| Home | | | Integrated Report 2014 | | | Annual Financial Statements 2014 | | |
|
| | Search |
 |
 |
Leadership messages
 |
|
Exactly a decade ago, in a different leadership context, I wrote:
“Since my earliest days in business, I have rejected the notion of shareholder supremacy. Clearly the rights of ownership must never be undermined, but equally owners cannot profit at the expense of others who are directly or indirectly associated with the enterprise. More practically, every disaffected stakeholder has the ability to damage the enterprise or to limit its progress, and their reasonable expectations must therefore be addressed. Thirdly, while business is not democratic, the context of modern democracy demands transparency, accountability, and stewardship from all entrusted with assets or power. Finally, it is trite to suggest that business should simply pay taxes on today’s profits and leave government to deal with broader society tomorrow – this is an abdication of a leadership obligation in respect of specific societal concerns in a particular business or industry.
Against this background we welcome and embrace reporting and action that ensures the alignment of our corporate behaviour with the long term interests of all stakeholders.”
Today these words hold true for Imperial; a multinational group operating in challenging competitive and socio-economic conditions in 29 countries on five continents. With revenues having exceeded R100 billion for the first time this financial year, we are acutely aware that our impact on a wide range of stakeholders is significant. Reporting on issues that touch them is of such importance that we do so in a separate report for the third consecutive year.
Imperial’s strategic, leadership, operational, financial and governance imperatives must continue to evolve in concert with the more demanding environment the organisation faces. Our strategies as a parent must be more supportive and precise in adding value to subsidiaries, which themselves must be clear about the aggression and durability of their competitive positions. Our leadership pipeline must be strengthened and transformed to enhance succession and diversity. Our operations must reach new standards of efficiency and productivity in a digital world. Our financial performance must ensure adequate risk adjusted returns as we enter less developed jurisdictions. And our governance structures must resist bureaucratic paralysis as they respond practically to an increasing regulatory burden in more countries.
These are the cornerstones of Imperial’s sustainability, which will be assured by our focus on the six major areas relevant to our businesses as covered in this report: people; job creation; safety; fuel efficiency; our environmental footprint and the social and developmental benefits that flow from our specific business activities. Integration is the key. The capabilities and resources devoted to sustainability are part of, and not an adjunct to, our everyday efforts.
This report seeks to provide stakeholders with insight into our progress on the journey of creating a more sustainable corporation and with the measurement thereof. We invite comment and advice from all stakeholders on both.
MARK J LAMBERTI
In the planning stages of this report, we asked ourselves whether it was necessary for the group to produce a separate sustainability review, given that we also publish a comprehensive integrated report.
Our view was that, due to the size of the company and the scale of our presence in the logistics and vehicle value chains, we have a responsibility both to manage our impact on society, people and the environment proactively, and to engage in open discussion on how we do this.
In such a diverse group, the report can also serve another function, which is to ensure that we filter information on the company’s sustainability initiatives through the group and promote learning and best practice among the various parts of our business. As diverse as the group is – in terms of sector presence, geography and people – the opportunities to improve performance by informing stakeholders about successful initiatives in the group are still significant.
Imperial’s approach to sustainability is best summed up by our actions. Even small wins, such as changing the kind of lighting we use in our warehouses and dealerships, making training available to all of our employees, washing cars in our dealerships with recycled water and driving in a way that is safer and more fuel efficient, have an impact because of the size and scale of the group.
Some facts about Imperial’s economic, social and environmental impact illustrate this point:
| > | I n 2014, the group sold over 200 000 vehicles through dealerships in southern Africa, Australia and the UK |
| > | 655 million kilometres were covered by the group’s fleet vehicles in Africa and Europe |
| > | The group’s businesses generated almost R23 billion of value-added revenue |
| > | Of this total, 64% was paid in salaries and benefits to the group’s employees |
| > | R170 million was spent in training throughout the group in 2014, more than 700 000 training hours |
| > | J ust over one million tonnes of CO2 was generated by the group, and 1 710 million litres of water were used in its operations globally |
ROAD SAFETY
Sadly, seven of the group’s employees lost their lives in vehicle accidents during the year and 49 third-party fatalities occurred in accidents involving the group’s vehicles.
Road safety is one issue which clearly illustrates that the group cannot function in isolation from society.
