Completed Activities

The following activities have already been carried out successfully.

Enterprise-Wide Risk Management Training

The SADC-DFRC, in collaboration with the African Development Bank, the Development Bank of Southern Africa (DBSA) and the Industrial Development Corporation (South Africa) recently organized a Seminar on Risk Management for SADC Development Finance Institutions.

The Seminar was held on 15th-19th November 2004 at Hotel Le Vendome in Cape Town, South Africa, and was sponsored by the Japanese Bilateral Trust Fund at the African Development Bank.

The aim of the seminar was to provide a forum for interaction and exchange of views amongst risk management practitioners in the region. Specifically, the objectives were to:

• Disseminate and share information on DFI risk management practices;
• Disseminate information on international industry best practices;
• Propose a strategy for alignment of objectives with international industry best practices;
• Develop a follow-up mechanism for key issues and concerns; and
• Provide a networking platform for DFIs in the region.

The seminar attracted 57 participants from 23 Development Finance Institutions in the SADC region, and three regional institutions, namely, the East African Development Bank (EADB), the Economic Community of West African States (ECOWAS) and the PTA Trade and Development Bank. This included two participants from Mozambique, whose DFIs (GAPI-SARL and IFFPI) have expressed interest to join the Network, and one from Agribank-Zimbabwe, which was not yet a member then. The participants came from a range of functional areas such as risk management, lending operations, auditing, accounting, etc. All held senior management positions in their organizations, and were generally highly qualified.

The resource persons for the Seminar were drawn from the African Development Bank (Financial Management), the Development Bank of Southern Africa, the Industrial Development Corporation (South Africa) and the SADC Development Finance Resource Centre. Additional resource persons were also drawn from Deloitte and Touche, as well as Standard and Poors, while arrangements were also made to visit a DBSA-supported urban development project in Franschoek in the Eastern Cape.

The seminar was opened by a representative of the Japanese government on behalf of the Japanese Bilateral Trust Fund, who reiterated his government’s support for the seminar and the work of the African Development Bank. Supporting remarks were also made by the Director of the Joint Africa Institute and the Chief Executive Officer of the SADC Development Finance Resource Centre. The AfDB would continue working in partnership with Development Finance Institutions through provision of traditional services, and exploring new opportunities for synergy and growth.

The SADC-DFRC envisions itself to be the focal point for the delivery and expansion of cutting-edge development finance services within the SADC region through capacity-building and research, consultancy and advisory services to the member DFIs.

Presentations were made by various resource persons beginning with an outline of the risk management framework from the perspective of the ADB and the DBSA. The seminar participants were then divided into two modules, namely, Credit Risk and Asset-and-Liability-Management. Under the Credit Risk module, participants explored Credit Appraisal, Credit Ratings, Security and Mitigation, Pricing, Loan Agreements, Credit Monitoring and Workouts.

The ALM module examined liquidity risk, currency risk and interest-rate risk. In both modules, there was emphasis on case studies and exercises, as well as practical experiences of the various institutions represented at the seminar.

In the subsequent plenary session, areas of common interest were presented and discussed. These included recent developments in provisioning legislation (by Deloitte and Touche), credit rating practices (by Standard and Poors), portfolio management and operational risk.

In examining all these areas, efforts were made to identify issues which could be the subject of further research, training and collaboration between the institutions. Some of these areas include, inter alia, risk management and corporate governance, credit ratings, credit monitoring and operational risk.

The seminar discussions were rigorous and practical, addressing the key challenges that DFI managers face on a day-to-day basis in the management of risk in their organizations.

A visit to the Franschoek urban development project was undertaken by all participants, and was intended to demonstrate how the DBSA was supporting a project where the private sector had come together with local communities to upgrade housing standards, and create room for investment in tourism and farming development.

The evaluation of the seminar by participants indicated that they found it to be relevant, and of practical value to their work. The resource persons were also judged to be clear and logical in their presentations and papers, and dealt well with questions, concerns and interventions of the participants.

It was the general opinion that some topics need further and detailed exploration targeted at specific groups using a variety of capacity-building interventions, while a regional forum on risk management should become an annual feature of the SADC DFI calendar.

Corporate Governance

Corporate Governance for Board chairpersons, 29th May – 1st June 2005, Johannesburg, South Africa in collaboration with the Institute of Directors in Southern Africa, Institute of Directors, Parktown, Johannesburg.

