Our material issues and highlights

Material issues 2010 performance Plans and targets

Sustainability governance and leadership

> Our sustainability governance structures 
> Links to corporate governance and strategy 
> Corporate code of Ethical Conduct 
> Corporate compliance 
> Commitment to King III 
> Unlawful conduct, corruption and money laundering 
> Anti-corruption and our participation in the United Nations Global Compact (UNGC) Working Group 
> Policy Analysis and engagement/
co-operation with government 
> Sanlam helped develop a set of corruption reporting guidelines, published in June 2010, as part of the UNGC working group on combating corruption. 
> To better apply King III recommendations, some realignments and material changes were made at the Sanlam Ltd level. 
> Two anti-corruption workshops were held with Sanlam RSA* employees, in partnership with Business Unity South Africa (BUSA). 
> The Group Ethics committee reviewed the Code of Ethical Conduct to ensure relevance to the structure of the Group and the regulatory landscape in the jurisdictions in which Sanlam operates. 
> The Group Policy unit published a compendium of work entitled ‘Five Years of Objective Retirement Advice for South Africa 2005 – 2010, written for the benefit of South Africa’s government, labour unions, NGOs, universities, corporates and the public. 
> Sanlam plans to increase its forensic capacity, in support of a robust anti-corruption programme for the Group in 2011. 
> A further R1,5 million will be invested in a database tool being developed to screen clients against sanctions and terrorist lists. 
> Sanlam RSA will perform an ethical risk assessment in 2011. 

How we manage sustainability

> Sustainability management structures, strategy and approach 
> Sustainability achievements during the year 
> Our commitment to codes and standards 
> JSE SRI Index
> Sanlam RSA initiated a process of developing a Sustainability Management Framework including a robust set of key performance indicators. 
> Our first Communication on Progress (COP) report was submitted to the UNGC. 
> Sanlam Achieved Best Performer Level for climate change on the JSE SRI Index for 2010. 
> Sanlam met 100% requirement for core governance and social indicators for the JSE SRI Index. 
> Sanlam RSA plans to finalise and implement its Sustainability Management Framework in 2011. 
> Further resources will be allocated to the implementation of the Sanlam RSA Environmental dashboard in 2011. 

Engaging our stakeholders

> Our key stakeholder groups 
> How we interact with our stakeholders 
> Sanlam Group undertook strategic engagement with a range of stakeholders at different levels within the organisation, e.g. from Board and policy level to business-unit level, on an ad hoc basis. 
> In 2011, we intend to develop a formal stakeholder engagement strategy and framework. 
Note
The material issues were identified through an internal engagement process with management. As no stakeholder engagement specific to broader aspects of Sanlam’s sustainability has yet been undertaken, these material issues have not been directly informed by stakeholder concerns. However, the various business units engage frequently with their stakeholders and these engagements inform many of the decisions made and actions taken within the business.
* Sanlam RSA refers to the Sanlam Group’s businesses in South Africa. Some areas, however, relate to the entire Group and are identified as ‘Sanlam’, ‘the Group’ or ‘the Sanlam Group’.

Sustainable business

> A diverse, sustainable business 
> Sustainable financial and operational capacity 
> Broad-based economic contribution 
> A transforming organisation 
> Diversifying ownership, management and control 
> For the period December 2005 to December 2010, the Sanlam Group outperformed all other relevant indices (Life, ALSI, Fini, Banks) by a compound average growth rate of 17,6% per annum over the five-year period. 
> Sanlam Personal Finance (SPF) reduced its policy lapses, surrenders and paid-ups from 7,2% in December 2009 to 5,9% for the same period in 2010. 
> Sanlam generated R4,3 billion for shareholders and retained R2,1 billion for future growth. 
> dti Scorecard
  > Equity ownership score is 18,20 (2009: 18,20). 
  > Management control score is 8,16 (2009: 7,54). 
> Sanlam RSA is gearing resources to adapt to changes that the Statement of Intent (SOI), the anticipated Treating Customers Fairly legislation and the new National Health Insurance system will bring. 
> Sanlam will be examining overlaps and synergies between businesses to ensure efficiencies are maximised. 
> Focus will be directed to the formalisation of record-keeping systems to improve BBBEE information consolidation. 
> BBBEE plans:
  > We aim to maintain our newly achieved level 3 status by improving our systems and targets. 

Motivated employees

> Employee performance
> Workplace transformation and diversity 
> Skills development and career progression 
> Conducive working environment 
> Employee health and safety 
> Sanlam RSA’s black employee complement has now reached 60% of total staff in line with our targets, and 86% of the new appointments made during 2010 were black. 
> Sanlam RSA invested R58 476 431 in employee training and skills development (1,77% of the leviable amount, down from 1,9% in 2009). 
> Sanlam RSA invested R1 271 834 in formal coaching initiatives (94 employees), and R4 970 241 in management development initiatives (913 employees). 
> SPF initiated a disability learnership with 18 participants. 
> The number of new recruits with a degree or three-year diploma has increased by over 84% since 2009. 
> Senior managers and staff members identified as “future leaders” completed a survey on the business culture to identify well-performing areas and areas needing attention. 
> dti Scorecard 
  > Employment equity score is 6,74 (2009: 4,04).
  > Skills development score is 9,55 (2009: 9,46).
> Sanlam RSA plans to obtain accreditation as ‘Investors in People’ for the Investment cluster. 
> The new Employment Equity targets for 2012 will be finalised in the first quarter of 2011. 
> Development is underway for a Graduate Leadership Programme (GLP) for 2011. 
> There will be a Group-wide focus on further entrenching the business culture to align this to Sanlam’s business strategy. 

