Corporate social investment

Afrox has a strong culture of corporate responsibility and is committed to uplifting society. The Company spent R4.1 million1 (2016: R3.4 million) on CSI activities.

1 In line with our target of donating at least 1% of our previous year’s net profit after tax to social investment initiatives.

CSI governance

The Social, Ethics and Transformation (SET) Committee oversees Afrox’s sustainability governance structure and entrusts the Managing Director with responsibility for the Company’s CSI initiatives. This includes the management of responsible corporate citizenship. Engagements with communities are guided by good governance principles to ensure ethical and responsible conduct. Afrox has an annual corporate citizenship plan that is developed with targets to measure our performance.

Afrox’s policies for CSI investments have been endorsed by the SET Committee. The Committee provides relevant CSI feedback through reports and presentations on sustainability compliance, and high-level risks to the Board. A donations policy outlines the procedures for any donations. Afrox defines a donation as a sum of money or non-cash benefit awarded to an organisation without any attached obligations. Beneficiaries are selected according to criteria that are regularly reviewed to reflect our social investment goals. In 2017, Afrox continued its policy of not donating to political institutions.

Overview

The Company administers socio-economic and enterprise development initiatives (ESD) in service training, learnerships, internships, apprenticeships and early childhood development programmes among others. We believe that secondary and tertiary learning institutions are integral to the development of a sustainable future for the communities in which we operate. These institutions further aid the alleviation of skills shortages and unemployment in the country.

We have four objectives that categorise our funding contributions:

Afrox provides support to approved Supplier and Enterprise beneficiaries through the LEAP business support programme. This programme allows beneficiaries to access coaching and business support from the Company to enhance their business management skills and ideally extend growth beyond Afrox into the wider South African market.

As an addition to this, Afrox started the Supplier and Enterprise Action Fund (ED Action Fund) in December 2017. The Company has invested R7.4 million in the fund and continued to provide various support grants through the LEAP programme.

ED Action Fund

The ED Action Fund is administered by Edge Growth, a supplier and enterprise business development support firm. Edge Growth performs thorough reviews and assessments of the beneficiary applications through its own independent governance framework. Beneficiaries who meet all the criteria are awarded financial loans to further their businesses at favourable terms in line with the BBBEE 2013 Codes of Good Practice. The first recipient of the funding received R2.35 million to finance the purchase of new gas cylinder delivery vehicles to support their business expansion.

We try to involve our employees in impactful CSI activities such as Bumbanani Day.

Bumbanani Day
Bumbanani means “Let’s build together” in Zulu and accurately captures the heart of this teamwork-based development day. Bumbanani Day brings together employees from various Afrox branches to assist children’s homes in nearby communities. This contribution takes the form of completing infrastructure upgrades, providing LPG donations or hosting events. In October 2017, Afrox volunteers interacted with more than 2 000 underprivileged children. The Company has spent more than 15 000 hours interacting with children at 47 facilities to date.

Enterprise and Supplier Development
The Company spent R13 million (2016: R6.2 million) supporting various suppliers and enterprises through the LEAP programme.

Donations, support and sponsorships
The Company gives product donations, such as free gas deliveries for heating and cooking, and actively engages with NGOs and charities. This includes support for 40 crèches and feeding schemes that in turn reach 30 000 children and destitute people.

Tertiary education sponsorship and skills development
Afrox supports skills development, through various partnerships, particularly for welding, providing 195 (2016: 123) learners, graduates, interns and apprentices with learning opportunities in the year. The Company supports 13 secondary schools and five tertiary-level welding schools. Refer to human resources for details on tertiary education sponsorship for employees’ children.

LIV Welding Academy

In September 2017, Afrox launched the Welding Academy, a custom container-based welding school that was developed by Afrox in partnership with LIV and SAIW. The LIV Village provides holistic residential care for orphaned and vulnerable children with the objective of nurturing and educating them to become valuable members of society.

In addition to assisting in the development of the welding school, Afrox provides welding equipment, consumables, gases and trained instructors. The Company obtained CHIETA and QCTO (Quality Control for Trades and Occupations) accreditation for the training programmes. Twelve inaugural learners began in October 2017 and are due to complete their course in at the end of 2018. The students will be the first in the country to obtain a welding qualification with QCTO accreditation.

Future focus areas

  • Further integrate the CSI responsibility into our operation by enhancing employee participation in corporate volunteering initiatives and improving communication on initiatives.
  • Improve engagement and collaboration with stakeholders in the communities we operate in, particularly with regards to the level and frequency of CSI communication with internal and external stakeholders.
  • Review the sponsorship and donations strategy to align to the Company’s strategy and footprint.
  • Support the Company in improving its BBBEE score to Level 3 by 2018.