ESG: The Future of Sustainability | 6th Edition

Be a part of the transformation.

CONTENTS

ENVIRONMENTAL GOVERNANCE SOCIAL

10 COP27: Commitments to protect vulnerable countries

12 Climate change 2022: A global snapshot

21 There’s a flood of capital and we need to ride the wave

22 Ushering in a just transition: Hope for the future of clean energy

26 The future is green: What about the economy?

28 The benefits of combating desertification

30 The ocean is made up of drops of water

34 Water: The driving force of all nature

38 Sustainable agriculture: Alternative transport for moving fresh produce

40 South Africa’s relationship with plastics

44 Surmounting mountains of e-waste

48 Sustainability initiatives: What is government doing to ensure a sustainable future?

52 The future of mobility in SA

58 The conscious consumer and CSI

60 Agility and change management: The new normal

62 New chances to get it right post-COVID

68 SMEs in Africa must focus on health and safety in the workplace

70 Unlocking WFH employee wellbeing and productivity

72 Happiness = Productivity

76 King IV and the ‘G’ in ESG

78 Driving an enabling environment for value creation

80 ESG: It pays to start

82 Making profits while making a difference

84 ESG investment options

86 Climate change will impact how insurers re-evaluate risk

88 Managing ESG risks for your business

90 We’re all connected: Acting locally, thinking globally

FEATURED CLIENTS

CEO Ralf Fletcher

Associate Publisher

Twaambo Judy Chileshe

TOPCO STUDIO

Production Director Van Fletcher

Group Editor Fiona Wakelin

Assistant Editors

Koketso Mamabolo

Sinazo Mkoko

Graphic Designer Tashwell Brown

Traffic Manager

Daniël Bouwer

Contributors Jessie Taylor

Decent Nyoni

Images iStock Freepik

Unsplash

Flickr

NASA

DISCLAIMER

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Cheryl Benadie Author, Speaker, GBV activist & Mental Health Advocate

Courtenay Webster Marketing & Communications Advisor at EBS Advisory

Feroza Aitken Founder of Thriving Founders & Certified Systemic Wellness

Shameela Soobramoney Chief Sustainability Officer at the JSE

Chantal Marx Head of External Research and Content at FNB Wealth and Investments

John Melville Chief Underwriting Officer at Santam

Tom Marsicano Founder & Director of ‘and Change’

Raylene Watson COO of EBS Advisory

Abigél Sheridan Founder of Chic Mamas Do Care & Love it Again

Shaw Mabuto Partner at Spear Capital

Antonio Petra Group Executive for Data & Insights at FCB Joburg & Hellocomputer

Asavela Lumkwana Portfolio Management Associate at Public Investment Corporation

Brondwyn Douglas Senior ESG Officer at Spear Capital

EDITOR'S LETTER

ESG is a composite term – an inclusive paradigm as opposed to the binary “either/or” – and the 3 elements: environment, social and governance are intrinsically intertwined with the sustainability of an organisation, a society, an economy and the planet.

COVID-19 brought with it an increased emphasis on the need for resilience and long-term sustainability in an environment where all bets were off and nothing seemed secure. “The first three months of 2020 saw USD $45.6-billion flow into ESG funds globally, $30.7-trillion currently sits in sustainable investment funds worldwide, and it is predicted this could rise to around $50-trillion in the next two decades” – ADEC Innovations.

This is a reflection of a growing global trend and awareness of the importance of the 3 elements of ESG and how they impact the future of us all. While caring about the environment and people used to be reduced by some to a kind of bleeding hearts brigade that made no business sense, the above figures tell a different story – and in the Journal of Investing there is an article with an interesting title by D. Lieberman: Impact Investing 2.0—Not Just for Do-Gooders Anymore.

This 6th edition of ESG: Future of Sustainability takes a deep dive into each of these vital pillars, looking at where we have been, where we are now and what the future holds – although the latter depends entirely on the individual and communal action we all take now - and it is not just Greta Thunberg who would like to have a planet to live on in the coming decades.

Some of the articles you can look forward to reading include:

Environment

Climate change 2022 – a global snapshot

COP27

E-waste

The future is green – what about the economy?

Ushering in the just transition

Social

Happiness = productivity

Health and safety at work

Managing WFH employee wellbeing

Change management

Building a holistic workplace

Governance

Managing ESG risks for your business

King IV and the “G” in ESG

Making profits while making a difference

Climate change and insurers

Acting locally – thinking globally

We hope you enjoy the publication as much as we did compiling it.

This 6th edition would not have been possible without the tireless energy, enthusiasm and expertise of the editorial production department: Van Fletcher, Director; Koketso Mamabolo, Editorial Assistant; Sinazo Mkoko, Editorial Assistant; Tashwell Brown, Designer; and Daniël Bouwer, Traffic Manager.

Thank you for joining us on this sustainability journey and we look forward to seeing you in 2024.

FIONA WAKELIN | GROUP EDITOR

By Jessie Taylor

The United Nations Climate Change Conference (COP27) closed with a breakthrough agreement to protect vulnerable countries affected by climate disasters by providing “loss and damage” funding.

The agreement was concluded at the end of more than two weeks of negotiations around climate change and efforts to mitigate its impact.

A reaffirmed commitment

COP27 saw countries reaffirming their commitment to limit a rise in global temperature to 1.5°C above pre-industrial levels, as well as cut greenhouse gas emissions and adapt to the impacts of climate change. The conference brought together more than 45 000 participants to share ideas and solutions and build partnerships and coalitions to address climate change and its impact.

The two-week summit began on Sunday, 6 November. While it was meant to finish on Friday, 18 November, the process over-ran into the early hours of Sunday, 20 November, as nations thrashed agreements on sticky issues.

The work of the conference comes at a critical time. A recent UN Climate Change report found that implementation of current pledges by national governments put the world on track for a 2.5°C warmer world by the end of the century. In addition, the UN’s Intergovernmental Panel on Climate Change has said that greenhouse gas emissions must decline 45% by 2030 to limit global warming to 1.5°C.

COP27 President Sameh Shoukry said: “The work that we’ve managed to do here in the past two weeks, and the results we have together achieved, are a testament to our collective will, as a community of nations, to voice a clear message that rings loudly today, here in this room and around the world: that multilateral diplomacy still works…. despite the difficulties and challenges of our times, the divergence of views, level of ambition

Some key outcomes of COP27

or apprehension, we remain committed to the fight against climate change… we rose to the occasion, upheld our responsibilities and undertook the important decisive political decisions that millions around the world expect from us.”

Balancing the climate change scales

Much of the discussion at COP27 centred around “climate finance” which considers the needs and priorities of developing countries, and these discussions gave rise to the ground-breaking decision to establish a dedicated fund to assist developing countries in responding to loss and damage caused by climate change.

The fund will help climate-vulnerable countries considered to be developing. It will not include emerging economies. Governments also agreed to establish a transitional committee to make recommendations on how to operationalise the new funding arrangements. Countries also agreed on the institutional arrangements to operationalise the Santiago Network for Loss and Damage to catalyse technical assistance to developing countries that are particularly vulnerable to the adverse effects of climate change.

Simon Stiell, UN Climate Change Executive Secretary, said: “This outcome moves us forward. We have determined a way forward on a decades-long conversation on funding for loss and damage – deliberating over how we address the impacts on communities whose lives and livelihoods have been ruined by the very worst impacts of climate change.”

In addition to the loss and damages funding, countries also made progress on the Global Goal on Adaptation. This aims to improve resilience to climate change among vulnerable countries and has seen nations pledge more than $230-million to the Adaptation Fund at COP27.

The funds will help vulnerable communities adapt to climate change through concrete adaptation solutions.

• The conference saw the launch of a new five-year work program to promote climate technology solutions in developing countries.

• A mitigation work programme was launched in Sharm el-Sheikh, aimed at urgently scaling up mitigation ambition and implementation. The work programme will start immediately and continue until 2030, with at least two global dialogues held each year.

• Delegates at COP27 wrapped up the second technical dialogue of the first global stocktake, a mechanism to raise ambition under the Paris Agreement.

• UN Secretary-General António Guterres announced a $3.1-billion plan to implement early warning systems within the next five years.

• Countries devised a master plan to accelerate the decarbonisation of five major sectors – power, road transport, steel, hydrogen, and agriculture.

• The Forest and Climate Leaders’ Partnership was launched. The partnership aims to unite action by governments, businesses and community leaders to halt forest loss and land degradation by 2030.

