Our approach to governance

Governance in the Group extends beyond mere legislative and regulatory compliance. The Board and management strive to entrench an enterprise-wide culture of good governance aimed at ensuring that decisions are taken in a fair and transparent manner, within an ethical framework that promotes the responsible consideration of all stakeholders, while also holding decision-makers appropriately accountable.

The Board is the highest decision-making body for those matters that are of significance to the Group as a whole, due to their strategic, financial or reputational implications or consequences. It operates in terms of an approved Board charter which regulates the parameters within which the Board operates and ensures the application of the principles of good corporate governance in all its dealings. This charter also sets out the roles and responsibilities of the Board and individual directors, including the composition and relevant procedures of the Board. The charter is aligned with the provisions of all relevant statutory and regulatory requirements, including, among others, the Companies Act, the JSE Listings Requirements, King IV and the Company's Memorandum of Incorporation.

To support it in its broader oversight and governance role, the Board has three standing committees, each with their own terms of reference, which supports the Board's decision making processes and through which it executes some of its duties, namely: the Audit & Risk Committee, the Social & Ethics Committee and the Remuneration & Nominations Committee.

The Board is of the opinion that the outcomes in respect of each of the 16 principles outlined in King IV have been achieved. We focus on maturing and improving our practices in this regard, with specific emphasis on integrity, sustainability, remuneration, governance, combined assurance and stakeholder relationships.

Decisions by the Board, its committees and other governance structures throughout the Group are made in good faith to promote the success of the Group for the benefit of our stakeholders. In doing so, the Board considers, among other matters:

1. Medium- and long-term consequences of any decision;

2. The need to foster the Group's relationships with stakeholders like employees, regulators, suppliers, customers, governments, and other stakeholders;

3. The impact of the Group's operations on communities and the environment; and

4. Maintaining the Group's reputation for high standards of business conduct and ethical behaviour and the need to act fairly in respect of shareholders and other stakeholders.

In line with the philosophy that good corporate governance is an evolving discipline, governance structures, practices and processes are actively monitored and revised from time to time to reflect best practice.

The following were key focus areas and outcomes resulting from the Board's deliberations since our previous integrated report:

• Aspen's coordinated response to the COVID-19 pandemic, with specific reference to employee health and safety practices and ensuring business continuity, including the supply of critical and COVID-19 related medicines despite lockdown measures creating sourcing and distribution challenges;
• Progressing the Group's achievement of its five strategic objectives which provide the foundation for us to deliver on our overall strategy of creating long-term value for our stakeholders;
• Material business disposals, including the announcement of the disposal of the European Thrombosis assets and a cautionary announcement to shareholders regarding the structured process undertaken to facilitate offers for our API business;
• The resolution of the pricing investigations in Europe and the UK, with both matters being settled during the year;
• The partnership with Johnson & Johnson to manufacture this company's vaccine at our Gqeberha site;
• Aspen's response to stakeholder concerns around ESG aspects, including our progress towards reducing carbon emissions and providing the related disclosures;
• Mitigation of the Group's funding and gearing risks, allowing for the Group to resume dividend payments to shareholders;
• Conclusion of the IFC's EUR600 million loan to Aspen;
• Establishment of a formalised Group Executive Committee and the appointment of Sean Capazorio as an executive director and Group Chief Financial Officer with effect from 1 January 2022 as a result of concerted succession planning activities;
• Material capital investment in Aspen's manufacturing capacity;
• Enhancements in the Group's cybersecurity resilience; and
• Competence, qualifications and experience of the company secretary confirmed.

Further reading

• Aspen governance overview, including an explanation of the Board's mandate, its composition and other material governance practices, as well as a detailed King IV application register as posted online
• Governance supporting our strategy, where we report on the key governance focus areas and outcomes for each of the Board's committees during the year under review

Board composition

Diversity of expertise

Policy: To create an experienced Board with the appropriate balance of knowledge and skills in areas relevant to the Group.

The following areas of expertise are relevant to Aspen:

Gender and racial diversity

Policy: The company's Gender Diversity Policy promotes a voluntary target of 40% female representation on the Board over a three-year period, while the Racial Diversity Policy promotes a voluntary target of 50% black representation on the Board over the same period.

Board meeting attendance

Board	31 July 2020	3 September 2020	9 September 2020	8 December 2020	9 December 2020	10 March 2021	25 June 2021
Kuseni Dlaminil
Gus Attridge
Linda de Beer
Ben Kruger
Themba Mkhwanazi			Apology
Chris Mortimer
Babalwa Ngonyama
David Redfern
Stephen Saad
Sindi Zilwa

	Membership of the Audit & Risk Committee.
	Membership of the Remuneration & Nomination Committee.
	Membership of the Social & Ethics Committee.