COMBINED ASSURANCE ON THE SIX CAPITALS

	Capitals	Internal audit and other independent assurance providers
	Human capital	Clover was assessed as a Level 4 contributor in the last B-BBEE assessment performed by EmpowerLogic in respect of Clover’s June 2017 year- end. Internal audit performed a review on the payroll process.
	Natural capital	Deloitte performed a limited assurance review, in line with the ISAE 3000 standard over the selected indicators included in the Assurance report and provided advice on tax implications on carbon reduction initiatives (based on scope 1 emissions). External safety, health and environmental legal compliance audits were performed at production and some distribution sites by SGS. These audits are performed every three years.
	Manufactured capital	Internal safety audits were performed by Clover personnel and Makrosafe, covering all Clover distribution sites. Internal audit performed independent reviews on production bill of materials. External audits were performed on assets. Clover adopted FSSC 22000 which the latest international standard for Food Safety and Quality Management systems. All factories are in transitional phase from ISO 22000 to FSSC 22000. Annual certification is performed by SGS. Clover engaged in independent third-party audits performed by customers such as Woolworths, Kraft, Nestle, Unilever and others. These audits are performed against international food safety standards. Clover was subject to SEDEX audits from our customers on an ad-hoc basis on selected factories. Marsh performed fire risk surveys over a three-year cycle of all Clover material sites. All Clover factories in South Africa are annually certified by SGS on HACCP standards. SABS performed SIIR certification on behalf of the Botswana Government on all factories exporting to Botswana. Property valuations are performed every three years by The Property Partnership. Replacement values from these valuations are used to adequately insure sites.
	Intellectual capital	Deloitte Legal performed an advisory review over processes and policies to ensure future POPI compliance Clover brands have won numerous accolades, confirming our status as a trusted household name. Clover’s portfolio of trademarks and patents are managed by Adams and Adams attorneys. Herbert Smith Freehills LLP is retained as Clover’s competition law advisors.
	Social and relationship capital	Clover Mama Afrika positioned itself as a sustainable and effective CSI project, as evident from prestigious awards received, with the Trialogue CSI Strategic Award received in 2017. Clover received a full allocation of points on our social economic development as assessed in respect of Clover’s June 2017 year-end by Empower Logic. Clover was the winner of South Africa RepTrak® 2018 most reputable company in South Africa award.
	Financial capital	Clover received an unqualified audit opinion by external auditors. External auditors assessed management’s representation over material internal financial controls.

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 10 360 complaints of which 1 654 were accepted and 8 706 were rejected due consumers being at fault in handling products or products being mishandled at distribution or store level.

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), Frantz Scheepers (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). Key Clover individuals continue to attend high-level induction programmes on the potential effect of the application of the CPA. 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 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.

COMBINED ASSURANCE

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 IV™, 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 levels of assurance as depicted on the table here. In th 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 is a committee of the Board of Clover. Its membership and functions are set out 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 2018 and will be presented to shareholders at the forthcoming annual general meeting.

Ms Neo Mokhesi

Chairperson: Social and Ethics Committee

26 September 2018