Social, ethics and transformation committee report

  • The committee operates under terms of reference, a copy of which can be found on our website www.barloworld.com. The committee has a clearly defined framework, aligned to the Companies Act, King IV and other relevant legislation and standards, to determine the most effective processes and reporting formats to deal with matters under the committee's mandate.

The committee operates under terms of reference, a copy of which can be found on our website www.barloworld.com. The committee has a clearly defined framework, aligned to the Companies Act, King IV and other relevant legislation and standards, to determine the most effective processes and reporting formats to deal with matters under the committee's mandate.

The committee recognises that some of its statutory functions overlap with the functions or mandates or terms of reference of other committees of the board. Where appropriate, these functions have been aligned to the mandate of the committee. In other areas of overlap such as safety, health and environmental matters, the committee, without derogating from its duties and responsibilities, worked closely with and relied upon the work of other committees of the board.

The committee strives to apply relevant codes of best practice including but not limited to the United Nations Global Compact Principles and Sustainable Development, the Organisation for Economic Cooperation and Development (OECD) guidelines regarding corruption, International Labour Organisation Decent Work Agenda, and the principles of good corporate citizenship as espoused in the King report on Corporate Governance in South Africa (KING IV).

The committee has access to any director or prescribed officer or employee of the Company. Where appropriate, these levels of employees have been asked to provide information or the explanations necessary to enable the committee to deliver its mandate.

THE COMMITTEE CARRIED OUT THE FOLLOWING DUTIES:

HUMAN CAPITAL

The committee monitored the impact of COVID-19 and the Company's response strategies which included a One Barloworld COVID-19 policy, as well as various initiatives implemented to contain costs and ensure the overall wellness of employees during this period. We have sadly lost six employees due to the COVID-19. Counselling sessions were arranged and provided to manage the emotional impact of these sad events on the families, friends as well as colleagues of these employees.

A salary sacrifice plan for employees at middle management and above as well as retirement fund payment holiday were implemented as part of the Company's COVID-19 response strategies. These initiatives, which illustrate the Company's partnership with employees during this difficult time, contributed towards ensuring the long term sustainability of the business and helped reduce the impact of unavoidable restructuring.

A number of wellness focused initiatives were also undertaken under the One Barloworld Group Wellness programme, Geared for Living, to assist employees deal with the emotional and psychological impact of the various lockdowns and cost containment initiatives. These included Emotional Impact Sessions which were arranged and attended by different level employees to debrief and start the healing and recovery process.

The Company ran the One Barloworld Employee Engagement Survey and the results provided insights into how employees are experiencing the organisation from a leadership, culture, talent and human experience perspective. Management has already started with the implementation of various plans to sustain the areas of strength and address elements that impact negatively on engagement with the view of improving the engagement score by the end of the new financial year.

The Human Capital transformation technology system project that was approved by the board was kicked off during September. The system is called PEOPLE1st and is powered by Workday. PEOPLE1st is in the design phase at the moment with a go-live date set to be 3 November 2021. This system promises seamless, waste eliminating and improved experience of the Company's end-to-end Human Capital processes.

This year, the Company's commitment to diversity and inclusion was acknowledged through the following awards at the Gender Mainstreaming Awards 2020. Barloworld took the overall Gender Mainstreaming Champions for 2020 for JSE listed companies. The Company also won in the following two categories:

  • Investing in Young Women
  • Women Empowerment in the Workplace (JSE-listed companies as well as OVERALL winner in this category)

2, 3, 16      2, 10, 12               Link to material matters:   Responding to COVID-19 impacts     Advancing Sustainably



DIVERSITY AND INCLUSION

The 2021 targets remained at a higher weighting (20%) on the Divisional balanced scorecards. With regards to the 2021 year, targets focus will be placed on the levers available to the Group relating to appointments, promotions and retention such that we do not regress from the achievements made in 2020.

The Company is focused on identifying and eliminating any employment barriers, perceived or real, and promoting demographic representation in the workplace that more closely resembles those of the communities in which we operate. Outside South Africa the strategy is to limit expatriates and increase the women representation at all levels.

ETHICS

The Data Repository for Anti-Bribery reporting process was revised to further promote and instill an ethical culture. The amended process has enhanced the effectiveness and independence of the investigations carried out across the Group. An area of improvement would be group-wide communication of the substantiated cases, which resulted in sanctions to demonstrate our non-tolerance to improprieties; including emphasis on the use of the grievance system for HR related calls. Turnaround time to implement recommendations in respect of substantiated findings is high, which adversely impacted age analysis of calls, and the integrity of the Ethics Line.

STAKEHOLDER ENGAGEMENT

The Company continues to evolve its approach and strategic intent to stakeholder engagement. The process of mapping stakeholder relationships has been undertaken across the Group. The Barloworld Stakeholder framework has been defined and embedded in the Group strategy. All divisions and business units have identified key strategic stakeholders. There is a structured approach to major issues raised by the stakeholders and management responses to the issues raised. Stakeholder engagement continued to be key in enhancing the Group's sustained value creation.

EMPOWERMENT AND TRANSFORMATION

As part of ongoing efforts to deliver on its responsibilities, the committee will continue to review, monitor and report on areas under its mandate. The concerted effort placed on preferential procurement and making this a group focus is starting to bear fruit. The Company's spend with small, medium and large black-owned entities as a percentage of the discretionary spend is increasing. Our focus on creating an inclusive culture continued as we rolled out the four-day TEDialogues to more than 50% of our middle management across the country.

Transfer of properties under the Barloworld Khula Sizwe empowerment transaction is substantially complete. There are few properties that still need to be transferred that were impacted by municipalities closing as a result of COVID-19.

As mention earlier, the impact of COVID-19 continues to be monitored and as a responsible corporate, the difficulties that are facing the small-, micro- and medium-enterprise was of concern to the committee. The response was the approval of a COVID-19 salary relief fund of R22 million by Siyakhula, that provided much needed support to the SMMEs continuation of trade for a period of six months including loan repayment holidays. A total of 50 beneficiaries were supported with 359 jobs being sustained.

SOCIAL IMPACT

Barloworld Mbewu, last year we embarked on an initiative to identify fertile fields in order to kick start the season of sowing. This initiative symbolised our commitment to incubate and unleash the latent potential of qualifying community based social entrepreneurs who continue to be innovative in solving their own local community challenges. Mbewu has benefited a total of 29 social entrepreneur cohort that have a proven income stream that demonstrates an ability to be scalable. The first cohort were also provided with business leadership training during this period of reporting and received combined funding of R13 million. They will further be assisted with access to markets and other development funders in future.

To continue balancing social, empowerment and transformation mandate as well as creating shared value with all our stakeholders, the social impact investment has been reduced due to the operating environment, as result, the corporate social investment funding support was R16 million (2019: 19 million) with 50% directed at health and welfare initiatives.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

The committee received updates on pertinent safety, health and environmental aspects through the Group's quarterly SHE report. In fulfilling its mandate, the committee has strategic oversight over SHE aspects and related Group policies. The committee had oversight of performance against set environmental and safety targets. Emerging trends including potential risks were reported to the Group risk and sustainability and SET committees. A benchmarking exercise was performed during the year that identified strengths and improvement areas for Environmental, Social and Governance (ESG) aspects. Where practicable, identified improvement areas have been addressed in this year's approach and disclosures. Where improvement areas require more engagement and a longer timeframe, a work plan being compiled with the aim of addressing stakeholder expectations.

NOMAVUSO NXASANA
Chairperson
Social, ethics and transformation committee