• Former US Vice-President and climate activist Al Gore, with the support of the UN Secretary-General, presented a new independent inventory of greenhouse gas emissions created by the Climate TRACE Coalition.

Sources:

CLIMATE CHANGE 2022

A GLOBAL SNAPSHOT OF EXTREME WEATHER EVENTS EXPERIENCED IN 2022

By Fiona Wakelin

The Carbon Disclosure Project report, Protecting People and the Planet, researched 998 cities - and showed that in addition to the 80% that are facing extreme climate events, for nearly a third, climaterelated hazards threaten at least 70% of their populations.

“Four in five cities across the world are facing significant climate hazards such as heat waves, floods and droughts” - Protecting People and the Planet.

Let’s take a look in the rear view of monthly extreme weather events we experienced throughout 2022.

JANUARY

Hunga Tonga Hunga Ha’apai Volcanic Eruption

The initial tsunami wave created by the eruption of the underwater Hunga Tonga Ha’apai volcano in Tonga reached 90 metres in height.

South Africa experienced catastrophic floods and landslides in the Eastern Cape after exceptionally heavy rainfall.

Storm Nadia, in Germany, brought on hurricane-level winds, floods and at least 130 000 homes in Britain lost power.

In Northern Europe, Storm Malik forced public transport to shut down, and major bridges to close.

FEBRUARY

MARCH

Powerful Winter Storm Battering

The US Atlantic Coastline - NASA

The Northeast of the US experienced extreme snow, sleet and ice. Moving from New Mexico to New England, the freezing cold front buried neighbourhoods with heavy snowfalls in New York and New England. Schools closed across several states and thousands of flights were cancelled.

Texas Governor Greg Abbott called the winter storm “one of the most significant icing events that we’ve had in the State of Texas in at least several decades,” – People

Heavy rains and floods hit Ecuador and Zambia, while wildfires blazed in South Korea and Kenya, and Mt. Etna erupted in Italy.

Floods hit Australia

Sydney experienced its worst rain event in decades - rain and floods continued to pummel Australia’s east coast.

Heavy rains in Zambia’s North-Western province left at least 1 600 people homeless. This month the greatest number of tornadoes on record were experienced in the US.

Tropical cyclone Gombe killed more than 50 people in Mozambique.

APRIL

KZN Floods

Floods in KwaZulu-Natal - severe flooding and landslides caused by heavy rainfall resulted in the death of 448 people,

displaced over 40 000 and completely destroyed over 12 000 houses - President Ramaphosa declared a national state of disaster:

“The significance of the Port of Durban and related infrastructure for the effective operation of the country’s economy means that this disaster has implications far beyond the province of KwaZuluNatal. With the heavy rains and flooding in the Eastern Cape and indications from the South African Weather Service that the North West and Free State may also be affected by bad weather, it is clear that there are other areas of the country that need emergency intervention. Cabinet therefore met in a special session last night and decided to declare a national state of disaster,” – President Ramaphosa.

Tropical storm Megi killed more than 120 people in the Philippines.

Alabama in the US issued 115 tornado warnings.

Disaster Prevention and Control, floods in the North and North Central regions damaged 512 houses resulting in urgent relocation.

Spain experienced an unprecedented heatwave – with temperatures reaching 40°C.

JUNE

European Heat Wave

More than 20 800 hectares of forest and land were burned in wildfires raging in south-western France. Wildfires also broke out across the UK as temperatures reached 40°C for the first time.

Soaring temperatures in Europe continued - described as “unprecedented, frightening, and apocalyptic,” the ongoing heatwave claimed more than 1 700 lives in Portugal and Spain.

Dust Storm In Iraq - Felton Davis

Sandstorms swept through Iraq.

In Vietnam flash floods and landslides damaged 26 767 hectares of rice and crops, while more than 26 000 livestock were swept away. According to a report by the General Department of Natural

Flood in Pakistan 2022

- Ali Hyder Junejo

Floods in Pakistan killed 1 717 people.

Europe was cooked by a heat wave and major rivers in France, Germany, Italy and the UK were drying up. Daily maximum temperatures in Spain, France, and Italy reached above 40°C, exacerbating the ongoing drought conditions in the Po river basin. Numerous June temperature records were broken across France and Spain.

Gqebergha in Eastern Cape came close to Day Zero as the local water supplies ran dry.

Lake Mead in California, America’s largest reservoir and crucial water source for more than 25 million people, reached its lowest level, with dried up tributaries threatening hydropower production –meanwhile, in the US midwest, recordbreaking rainfall in St. Louis, Missouri caused massive flash flooding.

AUGUST

Gangnam Street, Seoul

- Ali Hyder Junejo

In Seoul, South Korea, record downpours flooded homes, roads and subway stations.

It’s official – Europe has experienced the worst drought in 500 years.

At least 50 people were killed in floods triggered by torrential rains in northern Nigeria.

Massive floods caused by unprecedented monsoon rains across Pakistan resulted in over a thousand deaths.

Torrential rain hit west and north of New Zealand’s South Island forcing hundreds to evacuate their homes with road and school closures. Residents in the northern part of North Island were isolated after landslides, fallen trees and flood waters blocked highway access.

SEPTEMBER

Greenland Melting - Vadim Sidoruk

For the first time Greenland saw extensive melting in September – this usually happens in July (the northern hemisphere Summer).

“Nothing left to burn” in the Arctic.

Super Typhoon Hinnamnor crossed South Korea and moved toward Japan’s northern city of Sapporo.

More than 100 000 people were displaced in Nigeria due to floods which laid waste to a cemetery in the northern part of the country.

Hurricane Fiona hit the Atlantic coast of Canada, resulting in Cape Breton Island declaring a state of emergency.

The death toll from Pakistan’s ongoing floods reached over 1 545 and the total number of homes damaged across the country crossed the two million mark.

OCTOBER

NOVEMBER

2022 United Nations Climate Change Conference

Hurricane Ian - NOAA

Hurricane Ian devastated the state of Florida and its Gulf Coast before making a final landfall in South Carolina. One of the most powerful hurricanes to hit the USA in decades, its maximum sustained winds of 250 km/ph had been recorded hours before landfall, when the Category 4 hurricane was just short of reaching Category 5 classification, the strongest classification on the Saffir-Simpson Hurricane Wind Scale.

Texas Forest Services reported they had so far responded to 1 682 wildfires in 2022.

The volcanic eruption on La Palma island was described as a “lava tsunami” by scientists as a river of lava flowed into neighbourhoods.

Nigeria experienced its worst flooding in over 10 years, with farmland, infrastructure and 200 000 homes either partially or totally destroyed.°

Over 600 people died and more than 2 400 were injured and 1.4 million plus were displaced. For some states, more than a month of floods is likely still to come.

COP27 was held in Sharm El Sheik, Egypt, bringing together more than 45 000 participants, including world leaders and the business community, to discuss responses to the world’s climate crisis.The previous commitment to limiting the rise in temperature to 1.5°C was reaffirmed.

Discussions at COP27 focused on “climate finance”, which resulted in the formation of a fund to assist developing countries with the losses and damages emanating from climate change.

A master plan for decarbonising five major sectors was formulated, along with the announcement of a five-year plan by UN Secretary-General António Guterres for early warning systems.

DECEMBER

There can be no more hiding, and no more denying. Global heating is supercharging extreme weather at an astonishing speed, and it’s visible in South Africa and beyond. Guardian analysis recently revealed how human-caused climate breakdown is accelerating the toll of extreme weather across the planet. People across the world are losing their lives and livelihoods due to more deadly and more frequent heatwaves, floods, wildfires and droughts triggered by the climate crisis - The Guardian

Sources:

New York Times | Anadolu Agency | The Guardian | CDP | People |Relief | SA Gov | Programme of the European Union - Copernicus

Images:

Flickr I WikiCommons I NASA

JOHNSON & JOHNSON CONSUMER HEALTH CONTRIBUTES TO A HEALTHIER PLANET

The Cape Town site is one of JJCH’s biggest manufacturing plants in South Africa, manufacturing thousands of products annually, including key brands like Benylin®, Rehidrat®, and Listerine®. With the project completed, JJCH can successfully create and deliver meaningful consumer products in a way that considers the health of the planet, while not sacrificing the safety or quality of the products themselves.

This milestone showcases our efforts in contributing to the race of ensuring our target of 100% renewable electricity for Johnson & Johnson’s global operations is met by 2025 and to demonstrate the importance of renewable electricity, such as solar PV, to various external stakeholders, especially in a time of crisis for the South African power utilities.

