This Committee comprise the Massmart CEO, a Non-Executive Director, an independent permanent invitee and I, an Independent Non-Executive Director and Chairman. The Chief Ethics and Compliance Executive, the Group Corporate Affairs Executive, the Interim Group General Counsel and the Group Human Capital Executive attend meetings by invitation.
Governed by a Charter, we monitor the Group’s performance in terms of defined Social and Ethics performance indicators, which also include provisions of Regulation 43(5) of the Companies Act of 2008, as amended.
These indicators, which include but are not limited to, OECD anti-corruption guidelines, United Nations Global Compact principles, the Employment Equity Act, Johannesburg Stock Exchange Socially Responsible Index criteria and Broad-Based Black Economic Empowerment elements, are reviewed on a rotational or core agenda basis.
The Charter was updated and approved in November 2017 to ensure alignment to the principles of King IV.
We met twice during 2019 to review performance in the following areas:
- Legislative compliance
- Consumer safety
- Responsible sourcing
- Employee welfare and relations
- Ethical business practice
- Social and environmental responsibility and sustainability
We also considered matters relating to good ethical conduct, with reference to the Company’s Code of Ethical Conduct, related policies and accepted best practice.
These meetings were supplemented by regular management briefings to myself regarding key topics including: plastic use and packaging, genetic seafood screening, biodiversity, the Supplier Development Programme, the proactive management of anti-corruption and responsible sourcing amongst others.
Summary of key focus areas in 2019:
- Considering, analysing, reviewing and deliberating on management reports on ethics, health and public safety, food and other products safety, supporting small local manufacturers and socio-economic development
- Reviewing and assessing Massmart’s response to the listeriosis outbreak in South Africa, and ensuring the effectiveness of Massmart’s testing protocols
- Reviewing and considering the Group human capital and related talent management and retention strategies
- Considering the Group’s response strategies to address equal pay for work issues and government policy on minimum wage
- Reviewing and assessing the effectiveness of the Group’s transformation initiatives, including gender rights, monitoring the Group’s progress against BBBEE and employment equity targets
- Considering Massmart’s interaction with key stakeholders and industry bodies to understand the perspectives of those impacted by Massmart and those who in turn have an impact on Massmart
Focus areas for 2020 and beyond:
- Consider South Africa’s regulatory, political, environmental and social landscape and its implications for Massmart and the retail sector
- Monitor and assess Massmart’s responses to the gloabal outbreak of the coronavirus, Covid-19, and ensuring practical measures are in place.
- Monitor and track the Group’s employment equity plans and related progress
- Monitor the Group’s pay parity response strategies and compliance
- Monitor Group compliance with minimum wage legislation and applicable wage sectoral determinations
- Monitor the Group’s progress against its transformation agenda
- Ensure that systems, procedures and policies are in place to enable Massmart to maintain its responsible corporate citizenship status
- Massmart’s continued participation in various internationally accredited governance, social and environmental indices
- Monitor Group structures, particularly in relation to responsible Private Label sourcing
We confirm that no material issues were identified during the 2019 reporting period. We have effectively discharged our responsibilities during the past financial year and also executed our statutory duties in accordance with our Charter.
Dr Lulu Gwagwa
Chairman of the Social and Ethics Committee
2 April 2020