James Moore: African lessons in governance for brewer

Outlook It's a rare thing for Africa to be seen as a highlight of a company's results. The continent has long been synonymous with words like "conflict" and "basket case".

However, it was virtually immune to the financial crisis and has a number of dynamic economies in which the political classes have started to wake up to the fact that good governance pays dividends.

The brewer SABMiller is benefiting from this – Africa has long been an important part of its business but it may well become the engine of its growth.

Yesterday's results showed that Africa provided the best regional improvement in earnings, at least if you assume constant currencies, outside of Asia where the results were complicated by the acquisition of Fosters.

For some reason if you put a brand name with a colourful logo on a rather tasteless beer it becomes "aspirational" and people in emerging economies want to be seen drinking it. Still Africans would probably argue that tasteless beer is a small price to pay for economic growth and the poverty reduction that ought to go with it.

SABMiller's share price might benefit even more if it followed the example of those African leaders who have got the message that good governance pays.

It violates a number of provisions of the UK's Combined Code such as having an executive chairman, who was previously the chief executive, so won't be independent even when he gives up his executive role. It also doesn't have a majority of independent directors on its board, and its audit committee contains a representative of a powerful shareholder. Did someone say basket case?