With the global geopolitical configuration reaching a tipping point, unprecedented global levels of inflation, climate change, and a global health pandemic, Johnson & Johnson Consumer Health’s priority remains to contribute to having a sustainable environment and products which meet the needs of our consumers & customers.

Johnson & Johnson Consumer Health (JJCH) has set ambitious goals to deliver total health - for individuals at every stage of life, for communities around the world, and for our planet. We call this our Healthy Lives Mission. As part of our efforts to create a healthier planet, the South African business of JJCH recently worked on a Photovoltaics (PV) solar installation project at our manufacturing site in Cape Town.

The project started with a tender process which took around 8 months to complete. As a result, Sustainable Power Solutions was chosen to be responsible for the funding & design, installation, maintenance & operations.

The solar panels were installed in October 2021 and the project was completed in Q1 2022. The successful collaboration and selection of specialised partners were key to the success of the project.

This milestone is also part of Johnson & Johnson Engineering & Property Services (E&PS) driving sustainability in terms of Energy, Water, and Waste. It represents a cost saving for the site, and most importantly, electricity savings over the duration of the project which helps the environment. The installation also provides partial relief during loadshedding outages and will help offset some of the high cost of electricity on site.

MUTUAL FUTURES

For 177 years, we at Old Mutual have worked to create shared value for our customers, the communities we serve, and our employees across the African continent.

When others see challenges, we see opportunities. We’re inspired by the rich natural resources, strong heritage, culture, resourcefulness, and resilience of Africa’s people.

We want to protect this continent at all costs and help it to thrive. Why? Because its people represent our customers, our employees, and all of our stakeholders. We know that the more successful they are, the more successful we will be.

As the custodian of the lifetime savings and investments of more than 12 million customers across the continent, we are using our significant experience to create unique solutions to the shared challenges we face.

We’re shaping a GREENER ECONOMY by increasing our investment in renewable energy, by investing in projects like the Letsatsi Solar Farm in the Free State, a 75 MW facility which is comprised of 280 000 fixed panels with a capacity to power 65,000 homes!

We’re championing a FAIRER ECONOMY, with education at the centre of our efforts. Our investment in schools like Canaan College in Umlazi, Durban, is creating a unique opportunity for our youth to flourish by exposing them to new worlds, like robotics, coding and innovative literacy and numeracy skills.

We’re working to build a STRONGER ECONOMY with partners like the Phakamani Foundation, who are providing financing to female-run micro-entrepreneurs like Mme Selina, a thriving tuckshop owner from Mpumalanga who has become a beacon of hope not only for her family, but for her entire community.

Creating Mutual Futures is about working together to transform our collective growth path to one that is more socially inclusive, low carbon and resource efficient. A better world for all!

Follow our journey at oldmutual.co.za/sustainability

The world is constantly changing. We are at a point in history where we have to manage this change and decide whether it will be for the collective benefit of humanity, or not…

Favour Okoli, Student at Canaan College, Umlazi

Rose Masoka, Electrical Foreman at Letsatsi Power Plant, Bloemfontein

Mme Selina, Tuckshop owner Malekutu, Mpumalanga

Old Mutual Limited is a Licensed Controlling Company

A Special Economic Zone (SEZ) is typically defined as a geographic area in which the regular rules and policies applying to industry are different. This can take the form of incentives, special conditions and/or other types of policies or programmes. Typically, the aim is to try innovative ways to attract investment and create jobs.

In South Africa the SEZ programme has typically been used to target development in underserved areas and communities. The Atlantis residential and industrial area in the City of Cape Town represents one such community. Atlantis was originally established as a new town and the industrial area set-up as a deconcentration point to house coloured people forcibly removed under Apartheid. In the early nineties it underwent severe contraction and disinvestment as a result of subsidies being removed. This resulted in growing poverty and joblessness in the area.

Since 2010 and onwards there has been a concerted effort to revitalise the area and bring in new investment. The old industrial area was already serviced and with large stands, plus the continually improving transport connections and growth of Cape Town meant emerging opportunities for growth. The Atlantis SEZ is the outcome of this revitalisation effort and represents a collaborative response by the three

THE ATLANTIS SPECIAL ECONOMIC ZONE INVESTING IN GREENTECH MANUFACTURING

spheres of government. At this time (around 2013) the Renewable Energy Independent Power Producer Programme (REIPPP) represented (and still does) an opportunity to target the growth of greentech manufacturing.

Early initiatives and work by the three spheres of government resulted in the Atlantis SEZ being promulgated in 2018. This was followed by a process of establishing the operating company and obtaining the necessary licences and approvals to operate as a Provincial (Western Cape) Business Enterprise. The Atlantis SEZ Company (ASEZCo) was the outcome of this process. Originally 100% owned by the provincial government of the Western Cape, the company acquired the land to operate the zone through a land-for-shares agreement with the City of Cape Town. Through this the City of Cape Town became a minority shareholder. Seed funding from the DTIC SEZ Fund to put in place the civil infrastructure for the first precinct has kick-started the development of the zone. A great example of how the three spheres of government have come together to make this idea a possibility. The ASEZCo is now leading the process of working with the private sector to develop the Atlantis SEZ.

Among the many lessons learned from successful special economic zone programmes, the key elements include

a strategic location, integration of zone strategy with the overall development strategy of the region, understanding the market and leveraging comparative advantage, and, most importantly, ensuring that zones are “special” in terms of an agile business-friendly environment, a sound administrative framework and an embodiment of sustainability – a combination of factors not often found in SOEs.

The SEZs in China, for example, were originally designed to test and apply a more liberal, market-orientated approach to manufacturing and production within the context of a communist state. They were an experiment with market economics – a very successful one it turns out. In line with this thinking, the top priority for the Atlantis Special Economic Zone is to work with the local community and government stakeholders to attract job-rich investment linked to growing the green economy. It is a combination of spatial targeting (Atlantis and surrounds) and targeting of greentech manufacturing within an eco-industrial park that promotes sustainable and green manufacturing practices.

The SEZ aims to benefit the country from an economic, manufacturing and job creation perspective and will do so on several fronts – but two are worth emphasising.

Matthew Cullinan, Executive: Infrastructure Development

First, there is a strong emphasis on exploring how we can support the just transition to a green and sustainable economy. That means a heavy focus on building local skills and enterprises geared towards the green economy. Working with the local community to build shared value is central to our value proposition.

Second, we are targeting the development of a greentech manufacturing cluster. Our vision is to be Africa’s leading green manufacturing zone. Green manufacturing is no

longer a nice-to-have – with increasing consumer awareness and growing requirements for low-carbon, resourceefficient goods, and services (in some cases moving to law), it is the future of all manufacturing. As a green industrial park, housing manufacturers of green technologies, the ASEZ presents itself as an important role player in the broader enabling ecosystem of renewable energy projects and the roll out thereof. Components destined for these projects need to be manufactured in a suitable location that provides them with sophisticated

green infrastructure, a level of energy security, and a green precinct rating, which further improves the manufacturer’s global competitiveness.

Other than the boosting of manufacturing that adds upstream and downstream value, another important aspect is infrastructure—including both physical and non-physical infrastructure. For the former, a zone should provide high-quality connectivity through roads, ports, fibre, etc. and essential utilities including reliable power and water supply as well as environmental facilities such as waste and effluent treatment plants.

The Atlantis SEZ is not only a greentech investment destination, but also a zone that will be increasingly operated on green principles. Green infrastructure can be defined as services derived from well-functioning ecosystems, such as wetlands purifying water, that enhance and support human well-being and that are healthy and resilient. The definition can be extended to mechanical (human-made) infrastructure thatover their whole life - minimise carbon emissions, pollution, are resource efficient, and support natural systems functioning (soil, land, water, and biodiversity). Good examples would be wind or solar energy or industrial

waste-water treatment and filtration systems. It is important to recognise that there is human agency at work in any infrastructure provision.

From this perspective infrastructure projects must be designed and planned with a good understanding of their whole-life costs. In other words, not just their cost of ownership and operation, but also to include an understanding of how they will enhance (and at least not undermine) natural processes and human well-being. From a climate crises perspective, this can also be considered as contributing to resilience. Resilience is defined as the ability to absorb short-term shocks and to self-organise to adapt to long-term stress. Green infrastructure, according to this definition, would seek to support local resilience rather than erode it. The inclusion of wholelife costing of infrastructure requires that the construction, management, maintenance and decommissioning costs and impacts of the project are considered – both internally and in terms of the natural and human systems.

