Page 54 - Integrated Annual Report

REPORT OF THE SOCIAL AND ETHICS COMMITTEE (CONTINUED)
Broad-based Black Economic Empowerment (“B-BBEE”)
HCI is one of the most empowered companies on the JSE. The company has its roots in the trade union movement, and we are committed to broad based Black Economic Empowerment. The Southern African Clothing and Textile Workers’ Union continues to be a major shareholder of HCI, benefitting more than 100 000 clothing and textile workers and enabling the Union to run substantial social programmes for its members.
HCI joined with a number of broad based BEE entities who consider themselves to be pioneers in the establishment of B-BBEE vehicles in engaging with the BEE commissioner over her adamant refusal to accept collective Black ownership as an acceptable form of Black empowerment. The Commissioner has taken this view despite the obvious intention of the law to promote broad based entities. The Commissioner however is largely indifferent to the extent to which such entities distribute benefits to Black people, create jobs and otherwise benefit Black people.
Likewise the Commissioner is largely indifferent to whether such entities are controlled by Black people. Her sole concern appears to be whether such entities are owned by Black individuals.
A great many institutions such as unions, churches, voluntary associations, foundations and trusts do not have conventional “owners” and are accordingly barred from consideration as BEE entities by the Commissioner.
Happily the Minister of Trade, Industry and Competition published a Practise Note on 18 May 2021 in which the status of broad based groups was clarified. The Note makes it clear that broad based groups such as ourselves are legitimate Black owners and we trust that the Commission will abide by this determination. We view ourselves as pioneers of Black Economic Empowerment and we believe that broad based groupings like ourselves represent the essence of the empowerment project. We hope that in time the Commission will view us as allies in the process of broadening asset ownership in South Africa.
Ethics:
No material incidents and issues were brought to the attention of the committee and no unethical behaviour was noted during this period.
Diversity policy:
HCI adopted a gender and race diversity policy at board level in FY2019. At the date of adopting this Policy, the board’s aim is to ensure that the board will comprise of at least 25% female directors and will at all times have a majority of directors who are “black people” as defined in the Broad-Based Black Economic Empowerment Act, 2003, as amended.
At 31 March 2021, the board is comprised of 27% women and 73% of the directors are classified as “black people”.
At the time of writing this report, the group is in the process of completing its 2021 verification. On finalisation of this process, the B-BBEE certification will be published on our website, www.hci.co.za.
50
40
30
20
10
0
Ownership
2017
Management Skills and control development
2018 2019
Enterprise and supplier development
2020
Socio- economic development
Fraud and whistleblowing:
During the period under review no instances of fraud requiring action at a group level were raised or identified.
The committee is satisfied that the company has made adequate and appropriate provision for whistleblowing.
Element
Maximum score
Actual score
Ownership
25,00
25,00
Management Control
19,00
13,81
Skills Development
20,00
14, 84
Enterprise and Supplier Development
40,00
37,77
Socioeconomic Development
5,00
5,00
Overall score
111,00
96,42
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INTEGRATED ANNUAL REPORT 2021
HOSKEN CONSOLIDATED INVESTMENTS LIMITED