Social, Ethics and Transformation Committee's report

Dear Stakeholders,

The last year was a turbulent year filled with uncertainty as the whole world almost came to a standstill due to COVID-19 with many countries going into lockdowns. Like many companies, the Group was also impacted by the pandemic both operationally, how we engaged with stakeholders and even how we conducted our meetings. Key to this has been the Group's response to the COVID-19 pandemic which ensured the safety of employees and their families, and saw the Group adjusting its CSI allocation to play a part in donating Personal Protective Equipment.

In spite of all the challenges, I am pleased to report that the Committee performed its functions without any hindrance and can report on its activities for the financial year ended 31 May 2021.

The Committee was formed in February 2012 in accordance with section 72(4) of the Act and operates under Board-approved terms of reference, which include holding at least three meetings per financial year.

As prescribed by the Act, the role of the Committee is to monitor the Group's activities in respect of:

  • social and economic development, including the Group's compliance with the Broad-Based Black Economic Empowerment Act and the Employment Equity Act;
  • consumer relations and the Group's compliance with consumer protection laws;
  • the Group's standing in terms of the ILO protocol on decent work and working conditions, the Group's employment relationships and its contribution to the educational development of its employees;
  • good corporate citizenship, including the Group's promotion of equality, prevention of unfair discrimination and reduction of corruption, contribution to development of the communities in which the Group operates, and its record of sponsorships, donations and charitable giving;
  • the environment, health and public safety and the impact thereon of the Group's activities; and
  • the 10 principles of the United Nations Global Compact (UNGC).

This year the Committee met three times in line with its terms of reference. The Committee engaged with management on transformation across the Group's workplace focusing on continuous improvement in meeting the Company's transformation objectives and regulatory compliance.

Key focus areas for FY21 included:

  • Continuing to evolve Blue Label's CSI approach in pursuit of shared value by leveraging Trust Blu Foundation to ensure that our initiatives are aligned to deliver on RITE.
  • Increase integration of the Group's institutional capabilities to further support our CSI, enterprise and supplier development programmes.
  • Continuing to support the integration of socio-economic and enterprise development initiatives with marketing campaigns to increase synergy.
  • Overseeing the implementation of the approved stakeholder management programme, which is in line with the principles of King IV.
  • Continuing to review and assess stakeholder relations.
  • Continuing to provide oversight on the activities related to global diversity and inclusion.
  • Overseeing the development of a Group enterprise and supplier development policy to transform the supply chain by introducing 51% black-owned entities, 30% black women-owned entities, as well as exempt microenterprises and qualifying small enterprises.
  • Ensuring the embedding of ethics is done in an ethical, safe and responsible way.
  • Monitoring and evaluate the implementation of ethics management.
  • Talent transformation and succession planning to enable improved diversity at Senior Management and Top Management occupational groups.

The Committee ensured that the Group published its consolidated B-BBEE rating in respect of the 2021 financial year as required by the JSE of all listed entities and published a consolidated B-BBEE scorecard on its website, issued a SENS announcement and submitted a report to the B-BBEE commissioner.

In addition to monitoring and reporting on progress to date, the Company continued to explore implementation strategies to increase its B-BBEE compliance levels in line with our good corporate citizenship commitments. The Committee reviewed the impact of the Department of Trade and Industry codes of good practice to the Group and satisfied itself that management is ensuring a rigorous process to ensure compliance at individual subsidiary levels and that divisional management incorporates the Company's transformation objectives as an integral part of their day-to-day performance scorecards.

The Committee continued to interact with Senior Management and the Group's joint CEOs to ensure inculcation of the guidance and recommendations of the Committee into both strategic and operational plans within the Group and its subsidiaries.

The Committee continues to monitor progress of the roadmap to address the Company's equity targets and B-BBEE shortfalls. We will continue to review current initiatives and their effectiveness and make appropriate recommendations to the Board.

The following items were also considered and implemented during the year:

  • monitored the implementation of the revised CSI policy whose intention was to ensure that the principle of shared value for all stakeholders is embedded into all Group CSI initiatives.
  • monitored the implementation of the Trust Blu Foundation, the non-profit arm of the Group.
  • continued monitoring all CSI projects, in particular, our ongoing support of the flagship project.
  • monitoring of the coaching and skills development initiatives to ensure targeted spend of Group priorities and transformational objectives.
  • monitored employment equity, including feedback from the Group Employment Equity Committee.

The Committee continued to monitor Group compliance with the 10 principles of the UNGC. We are pleased to report that the Group acknowledges the United Nations Foundation Sustainable Development Goals and are aligning our plan with the Environmental, Social and Governance requirements. We have cut out a set of objectives aligned to the initiatives that BLT will undertake in the coming year. We will continue to implement measures for the prevention and combating of all forms of corruption in line with all applicable local legislation. Monitoring of the ethics statement and the implementation of the Whistleblowing Policy of the Group remained a key monitoring tool for the Committee.

The Committee further noted that all health and safety policies and procedures continue to be well managed and co-ordinated via the Health and Safety Committee.

Key focus areas for 2022

The Committee believes that the Group complies with the statutory duties, save for issues being addressed by management concerning employment equity and aspects of procurement as the Group purchases mainly from the networks and power utilities. In addition, work continues to be undertaken to improve on the Group's B-BBEE equity scorecard.

Our focus areas will be:

  • Drive a mindset of performance with purpose which includes:
    • Being responsive for the need of the communities we serve while building our business which includes.
      • Quality education.
      • Decent work and economic growth.
      • Sustainable communities - socio-economic plans.
      • Reduce inequalities.
      • Reducing poverty.
    • Improving the environment, health, and safety performance continuously.
  • Continue driving a growth mindset culture which includes:
    • Short and long-term objectives.
    • Developing innovative solutions for long-term growth.
    • Developing self and others to build careers as a retention strategy.
    • Driving long-term employee development for succession planning.
  • Continue to evolve Blue Label's CSI approach in pursuit of shared value by leveraging Trust Blu Foundation to ensure that our initiatives are aligned to deliver on RITE.
  • Increase integration of the Group's institutional capabilities to further support our CSI, enterprise and supplier development programmes.
  • Continue to support the integration of socio-economic and enterprise development initiatives with marketing campaigns to increase synergy.
  • Oversee the implementation of the approved stakeholder management programme, which is in line with the principles of King IV.
  • Continue to review and assess stakeholder relations.
  • Continue to provide oversight on the activities related to global diversity and inclusion.
  • Oversee the development of a Group enterprise and supplier development policy to transform the supply chain by introducing 51% black-owned entities, 30% black women-owned entities, as well as exempt microenterprises and qualifying small enterprises.
  • Ensure the embedding of ethics is done in an ethical, safe and responsible way.
  • Monitor and evaluate the implementation of ethics management.
  • Talent transformation and succession planning to enable improved diversity at Senior Management and Top Management occupational groups.

The Committee believes that the Group complies with its statutory duties, save for issues being addressed by management with regard to employment equity and aspects of procurement as the Group purchases mainly from the networks and power utilities. In addition, work continues to be undertaken to improve on the Group's B-BBEE objectives and targets.

I look forward to reporting on our progress next year.

SJ Vilakazi
Chairman

27 September 2021