Beyond the physical infrastructures, zones also need to provide important non-physical infrastructures, such as skilled labour, education and skills training, innovation platforms and nonphysical connectivity, such as efficient trade and logistics services. For example, plans are currently in place to open the defunct railway line between the Atlantis SEZ and the Port of Cape Town.

Green manufacturing is increasingly central to economic competitiveness in the context of growing consumer demands for sustainable goods and services. These demands are increasingly backed up by government regulations and targets around things such as the carbon content of goods. Having an SEZ with specific targets around net-zero carbon, net-zero water (positive water balance), netzero waste to landfill, and working with nature, ensures that we are laying the foundations for truly green and sustainable production. A focus on inclusivity and building skills and

enterprises off the manufacturing base also leads to social stability and resilience.

The Atlantis Special Economic Zone will continue to grow the regional economy in a meaningful and impactful way, enabling the regeneration of Atlantis and a leader in green economy manufacturing in an eco-industrial park that puts sustainability, job creation and social inclusion at the top of its agenda.

special economic zone

THERE’S A FLOOD OF CAPITAL AND WE NEED TO RIDE THE WAVE

MEET DAVID RENWICK

10 KEYS TAKEAWAYS LISTEN FROM THIS PODCAST:

1. We need to look at the relative value of what we have in South Africa

2. The character of the people behind what you’re investing in is just as important as the plan or sustainable margins

3. Sustainable business is about keeping operations going, which is a good thing

Contributing to a sustainable future was always something David Renwick wanted to get involved in. Absa Group’s Head of Investment Banking felt like he was making more of an impact on “spreadsheets and financial reports than actually on the environment and society.” Now he has the opportunity to make an impact and share views and ideas with his peers on platforms such as the Future of Sustainability Conference.

In the latest Business Unusual Podcast, Topco Media’s CEO, Ralf Fletcher is in conversation with David about sustainable investing and reasons to be optimistic about South Africa. David explains why the people behind an idea are just as important as the idea. The wide-ranging conversation also examines the positives we seldom focus on and why we need to take advantage of the flood of capital available for sustainable projects.

4. It’s not all doom and gloom - there are opportunities everywhere

5. Policymakers have a bigger role to play than banks and other financial institutions

6. The policies we implement need to be robust

7. There’s been a significant shift in the private sector towards supporting renewable energy projects

8. The pandemic has reshaped business - now you have to plan for survival and not just growth

9. More private-public partnerships will increase the amount of capital available

10. A lot of capital is available for sustainable projectswe need to take advantage of it now, not later

USHERING IN A JUST TRANSITION

HOPE FOR THE FUTURE OF CLEAN ENERGY

By Koketso Mamabolo

The world set itself a challenge: net-zero emissions by 2030. This goal cannot be achieved without cutting down, and eventually abandoning the burning of fossil fuels to generate electricity. The good news is that coal, gas and oil are falling out of favour while renewable energy sources are steadily taking over. In South Africa, the ‘winds of change’ have opened up an opportunity for the business community to play their part and the financial windfall could bring muchneeded growth to the local economy. In 2021/22 alone, the Renewable

Energy Independent Power Producer Procurement Programme (REIPPPP) attracted R50-billion in investments. The opportunities for independent power producers (IPPs) to get involved are set to increase as South Africa turns to renewable energy to meet demand. But how did we get to this point? And what does the future hold?

And then there was light

South Africa’s first large-scale renewable energy projects came online in 2013 - but the journey began earlier. In 1998 the White Paper on Energy Policy was published and was followed

by the White Paper on Renewable Energy five years later.

“However, the renewable energy framework took shape only with the IRP 2010 - 2030 [Integrated Resource Plan] in 2010,” says Green Cape, in its latest renewable energy market intelligence report.

“The purpose of the IRP 2010 was to determine the preferred energy mix over the next 20 years. It included allocations for renewable energy, amounting to 14 725 MW; coal-fired plants of 6 250 MW, and gas-fired power plants of 3 726 MW.”

The Independent Power Producers Office (IPPO) was established in the same year to provide advisory services, manage the procurement process and monitor and evaluate contracts. With this came the Independent Power Producer Procurement Programme (IPPPP) - an initiative involving what was then known as the Department of Energy, National Treasury and the Development Bank of Southern Africa (DBSA). The IPPO is currently based at the DBSA.

“Since the establishment of the Independent Power Producers Office in

2010, over 6.42 GW of electricity from renewable energy sources has been procured from 112 Independent Power Producers (IPPs),” says Green Cape. To date 81 IPPs have been involved in making 5.25 GW operational. The Department of Mineral Resources and Energy (DMRE) and the IPPO are aiming to procure 11.83 GW by 2030. The target includes 6 800 MW for solar and on-shore wind and another 513 MW for battery storage.

The South African market

One of the key questions facing the global community is how to meet the growing demand for electricity while transitioning to cleaner energy sources. The projections by the International Energy Agency for 2021 predicted global electricity demand to rise by more than 1 000 terawatt hours (TWh).

Of the electricity generated globally, 29% came from renewable sources in 2020/21, which saw the use of coal, gas and oil dropping by as much as 8%. The 2021 industry expansion is expected to represent the fastest growth rate since the 1970s. Almost 70% of the global renewable growth will likely come from solar PV and wind. These two sources are at the heart of local growth, dominating the South African market.

Solar PV and wind are “backed by a growing small-scale embedded generation market (mostly solar PV for commercial and industrial businesses) and private sector large-scale projects for energy-intensive users such as mines,” says Green Cape.

“Based on the R/MW [rands per megawatt] overnight capital cost per technology, the approximate South African market value per technology based on IRP 2019 allocations is R99-billion for solar PV, R271-billion for wind and R48-billion for distributed generation up to 100 MW.”

Around 10% of the wholesale generation capacity in South Africa comes from large-scale renewable energy projects. “The industry is showing growth and potential with just over 5 GW of large-scale connected and operational capacity.”

Just Energy Transition Plan

“The plan is clear that there is no tradeoff between tackling climate change and supporting economic growth,” says President Cyril Ramaphosa, in his message in the Just Energy Transition Investment Plan, published before COP27 in Egypt “Instead a just energy transition can attract investment, create new industries and jobs, and help us to achieve energy security and resilience.”

The five-year plan is a response to the United Nations Framework Convention on Climate Change (UNFCCC) at COP26. The partnership was formed between the governments of South Africa, the EU, the US, the UK, France and Germany. Together they are known as the International Partners Group (IPG).

The R1.48-trillion Just Energy Transition Investment Plan (JET IP) zeroes in on

“ AROUND 10% OF THE WHOLESALE GENERATION CAPACITY IN SOUTH AFRICA COMES FROM LARGE-SCALE RENEWABLE ENERGY PROJECTS. ”

the priorities over the next five years and provides suggestions on how the IPG’s first offer to South Africa of $8.5-billion (over R150-billion) can be used.

The Presidential Climate Finance Task Team (PCFTT) worked closely with the IPG members in evaluating the offer, in order to advise the President’s cabinet on what the offer entails and how it fits into the country’s needs and aspirations.

“The South African government has undertaken to maintain an open dialogue with the stakeholders, facilitated through the Presidential Climate Commission (PCC) to enhance the efficacy and impact of the JET IP, especially during the implementation phases ahead,” reads the document outlining the plan.

“In particular, JETP [sic] recognised the essential contribution required from the private sector and the role of philanthropic capital in contributing to the financial gap expressed in this investment plan, including developing approaches to support the just transition in affected regions of South Africa.”

How does SA define the just transition?

“A just transition aims to achieve a quality life for all South Africans, in the context of increasing the ability to adapt to the adverse impacts of climate, fostering climate resilience, and reaching net-zero greenhouse gas emissions by 2050, in line with best available science. A just transition contributes to the goals of decent work for all, social inclusion, and the eradication of poverty. A just transition puts people at the centre of decision making, especially those most impacted, the poor, women, people with disabilities, and the youthempowering and equipping them for new opportunities of the future.”

Funding needs (2023 - 2027)

The majority of the R1.48-trillion investment required will need to go to the development of the electricity sector. Most of the R711.4-billion that needs to go to the sector will go towards infrastructure, with electricity generation infrastructure being top of the agenda.

The priorities include decommissioning the ageing coal generation fleet, while simultaneously increasing the scale and rate of development in renewable energy generation. Transmission infrastructure will have to be improved and the distribution system brought up-to-date. According to the JET IP, the Mpumalanga province - which is home to the majority of the country’s coal generation fleet - needs R60.4-billion in investment to off-set the impact of moving from coal to renewable energy sources.

