Social Responsibility and Ethics

The report of this new Board committee (previously the Sustainability Committee) incorporates both the requirements of the Companies Act, 71 of 2008 (the Act) in terms of regulation 43, as well as the King Report on Governance for South Africa (2009) ("King III") regarding responsible corporate citizenship. This report also deals with sustainability matters deemed material by the Board as previously reported by the Sustainability Committee.

Introduction

In terms of regulation 43 of the Act, the Group subscribes to the "enlightened shareholder value approach" – this approach requires that directors are obliged to promote the success of Clover in the collective best interest of stakeholders, which includes, as the circumstances dictate, Clover's needs to take account of the relevant interests of among others, the community, employees, customers and suppliers. Clover is one of the few South African businesses that have been in existence for well over 100 years. It recognises that in order to survive and prosper, critical self-assessment and constant change are required. The Group's sustainability strategy is also based on the acknowledgement of its responsibility to all stakeholders in order to ensure its long-term viability.

The committee is chaired by the Lead Independent Director of the Board and consists of four members who meet on a regular basis. The committee is a sub-committee of the Board and will, through one of its members, report to the shareholders at the Company's Annual General Meeting on all matters within its mandate. It ensures open communication with other committees in order to ensure consistent behaviour from a social and ethics point of view. The committee has developed and adopted a formal work plan entailing the functions of the committee as set out in regulation 43 of the Companies Act in terms of which the committee prioritised the implementation of certain actions to enable the committee to fully discharge its statutory functions over a period of three years. This committee assumes the responsibility to ensure that the Board sets the appropriate tone, and that the behaviour and messages of the Board and the directors support and contribute to Clover's ethical corporate culture. This report sets out the achievement of the committee in the first year of its establishment.

Over and above the requirements of the Act, the scope of the report has also taken into consideration the Sustainability Reporting Guidelines of the Global Reporting Initiative. In short, it attempts to summarise the key aspects of Clover's business that are critical to its long-term future.

Scope

The scope of this review currently covers its South African operations and will over time be extended to its subsidiaries in other countries.

Assurance on this report

While King III also requires that sustainability reporting should be independently assured, the committee is of the opinion that it would be premature to obtain external assurance until the Group's recording systems are mature. Clover has put in place processes to ensure compliance to all applicable legislation and/or legal requirements. It is, however, the Group's intention to expand on qualitative and quantitative information as systems are progressively bedded down. Major improvements in this regard were made during the year under review, specifically with regard to Clover's employment equity plan, employee training and development, the formalisation of the Group's social and ethics policy as well as its policy on environmental impact.

It is the Group's intention to further incorporate prevailing codes of best practice in terms of Regulation 43 (Regulations to the Companies Act). While these processes are being matured, the Social and Ethics Committee has monitored Clover's activities with regard to matters relating to:

 

 

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