Chief Executive Officer’s review
This is Tiger Brands’ third annual sustainability report. The report outlines our governance response and strategic commitments to sustainable development, and reviews our performance in delivering on these commitments, as well as on our most material environmental, social and governance (ESG) impacts. Publication of the report reflects the company’s commitment to enhanced transparency and accountability.
Chief executive officer
Informing our sustainability response is the clear understanding that this is
explicitly in the company’s best long-term interest. For Tiger Brands to flourish
into its second century, we need a healthy workforce and consumer base, a
strong economy with robust institutions, and a sustainable natural resource base;
protecting these is as much a financial necessity as it is a moral imperative. In
addition to helping us protect value – by protecting the resources and
relationships we rely on, managing risk and reputation, and delivering improved
efficiencies – sustainability is also about creating value. Increasingly we are
seeing opportunities for profitable growth, for example through innovations in
nutrition and the circular economy, or by developing socially inclusive
partnerships across our value chain. Simply put, sustainability is smart business.
Responding to the Covid-19 pandemic
The company’s performance this year, on all issues, has been impacted by Covid-19. The pandemic has highlighted some of the deep structural inequalities within South Africa and reminded us how these impact all of us. But the pandemic has also shown us how we can pull together – as individuals, businesses and communities – and reaffirmed the role that we can and should play to “build back better”. I have been incredibly heartened by the nature of the Tiger Brands’ response to the pandemic, and how we pulled together, acting positively and proactively to keep each other safe, to ensure the continued availability of affordable nutrition, and to increase food support to communities most in need.
The company acted rapidly to protect the wellbeing of employees, prioritising remote working where possible, and introducing rigorous screening, testing and hygiene protocols for staff at our essential services sites, accompanied by funding private transport and a special incentive for essential workers during the lockdown. In the context of these profound challenges, the response of our staff was superb, with record levels of attendance during the first six weeks of lockdown, notwithstanding the restructuring and leadership transitions being undertaken at the time. Despite our various efforts, I am saddened to report that 11 of our employees died after contracting the virus. I extend my deepest sympathies to the families of all those who have been severely affected.
Following the government’s strict lockdown requirements in South Africa in April 2020, we were quick to respond to initial panic buying and pantry loading, by ensuring a continuous supply of product, taking measures to ensure product safety, working with suppliers, logistics and customers to limit disruptions, and providing effective communication to address concerns around food security. These efforts were accompanied by a strengthened focus on our numerous community food and nutrition programmes for families, school children and frontline healthcare workers and hospitals.
The role of Tiger Brands as an “essential service provider” highlighted the importance of our business as a key contributor to food and nutrition security in South Africa, and it reminded us of our particular responsibilities in protecting the wellbeing of our employees and communities. This has brought new life to the societal purpose at the heart of our company, “to nourish and nurture more lives everyday”, and to delivering on our strategic commitment to sustainable development.
Our commitment to a Sustainable Future
Last year, we completed a comprehensive review and update of our five-year growth strategy in which we agreed a clear set of commitments for each of our four strategic pillars: Drive Growth, Be Efficient, Great People and Sustainable Future. The Sustainable Future pillar outlines our commitments and targets in three priority focus areas – health and nutrition, enhanced livelihoods, and environmental stewardship – where we believe Tiger Brands can make the most meaningful intervention, as Africa’s largest food company, in addressing some of the significant societal challenges facing our markets and contribute to the UN Sustainable Development Goals.
While our most immediate priority this year has been on addressing the significant commercial exigencies facing Tiger Brands, we did not lose sight of our strategic commitments to a Sustainable Future, and it is encouraging to see the progress made this year in each of the three focus areas.
Enabling health and nutrition
South Africa’s population is one of the least healthy globally, with high levels of obesity, lifestyle-induced non-communicable disease, and persistent hunger and malnutrition, all trends that have been amplified by Covid-19. In this context – and given our role as a leading company in South Africa’s food system – we recognise our responsibilities, and the opportunities, in promoting health and nutrition. We have made progress this year in better enabling consumers to improve their health and wellbeing by providing products that are more nutritious and affordable, developing best-in-class nutritional standards, and leveraging the company brand and marketing activities to promote consumer nutrition (see Health and nutrition).
Given the existing challenges in the South African economy, characterised by high levels of unemployment and inequality, and worrying growth prospects, we have committed to improving the livelihoods of thousands of people by providing opportunities across our value chain for inclusive economic participation. This includes a specific focus on supporting black/black-women farmers and enterprises, through our supplier and farmer development programmes, and our preferential procurement policies. Our progress this year has been driven through our enterprise and supplier development fund, agriculture aggregator model, preferential procurement activities, and ongoing social investment and community food support (see Enhanced livelihoods).
Reducing our environmental footprint
Healthy ecosystems are the foundation of a secure food supply. Recognising the significant environmental impact of the agri-food value chain, both globally and nationally, we have committed to improving our environmental performance by implementing innovative solutions that optimise energy and water consumption in our operations, reduce the negative impacts of packaging, and minimise waste, effluent and emissions. We made some progress this year in reducing the footprint of our operations, focusing on the most material issues: improving energy and water efficiency, reducing greenhouse gas (GHG) emissions, and striving for zero waste to landfill operations (see Our sustainability strategy).
Our strategic enablers
Delivering on these priorities requires a continued focus on instilling the right culture, ensuring robust food quality and safety systems, protecting employee health and safety, and maintaining good governance, all reviewed in more detail in this report. There are two issues to mention briefly upfront.
Firstly, on employee health and safety. While Tiger’s response to protecting employees during the pandemic has been admirable, we still have work to do in areas of our occupational health and safety. I am saddened to report that there were three work-related fatalities this year. In February 2020, Adam Makhado was involved in a motor vehicle accident, and in July 2020, Mboniseni Innocent Sithole was shot dead in an attempted robbery in Daveyton. Both were employees of Albany and were delivering bread at the time of the incidents. In October 2019, a contractor to Davita Trading, Kuda Sithole, suffered fatal internal injuries when the machine he was attempting to install fell on him. My sincere condolences go out to the families. We have provided support and counselling to the families of our employees and are implementing appropriate response measures to minimise the potential for future such incidents.
The second issue to highlight is our continued strong emphasis placed on food safety and quality throughout the year, and the various measures we have taken to ensure that we have robust management systems, qualified people, and a strong quality culture embedded across the organisation. We have further strengthened our audit and assessment processes, achieving external certification for all our manufacturing facilities against globally recognised food safety standards such as FSSC 22000 and HACCP, and started the certification process for our warehouses. It is encouraging to report that we maintained an improving trend on our quality KPIs, ending the fiscal year with zero public recalls, a 25% reduction in market-place incidents and another 5% reduction in consumer and customer complaints.
This has been an incredibly eventful and challenging first period as CEO of Tiger Brands. Despite the significant challenges, at a personal level it has also been stimulating, thanks to the incredible dedication and support provided by Tiger’s employees and my colleagues on the executive team and board, particularly in their response to Covid-19. We face some challenges ahead, but I am confident that together the company’s employees and leadership teams will ensure that Tiger Brands delivers on its potential in creating long-term value.
Chief executive officer
30 November 2020