Sanlam’s key objective is the creation of value for stakeholders over the long term. Therefore, the Group drives diversity and innovation to position itself as a leader in client-centric wealth creation, management and protection. This means that Sanlam must treat its clients fairly, while doing business in a profitable and sustainable way.
Successful execution of the above depends on the Group’s ability to deliver on business promises and principles through sound practices and processes. The SES committee assists Sanlam with its sustainability and social and ethics responsibilities, and manages and monitors the Group’s sustainability performance.
As a signatory to the United Nations Global Compact (UNGC), Sanlam has committed to align its operations and strategies with 10 globally accepted principles in the fields of human rights, labour, the environment and anti-corruption. We are required to submit a periodic ‘Communication on Progress’ (COP). Sanlam is also actively involved with the UNGC as part of its working group on combating corruption. To ensure that we continue engaging with our stakeholders on what is particularly relevant to Sanlam’s resilience, we have adapted our sustainability reporting approach. This year, as part of the online Sanlam Annual Reporting Suite, the material sustainability themes form five supplementary reports:
We also understand that we cannot create economic and social prosperity without safeguarding the natural resources on which businesses and people rely. In addition to greenhouse gas (GHG) emissions targets, Sanlam has sustainability targets linked to paper consumption, electricity, water, travel, waste and recycling. To this end, the Group is committed to recording and tracking at least 80% of its scope 3 emissions. Sanlam also has an ongoing partnership with the World Wide Fund for Nature South Africa (WWF-SA). The Group initiated various projects together with WWF-SA to conserve and to support the healthy functioning of South Africa’s water systems.
Embracing and accelerating transformation, including gender diversity, remains a priority and one of Sanlam’s key strategic pillars. Overall, the number of black professionals in the Group has continued to increase at a steady pace – from 203 employees in 2014, to 270 in 2016. This is an increase of 33%. However, we need to increase the percentage of black middle and senior management in the Group. This has been flagged as a business priority for 2017.
SES committee Chairman
Sanlam Limited (Sanlam) is the holding company of the Sanlam group of companies (or the Group). Sanlam is a South Africa-based, diversified financial services group, originally established as a life insurance company in 1918. Sanlam is listed on the Johannesburg Stock Exchange (JSE) with a secondary listing on the Namibian Stock Exchange (NSX) since 1998.
The Group operates through a number of subsidiaries, associated companies and joint ventures. Sanlam Life Insurance Limited (Sanlam Life) is the largest operating subsidiary of Sanlam. Sanlam and all of its subsidiaries, associated companies and joint ventures are referred to as the Sanlam Group or the Group.
The Group’s head office is in Bellville near Cape Town in South Africa. It is rated a broad-based black economic empowerment (BBBEE) lefivel 2 contributor as determined by the Financial Sector Charter (FSC).
The Group’s key objective is the creation of sustainable value for shareholders over the long term. This is achieved by optimising Return on Group Equity Value (RoGEV) through a continued focus on Sanlam’s five strategic pillars. These strategic pillars are supported by five sustainability themes, which are entrenched within the Group’s operations and decision-making. This ensures that the Group’s strategic pillars are tested against those key principles that will ensure long-term thinking and sustainability.
View Sanlam's strategic pillars and sustainability themes
More information about the five strategic pillars in the Integrated Report.
More information about Sanlam’s strategy can be found in the ‘Strategic Review the Group Chief Executive’ in the Integrated Report
Under each of the five sustainability themes, the Group identified material enablers that collectively support its ability to create sustainable value for all stakeholders over the longer term. The Group’s sustainability performance is overseen by the Sanlam Board’s Social, Ethics and Sustainability (SES) committee.
Successful execution of Sanlam’s strategy depends on the Group’s ability to deliver on business promises and principles through sound practices and processes, as well as ethical leadership and behaviour. This includes effective risk management and the appropriate balancing of stakeholder interests to ensure sustainable value creation for stakeholders.
Sanlam operates within a complex, global environment that requires skilful response and management. Therefore, the Group must continue to find, engage and motivate the best people to ensure optimal delivery of each strategic pillar. Sanlam must also speed up transformation to reflect the demographics of its client base and the broader societies in which it operates, a prerequisite for long-term sustainable performance.