Most of the country’s GHG emissions are produced by 15 coal-fired power plants, 14 of which are operated by Eskom and one by a privately-owned operator. Over the next three decades, 13 of the plants will be due for retirement, leaving only the two youngest (Medupi and Kusile) at the end of 2050.

One of the 13 plants, Komati Power Station, reached the end of its operating life at the end of October this year. According to a statement from Eskom, Komati Power Station will be repurposed, making it “one of the largest coal-fired power plant decommissioning, repowering and repurposing projects globally.” This will make it the benchmark for similar projects around the world.

“The power plant will be converted into a renewable generation site powered with 150 MW of solar, 70 MW of wind and 150 MW of storage batteries, thereby continuing to put the site and its

associated transmission infrastructure into good use and to provide economic opportunities to the community.”

Eskom goes on to say: “Funding for this facility, which will enable a ‘just’ transition for the local community following the decommissioning of the power station, has already been received from one of the developmental finance institutions (DFIs) and Eskom will make an official announcement in due course.”

A month later, the World Bank Group’s board approved Eskom’s request for $497-million in funding for the project.

“I am encouraged to see South Africa taking steps to produce more electricity while finishing the closure of the 60-yearold Komati coal plant,” said the World Bank Group’s president, David Malpass, on a visit to the decommissioned power plant. “Moving toward an efficient lower carbon growth model will require large investments in new capacity and grid upgrades to absorb renewables. These are important steps to repair the ailing energy sector and provide reliable access to electricity for businesses and people.”

Political Declaration signed by the IPG

“Establishing an ambitious long-term partnership to support South Africa’s pathway to low emissions and climateresilient development, to accelerate the just transition and the decarbonisation of the electricity system, and to develop new economic opportunities such as green hydrogen and electric vehicles amongst other interventions to support South Africa’s shift towards a low carbon future.”

Sources:

Eskom | Green Cape | ESI Africa | Presidency RSA

THE FUTURE IS GREEN

WHAT ABOUT THE ECONOMY?

By Koketso Mamabolo

One of the main concerns for world leaders is the need for development. Whether it be economic powerhouses such as the United States and the European Union, or developing countries such as South Africa and Brazil, growth is high on many agendas. But this growth cannot go unchecked, and more leaders are committing to not ignoring the impact of this growth on the environment, and doing something to ensure the development of the world’s economy is as sustainable as possible. This is where the concept of a ‘green economy’ comes in.

What is the green economy?

There are a few main features of the economy. Firstly, the green economy

has to be low in carbon emissions due to their impact on the environment. A lowcarbon economy requires reducing emissions across value chains, from suppliers all the way to retailers. Alternative sources of energy and innovative technology are rucial to ensuring that this becomes a reality.

The second feature of the green economy is the efficient use of resources. The rate at which resources are being used is not sustainable and requires all organisations to think carefully about what they use and how they use it. Manufacturing processes need to be reflected on, alternatives need to be found and creative solutions

are going to become even more important as resources continue to dwindle.

Another, easily overlooked feature of the green economy is that it has to be socially inclusive. It’s not enough to be low-carbon and resourceefficient, everyone has to have equal opportunities to participate in the green economy. This will require active efforts to bring more women into the economy, and ensure that developing countries are not left behind as the world shifts towards a more sustainable future.

This human aspect is at the heart of South Africa’s thinking around the green economy. In the National Framework for Sustainable Development, published in 2008,

the government is clear that its approach is people-first:

“South Africa aspires to be a sustainable, economically prosperous and self-reliant nation state that safeguards its democracy by meeting the fundamental human needs of its people, by managing its limited ecological resources responsibly for current and future generations, and by advancing efficient and effective integrated planning and governance through national, regional and global collaboration.”

Current policies in SA

In 2014, the Council for Scientific and Industrial Research published a reference guide titled “Steering Towards a Green Economy”. For the green economy to become a reality, the public and private sectors need to play their part. For the private sector, it’s about investing in green sectors and driving the push to make other sectors environmentally friendly. The public sector also needs to make significant investments, but where it can have the biggest impact is on policies that create the environment for a green economy to flourish, and the standard to which it should be changed.

The draft Climate Change Bill, which was introduced to the National Assembly in early 2022, is one of the policy elements which can take us even further. Chapter 2 of the Bill acknowledges that the role of stakeholders will define the success of the government’s strategy.

“In order to give effect to the principles and objects set out in this Act, organised labour, civil society and business may advise on the Republic’s climate change response, the mitigation of climate change impacts and adaptation to the effects of climate change towards the attainment of the just transition to a climate resilient and low carbon economy and society,” reads the Bill.

Green Economy Coalition

“An economy in the service of life - one that puts people and the environment first,” is what the Green Economy Coalition - which has 9 national hubs, including one in South

Africa - sees as the solution to the problem the world is facing.

“South Africa is showing all the signs of taking on the green growth challenge. Back in 2010, the Department of Environmental Affairs convened a Green Economy Strategy Summit to gather insights on key focus areas for a green economy,” says the Green Economy Coalition.

“In 2011, following a social dialogue with labour groups, civil society and business, the Ministry of [Finance] developed a government-wide Green Economy Accord, an ambitious set of commitments for greening the economy.”

The Green Coalition has partnered with the African Centre for a Green Economy, based in Cape Town and the Trade & Industrial Policy Strategies, which is based in Pretoria, in order to work towards the green economy. The Green Economy Coalition has identified 5 different areas where change needs to take place for the green economy to become a reality:

1. Measuring & Governing

2. Reforming Financial Systems

3. Greening Economic Sectors

4. Tackling Inequality

5. Valuing Nature

With the world’s future hanging in the balance, the green economy has never been more important. The path ahead has been chartedit’s up to all of us to join the journey.

Sources: Green Economy Coalition

CSIR

THE FIGHT AGAINST LAND DEGRADATION

WE ALL STAND TO GAIN

By Fiona Wakelin

In 2022 the 15th COP summit of the United Nations Convention to Combat Desertification (UNCCD) was held in Abidjan, Ivory Coast.

The UNCCD is the global voice for land and “promotes practices that avoid, reduce and reverse land degradation and are the driving force behind Sustainable Development Goal 15 and Land Degradation Neutrality.”

Exciting announcements

At COP15 a number of optimistic, exciting announcements were made – not least that the global economy could increase by more than $140-trillion a year (1.5 times the annual global GDP) if the objectives of the UNCCD are achieved.

“The benefits of taking action against land degradation largely outweigh the costs of sustainable landscape management. In Sub-Saharan Africa, it is by at least seven times. Inaction costs Sub-Saharan countries $490-billion per year, while according to the Economics of Land Degradation Initiative, action to reverse land degradation could generate benefits worth up to $1.4-trillion,” said Luc Gnacadja, former Executive Secretary of the UN Convention to Combat Desertification and former Minister of Environment of Benin, currently acting as a Co-Chair of the Adaptation Benefits Mechanism Executive Committee.

Desertification is the process of productive land being degraded into desert-like conditions and is caused

by activities such as overgrazing, mining, deforestation as well as extreme weather events associated with climate change. Not that long ago - between 2015 and 2017 - the Western Cape experienced three consecutive years of below-average rainfall, leading to its worst drought in more than a century and on an ongoing basis the continent is hit by storms, erosion and desertification which has both an environmental impact (water scarcity, soil degradation, reduction of biodiversity) and socioeconomic impact (poverty, food insecurity, migration).

Digital sustainable land bonds

Digital sustainable land bonds - which allow carbon buyers to purchase at an earlier stage of development - were presented at the summit by Rishabh Khanna, Chief Impact Officer at Earthbanc and a steering committee member of the Initiative of Land, Lives and Peace.

“Finance for land and ecosystem restoration makes up less than 1% of all climate finance due to a lack of universal capital market products for these activities. Part of the reason is that monitoring, reporting and verification of sustainable land management has been labourintensive, sometimes inaccurate and uses fragmented measurement and accounting methodologies.”

Adaptation Benefits Mechanism

The Adaptation Benefits Mechanism, piloted by the African Development

Bank between 2019 and 2023, certifies and monetises the environmental, social, and economic benefits of adaptation actions for sustainable and resilient landscapes.

“Unlike for mitigation, where costefficiency is the driving factor for investments, revenues from monetising the adaptation benefits are likely to be directed towards actions in vulnerable communities that are needed most, because they deliver compelling stories,” explained Gareth Philips, Climate and Environment Finance Manager at the African Development Bank.

