Reporting to Society 2018 - Transformation skills development

Skills development

SSBSA scored 17.62 on the skills development element of the scorecard. This is slightly lower than the score of 18.31 we achieved in 2017, primarily due to spending on the training of unemployed black people being included under CSI rather than skills development, and a delayed start to some of our learnerships.

In 2018, we spent approximately 82% of our total skills development budget on the development of black employees across all levels of the organisation. Approximately 15% was spent at senior and executive management levels.

Standard Bank is committed to the development of leadership skills across the bank. In 2018, 4 920 SBSA employees attended leadership and management development programmes. Almost 75% of these employees were black, and 41% were black African.

We encourage our employees to stay up to date with developments in their various fields of work, to develop their professional skills and where appropriate to pursue additional formal qualifications. The bank offers bursaries to all employees who meet set criteria. We have implemented an online system to facilitate the application process. In many instances our employees pursue specialist qualifications, but we have also seen a significant uptake in post-graduate qualifications, and MBAs in particular. We awarded 1 555 staff bursaries in 2018, valued at approximately R38.1 million.

Standard Bank’s graduate programme provides an entry-point to the corporate world for university graduates. 194 graduates joined the programme in 2018, of whom 91% were black.

We offer learnerships for matriculants and graduates, which provide young people from disadvantaged backgrounds with an opportunity to work in the bank and learn about different aspects of our business. Each learner is assigned a coach, mentor and line manager who are there to provide ongoing support and give the learner as much opportunity as possible to succeed. On completion of the programme (12 to 18 months), participants receive a nationally recognised qualification and where possible, are absorbed into the organisation. In 2018, 815 unemployed people started a learnership or internship programme with the bank, 99% of whom were black, and 87% of whom were black African. At the end of 2018, 64% of learners who completed their learnership were offered additional work opportunities, be it on an internship, fixed-term contract or in a permanent role.

From 2019, SBSA is participating in the YES initiative, a joint programme between government and business that aims to place unemployed young people in training programmes, learnerships and jobs, to support sustainable work readiness and skills development. We have adapted some of our existing learnership programmes to accommodate YES participants.

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Leadership training and graduate programmes


	2018	2017	2016
SBSA leadership training – total number of employees	4 920	3 543	2 460
SBSA leadership training – % of black attendees	74.8	67.5	67.0
SBSA leadership training – % of black African attendees	41.0	34.8	na
SBSA learnership/graduate programmes – total number of employees	1 009	924	1 037
SBSA graduate programmes – % of black attendees	91	89	81
SBSA graduate programmes – % of black African attendees	75	40	na

SBSA Leadership Training % of black attendees

2018

74.8%

2017: 67.5%

SBSA graduate programmes % of black attendees

2018

91%

2017: 89%

Preferential procurement

We scored 18.83 out of 19 for preferential procurement. This is a significant improvement against our score of 17.49 out of 19 in 2017 and reflects the bank’s increased investment in procuring from black and black women-owned qualifying suppliers.

We are committed to advancing job creation and economic transformation by opening opportunities in our supply chain to black-owned suppliers and small enterprises. We have revised our preferential procurement and supplier development policy to better support transformation and inclusion within our supply chain. We work with potential and current suppliers to identify appropriate opportunities, and we provide successful candidates with business development support. We also provide suppliers who meet specific criteria with access to finance where needed.

In 2018 SBSA achieved 14.94 out of 15 points for procurement, with 3.90 out of 4 bonus points. We exceeded our internal minimum targets and FSC targets, with the exception of the qualifying small enterprise (QSE) category. Spend with blackowned suppliers has increased over the past three years, from R3.4 billion in 2016, to R4.1 billion in 2017, and R5.1 billion in 2018, in actual rand terms and spend. We have exceeded our target for procurement spend with BBBEE compliant companies. 35% of our procurement spend is with black-owned companies and 22% directed to black women-owned companies. The percentages on the different spend categories is based on weighted spend on the bank’s preferential procurement scorecard.

