INTEGRATED ANNUAL REPORT 2011 GRI RESPONSES  

Management approach disclosures

Local communities

Barloworld operations are predominantly in urban centres across the world. Their direct influence on local communities is relatively limited.

The group employs local people but, given its locations, it cannot be regarded as the primary employer in any region. At its operations, the group interacts with local stakeholders as appropriate. Given the nature of its operations these usually do not relate to material development issues or negative impacts of its operations.

The group contributes to the socio-economic development of its regions directly though employment, paying local taxes and levies, through its socio-economic development programme and through Siyakhula, its enterprise development initiative.

Corruption

Barloworld has a ‘zero tolerance’ approach to dishonest, corrupt and illegal conduct. This is central to its code of ethics, worldwide code of conduct and reflected in policies and practices in the group that prohibit corrupt behaviour. This approach applies to all business units and regions where the group operates. Risks are investigated and appropriate measures taken prior to investing in regions where such practices may be more prevalent.

The group is a signatory to the UN Global Compact of which Principle 10 addresses corruption. For details on the UN Global Compact, see: www.unglobalcompact.org.

Criminal behaviour is not tolerated and formal charges are laid against any perpetrator. Internal proceedings are also instituted against perpetrators who will be dismissed if found to have participated in unacceptable conduct.

The group’s comprehensive risk management approach covers all operations and risks associated with corrupt and dishonest behaviour. These are analysed and assessed as part of the risk management process.

Induction and other staff training programmes address expected behaviour in terms of the company’s ethics, codes, policies and procedures. Ongoing communication through employee handbooks, letters of appointment, management briefings and structured team forum meetings reinforce our commitment to our values and expected behaviour. All new employees participate in induction training and orientation.

There are structured processes in the group to review all business conduct and ensure compliance with legislation, company ethics, codes and policies.

In addition to our code of ethics, worldwide code of conduct and anti-Fraud Policy, the Barloworld policy on dealing with: public officials, agents, distributors, intermediaries, trade restrictions, export controls and sanctions is implemented across the group and all employees are expected to comply.

The group is currently implementing a detailed ethics and compliance programme through all its operations and regions which also addresses corruption.

To ensure that conflicts of interest are avoided, staff are required to formally declare any direct or indirect interests in contracts and/or businesses. Barloworld board members and divisional executives are also required to disclose conflicts of interest and gifts received are recorded in gift registers. This also applies to trustees of the group’s retirement fund.

Public policy

The group also is a member of a number of organisations including Business Leadership South Africa and the South African Chambers of Commerce and Industry.

In addition, our operations across the world belong to organised business associations and advocacy groups where they operate.

The group and its divisions participate in relevant industry forums and industry lobbying and policy development activities.

By participating in these initiatives Barloworld contributes to wider society, has an opportunity to share knowledge, raise concerns and influence policy.

Anti-competitive behaviour

The group does not condone anti-competitive behaviour.

Compliance

The Barloworld Ethics and Compliance Programme

Barloworld is driven by the maxim of creating sustainable value for all its stakeholders.  What sets the group apart is its ability to develop and maintain mutually beneficial long-term business relationships. This is called the ‘Barloworld Way’.
The group is committed to responsible business conduct and best practices. All group activities are guided by the governance framework of ethics and a commitment to legal compliance.  The group upholds the King lll principles that good governance combines both regulatory requirements and voluntary standards of excellence.
Within this context, Barloworld has developed the group ethics framework and compliance standards in the ethics and compliance programme.

Structure  
 

The programme is structured to meet the requirements of King lll, the UK Bribery Act adequate procedures and other international best-practice standards. It applies to all group companies, at all locations around the world.

There are two parts to the programme. The ethics framework establishes overall governance standards. It provides an overview of the context for the programme; defines roles and responsibilities; sets out the principles to be applied and standards required to meet these principles. The framework sets the ethical foundation and governance of Barloworld. It includes the code of ethics and the worldwide code of conduct.

The second part is detailed compliance standards that define specific operational requirements for creating, maintaining and improving policies and procedures.  Standards provide a defined and structured approach that aligns with the ethical framework.  The approach is multi-dimensional and facilitates the integration of compliance standards with existing and established control procedures.

   
Process  
 

The programme started with a briefing from Barloworld group CEO, Clive Thomson. The  primary aim is to protect the company from the risk of reputational and financial loss.

The research phase identified regulatory requirements, such as the UK Bribery Act and international best practice. It also involved meeting with key executives in each division to understand the context and expectations of the business.  Phase two of the project was to write the ethics framework and compliance standards. A separate chapter was written on bribery and corruption. After detailed scrutiny by executive directors, the programme was  approved by the main board.

   
Implementation  
 

Implementation spans a five-year period with the main aim for 2011 to raise awareness at each division. It is a risk-based approach intended to recognise and build on standards and controls already in place. A structured approach has been applied to ensure  additional policies and procedures are developed and added only where needed.

Roles and responsibilties for ethics and compliance have been defined and agreed at group level and in each division.

The focus has been on communicating an overview of the programme through presentations and workshops. These have taken place in many regions of the world including Russia, Iberia, the United Kingdom, Dubai, South Africa, Angola, Zambia, Mozambique, Namibia and Botswana. Executive management and senior operational management have committed time and attention to understanding the new requirements, considering the business risks and developing high level plans for the future.

   
Outcomes  
   
In each division, executive management conducted a multi-dimensional self-assessment to determine key risk areas for ethics and compliance. This will be used to direct action plans.  Valuable input has been provided by operational managers on issues such as anti-corruption and bribery as well as identifying high-risk third-party service providers.
   
Benefits  
   

As a global company, Barloworld is committed to upholding international standards and meeting regulatory requirements in the regions and countries in which it operates. The programme provides a framework that consolidates all aspects of governing the business and sets a global standard of excellence.
Entrenched in its code of ethics and worldwide code of conduct is the requirement to ‘obey the law’. This is the minimum requirement and the organisation strives to conduct its operations as a responsible corporate citizen. 

Where possible, the group also participates in the formulating responses to draft policy and legislation.