What is the difference between adaptation and mitigation? Adaptation means communities adapt to accommodate the effects of climate change, while mitigation looks at the root causes and results in actions that reduce greenhouse gas emissions and/or increase the carbon sinks (which absorb CO2 – such as forest plantations).

World Day to Combat Desertification

In 1994, the United Nations General Assembly declared June 17 the World Day to Combat Desertification and Drought to promote the implementation of the UNCCD in those countries experiencing serious water challenges, particularly in Africa.

Sources www.unccd.int

African Development Bank Group www.gov.za

THE OCEAN IS MADE UP OF DROPS OF WATER – EVERY BIT COUNTS

By Fiona Wakelin

Sustainable policies and practices both at work and at home, at governmental and private sector level are key to ensuring there is a future for us all on the blue planet.

Climate change is real and is happening as we speak. National Geographic recently listed some of the impacts we are experiencing:

• Ice is melting worldwide, especially at the Earth’s poles.

• Much of this melting ice contributes to sea-level rise. Global sea levels are rising 0.13 inches (3.2 millimeters) a year, and the rise has been occurring at a faster rate in recent years.

• Rising temperatures are affecting wildlife and their habitats.

• Extreme weather events are happening more frequently.

• On average rain and snowfall have increased.

• Some regions are experiencing more severe drought, increasing the risk of wildfires, lost crops, and drinking water shortages.

Wildfires in California and Australia. Tsunamis in South East Asia. Drought and famine in Africa. These may seem such huge issues that nothing can be done about them – but in reality the future is in our hands. Here are the top ten things you can do to mitigate climate change:

1. Become a water warrior

Our bodies are made up of 60% waterand we literally can’t live without it. We would only last for 3-4 days without H 20. One of the characteristics of climate

change is the increase in the number and severity of weather events. A year ago South Africa was ravaged by one of the worst droughts in living memory – some areas are still in crisis. And many believe the next world war will be about access to this most precious of commodities. So number one on the to-do list is: be water wise. Every drop counts. Showering not bathing should be the norm. Using grey water in the garden. Checking for leaks and drips. Become a water warrior!

2. Say no to plastic

Did you know there are 5 garbage patches in our oceans? The largest island of plastic floats somewhere between California and Hawaii and is known as the Great Pacific Garbage Patch (GPGP). Its surface area is about three times as big as France - 1.6 million square kilometers. In 2018, the Los Angeles Times reported that the size of the GPGP had increased to a total of 1.8 million pieces of plastic weighing roughly 87,000 tons. This is killing our oceans, fish, shell fish and marine mammals. Not only that but scientists estimate that 50-80% of the oxygen production on Earth comes from plankton in the ocean – and the plastic is blocking the sunlight so the tiny uni-cellular plants can’t photosynthesise – which means they can’t absorb CO 2

or produce the oxygen we need to breathe.

3. Get your hands dirty - plant a tree or ten

Trees and plants absorb the harmful CO 2 which is causing the greenhouse effect and resulting in global warming. Not only that but they use sunlight to reintroduce oxygen into the atmosphere. Our very own spekboom (bacon tree/pork bush!) is a wonder plant and is like a sponge for CO 2 – it has the ability to capture four to ten tons of carbon per hectare! Go green bacon! So even if you don’t have a garden, growing spekboom in your home is doing the planet a service.

4. Green your ride Walk/cycle/carpool. Emissions from the transport sector account for 10.8% of South Africa’s total greenhouse gas emissions, with road transport being responsible for 91.2% of them. In America if you carpool you get to use a designated lane on the freeway as a bonus. And in Germany driving in a car is old school. Walking, cycling, using public transport and investing in hybrid cars all contribute to a reduction in those gas emissions which are polluting our atmosphere and contributing to climate change.

5. Recycle and upcycle Recycling (making the same things out of used items) and upcycling (making different

things out of used material) both conserve energy and reduce pollution. Do the planet a favour and find out where your nearest recycling depot is – or arrange to have your recyclable waste collected. It takes a few minutes every day to sort it into the different categories (glass, paper, metal, plastic and electronic) but the benefits are enormous.

6. Join the clean energy economy

In South Africa our main energy supplier is nonrenewable and coal based - bad news for the environment. Solar, wind, water and biomass are great for energy efficiency and for the planet. To support the diversification of SA’s energy supply, our 3 major banks Nedbank, Standard Bank and First Rand will no longer fund “dirty” coal fired power plants. What can you do? Let your bank or investment adviser know you do not want your investments to include fossil fuels. Back at home buy energy efficient light bulbs and invest in solar panels - power your home by converting sunlight via photo voltaic cells – it will help reduce carbon emissions and save you money in the long run.

7. Waste less

According to the World Wildlife Fund (WWF) about one-third of all the food produced in the world goes to waste. That’s equal to about 1.3 billion tons

| THE OCEAN IS MADE UP OF DROPS OF WATER

1. – and when we waste food, we also waste all the energy and water it takes to grow, harvest, transport, and package it. And if food goes to the landfill and rots, it produces methane—a greenhouse gas even more potent than carbon dioxide. Here are some tips to help reduce waste:

• Make a list and buy only what you need.

• Give some love to leftovers – make them into soups, stews, curries, smoothies, jams, stocks –and get your waste down to a minimum.

• Put your deep freeze to work.

production. But it is not only the planet that wins. Plant-based diets are high in fibre which is good for lowering cholesterol and stabilising blood sugars.

3. Join the conversation

As we say in South Africa – thetha. The are many climate change forums around the world which fuel the information highway. Being informed is crucial when confronted by denialism. Speak to others. Educate and inform. In 2006, then-Vice President of the USA, Al Gore’s film An Inconvenient Truth pieced together incontrovertible evidence of climate change. The film generated world-wide interest and resulted in a new era of climate change activism. The baton has been ably taken by the younger generation, one of who is Greta Thunberg. When we join a conversation and communicate, the energy for change gathers momentum. You can make a difference.

4. People, planet and profit

2.

You are what you eat

For your health and that of the planet make the move - reduce meat consumption. Go plant-based. Buy organic. Grow your own. Earth has 3 major lungs – the Amazon jungle, the Philippine jungle and the Congo jungle. They are massive carbon sinks and responsible for the majority of land-based oxygen production. Deforestation is happening in Brazil to make way for cattle farms – and the cattle themselves produce tons of methane which is adding to the greenhouse effect. In the Philippines deforestation too is taking place, destroying the natural habitat of the Orang-utan and other forest dwellers. The forest is being replaced with palms to grow the cheap palm oil which is present in a vast number of everyday food products. Reading labels on food packets gives you all the information you need to choose whether or not to support this industry. Making informed choices about what to consume is empowering – and markets dictate

Ensure you have solid environmental, social, governance (ESG) practices embedded in your business. Prospective investors are becoming increasingly interested in a company’s policies regarding sustainability – and to prove it the big four accounting firms, Deloitte, PwC, EY and KPMG, have got together to produce a White Paper to try to agree on a common set of ESG principles. The White Paper, Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent Reporting of Sustainable Value Creation was released at the World Economic Forum’s Sustainable Development Impact Summit in September 2020 and is based on 21 core metrics and 34 expanded disclosures under the four pillars: people, planet, prosperity and principles of governance. Growing the sustainability movement and ensuring your supply chain is compliant is in your hands.

We are in this together – and – to quote the inimitable Ms Thunberg:

“Together and united, we are unstoppable.”

NATIONAL CLEANER PRODUCTION CENTRECONTRIBUTING TO A NET ZERO SOCIETY

opportunity workshops, the programme has helped create new waste value chains – from informal waste pickers to aggregators, processors and manufacturers. The programme not only facilitates waste diversion and inspires economic activity, but also supports large industries in contributing to a net zero society.

To learn more about the NCPC-SA or to register one’s waste stream on the Industrial Symbiosis an email to ncpc@csir.co.za or visit: www.ncpc.co.za.

Disposing of old collateral is an opportunity for companies to practically participate in waste circularity, waste diversion and walk on a pathway to unlock economic opportunities for smaller businesses. In celebrating its 20th anniversary in 2022, the National Cleaner Production Centre South Africa (NCPC-SA) refreshed their logo, necessitating a change in collateral. The centre’s old banners were donated to GoRD, a manufacturer of eco-friendly clothing and accessories made from reclaimed and upcycled waste material.

GoRD typically reclaims old banners and chip packets which are cleaned, cut and sewn into pencil cases, wallets, bags and clothing then sold locally and in Germany. “Receiving banners from the NCPC-SA made a huge difference as we usually struggle to get banners compared to other types of waste that we use”, said Tsidi Ramofolo. “We received enough to make 15 jackets, 10 large shopping bags and 12 [moon bags]”, she added.

