Stakeholders are involved in each level of our value creation process. Afrox strives to be cognisant of these relationships in all our activities, acting with integrity, honesty and equality at all times.
Stakeholders are identified based on their impact on Afrox’s sustainability. This includes stakeholders that impact our ability to remain a responsible corporate citizen.
We classify stakeholders according to the following groupings:
- Shareholders, lenders and market analysts as they provide, or impact access to, financial capital.
- Customers – meeting and exceeding customer requirements is key to our future sustainability.
- Business partners are part of the driving force behind the development and delivery of products, technologies and support services we provide.
- Employees are integral to our ability to provide product offerings and customer-specific solutions.
- Trade unions support our employees.
- Government and regulators are providers of Afrox’s legal licence to operate and regulate pricing of LPG.
- Communities and non-governmental organisations (NGOs) are providers of Afrox’s social licence to operate.
Managing and engaging with stakeholders
The arrangements for governing and managing stakeholder relationships vest with various business units and individuals across the Company aligned to functional expertise. Our stakeholder management principles and approach are always based on positive partnerships, engagement, consultation and teamwork to achieve common goals.
The Company adopts a collaborative style when engaging with all stakeholders.
Through the various functional disciplines, structured and robust processes are in place to monitor stakeholder engagement, including:
- Investor input and feedback through investor road shows
- Formalised customer feedback (e.g. Rant and Rave online feedback platform)
- A dedicated customer service centre that monitors customer service levels
- A community involvement and union relationship monitoring mechanism provided through the HR department
Any areas of concern and opportunities to improve are escalated to the responsible senior executive, and to the Board where required.
Communication with the public and shareholders embodies the principles of balanced reporting, clarity and openness. Positive and negative aspects of both financial and material non-financial information are provided. We maintain an active dialogue with our key financial audiences, including institutional shareholders, investment analysts and our funding community. Our policy is to present to investors, fund managers and analysts twice a year after the release of the Company’s results.
The Board actively endeavours to balance the interests of all shareholders and other stakeholders fairly; the Board as a whole continually challenges business decisions and judgements to ensure that all shareholder interests, particularly minority interests, are appropriately protected. In alignment with this obligation, the Board reviews all transactions and/or agreements between the Company and The Linde Group annually.
The table below shows the legitimate needs and concerns of our key stakeholders grouped into key stakeholder themes.
|Key themes||Stakeholders who share this concern||Response through related material matters||Stakeholder engagement methods|
|Financial results, including total shareholder return, HEPS and cash generation||Shareholders, lenders and market analysts||1 to 8||
|Transformation, BBBEE compliance and the impact of the new BBBEE Codes||
||2, 4, 7 and 8||
Ongoing interactions with shareholders, lenders and market analysts
Direct contact/community meetings and correspondence with communities
|Safety for employees, contractors and customers||
|Employment security, fair pay, incentive structures and employee development||
|Transparency, appropriate information and effective communication||
|Innovation and product development||
||1 and 5||
|Customer value creation, service levels and the level of pricing/price increases||
||1, 5 and 6||
|Future sustainability and growth||
||1 to 8||
|Frequency||The frequency of engagement with each stakeholder is stakeholder-specific and determined by the individual or business unit responsible for engagement. Positive stakeholder engagement is ongoing. No activities were specifically undertaken as part of the report process.|
Our stakeholder engagement had the following focus areas in 2017:
- In line with the Company’s intent to enhance our community involvement activities, we focused on developing stronger relationships with community-based organisations.
- The Company continued to seek opportunities to build closer relationships with our suppliers, especially regarding our Enterprise and Supplier Development programmes. This comprises a formal programme of funding, coaching and monitoring small businesses that are integral to our value chain.
- We actively engage with investors through electronic means, roadshows and investor presentation days. This year we looked for opportunities to improve the effectiveness of these engagements.
All the focus areas mentioned above will continue to be focus areas in 2018.
Stakeholder influence and interest mapping
The mapping below indicates the relationships with the highest influence on and interest in Afrox’s activities:
Customer profile and engagement
The Company has divided its customers into four distinct customer profiles to aid effective product and service provision. Afrox’s sales and marketing function use their customer-driven solutions and excellent service to attend to the unique needs of each customer profile, regardless of geographical location.
These customers provide 80% of Afrox’s revenue and are subdivided according to sectors such as food and beverage, energy and fabrication. Each sector has a dedicated team.
These are growth markets such as hospitality, refrigerants, propellant and helium customers.
These customers traditionally use bulk gases in a manufacturing process. They receive process solutions and unique product package options.
More than 70% of our customer base falls into this category. These customers are not classified as ‘large customers’ and spend R500 000 or less on Afrox products annually.