2. Mark allocation The question is worth 25 marks. However, you will only receive a final percentage mark and will not be given individual marks. Use the grading rubric to see how marks will be allocated. 3. Question You have recently been employed as a compliance consultant for de Buys Agri-logistics, an agri-logistics company listed on the AltX of the JSE. Note: The AltX is the alternative board for small and medium-sized companies to raise capital on the JSE. Many organisations use the AltX as a means to raise capital, and as a steppingstone to listing on the JSE Main Board. De Buys \& Sons was established in 1928 and has been run by the family ever since. The parent company owns subsidiary businesses that operate in bulk storag, distribution, and fertilisation investments for large-scale fruit farming in the Western Cape, as well as maize and wheat commodities farming in the North West Province and the Free State. The company has an annual turnover of approximately R150 million, with an annual profit of R67 million in the financial year. The financial results are audited and approved by an independent auditor. The total number of employees in the holding company is 24 (typically administrative and professional services employees: auditors, financial analysts, and human resources professionals). Each subsidiary organisation has a wide employee and stakeholder footprint. The stakeholders include local communities (i.e. families, small businesses, and schools) as well as employee groups such as logistics personnel (i.e. truck drivers and delivery persons), warehousing staff, farm labourers, fruit pickers, and seasonal staff. There are also employees involved in food sciences and farm management, as well as climatologists and hydrologists. The company is a family-founded organisation; however, you have discovered that the board of directors of this organisation is predominantly made up of family members. The CEO and chairperson, Frikkie de Buys, and the CFO, John de Buys, are the grandsons of the founder. The board consists of eight people, including the CEO and CFO, the CEO's daughter, and three other members of the family who are also shareholders. There is one independent, nonexecutive director, Elana Francis, who is a good friend of the CEO, and a representative of the trust. The casting vote of the board lies with Frikkie, as the chairperson. Figure 1 illustrates the composition of the board. DE BUYS AGRI-LOGISTICS (Cousins) (Daughter) (Family friend) Figure 1: The board of directors of de Buys Agri-logistics company.| As a compliance practitioner, you are worried bout the possibility of conflicts of interests and non-compliance that may occur due to the current structure of the board. Using the King IV Code and Section 72 of the Companies Act of 2008, you are required to write a report to advise a restructuring of the board that is more ethically compliant with the King IV Code. Your answer should pay particular attention to the social and ethics committee and the audit and risk committee. Your report should consist of the following sections: - Introduction [100 words max] - Issues with the current board structure [200 words max] - Suggestion for a new board structure [200 words max] - Appeal for a social and ethics committee [200 words max] - Conclusion [100 words max] (Max. 800 words in total) Note: Part of your substantiation will require evidence from the King IV Code and the Campanies Act of 2008. If you have not yet done so, please familiarise yourself with these documents