How clover creates value and reporting on the six capitals

• How Clover creates value today
• Overview of Clover’s value creation process
• Reporting on the six capitals
• Clover’s business model
• Human capital
• Natural capital
• Manufactured capital
• Intellectual capital
• Social and relationship capital
• Financial capital
• How Clover sustains value for Tomorrow
• Clover’s future value creation philosophy
• Human capital
• Natural capital
• Manufactured capital
• Intellectual capital
• Social and relationship capital
• Combined Assurance

Social and Relationship Capital

How Clover sustains value for tomorrow: Social and Relationship Capital

 

Compliance with consumer relationship legislation

Regulation 43(5)(a)(iv) of the Companies Act (Act No 71 of 2008) requires companies to monitor their consumer relationship activities. These activities include Clover’s advertising, public relations and compliance with consumer protection laws.

We manage our consumer relations through the Clover Consumer Centre (CCC), which deals with complaints and enquiries. Clover deploys expert consultants to manage queries and protect our brands, while ensuring compliance with the Consumer Protection Act.

During the year under review, Clover received 9 168 complaints of which 1 901 were accepted and 7 267 were rejected due consumers being at fault in handling products or products being mishandled at distribution or store level.

Type of call	Description
Priority 1	Critical calls Complaint which can: damage the image of Clover or the Clover brand name threaten the health or safety of the consumer and/or Clover personnel hold a contamination threat to the environment result in a consumer suffering damages as a result of a Clover product possibly result in negative publication in the media possibly result in legal action against Clover possibly result in the consumer referring the matter to the Consumer Council.
Pririty 2	Client requests feedback in writing The complaint receives urgent attention and the consumer is kept informed by the head of the Consumer Centre until such time as the investigation is completed and complies with the requirements of the consumer.
Priority 3	Client wants to speak with manager Complaints, which are not satisfactorily dealt with by the consultant and where the consumer insists on communicating with the head of the Consumer Centre, the complaint must be escalated for attention.
Priority 4	Completed by consultants Complaints are attended to by the consultant with the information at hand and no further escalation of the complaint/incident is necessary.
Priority 5	Completed by consultants These are complaints that are received through social media.

Public and Investor relations

Clover’s Corporate Services department is responsible for public relations. No Clover employee may comment or conduct any interviews with the media on behalf of Clover without the express permission of Marcelo Palmeiro, who is assisted by Company Secretary Jacques van Heerden and Prof Elain Vlok (Manager: Corporate Services) when required. With regards to Investor Relations, this function is delegated to Johann Vorster (Chief Executive), Elton Bosch (Chief Financial Officer) and Jacques van Heerden (Company Secretary), who are responsible for all investor communications. They are assisted by an independent and professional agency

Compliance with Consumer Protection Laws

Clover has taken proactive steps to be fully prepared for the application of the Consumer Protection Act (CPA). High-level induction programmes to key Clover individuals regarding the potential effect of the application of the CPA are ongoing. The process of establishing a CPA Centre of Excellence, which will enable Clover to maintain its commitment towards compliance with laws and regulations, is underway. The marketing department provides the Social and Ethics Committee with regular reports on its activities, enabling the Social and Ethics Committee to monitor compliance with the CPA. Furthermore, logs are maintained for any promotional and trade coupon promotions in line with the CPA. The Company Secretary together with the Group Manager of Product Innovation and Technology are responsible for the annual review of the company’s compliance with regards to the following acts:

• the Consumer Protection Act
• Food stuff, Cosmetics and Disinfectants Act
• other labelling legislation
• various other acts that impact our stakeholders.

Please refer to the Report on Governance, Risk and Compliance where this has been discussed in detail here.

Financial capital

For information on the financial capital, refer to the Chief Financial Officer’s report here and the Annual Financial Statements that follow.

Combined assurance

Although King III requires that sustainability reporting be independently assured, Clover has obtained partial assurance over the six capitals to the extent disclosed in the combined assurance framework in the table on the right. Clover intends enhancing our qualitative and quantitative information as systems are progressively bedded down. All material risks considering the sustainability of Clover’s business model and in complying with Regulation 43 of the Companies Act, as well as King III, are incorporated into Clover’s risk universe. These are monitored under Clover’s risk management process as described more comprehensively in the Governance section.

Furthermore, legal compliance with Regulation 43 of the Act is described fully under the Six Capitals report, while compliance with Clover’s regulatory universe is described under Compliance in the Governance section. All legal compliance falls under the supervision of the Company Secretary who ensures that the full regulatory universe is monitored. During the year under review, the Social and Ethics Committee monitored and addressed all lines of defence as depicted on the table here. In the opinion of the Social and Ethics Committee, based on the information provided to it, the statements made in our report, fairly reflect Clover’s standing.

Report of the social and ethics committee

The Social and Ethics Committee (“Committee”) is a committee of the Board of Clover. Its membership and functions are set out in the report of Governance Risk and Compliance here. As required by the Companies Act of 2008, the Committee has reviewed the information reported by management in the Report on the Six Capitals. In the opinion of the Committee the report fairly sets out Clover’s standing in terms of the matters specified in regulation 43 to the Companies Act 2008 in respect of the year ended 30 June 2017 and will be presented to shareholders at the forthcoming Annual General Meeting.

Ms Neo Mokhesi

Chairperson: Social and Ethics Committee

11 September 2017