We recognise that we cannot achieve our purpose ‘Africa is our home, we drive her growth’ without our stakeholders. That’s why we engage with our stakeholders on a regular basis, to understand their concerns, build relationships and develop partnerships.
Our stakeholder engagement maintains and strengthens our legitimacy and social licence to operate; and builds on our reputation as a socially relevant and responsible corporate citizen. We rely on engagement with a broad range of stakeholders to better understand the social and environmental impacts of our business activities, including indirect impacts arising from the projects and businesses we fund. We are committed to building constructive partnerships with our stakeholders, as part of our efforts to support the development and implementation of effective solutions to the social and economic challenges in our countries of operation. We commit to engaging with our stakeholders in a transparent and constructive manner. Engaging with our stakeholders is an important vehicle for developing social and relationship capital.
Our engagement is governed by our group stakeholder engagement principles. Standard Bank Group’s social and ethics committee approved group stakeholder engagement principles in 2018. These act as a guideline for our operations across geographical areas, while recognising the need to accommodate local contexts. The principles were developed in consultation with our regional and country chief executives across Africa.
We are committed to:
The Standard Bank Group board has overall responsibility for oversight of stakeholder engagement. It has delegated its oversight function in this regard to the group social and ethics committee, in line with the requirements of the King IV Code of Corporate Governance. The group social and ethics committee is responsible for:
The group social and ethics committee receives and considers a quarterly report on material stakeholder engagement across the group. Governance standards, policies and guidelines pertaining to stakeholder engagement are approved by this committee. At country level, the board may have oversight of stakeholder engagement in country or may delegate oversight to the executive committee. Chief executives in country are responsible for engagement with material stakeholders in the country.
Group policy, advocacy and sustainability, within group risk, is responsible for developing the governance framework for stakeholder engagement across the group, including reporting on material stakeholder engagement to the group social and ethics committee. It is responsible for ensuring that material stakeholder concerns and issues are incorporated into Standard Bank’s annual assessment of material issues. It also serves as a subject matter expert on developing good stakeholder engagement practices and managing certain stakeholder engagements on behalf of the Standard Bank Group.
Standard Bank’s stakeholders are those individuals, groups, and organisations that materially affect or could be materially affected by our business activities, products and services and performance. They provide us with the resources we need to achieve our strategy and purpose; influence the environment in which we operate our business; and confer legitimacy on our activities.
Stakeholder engagement is part of our everyday business. We engage with our different stakeholders in different ways and strive to be responsive to the concerns of our stakeholders. Given the scale of our operations and the diversity of our stakeholders, Standard Bank has adopted a decentralised stakeholder engagement approach. This means that different teams in the bank meet with their stakeholders regularly on matters of mutual interest, exploring potential partnerships, and searching for opportunities to create value. The issues on which we engage with stakeholders are multiple and diverse. Examples include our employee value proposition, progress in achieving transformation and inclusion, understanding the expectations of regulators, communicating strategy and financial performance, and identifying the needs of customers and clients.
Our proactive engagement with stakeholders informs the identification of our material issues, business strategy and operations, shapes products and services, helps us to manage and respond to stakeholder concerns and expectations, minimises reputational risk and influences our operating environment. Underpinning the decentralised operating model is our ethos of listening to, and constructively engaging with, legitimate stakeholders.
Stakeholders with a direct relationship with Standard Bank
Stakeholders with an indirect relationship with Standard Bank
Standard Bank engages with policy makers, regulators and legislators on material public policy and regulatory matters.
These engagements are conducted in a transparent and constructive manner and are aimed at highlighting the potential impact of policy and regulatory changes on our customers and the economy.
Within South Africa, we’ve adopted an externally assured operating model for the process of monitoring policy and regulatory developments, assessing their impact and providing evidence-based submissions thereon to stakeholders. We maintain a schedule of policy and regulatory developments, which is shared with relevant internal stakeholders throughout the organisation to ensure awareness and readiness for new compliance requirements.
Standard Bank undertakes advocacy in various ways, including bilateral meetings with government departments and regulators, through participating in trade associations such as the Banking Association of South Africa (BASA) and the International Institute of Finance, attending deliberations in Parliament, and by holding seminars with government officials on forthcoming policy changes.
