SUSTAINABILITY AT BIDVEST

Sustainability at Bidvest offers employees a fresh way of thinking that inspires them and enables a new generation of entrepreneurs to create business value that integrates evolving financial, social and environmental needs and expectations.

Approach and boundaries

This is the fifth year that Bidvest has reported on sustainability issues. Previously, Bidvest issued separate sustainability reports, but this year has chosen to integrate sustainability into its annual report.

Sustainability at Bidvest is concerned primarily with social, environmental and Group sustainability issues – the management of sustainability, transformation, the quest for talent, HIV/Aids and our response to environmental challenges. Each divisional report covers economic, marketplace factors and sustainability issues specific to that division. For a complete assessment of Group sustainability issues, it is imperative that the review of operations and other relevant sections in this annual report are read. More information is available in the sustainability section of Bidvest’s website.

The starting point for sustainability reporting in South Africa is the King ll Report on Corporate Governance released in 2002 which encourages companies to pursue ethical operating and good governance practices in financial, social and environmental matters. Social issues are dominated by South Africa’s transformation challenge while our international operations, particularly the UK and Australia, provide an environmental lead.

The DTI codes of good practice have evolved and changes have had a material impact on the previously reported numbers. Data collation procedures have improved and various businesses were moved from one division to another. We have not attempted to restate previous years’ numbers as it would be a major exercise and simply not commensurate with the effort. Accordingly please treat prior year numbers with a degree of caution – they may not be directly comparable.

Bidvest’s approach is informed by the Global Reporting Initiative. Bidvest self-declares this report at GRI Application Level B+.

DEVELOPING SUSTAINABILITY AT BIDVEST

Many of the principles that are today categorised as “sustainability” are inherent in the way we do business, as evidenced by our consistent growth over two decades, our focus on returns and efficiencies and our commitment to doing business in a moral, fair and ethical manner.

The concept of sustainability has enabled Bidvest to bring these issues onto the “radar screen” and allows management to address them directly. Bidvest’s long-term financial track record and performance in the social arena, particularly as a result of transformation in South Africa, has enabled the Group to address two of the three pillars of sustainability. Meaningful datagathering and reporting on environmental performance has been a challenge for Bidvest and has become a key focus area. The need for improvement in this area has been highlighted by Bidvest’s participation in the JSE Socially Responsible Investment Index, the Dow Jones Sustainability World Index and the Carbon Disclosure Project.

In 2003, the Black Economic Empowerment transaction with Dinatla Investment Holdings was the catalyst for sustainability reporting and Bidvest’s formalisation of the concept of sustainability. Bidvest is a substantial employer of historically disadvantaged individuals in South Africa. Legislation, particularly the Employment Equity and Black Economic Empowerment Acts and various industry charters, has driven the need to quantify progress towards socio-economic transformation and BEE certification. Data collation began in 2003 and formal reporting the following year. Initial focus was on BEE, but has widened to include other sustainability issues.

While our South African businesses concentrated on bringing historically disadvantaged citizens into the formal economy, Bidvest companies abroad faced the cost of stricter environmental legislation and heightened reputational risk as climate change and other concerns began to mount.

The new millennium was characterised by increasing volatility and appreciation for risk, prompting Bidvest to undertake a concerted risk review. In 2006 and 2007, the Group surveyed the risks facing businesses in each division, identifying 60 risks that became the basis of a new risk management tool driven by the Group’s risk committee.

Many major developments around the world are being driven by climate change and other environmental pressures, in particular concerning energy and resource usage. The world is not the same place it was two years, or even a year ago. There has been a fundamental and irreversible change demanding new strategies for survival. Sustainability gives a framework to address and assess new risks and drive new opportunities.