Transformation and ethics

The group’s transformation and ethics committee has been reconstituted as the social and ethics committee in accordance with the new Companies Act and all working forums will be realigned accordingly.

Personal and organisational integrity are embedded in Eqstra’s culture. The group’s code of conduct is communicated to employees and monitored by the social and ethics committee in conjunction with internal audit. Behaviour that undermines the spirit of this code is reported and addressed immediately. A revised business ethics policy was approved by the board and is in the process of being rolled out.

To report suspected irregularities, the group has email and tip-off line facilities that are easily accessible to all employees. The group monitors ethical performance regularly to ensure corrupt or unethical business practices are minimised. During the 2011 financial year, 28 incidents were reported using these channels (2010: 23 incidents). Following thorough investigations, all cases were either resolved or dismissed as unfounded.

Employment and labour rights

Eqstra is committed to promoting equal opportunities and fair employment practices regardless of employees’ ethnic origin or gender. The group subscribes to the principles of fair labour practices in the workplace and our conditions of service comply with applicable laws and industry standards. No material fines were received during the year.

Broad-based black economic empowerment

Broad-based black economic empowerment (BBBEE) is both a business and moral imperative for Eqstra. In line with the Department of Trade and Industry’s guidelines, Eqstra’s approach to BBBEE centres on the principles of ownership, management control, employment equity, skills development, enterprise development, preferential procurement and corporate social investment. Actions taken in each of these areas are set out in more detail. Based on the extent of the group’s compliance to these principles, Eqstra is a level 3 contributor to BBBEE. This rating was achieved in November 2010.

Since Eqstra’s achievement of its level 3 rating, based on a BBBEE score of 75.78 points, it has concluded an interim rating for the year under review. The interim rating is still subject to verification, but reflects an improvement to 81.19 points, further strengthening the group’s level 3 rating.

The social and ethic committee oversees implementation of the principles of transformation in divisions as well as broader matters relating to the advancement of previously disadvantaged South Africans in the workplace and the formation of partnerships for the development of communities in which the group operates.

Ownership

Eqstra’s BBBEE ownership increased to 28,6% in the interim 2011 rating, from 25,5% in 2010. Eqstra’s two BBBEE partners are Lereko and Nozala Investments.

Board and management control

Eqstra’s board consists of ten directors, including two black women and one black male. The group has 40% black representation at board level. Eqstra’s executive committee comprises eight members, including one white female and three functional heads who are previously disadvantaged males.

Employment equity

Our people policies and programmes are designed to address all employees’ interests through the following priorities:

Eqstra is committed to building a representative workforce. At the 2011 year-end, 77% of the total South African workforce and 34% of management staff were from designated groups (2010: 78% and 30% respectively). While total management decreased by 16%, from 1 182 in 2010 to 998,  total black representation in management in South Africa improved.

Percentages refer to nationals only and apply to employees based in South Africa.

Improvement of employment equity is a strategic priority and specific plans were put in place to further develop middle management skills. These plans include early identification of individuals with potential and proactively investing and mentoring these individuals to develop within the group. This is further supported by the learnership academies established in the group. All divisions have submitted the required employment equity plans to the Department of Labour.

Skills development

Eqstra’s focus on skills development is evident from the investment made in the development of its people. The interim rating reflects an increase to 11.6 points (2010: 10.8).

Preferential procurement

In line with the group’s commitment to transformation and empowerment, it is actively managing and improving discretionary procurement spending. All divisions are focused on increasing their procurement from empowered companies, where possible.

During the 2011 financial year, BBBEE procurement was R2 048 million, or 71,5% of discretionary spending in South Africa. The total spending on black suppliers decreased slightly over the previous year, but increased in percentage terms (2010: 69,9%). Procurement spend from qualifying small enterprises or exempted micro-enterprises accounted for 10,6% of total procurement or R303 million (2010: 9,8%).

Enterprise development