Standard Bank South Africa (SBSA) engaged with government departments and Parliament on several critical issues during 2018, including the implementation of the Twin Peaks approach to financial sector regulation, land reform, consumer credit, regulating the payments system and fintechs, processes related to sales in execution, and transformation of the financial sector.
Standard Bank has had programmes in place for several years to ensure the integration of the treating customers fairly (TCF) framework into our business. In 2018, the draft Conduct of Financial Institutions (CoFI) Bill was released and deals with regulating and supervising the conduct of the financial sector, market integrity and consumer education. In anticipation of this draft Bill, Standard Bank engaged with National Treasury and the Financial Sector Conduct Authority, both bilaterally and through BASA, on conduct issues throughout 2018. We also participated in workshops held by the regulators, including a workshop on the World Bank retail diagnostic report to input into the development of CoFI.
We have been working with BASA and the Financial Intelligence Centre in the SARB to implement the changes to the Financial Intelligence Centre Act to combat financial crime. This is ongoing.
In 2018, Parliament’s Portfolio Committee on Trade and Industry published the National Credit Amendment Bill to propose ways of assisting overindebted, vulnerable customers. Standard Bank participated in the public consultation process, including presenting to Parliament, both on an individual bank basis and through BASA. In addition, as part of our standing annual stakeholder engagement programme, we met with the Department of Trade and Industry, the National Credit Regulator and National Treasury on the impact the proposals in the Bill are likely to have on customers, as well as additional interventions which could be considered when customers are facing debt challenges.
Standard Bank participated in Nedlac’s Financial Sector Transformation Workshop in April 2018. From the workshop, four working groups were formed. The SBSA CE is the business representative in the group on ‘Market Concentration, Monopolisation, Ownership and Licensing’. The working groups are currently drafting resolutions to accelerate transformation. These will be presented at the Financial Sector Summit for adoption. We are also participating in the BASA working groups to develop industry proposals.
On land reform, we have been involved in engagements with government as part of the broader industry, through collaborations with BASA, BUSA and the Agricultural Business Chamber. These have included presenting in Parliament to the Constitutional Review Committee on the amendment of Section 25 of the Constitution, participating in roundtables with the Deputy Minister of Public Works on the Expropriation Bill, preparing submissions accordingly, and reaching out to President Cyril Ramaphosa’s land reform advisors to further engage on the issue.
The SARB and National Treasury released the draft Financial Sector Laws Amendment Bill which covers the processes to be followed if a bank is in distress and needs to be remediated or wound up in a way that ensures the financial system and economy are safe and customers are protected. This draft Bill also sets up the mechanism of depositor insurance for customers to be insured in the case of a bank closure or distress. Standard Bank continues to participate in the SARB technical working groups to develop these safety and stability mechanisms, and we are working with BASA on engaging with law and policy makers.
Together with some other member banks of BASA, we participated in a positive impact working group led by National Business Institute (NBI). This working group discussed the relevance of the UN’s Sustainable Development Goals (SDGs) to the finance sector and which goals the sector could specifically make a significant impact on. During 2018, we finalised the sectors goals and associated targets of the SDGs.
We provided input to BUSA on the draft Climate Change Bill, as well as the Carbon Tax Bill. We also commented on the carbon offset regulation from National Treasury released late in 2018.
Our material issues are those that matter most to our key stakeholders and providers of capital, and that impact on our ability to create value in the short, medium and long term. We therefore consider an issue to be material if it has the potential to substantially impact on our commercial viability, our social relevance and our relationships with our stakeholders. Our material issues are informed by the expectations of our stakeholders, and the economic, social and environmental context in which we operate (the triple bottom line).
We measure our ability to create shared value in terms of our five strategic value drivers – client focus, employee engagement and risk and conduct, which determine our financial outcomes and our social, economic and environmental (SEE) impacts. Our material issues encompass the risks and opportunities in relation to each of these value drivers.
While material issues evolve over time, in response to changes in our operating environment and stakeholder expectations, the broad themes tend to be relatively stable. We view the materiality determination process as a business tool that facilitates integrated thinking.