Resources review

The introduction by the International Integrated Reporting Council (IIRC) in 2013 of the concept of six capitals of value creation marked a meaningful movement towards a clearly defined framework for what was, until then, referred to as triple-bottom-line reporting. The concept has since then also been incorporated in King IV.

The capitals form an integral part of the foundation of the Grindrod integrated governance, risk and sustainability framework which guides the business in formulating and implementing its strategy. The company internalised the six capitals as our money (financial capital), our assets (manufactured capital), our skills (intellectual capital), our people (human capital), our relationships (social and relationship capital) and our environment (natural capital).

Building on the capitals approach to create value, various international best-practice governance and sustainability tools have been used to develop an integrated governance, risk and sustainability framework to guide Grindrod in creating sustainable value to the benefit of all stakeholders.

In addition to the six capitals, governance and sustainability benchmarks and tools included in the framework are:

  • The King IV Report on Corporate Governance for South Africa, 2016;
  • the Sustainable Development Goals (SDGs) published by the United Nations in terms of its 2030 Agenda for Sustainable Development;
  • the SDG Compass, a tool that facilitates sustainability as an outcome of core business strategy; and
  • the UN Global Compact’s Ten Principles, a value system targeting people and planet.

These elements combine to provide a holistic framework for determining the feasibility of actions to create shared value through economic growth, governance, social inclusion, environmental protection, collaboration, partnerships and ethics. It provides for a correlated and interactive approach, as depicted in the graphic below.

The holistic approach reduces risk and increases the potential for identifying opportunities, while the concept of shared value reconnects company success with social progress, resulting in shared value being created.

King IV provides a principle- and outcomes-based approach to achieve accountability, responsibility, fairness and transparency through an integrated approach. It lays the foundation for creating a value chain aiming to have positive impacts on all stakeholders, through positive inputs, business activities, outputs and outcomes.

The UN SDGs represent a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity. The 17 goals are globally relevant and mobilise all stakeholders towards a common purpose.

Five of the SDG goals – SDG4: quality education, SDG6: clean water and sanitation, SDG8: decent work and economic growth, SDG9: industry, innovation and infrastructure and SDG13: climate action – were adopted by Grindrod as they are considered appropriate to the business’ strategy and its business model.

Focus areas associated with these five SDGs are outlined in the table below.

The Ten Principles of the United Nations Global Compact focus on corporate responsibility in relation to human rights, labour, the environment and anti-corruption. They are derived from the Universal Declaration of Human Rights, the International Labour Organisation’s Declaration on Fundamental Principles and Rights at Work, the Rio Declaration on Environment and Development and the United Nations Convention Against Corruption.

These framework guidelines are further defined through specific international management and reporting parameters included in integrated management systems which comprise:

  • the ISO 9001 quality criteria;
  • the ISO 14001 environmental management system;
  • the OHSAS 18001 occupational health and safety framework;
  • IMO regulations;
  • the concepts and guiding principles included in the GRI’s G4 Sustainability Reporting Standards for the disclosure of the most critical impacts on the environment, society and the economy; and
  • the international GHG Protocol, which defines reporting parameters for GHG or carbon (C) emissions, based on an operational control approach.

The success of this approach is evidenced by the inclusion of the company, for the third successive year, in both the Financial Times Stock Exchange (FTSE)/JSE Responsible Investment Index and the FTSE/JSE Responsible Investment Top 30 Index, which are based on the FTSE environmental, social and governance (ESG) ratings. The company’s rating improved from 3.3/5 scored in 2015 to 3.8/5 in 2016. Awaiting 2017 results.

Source: FTSE, ESG FTSE publications; Integrated ESG into investments and stewardship.
SDG Focus Grindrod focus Group and divisional projects

Ensure inclusive and quality education for all and promote life-long learning.

ENLIGHTEN PEOPLE
  • Employee development initiatives.
  • Industry-related training.
  • Community-focused social investments.
  • Career development plans.
  • Management development programme (MDP).
  • Mentorship programmes.
  • Learnerships and apprenticeships.
  • Skills training and workshops.
  • On-the job training.
  • Grindrod Maritime Training Academy.
  • Graduate programme.
  • Graduate learnerships.
  • Adopt-a-School.
  • Learnerships for students and disabled learners.

Ensure access to water and sanitation for all.

ENHANCE WATER SECURITY
  • Water management policy.
  • Effective water-resource management.
  • Vessel water-purification and reverse osmosis plants.
  • uMhlthuze Water Stewardship Partnership.
  • Rain-water harvesting.
  • Dust suppression with used water from holding dams.
  • Regional water projects.

Promote inclusive and sustainable economic growth, employment and decent work for all.

EMPOWER PEOPLE
  • Empowerment initiatives.
  • HR policies.
  • Safe working environment.
  • Safety and wellness of our people.
  • Enterprise-development initiatives.
  • Durban canteen ownership.
  • Bank car-wash project in Durban.
  • B-BBEE targets.
  • Standardised remuneration structures acknowledging individual merit.
  • Fair treatment of employees.

Build resilient infrastructure, promote sustainable industrialisation and foster innovation.

ADVANCE PEOPLE
  • Stringent management systems based on international benchmarks.
  • Investment in strategic infrastructure projects.
  • People focus.
  • Top-down management structure, driven from board level.
  • Accountability at business level.
  • Six-capitals approach incorporated in decision-making.
  • Target growth across all businesses.
  • Capital projects evaluations include IFC performance standards.
  • Employee engagement through structures, meetings, news dissemination, projects and awards.
  • Shareholder engagement through circulars, news releases and the integrated annual report.
  • Community engagement to foster mutual respect and understanding.
  • Wellness days at businesses, employee vitality programmes, bank health canteen and rooftop vegetable garden.

Take urgent action to combat climate change and its impacts.

MITIGATE CLIMATE CHANGE
  • Vision 2020 policy.
  • Shipping vessel replacement policy.
  • IMO compliance.
  • The Blue Fund.
  • Target emissions reduction, water security and waste management.
  • Capital projects reporting on IFC performance standards.
  • Eco-friendly vessels to achieve environmental and business targets.
  • Improve on IMO compliance through variable-frequency drives project, upgrading ballast-water treatment and proactively addressing packaging material at source.
  • Voluntary Maritime Singapore Green Initiative.
  • Environmental and community coastline preservation and awareness projects.