However, donating banners to this organisation is just the tip of the iceberg.

The NCPC-SA’s mandate is to transition industry towards a waste-free and carbon-neutral economy, and has been consistent in supporting small businesses and promoting a circular economy. The Industrial Symbiosis Programme (ISP), one of their flagship waste management and diversion projects, connects large industries with individuals and businesses who use industrial waste as a resource to produce other goods.

The ISP currently operates in five provinces namely Limpopo, Mpumalanga, the Free State, Gauteng and KwaZulu-Natal. Through capacity building and business

WATER - THE DRIVING FORCE OF ALL NATURE

WATERSHED MOMENT FOR VARIOUS MUNICIPALITIES

By Sinazo Mkoko

Water - a scarce yet invaluable resource in our lives. Without it, no animal, plant or human can survive, as Leonardo da Vinci succinctly put it: “Water is the driving force of all nature.”

Often referred to as water-scarce, South Africa is one of the 30 driest countries in the world according to the United Nations World Water Development. The loss of a substantial amount of treated water through leaking pipe and inadequate infrastructure is adding to the challenges that the country already faces.

Speaking at the Siemens in Africa panel addressing water and infrastructure challenges faced by the City of Joburg, the CEO of Rand Water, Sipho Mosai, said the city alone is currently going through a

watershed moment, where there’s a need to relook at the interface and interactions with water.

“The earth doesn’t get any new water from outer space, the earth recycles water and that pattern is unpredictable. We have one of the highest evaporation rate [sic] and one of the lowest rainfall and without climate change, it really requires us to adapt. In Johannesburg, we’re one of the highest water consumers of water in the world. We are currently sitting at 300 litres per capita per day on average the world is sitting at 173. We’ve been asking ourselves questions and we want to take our consumers through the journey of clearly understanding that this is a finite resource and we have climate change and we need to look at how we use water,” he said.

Reasons behind water shortages in Gauteng

Responding in parliament about the reasons why the north and southwest areas of Johannesburg are experiencing inconsistent water supply, Water and Sanitation Minister, Senzo Mchunu, said two of Rand Water’s purification plants, Zuikerbosh and Vereeniging, and two major pumps stations (Palmiet and Eikenhof) supplying large parts of the city were affected by power failures.

Hon. Mchunu added that Rand Water’s operating philosophy is to maintain the reservoir levels between 60-80%.

“This targeted range is intended to enable the network system to be resilient and respond to any challenges.

Historically, during September to January, water consumption increases exponentially in Gauteng. It was with this understanding that we wrote to the high consumers - City of Tshwane, City of Johannesburg, and City of Ekurhuleni; to encourage and plead for reduced consumption in anticipation of the increased demand for water. Despite these efforts, water consumption continued to increase significantly.”

Minister Mchunu went on to say that Rand Water’s overall water storage declined from 52% to 38%.

“Stemming from this decline, a meeting was convened with the Metros to notify them of the intention to apply Stage 1 restrictions. Despite these efforts, water storage levels continued to decline and that prompted Rand Water to apply Stage 2; the restrictions are necessary to stabilise the system.”

The Minister shared that the department carries out a number of assessments into the state of water and sanitation infrastructure in the municipalities. These assessments, he said, enable the department to monitor the condition of municipal water and sanitation infrastructure through three incentivebased regulatory mechanisms including: the Green Drop Report, which focuses on sanitation (waste-water treatment systems and effluent quality), the Blue Drop Report, which focuses on water (water treatment and water quality) and the No Drop Report, which focuses on non-revenue water and water losses through leakages.

“Findings of the 2022 Green Drop Report indicated that 334 Wastewater Treatment Systems have been identified to be at critical state by achieving less than 30% during Green Drop Assessment. Letters of non-compliance in terms of audit findings have been sent to respective water services institutions responsible for the systems at critical state, requiring them to submit a detailed corrective action plans. To date, eighteen municipalities responsible for 81 wastewater treatment systems have submitted action plans. The department has also collaborated with SALGA and MISA to assist municipalities on the development of action plans,]” he said.

According to the Department of Water and Sanitation, the approach for implementing restrictions involves communication on implementation of restrictions to all municipalities that are supplied by Rand Water and to implement restrictions to the three Metros which utilise approximately 80% of Rand Water’s supply, as well as:

• Identifying major meters under each municipality that will be restricted (53 meters under Johannesburg, 57 under Ekurhuleni and 28 under Tshwane).

• These meters are monitored over a period of two weeks to assess and review progress to achieve the desired results. As for the current stages two (30%) water supply restrictions that has been implemented effective from 04 October 2022, will be reviewed

• If the performance of Rand Water’s supply has not improved after two weeks, the review of the implemented water supply restrictions will dictate if other municipalities will be included

• If the performance of Rand Water’s supply does improve after two weeks, the review of the implemented water supply restrictions will dictate reduction to stage one (10%) or removal of restrictions.

These restrictions are aimed at restoring the overall reservoir storage capacity to approximately 60%. Rand Water has formally consulted with the affected municipalities to inform them of its intention to implement the restrictions. The situation is reviewed on an hourly basis and where improvements are made, Rand Water lifts the restrictions to provide reprieve. Rand Water’s consultation with the customers is designed to ensure that no areas are left without water for a prolonged period.

Water crisis likely to be worse than energy crisis

Other leaders in this sector have also raised concerns about South Africa’s water crisis. Weighing in on the current crisis Gauteng is facing, managing director of AECOM Africa, Darrin Green, warned that this crisis is likely to be worse than the energy crisis.

“The energy crisis is confronting us first or maybe it is the most obvious, but for me, the current water shortage in Gauteng is absolutely a worse crisis. While the fundamental issues are the same, it is going to be a much more difficult situation for people to live with on a day-to-day basis,” he said.

Finding possible solutions to ensure a sustainable water supply

According to the co-founder and CEO of Kampwater, Hans van Kamp, there are ways in which the country can survive a possible “day zero” when the municipal taps are shut off. Kampwater is a Stellenboschbased water treatment supplier assisting affected organisations like hospitals to overcome the water crisis.

Van Kamp said the sources of clean, fresh water in South Africa are limited and organisations and homeowners are looking at different ways of water supply that are less dependent on the current infrastructure.

“Water supply systems and the distribution networks are high on maintenance. In Gqeberha it is estimated that 40% of the municipal water is lost due to leaking pipes. In the rest of the country, large amounts of treated, clean, drinkable water are lost daily because of the thousands upon thousands of leaks that characterise South Africa’s water piping system.

“Compounding this is the fact that we have not had good rains for more than seven years and we have had a sharp increase in water consumption from across sectors, be it residential, business, or other. One of the solutions should be that a major part of the maintenance budget should be spent on the infrastructure, the current pipework network. Most of the maintenance work should be spent on preventative maintenance and upgrades to cope with the increasing demand. However, most municipalities are struggling to keep up and keeping the system from collapsing. There are some exceptions but not many,” said Van Kamp.

He added that the current water system and the challenges it is experiencing with loadshedding cannot cope with the evergrowing population. South Africa boasts the 33rd largest economy in the world and the 23rd largest population on the planet, according to The World Bank.

“We are the most populated nation south of the equator, home to over fifty-nine million people. This number is only expected to increase as citizens from poorer countries in the vicinity migrate to look for new homes, work, and other opportunities. The investments in the supply of water to the population can only be done with a long-term vision.

“The systems we have cannot cope with the growth of the population. In 1994 Cape Town had 2.384 million residents and water usage of roughly 300 megalitres per day (MLD). This year, we are looking at a population of 4.760 million people in the same area and water usage of 769 MLD per day. That is more than a 100% increase in people and water usage in 28 years with a system that did not grow at the same rate to provide for this increase,” he said.

Touching on short-term solutions, Van Kamp said, like having a power inverter at home, having a backup water tank will

help to relieve the problem with water supply in the short term.

“For domestic users, this solution can offer relief. If you add a water tank that is topped up by the municipality supply and have a booster pump to the house it will relieve pressure when there are events like ‘watershedding’, or restrictions applied. For industrial water users and especially the essential services like hospitals, the blood bank and frail care centres, he said there’s a need to look for alternative supplies, like rivers and boreholes.

Van Kamp said boreholes have been a source of water for a very long time but despite this, their benefits are still relatively unknown to a lot of business owners.

“The most common use of boreholes is as a self-sufficient water source for businesses. A deep hole is drilled down to the water source, the sides of the well are secured, and a pump is installed to draw the water to the surface. To do this you need a geohydrologist to do a study of the likelihood of finding a reliable source of water.