South Africa has one of the highest road fatality rates in Africa, with 32 deaths per 100 000 people on the roads each year. Road accidents are the biggest killer globally of young people aged between 10 and 24. With approximately 14 000 road deaths in South Africa each year, the country has one of the highest per capita road death rates among young people in the world.
In response to the challenges we face on road safety, we implemented the now well-known programme, Imperial I-Pledge, in 2011 and continue to expand its reach. In 2014, we focused particularly on child safety. Publicly-available data highlights a terrible statistic – every day at least three children die on South African roads either because they are not seen by motorists or because they are not properly secured while travelling in a car. Key elements of the Imperial I-Pledge initiative therefore focus on scholar safety and the provision of car seats for children, accompanied by a public awareness campaign around the consequences of not using car seats or seat belts for children.
To date, the campaign has seen the
re-implementation of scholar patrol
programmes in 400 schools in South Africa,
the collection and redistribution of over
2 500 car seats and pledges by over
a quarter of a million South Africans to
commit to road safety. While I-Pledge
started as an effort to make Imperial’s own
employees more aware of road safety
issues, its reach has expanded far beyond
this original mandate.
| HIGHLIGHTS |
ALMOST 52 000 PEOPLE EMPLOYED OVER AFRICA, EUROPE, SOUTH AMERICA, AUSTRALIA AND THE UNITED STATES |
TOTAL SALARIES PAID: R14 BILLION OR 64% OF WEALTH CREATED BY THE GROUP |
The case study on page 36 gives more detail on these efforts and provides an update on the progress made in the Imperial I-Pledge programme during the year.
The use of technology in road safety is increasingly important in our business. We have now embarked on a process where new logistics vehicles are being equipped with cameras as standard, which not only gives valuable information in the event of an accident, but enables us to prevent accidents by continuously monitoring driver behaviour.
TRAINING AND SKILLS DEVELOPMENT
Our focus on training and skills development is driven by an understanding that employees differentiate our business from those of our competitors and enable us to create value – both in the narrowest sense of shareholder value and in the broader sense of value in society.
In simple terms, Imperial focuses on training and skills development because:
| > | The group is an industry leader and we know and understand that there is a shortage of essential skills in our industry |
| > | Our own employees need to remain skilled to allow our business to perform ahead of the curve |
| > | And finally, like every employer, we carry the responsibility to allow employees access to broader learning and developmental programmes |
Our programmes, on which we spend a significant amount of money, over R170 million in 2014, have a positive impact on our business directly, on the industry skills pool and on society. Imperial’s almost 52 000 employees are also parents, community leaders, consumers and potential future entrepreneurs. By allowing each of them access to training and skills development programmes, we are therefore not only meeting our own training needs, but are also raising the level of skills and knowledge in our society as a whole, particularly in the area of much-needed artisanal skills.
 |
FOR MORE INFORMATION on Imperial’s approach to people development, refer to pages 18 to 23. See also the case study on Europcar’s Foundational Learning Competence programmes on page 24 |
USING NATURAL RESOURCES RESPONSIBLY
As we mention earlier, we have not lost sight of the fact that small wins can make a difference across a group as large as Imperial. The culture of the business is highly entrepreneurial and the responsible use of natural resources has become an imperative for many of our managers because they see and understand the business and financial benefits. In this way, responsible environmental practices have become embedded in the way we do business, more effectively than if we had created and prescribed group-wide policies and directives.
Instead, each part of the business was asked to establish a reference site which could be used as an example to promote learning and share best practice. In the vehicle division, for example, the Kia dealership in Weltevreden Park became the first fully solar-powered Kia dealership in the world, and one of South Africa’s most environmentally-friendly motor vehicle dealerships. It would now be unthinkable for the group to build a dealership without giving consideration upfront to issues such as water recycling, energy efficiency and other sustainability initiatives, with a long term objective of having zero landfill waste.
This approach has given rise to many smaller initiatives at a business unit level, including the introduction of energy-efficient lighting and water-free wash bays, an increase in the use of water recycling and the use of technology to increase fuel efficiency in the Logistics International division. See the various examples given in the case studies in this report.
In conclusion, I would urge each of our employees to read this report and think about what they can do to make sure we continue to do business responsibly, taking into consideration Imperial’s role as a major South African corporate and a leader in its sector. This is the way in which we will further entrench the group’s leadership position and support the process of changing and modernising the industries in which it is represented.
VALLI MOOSA