate and appropriate information is communicated to members regarding their rights, benefits, contributions and responsibilities in terms of the Scheme Rules.

Trustees are remunerated for their services in terms of the Scheme's Remuneration Policy. The benchmarked professional fees of Trustee and Board Committee members are discounted in recognition of the non-profit status of medical schemes.

Board Committees

In compliance with the Act, the registered Scheme Rules and in line with best practice governance principles, the Board has implemented appropriate governance structures to navigate and manage the complex operating environment, risks and strategic objectives of the Scheme.

The Board is supported by ten Board Committees, which are constituted and structured according to the needs of the Scheme and to assist the Board to fulfil its fiduciary and oversight duties effectively. Board Committee members consist of both Trustees and independent members.  Independent Board Committee members serve a term of three years and are eligible for subsequent re-appointment for a further three years, but may not serve more than two consecutive terms. Committee members are remunerated for their services in terms of the Scheme’s Remuneration Policy.

The Committees report regularly to the Board, and each has its own terms of reference and clear procedures for reporting. The terms of reference set out each Committee’s role and responsibilities, which are reviewed on an annual basis to ensure that they remain relevant to the business of the Scheme, and that the skill and expertise of members on the Committee are appropriate and relevant. The Committees make recommendations to the Board for the approval of any decisions to be taken.

Constitution of our Board and Board Committees

Scheme Executive Management

The Trustees, as one of their fiduciary duties, appoint and delegate accountability for the day-to-day management of the Scheme to the Principal Officer and the Scheme Office. The Principal Officer, who is the chief executive of the Scheme, must be fit and proper to hold this office and may appoint any staff required for the proper execution of the business of the Scheme.

The Board delegates collective management responsibilities to the Principal Officer and determines the terms and conditions of service of any person employed by the Scheme. The Principal Officer is required to execute the decisions of the Board and, as the accounting officer, bears the ultimate responsibility for all management functions.

Guided by the Act, its Regulations, the Scheme Rules, the Board delegation of authority, and applicable laws, codes and standards, the Principal Officer is supported by an executive management team to execute the strategic objectives of the Scheme. The team works in collaboration with the Administrator and Managed Care Provider, Discovery Health, in implementing strategy. The management team’s diverse expertise includes medical, actuarial, risk management, accounting, business management, strategic development, financial management, investment, legal, ethics, compliance and research capabilities.

Principal Officer

Dr Nozipho Sangweni

MBChB, MBA, PGDip Occupational Health, PGDip Civil Aviation Management

Scheme Secretariat

Within its operational structure, the Scheme has a secretariat function that is appropriately qualified and experienced to provide the Trustees with support regarding their duties, responsibilities and powers. In addition, the secretariat function ensures that accurate minutes of all Board and Committee meetings are prepared, distributed and stored appropriately.

Delegation of Authority

The Board has implemented a formal delegation of authority that defines the authority, roles and responsibilities required for the optimal operation of the Scheme. The delegation of authority is reviewed and updated whenever necessary to ensure relevance to operating requirements and alignment with the accountabilities and authorities of Scheme employees.

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