Dependable products and services

> A diverse, sustainable product portfolio 
> Broadening access to financial services 
> Appropriateness and competence of sales advisers 
> Client education and literacy 
> Client service levels
> Dealing with client complaints 
> Sanlam Developing Markets (SDM) sold just over 760 000 individual life policies in South Africa and internationally. 
> SDM activated 104 new retail stores in partnership with the JD Group. 
> SPF increased the total complement of advisers by 12%. 
> SPF runs an Internal Training Academy that cost R29,2 million in 2010, as well as providing free broker training and examinations, which cost R352 000. 
> Sanlam won a number of client service awards from Business Processing Enabling South Africa (BPESA). 
> SPF’s Client Relations unit was commended by the Ombudsman for Long-term Insurance for being the organisation that best supported the Ombudsman over the last 10 years. 
> Sanlam aims to grow the Sanlam Cobalt Financial Literacy Campaign by 30% during 2011. 

Responsible investment

> ESG-based investment decision-making and progress against the
UN-PRI 
> Socially Responsible Investment funds 
> Financing empowerment and investing in infrastructure 
> Responsible property management 
> Sanlam voluntarily completed the United Nations Principles for Responsible Investment (UN-PRI) survey in May 2010. 
> Sanlam Investment Management (SIM) was rated fourth out of the nine measured equity funds and second out of the five measured bond funds according to an Alexander Forbes investment performance survey for the year ending December 2010. 
> SIM was proud to host the Information Management Network’s (IMN) Inaugural African Cup of Investment Management conference. 
> Sanlam Personal Finance launched the Empowerment Fund. 
> Sanlam Private Investments launched the Shariah fund.
> Sanlam Multi Managers will be launching a new SRI product in 2011. 

Responsible procurement

> Our procurement policy
> BBBEE procurement
> Enterprise development
> Strategic sourcing has brought about considerable efficiencies in terms of cost, bringing over R180 million in benefits to the Group during 2010. 
> Total unweighted procurement spend for 2010 was R9,3 billion
> 80,46% of Sanlam RSA’s procurement on a weighted basis came from BBBEE-certified suppliers. 
> Our supplier selection process now includes a screening tool, currently being aligned with policy requirements. 
> dti Scorecard
  > Preferential procurement score is 17,29 (2009: 15,46). 
  > Enterprise development score is 15,00 (2009: 15,00). 
> Sanlam RSA plans to implement a web-based system that allows suppliers to upload their own BBBEE certificates. 
> Sanlam RSA is entrenching environmental selection processes.
> Further research will be done into maximising web-based solutions that will lessen the need for business travel. 
> There will be a particular focus on supporting the growth and upliftment of black entrepreneurs through our procurement practices, focusing on black female-owned businesses. 

Prosperous society and community

> CSI and SED
> Sponsorships that focus on society and communities 
> CSI spend was R19,3 million, which represented 0,52% of Group net profit after tax. This excludes Santam’s CSI spend. 
> The CSI unit reviewed and adjusted the CSI strategy, narrowing investments from 23 projects in 2010 to 13 projects going forward. The 2011 – 2015 CSI strategy was finalised. 
> Takalani Sesame reached 25 million children, and Sanlam spent over R9,5 million on this initiative in 2010. 
> dti Scorecard
  > Socio-economic development score is 2,81 (2009: 2.84). 
> We aim to establish the Sanlam Foundation in 2011. 

Healthy bio-physical environment

> Report of the Group Environment committee 
> Our Carbon Footprint
> Resource consumption and efficiency 
> Environmental targets
> The Group Environmental Policy was refined through a consultative process. 
> Sanlam RSA used an independent consultancy to measure the 2010 carbon footprint of its six largest buildings, covering 68% of total Sanlam RSA full-time equivalent employees. 
> Sanlam RSA’s CO2 emission for 2010 calculates to 11,77 metric tonnes per full-time equivalent employee. 
> For the third consecutive year, we declared our carbon footprint publicly by submitting our 2009 data to the CDP. 
> Sanlam head office recycled about 61% of all waste.
> Sanlam invested R3,1 million in the World Wide Fund for Nature (WWF) partnership. 
> Sanlam spent over R3,2 million on various resource efficiency initiatives at the head office. 
> The Group Environmental Policy will be signed off early in 2011. 
> New resource reduction targets will be set for Sanlam RSA. 
> A core focus will be the positioning of Sanlam RSA as a corporate leader in, and champion of, environmental sustainability.