Corporate Governance in Mauritius
In his Budget Speech presented on the 8 June 2017, the Prime Minister of Mauritius unveiled a three year Strategic Plan to support the Government’s medium-term and long-term objectives. It is stated therein that: “Good governance is a pre-requisite for a conductive business environment that allows these growth sectors to thrive. Government will, through the constitutional bodies, improve transparency, effectiveness and efficiency in the delivery of public services”.
An examination of the Finance (Miscellaneous Provisions) Act 2017, which came into force on the 24 July 2017, shows the Government’s continued intention to promote good governance by amending the Companies Act so as to make it compulsory for all companies which have a duty to file annual reports, to include within them a report on corporate governance. One can therefore see a definite determination on the part of the Government of Mauritius in encouraging companies in Mauritius to conduct their business with better principles.
One would note that by virtue of the Financial Reporting Act, the National Code of Corporate Governance (the “Code”) was already compulsory for all public interest entities as defined in the Financial Reporting Act. However, all other companies are encouraged to give due consideration to the application of this Code insofar as the principles are applicable.
The Code which is currently in use in Mauritius is a new code which officially launched on the 13 February 2017. The Code adopts an innovative approach of “apply-and-explain” instead of the mandatory or prescriptive approaches to corporate governance, which have been traditionally applied by other jurisdictions worldwide. As such, rather than being a rigid set of rules, the Code includes eight simple principles.