Ethical operations – reporting on the 6 capitals
Financial capital
| Stakeholder Group | How we engage with our stakeholders | Their contribution to value creation | What our stakeholders expect from us | What is key for our stakeholders | Method of governance |
|---|---|---|---|---|---|
Communities, traditional and civic society |
Direct interaction through various corporate social investment initiatives and environmental campaigns in various communities | Participation with the community affords Clover the opportunity to understand their needs and to further align our business in a way that improves the lives of our communities at large | Ongoing commitment to our core strategic social investment initiatives adding to the wellbeing of the community |
|
Corporate Governance policies |
|
Consumers |
Promotions and community-based initiatives, social media, Clover consumer centre, Consumer Goods Council | Loyal consumers continued support of their most admired brands and trusted products | Providing high quality and trusted products of their most admired brands in fulfilling consumers' needs |
|
Social media policy, Consumer crises policy, Competition Law policy, Product quality assurance programmes |
|
Customers/ trade |
Meetings, conferences and workshops, CSC taking orders from trade | Extensive retailer footprint providing the basis for continued growth. Clover's brand expansion through retail expansion into Africa | Providing good quality products at competitive prices |
|
Service level agreements |
Employees/ Management |
Intranet, CE briefs, management and general staff briefings, Corporate bi-monthly newsletter (In Clover), workshops and conferences, training programmes, notice boards, intranet communication and performance reviews | Employees acting in accordance with Clover's values of respect, integrity, fairness and responsibility form the foundation of our business. By providing timely business information and strategic information, Clover can put its strategy into action | A stimulating and gratifying work environment, while offering prospects to meet career growth aspirations |
|
SHE Policy, EE Plan Employment policy |
Government and regulating authorities |
Personal meetings, written and verbal communication, through business organisations, Parliamentary portfolio committees | Government gives us our licence to operate and provides the enabling regulatory framework | Continued contribution to the economic growth and social upliftment of the communities in which we operate. Exercise good corporate governance practices while ensuring compliance with all applicable legislation |
|
Public participation |
|
Insurers |
Meetings and site surveys | Ensure Clover has insurance cover for potential loss events that would be material | Open and transparent communication enabling insurers to assess risk appropriately |
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Media |
Media statements and briefings, Social media pages and site visits | The media contributes in sustaining our brand reputation and increase awareness on new products, community development programmes and changes in our business strategy | Good Corporate Citizenship |
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Protocol to respond to media set in social media policy |
|
Milk producers |
Circulars, regional individual and group meetings with producers, media and the Clover producer forums | Clover's milk producers provide good quality raw milk used in manufacturing of our dairy products | A stable market for milk produced for delivery to Clover |
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Producer agreements |
|
Principals |
Contract and service level agreements, meetings, transactional information integrated via respective ERP systems | Participation in growing the footprint of retailers while achieving economies of scale and reducing costs in the supply chain | Timely delivery of ordered product with professional in store merchandising |
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Service level agreements |
| Refer to Report on Governance, Risk and Compliance where this has been addressed. Shareholders, investors and analysts |
Investor presentations and road shows, circulars to shareholders, Integrated Annual Report, Annual General Meeting, Press releases, announcements and notifications through SENS, Clover website and site visits | Investors provide the financial capital necessary to sustain growth. Shareholders are encouraged to attend Clover's AGM to vote on resolutions and to discuss relevant issues with the directors and management | Providing sustained returns on investment by achieving business objectives through delivery on embedded strategy, sound risk management identifying strategic growth opportunities and good governance practice |
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Price sensitive information policy, Insider trading policy, ERM policy, Governance policy and Code of Ethics |
|
Suppliers and service provider |
Supplier meetings, site visits, performance evaluation and audits, business association meetings | Our suppliers provide us with good quality raw materials and services that enable us to produce quality products for our consumers | Conducting business in a transparent manner that is mutually beneficial and sustainable |
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Procurement policies |
|
Trade unions |
Regular meetings with trade unions and collective bargaining forums | To engage organised labour in a positive manner on matters affecting their members as well as other matters of mutual interest | Positive work relationships in dealing with matters sensibly during negotiation processes |
|
Collective bargaining agreements |
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 8 792 complaints of which 1 390 were accepted and 7 402 were rejected due consumers being at fault in handling products or products being mishandled at distribution or store level. This is a 11,7% decrease from the previous reporting period.
| Type of call | Description |
|---|---|
| Priority 1 | Critical calls
Complaint which can:
|
| Priority 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. |
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 2016 and will be presented to shareholders at the forthcoming Annual General Meeting.
Ms Neo Mokhesi
Chairperson: Social and Ethics Committee
12 September 2016