Sanlam must provide appropriate and fairly-priced products and services that grow and preserve the wealth of its clients and broader society. This is a key driver of new business growth and client retention, which in turn support earnings growth and the sustainability of the Sanlam business model. Sanlam also has a responsibility to improve access to financial services, broaden wealth distribution, and promote a savings ethos through innovative product and service development.
Wealth creation requires a healthy, growing and equitable economy. Sanlam contributes to the achievement of this outcome by responsibly managing and protecting the retirement savings of millions of people, by providing protection for their assets, providing liquidity to the banking industry, investing in local businesses and communities through enterprise and supplier development, and by enhancing innovative product and service development.
Sanlam recognises the increasing impact of climate change and its potential impact on future earnings growth, in particular for its general insurance businesses which are increasingly a ected by severe weather patterns. Therefore, the Group is committed to incorporating environmental factors into investment decisions, and increasing its share of investments in environmentally responsible markets and entities. Sanlam also continuously works to minimise its environmental footprint to prepare for and support a low-carbon economy. Managing climate risk is a key focus area for Santam – the Group’s largest general insurance business.
The Group has also come to appreciate how a stable and strong financial system can absorb and mute these shocks. Where a well-established infrastructure of insurance companies, banks, investment groups and stock exchanges exist, individuals and businesses are to some extent protected, and thus better able as a society to manage risks. In these markets, members of society have a choice of life and asset insurance, safe payment systems, access to credit, the ability to trade in any currency and accumulate assets with a high level of trust.
South Africa is fortunate to have such a financial system: established and stable, well-governed and respected. South Africa is, for example, a forerunner in corporate governance with codes such as the King IV Report on Corporate Governance for South AfricaTM, 2016 (King IVTM), which was released on 1 November 2016 and will be effective from 1 April 2017. In addition, the JSE has been rated as one of the top-ranking stock exchanges in the world.
As one of the largest financial services groups in Africa, Sanlam is a key pillar within the financial infrastructure and its resilience and sustainability is therefore of utmost importance to maintain stability – a responsibility that is unremittingly recognised by the Sanlam Board and which underpins the Group’s prudent management and financial reporting approach.
The 2016 financial year tested Sanlam’s resilience in many ways. Sanlam’s Integrated Report captures some of the events, challenges and opportunities that the Group continues to find, despite uncertain times.
This includes understanding Sanlam’s dependence on various resources and relationships that enable the Group to create value over time, as well as the Group’s effect on these resources and relationships.
In 2015, Sanlam defined six capitals that are the dominant stores of value for the Group to be able to operate. These capitals are recommended by the International Integrated Reporting Council’s (IIRC) Integrated Reporting
Sanlam’s use of the six capitals – with positive and negative impact on future availability and society – is described as input elements into the Group’s business model. For example, financial capital is a key safeguard to protect clients’ trust in the business and the ability of the business model to create value. The Group’s business model is further based on various activities that are complex in nature and require specialised financial, actuarial, risk management, distribution and other skills. The availability of these skills – or human and intellectual capital – is fundamental to the Group’s ability to offer its products and services, and is a key factor in its competitive advantage.
Given the nature of the Group’s operations it has a relatively low impact on manufactured and natural capital. These two capitals are therefore referenced but not dealt with further in this report.
Value creation through the Sanlam business model is further rooted in the shared-value approach which focuses on value creation for the business while generating measurable social, economic and environmental value. Integral to this approach is the need to target impacts and outcomes that offer social return on investment and increased shareholder value through the Group’s various partnerships and programmes. The Sanlam Foundation spearheads Sanlam’s corporate social and environmental investment activities.
Ernst & Young Inc. was engaged to conduct limited independent assurance on specific elements of the performance information in the Supplementary Sustainability reports.
Sanlam values the feedback of its stakeholders on the Group’s performance and sustainability reporting. Queries, concerns and comments can be sent to firstname.lastname@example.org , or addressed via +27 21 947 2548.