This workshop was organized by the DFRC in collaboration with the Institute of Directors in Southern Africa on the theme “Corporate Governance and Board Effectiveness” to raise awareness of pertinent issues and recent developments in the field of corporate governance. 17 Board Chairpersons, or their representatives, from the member DFIs attended the workshop.

The workshop was opened by Mr Reuel Khoza, president of the Institute of Directors in Southern Africa, who emphasized on the role of effective leadership to bring about good corporate governance in organizations. He also indicated that the leadership style was changing in South Africa, from a Euro-centric, autocratic and non-participative style to one increasingly based on African values incorporating interdependence and inclusivity. Mr Khoza also stressed that the philosophy of African leadership, referred to as Ubuntu in South Africa, constituted an appropriate foundation for good governance of corporations.

The Vice Chairman of the Board of Trustees of the SADC Development Finance Resource Centre, Colonel Joseph Simbakalia also attended the official opening, and the first day of the proceedings of the workshop. He made a presentation which emphasized the importance that the DFRC attached to corporate governance in the Development Finance Institutions in the SADC region, and wrapped up the proceedings at the end of the day. The Chief Executive Officers of the SADC-DFRC and IoDSA, Dr Ros Thomas and  Mr Anthony Dixon, respectively, also attended the opening ceremony.

The speakers at the workshop were all IOD-accredited speakers and included Mr Philip Armstrong (Corporate Governance Expert), Mr Anton Van Wyk from Price Waterhouse) and Mr Mohamed Adam (Legal Counsel, Eskom). Guest speakers on the programme included Mr Thakhani Makhuvha, Risk Manager at IDC-South Africa, Cynthia Anthony-Maistry, Risk Manager, DBSA and Ernest Dietrich, Deputy Treasurer, DBSA.

The workshop programme covered the role and importance of corporate governance, purpose and function of Board committees, risk management and integrated sustainability reporting.

The debates were lively and engaging, with participants raising important issues of the practical challenges they faced in their roles as directors. The workshop was generally well-received by the participants.

On the first evening of the workshop, the participants  attended a reception cocktail at the Park Hyatt in Rosebank, which was graced by Mr Mervyn King, the Chairman of the King Committee on Corporate Governance. On the second evening, Mr Jay Naidoo, Chairman of the Development bank of Southern Africa, hosted a dinner in honour of the participants at the Park Hyatt Hotel.

The first in-country follow-up workshop was held at Windhoek Country Club in Windhoek Namibia,  9th- 10th February, 2006. The workshop attracted 25 Board members and senior company executives  from the three Namibian Development Finance Institutions, Agribank – Namibia, Development Bank of Namibia (DBN) and the National Housing Enterprise (NHE).

The workshop was officially opened by the Right Honorable Nahas Angula, Prime Minister of the Republic of Namibia, who emphasized the need for good corporate governance for state institutions to deliver on their mandate.

The resource persons for the workshop included Mr. Tony Dixon, Executive Director, Institute of Directors in Southern Africa of South Africa and Dr Len Konar, a Corporate Governance consultant based in South Africa. Mr. Corne Badenhorst of Ernst and Young made a guest presentation on perspectives on Corporate Governance in Namibia.

On the evening of Monday 9th February, the DFRC facilitated a public lecture by Judge Mervyn King, Chairman of  the King Committee on Corporate Governance of South Africa and honorary vice president of the Institute of Directors in Southern Africa,  on “The importance of Corporate Governance in the 21st century. The lecture  was sponsored by the Development Bank of Namibia, and was attended by the Prime Minister of Namibia, who gave the introductory remarks, and many other political , public service and business leaders in Windhoek.

Investment Appraisal and Risk Analysis

The first workshop module of this programme  was held from 18th to 29th July 2005 at the Eskom Leadership Development Centre in Midrand, South Africa. The technical service provider was the John Deutsch International Executive Programs of the Queens University who were responsible for programme development and its technical delivery on the ground. Overall programme management was done by the SADC DFRC.

The programme was opened by Dr Ros Thomas, Chief Executive Officer of the SADC Development Finance Resource Center and Professor Glenn Jenkins, the Director of the Investment Appraisal Programme at Queens University.