We are working with suppliers to improve their BBBEE status. We’re in the process of engaging with all our non-BBEEEcompliant suppliers, asking them to provide us with their BBBEE Improvement Plans, detailing their plans to transform their businesses. This consultation is yielding positive results. We’ve also developed a strategy to identify opportunities where procurement spending can be shifted from non-compliant suppliers, who currently constitute 48% of Total Measured Procurement Spend, to black-owned small and medium enterprises (SMEs).

Our efforts to diversify our supply chain include a specific focus on black-owned small and medium enterprises. In 2018, 17% of Total Measured Procurement Spend (TMPS) for preferential procurement initiatives was with black-owned SMEs, and 8% with black women-owned SMEs.

We have pioneered a supplier development programme that aims to improve economic participation of black-owned SMEs into our supply chain, by providing them with business development support services together with tailored financial solutions. The business development support available to participants ranges from coaching and mentoring to technical training. During 2018, 109 suppliers participated in our supplier development programme. 65 of these suppliers received procurement opportunities worth almost R198 million.

The Standard Insurance Limited (SIL) team, which provides a wide range of short-term insurance solutions, is committed to using locally based, black-owned enterprises to service customer claims. We’re growing our stable of black-owned small businesses, from panel beaters and electricians to plumbers and builders, and bringing these small enterprises into our formal supply chains.

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We have exceeded our target for procurement from BBBEE-compliant insurance service providers. During 2018, SIL and supplier development engaged with suppliers through supplier roadshows across the country. We also onboarded 400 service providers to our digital platform. The aim of these engagements was to raise awareness among the suppliers on our SIL panel of supplier development opportunities, and to hear directly from them about the kinds of support and information they need from us. One recent success story is that of a small black-owned supplier who manufactures and distributes electric geysers, who is now part of Standard Bank’s supplier database. From November 2018, this business will supply about 30% of SIL’s electric geyser requirements to the customer base. SIL’s leadership team worked closely with group procurement to ensure the successful fulfilment of this partnership and continues to work on developing similar partnerships.

In our credit rehabilitation and recoveries (CRR) value chain, procurement from black-owned suppliers increased from 41% of total spend in 2017, to 48% in 2018. Our CRR team has developed an incubation programme, which proactively identifies and makes contact with black-owned collections agencies who had challenges to get onto Standard Bank’s collections panel. These agencies are then invited to participate in our Supplier Development Programme. The team proactively identifies non-performing suppliers, as part of its standard supplier performance process. These suppliers are placed on probation. Any black-owned suppliers placed on probation are invited to participate in the Supplier Development Programme and receive business development support. In 2018, 50% of the black-owned suppliers referred to the Supplier Development Programme improved their performance and were reinstated on the Credit Rehabilitation and Recoveries panel.

Our efforts to improve the representation of black advocates in matters relating to Standard Bank include a preferential procurement target in respect of our CRR panel, for 40% of all instructions for outsourced matters to be given to black advocates. This was communicated to the attorneys on the CRR panel in May 2018. We have also provided procurement guidelines to align court appearances to the bank’s Financial Sector Code targets for preferential procurement.

Total % of credit rehabilitation and recoveries (CRR) spend with black-owned attorneys:

SBSA is working with attorneys to build technical legal knowledge, through workshops, bespoke engagement on standardised legal processes and monthly performance discussions. This is being undertaken with the support of the bank’s supplier development team.

Our efforts to create sustainable supply chains and support the growth of black-owned small businesses have included the development of a credit product available specifically for black owned SMEs with annual turnover of less than R50 million. The credit model sets aside a R500 million credit line, which enables us to extend funding credit support to these SMEs subject to their meeting a set of defined credit criteria. The credit model was approved in August 2018. Since then 2% of the credit line offtake has been approved and disbursed. We expect this uptake to increase significantly going forward.

Kholofelo Shaai

HEAD: SUPPLIER DEVELOPMENT, SBSA

“Preferential procurement and supplier development aims to facilitate greater empowerment and economic transformation through the procurement of third-party goods and services. Our efforts to diversify our supply chain include a specific focus on SMEs, where we have pioneered a supplier development programme that intends to improve economic participation, through access to market, finance and business development services.”