South Africa’s retirement funds safeguard trillions of rand earmarked for members’ long-term financial security. When governance fails, the damage is immediate and personal for savers. The 2025 King V Report on Corporate Governance raises expectations of how boards should lead ethically, exercise control, and deliver sustainable value. For retirement fund trustees, King V may be voluntary, but it has become a key benchmark for governance credibility and defensible fiduciary decision-making.
That message came through clearly in a recent Institute of Retirement Funds Africa (IRFA) webinar presented by IRFA president Geraldine Fowler and IRFA executive Wayne Hiller. The session focused on how King V applies in practice to retirement funds, and how boards should assess whether to adopt it within an already demanding regulatory environment.
What is King V?
King V is the 2025 edition of South Africa’s Code on Corporate Governance, issued by the Institute of Directors in South Africa. Fowler said although retirement funds already operate within an extensive legislative framework, King V adds value by strengthening ethical leadership, transparency, and sustainable value creation.
The presenters emphasised that King V does not replace existing law or regulation. Instead, it complements the Pension Funds Act (PFA), FSCA oversight, Regulation 28, and responsible investment frameworks, such as the Second Code for Responsible Investing in South Africa (CRISA 2). Taken together, these instruments form what IRFA described as a comprehensive governance framework for retirement funds.
King V uses an outcomes-based approach. Hiller explained that governance is assessed by what it achieves, not by box-ticking. Boards are expected to demonstrate four governance outcomes: an ethical culture, performance and value creation, conformance and prudent control, and legitimacy.
Apply and explain, not tick-box compliance
A central feature of King V is its “apply and explain” approach. Fowler emphasised that all 13 principles apply to every organisation, including retirement funds, but that recommended practices are not rigid rules.
Where a board chooses not to implement a recommended practice exactly as set out, it must explain why and disclose any alternative or compensating measures. Boards must also provide a concluding statement confirming whether applying King V has achieved the four governance outcomes for the fund. This flexibility matters in a sector where funds vary widely in size, complexity, and business model.
Translating King V into retirement fund language
Because King V was drafted for a broad range of organisations, IRFA emphasised the need to translate its terminology into a retirement fund context. In King V terms, the “organisation” is the retirement fund, the “governing body” is the board of trustees, and “management” is primarily the principal officer and operational management.
Members remain the primary stakeholders, although beneficiaries, employers, regulators, and service providers form part of the broader stakeholder ecosystem. Fowler said this shared understanding is essential if trustees are to apply King V in a way that is practical and relevant.
The 13 King V principles – and why they matter for retirement funds
The King V framework rests on 13 interrelated principles. All apply to retirement funds but must be interpreted through the lens of fiduciary duty and the public-interest nature of the sector.
Principle 1: Leadership
Trustees are expected to lead ethically and effectively. Fowler noted that King V explicitly reinforces existing fiduciary duties under the PFA, requiring integrity, competence, accountability, fairness, and transparency. In practice, this means clear board charters, regular performance evaluations, and ongoing trustee training.
Principle 2: Ethics
Boards must govern ethics across the entire fund, not only individual conduct. Ethical decision-making must shape how funds engage with members, beneficiaries, and service providers. IRFA linked this directly to Regulation 28’s ESG requirements and CRISA 2’s call for responsible investment.
Principle 3: Strategy, performance, and sustainability
Hiller emphasised that retirement funds define value differently from commercial entities. Performance is about delivering sustainable, risk-adjusted returns while controlling costs and protecting member outcomes across generations, not maximising profit.
Principle 4: Reporting
King V expects reporting that explains how strategy, risk, performance, and sustainability are connected. For funds, this means going beyond statutory disclosures to show how investment decisions, risks, and long-term sustainability affect member outcomes.
Principle 5: Composition of the governing body
Boards should reflect the right mix of skills, experience, diversity, and independence. Hiller emphasised that independence is a “state of mind”, not a label, and applies equally to member-elected and employer-appointed trustees.
Principle 6: Committees of the governing body
Committees allow for deeper oversight in areas such as audit and risk, investments, and benefits. Fowler reminded trustees that delegation does not remove accountability: the board remains ultimately responsible.
Principle 7: Appointments and delegation
The principal officer functions as the fund’s executive anchor. Boards must ensure the role is properly resourced and must actively oversee outsourced service providers. “You cannot outsource accountability,” Hiller said.
Principle 8: Risk
Boards must govern risk in a way that supports strategic objectives. This includes defining risk appetite and overseeing investment, operational, cyber, and service-provider risks, rather than focusing only on downside avoidance.
Principle 9: Compliance
Compliance is a legal and an ethical obligation. Failure to comply with legislation, regulatory standards, or adopted voluntary codes directly undermines a fund’s legitimacy, IRFA warned.
Principle 10: Data, information, and technology
Technology is now a strategic asset and a material risk. Boards remain accountable for data security, system resilience, and compliance with the Protection of Personal Information Act, even where IT systems are outsourced.
Principle 11: Remuneration
Trustee remuneration and service-provider fees must be fair, responsible, and transparent. Because members do not vote on remuneration, boards carry heightened accountability to ensure value for money and full disclosure.
Principle 12: Assurance
A combined assurance model helps boards gain a holistic view of governance, risk, and controls by co-ordinating management assurance, compliance monitoring, and external audit.
Principle 13: Stakeholders
Funds must adopt a stakeholder-inclusive approach, with members and beneficiaries at the centre. Meaningful engagement, not superficial disclosure, underpins trust and long-term legitimacy.
IRFA repeatedly emphasised that King V is not a one-size-fits-all framework. Smaller funds may apply the principles differently from large umbrella funds, provided outcomes are achieved and properly explained.
Deciding whether to adopt King V
Whether to adopt King V is a strategic decision. On the upside, adoption strengthens trust, credibility, and governance defensibility. On the downside, it requires time, resources, and a willingness to operate under greater scrutiny.
Hiller said boards should ask a single question: will adopting King V improve governance outcomes and deliver sustainable value for members? If the answer is yes, the commitment is justified.
A practical roadmap for implementation
For boards that choose to adopt King V, Fowler outlined a clear implementation roadmap: educate the board and management, assess legislative alignment, conduct a gap analysis, identify alternative practices where needed, secure formal board approval, update governance documents, and monitor outcomes.
The first year is the most demanding. After that, maintenance becomes more manageable as practices are embedded.
IRFA confirmed that the webinar was the first in a two-part series. The second session will focus squarely on King V’s disclosure and reporting requirements, with practical guidance on how adopting funds should apply the King V disclosure framework. Details will be announced in due course.