Dr Thomas outlined the basis for the decision of the DFRC to bring the Investment Appraisal programme to the Southern African region, which was to upgrade the technical skills of the technical staff of the SADC Development Finance Institutions and develop a shared understanding of best practices Investment Appraisal and Risk Analysis techniques across the region.   She also presented the background to the DFRC, in terms of its history, objectives and functions, particularly its role in strengthening collaboration and cooperation among the DFIs in the region.

Professor Jenkins outlined the philosophy of the programme, and gave a more detailed account of the structure and content of the programme to be followed over the two-week period.

The programme was coordinated by the SADC-DFRC, represented by Dr Herrick Mpuku, Capacity Building Manager and Mariam Ekenyane, Senior Secretary, while the teaching staff comprised Messrs Andrey Klevchuk, Zakaria Bellott, Arkins Kabungo, Tumani Dembajang and D N S Dhakal.

There were 38 participants from 11 countries of the SADC region representing 16 development finance institutions and one from an international financial institution based in Kenya. These participants were mainly Investment and Business Analysts, in the middle to senior management categories of their institutions.

The participants were resident at the Eskom Leadership Development Center, in the Eskom Convention Center.

The morning sessions comprised lectures, while the afternoon and the early evenings were committed to computer-based work and case studies.

The afternoon programmes were highly interactive with the tutors working closely with the participants on the case studies; the participants responded positively and enthusiastically to the case studies.

At the end of the two week session, groups working on the major case, Arkati Power, made presentations to the rest of the class on the work they had done.

An examination was also conducted to assess their understanding and grasp of the concepts presented during the programme. Evaluation forms for both Queens University and the DFRC were circulated for the participants to fill in for subsequent analysis.

On Monday evening, 18th July 2005, a reception cocktail was held in the Eskom LDC dining hall, which was graced by the Charges d’Affaires from the Royal Danish Embassy, Ms Lone Spanner. Ms Spanner reiterated the continued support of the Danish government through DANIDA to the work of the DFRC and the broader DFI community in the SADC region. Professor Jenkins also gave some introductory remarks about the background and expectations of the programme, and thanked the Danish government for the support rendered to the programme. The Programme Manager, Dr Mpuku recognized the pivotal role that DANIDA was playing in building the programmes of the DFRC.

On Friday, 29th July, the workshop was officially closed with a formal dinner at which certificates were presented. The proceedings were presided over by the SADC DFRC Chief Executive Officer. Dr Thomas informed  the audience, that those participants who performed well on the two modules of the programme would be considered for a Training of Trainers’ programme on Investment Appraisal and Risk Analysis. Remarks were made also by Dr Dhakal, on behalf of the  Queens University team, while  Mr. Geerjenan from Mauritius spoke on behalf of the participants.  Certificates were presented thereafter.

The programme was judged to have been successful based on the quality of presentation, the organization and the enthusiasm of the participants. This is also supported by the analyses of the post-workshop evaluations, which are presented separately.

The second module of this programme was held on 7th – 18th November 2006, and was opened by Dr Ros  Thomas and Professor Glenn Jenkins, Chief Executive, SADC-DFRC and Director, PIARA, respectively. The focus of the second module was on the economics of  investment appraisal and  stakeholder analysis.

The workshop employed lectures, case studies and group work for the delivery of material to participants.

The workshop was officially closed on Friday 18th November at a dinner, where certificates where presented, and awards for the best participant in the examination and class work, were given out. Dr Thomas presided over the closure of the workshop, while Dr Dhakal represented the Queens University teaching staff.  A vote of thanks was delivered on behalf of the participants by Konwil Bayer from Agribank in Namibia.

Project Appraisal of SME Credits

This programme is aimed at improving the skills of SME loan  officers in DFIs to carry out effective appraisal of loan applications.

The SADC-DFRC collaborated with the DBSA Vulindlela Institute in the development and implementation of this programme, which was sponsored by the Japanese International Cooperation Agency (JICA) and the New Partnership for African Development (NEPAD).

The workshop was held at DBSA Vulindlela Institute, Midrand on 6th - 17th February, 2006.

The University of Pretoria, led by Professor Jan van Juuren, an entrepreneurship expert, was contracted to provide technical service delivery, together with some private consultants.

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