“If you do, you access the source by drilling a borehole, evaluate the yield and water quality, do site preparations like a slab, electrical connection, and water connections, and then install tanks and a water purification system. To be able to run a sustainable system, you need to monitor the borehole level, extraction, tank levels and water quality. It is important to also have a service level agreement in place for the borehole that will include maintenance and online monitoring, ” he said.

Sources:

Unlocking sustainable possibilities in African mining

Mining Indaba 2023

We are committed to partnering strategically with our clients to unlock sustainable possibilities and value across the African continent’s mining sector through stability, security and supply.

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The bravery to imagine and the will to get things done. That’s Africanacity.

SUSTAINABLE AGRICULTURE

ALTERNATIVE TRANSPORT FOR MOVING FRESH PRODUCE

By Jessie Taylor

South Africa boasts a strong agricultural sector that accounts for at least 10% of the country’s export earnings. The sector has been steadily growing over the last few years, but now economists fear this growth is starting to slow due to rising costs and transport challenges.

Finding alternative transport options could not only offer the sector the support it needs for continued growth, but it could also have the added benefit of reducing carbon emissions.

A HEALTHY ECONOMIC OUTLOOK

South Africa has a diverse agricultural sector that produces grains, fruits, wine and vegetables, as well as livestock production. The industry is a key earner for the country, with exports earning estimated at more than $10 billion. Leading exports include citrus, wine, table grapes, corn and apples accounted for the largest exports by value.

But at the same time, South Africa also imports more than $6 billion worth of agricultural goods annually – this was made up of rice, wheat, palm oil, cane sugar, sunflower oil and meat products.

The country’s agricultural gross domestic product (GDP) grew by 3.6% year on year. However, the Bureau for Food and Agricultural Policy (BFAP) has warned that the sector’s growth

could start to slow this year, due to increasing costs and logistical constraints.

This comes at a time when demand for fruit and vegetables is increasing among European nations – which could open up various trade opportunities for South Africa.

The global trend toward healthy eating has seen an increased demand for fresh fruit in Europe.

According to South African Fruit Exporters (SAFE), European consumers are increasingly buying more fruit, mainly citrus, apples, pears and kiwis – fruit which has a longer shelf life, is high in vitamin C and is not too expensive.

However, this rising demand has one side effect: Carbon emissions. Importing fruit and vegetables is a carbon-heavy activity, as a result of the complex logistics involved.

BALANCING NATURE WITH CONSUMER DEMAND

Research has found that global transportation of food produces up to 7.5 times more greenhousegas emissions than previously estimated. And a third of the emissions are created by the export and import of fruit and vegetables –twice the amount produced by growing them.

With the move to plant-based and healthy diets, demand is growing among wealthier nations for fresh fruit and vegetables year-round. This demand has seen just over 12% of the world’s population generating almost half of “foodmile” emissions. Food miles are used to describe the carbon intensity of transporting a tonne

of a food item from its country of production to where the consumers live.

Around the world, there has been a shift towards reducing meat intake, as raising livestock is responsible for most of the agricultural production emissions. However, the transportation of fruits and vegetables is especially carbonintensive, because they need to be shipped in refrigerated containers.

If the fruits and vegetables are transported by truck, the carbon emissions increase even further compared to ocean shipping.

The complex transport system not only affects the planet but also eats into farmers’ bottom lines. According to the BFAP, the profitability of horticulture crops is often reduced by freight cost increases and delays at ports.

While the growing demand for fruit and vegetables offers promise from agricultural exporters such as South Africa, it also requires the country to grow its local markets.

Despite its large agricultural output, South Africa faces a gap between the population’s needs and the food products it produces. This gap must then be filled by imports.

Switching towards local supply greatly reduces transport costs and the resulting carbon emissions – and this requires encouraging purchasing at farmer’s markets for consumers, and encouraging retailers to support local farmers. Another alternative is to explore new transportation methods. Creating a low-emissions global food transportation system could

replace tracks and ships powered by fossil fuels. This would require the use of alternatives, such as vehicles powered by batteries, biofuels or hydrogen.

QUICK FACTS ON SOUTH AFRICA’S FOOD IMPORTS:

• South Africa’s main food imports include vegetables, meat, and cereals (especially rice).

• It is estimated that the country spends more than $88 billion on imports every year.

• Most of our imported food is sourced from China, the United States, Argentina, Germany, and the United Kingdom.

• Almost half of all South Africa’s imports come from Asian countries.

• South Africans use around three million tons of wheat annually, but local farmers produce only around half that amount. Most of our wheat is supplied by Russia.

• South Africans have a sweet tooth – despite local production, South Africa imports around $430 million worth of sugar and confectionery, primarily from Thailand, Brazil and France.

Sources:

bestfoodimporters.com

safe.co.za

businesslive.co.za

engineeringnews.co.za

tatssa.gov.za

trade.gov

“SOCIETY’S RELATIONSHIP WITH PLASTICS IS CHANGING.”

BUT MORE NEEDS TO BE DONE

By Sinazo Mkoko

Concerns about a mounting plastic crisis across the globe have been loudly raised and private and public organisations continue to seek solutions to deal with this ongoing environmental threat.

From 28 November to 2 December 2022, historic negotiations to end global plastic pollution took place in Punta del Este, Uruguay.

According to the United Nations, an international legally binding instrument to end plastic pollution, including in the marine environment, will be developed by the private sector and civil society with hopes to finalise it by 2024.

Known as INC-1, the first session of this Intergovernmental Negotiating Committee (INC), came nine months after representatives from 175 countries endorsed a landmark resolution on plastic pollution at the United Nations Environment Assembly. Countries tasked the UN Environment Programme (UNEP) with convening and managing the INC process, the UN says.

The meeting which attracted over 2 500 in-person and virtual delegates from 147 countries set the foundation to shape the global instrument to end plastic pollution, with many governments, according to the UN, confirming their desire to have an instrument that addresses the full lifecycle of plastics, protecting human health and the environment, with special attention paid to the unique circumstances of those countries most in need.

Executive Director of the UN Environment Programme (UNEP), Inger Andersen, said at the opening: “We must eliminate and substitute problematic and unnecessary plastic items and ensure that plastic products are designed to be reusable or recyclable. Important that we find our way

towards an ambitious multilateral instrument that ensures plastic products are circulated in practice, not just in theory.”

Plastics SA - South Africa’s umbrella body representing all sectors of the country’s Plastics Industry playing an active role in the growth and development of the SA industry and striving to address plasticsrelated issues, was part of the organisations that attended the INC-1.

Plastics SA’s Sustainability Director, Douw Steyn, represented the South African plastics industry in these negotiations and stated that the meeting was a mix of high and low moments. “It was a huge privilege to join representatives of the global plastic industry such as the World Plastics Council, Plastics Europe, the European Chemical Industry Council), American Chemistry Council as well as environmentalists, scientists, waste pickers, tribal leaders; governments and others affected by pollution in these talks. Twenty-three bilateral meetings with governments and key stakeholders took place during (sic) five days, and it was interesting to see how globally we are all grappling with the same issues,” he said.

He added that despite the fact that participants were united around the shared goal and vision of how to effectively and responsibly deal with waste, factions also quickly came into focus and as a result, “the first round of negotiations ended on a split on whether to limit plastic production, phase out types of plastics and harmonise global rules.”

Other common themes and desired actions that emerged from the INC-1 meeting include:

• Scaling up a circular economy for plastics, where used plastics are captured and remade into new plastics.

• Designing products for circularity.

• Enabling partnerships between the private sector and governments to unlock financing to improve waste

• management, which serves as the foundation of a circular economy.

• Enhancing transparency on chemical additives.

The Human Impact

According to the Organisation for Economic Co-operation and Development (OECD) report, the amount of plastic waste produced by humans globally is approximately 460 million metric tonnes of plastic a year, and without urgent action, this is expected to triple by 2060 with around half ending up in landfill and less than a fifth recycled.

OECD Secretary-General Mathias Cormann stated that the report proposes tangible policies that can be implemented along the lifecycle of plastics that could “significantly curb and even eliminate – plastic leakage into the environment.”

“If we want a world that is free of plastic pollution, in line with the ambitions of the United Nations Environment Assembly, we will need to take much more stringent and globally co-ordinated action,” Cormann said.

Another study done by UNEP revealed that over 14 million metric tonnes of plastic enter and damage aquatic ecosystems annually, and “greenhouse gas emissions associated with plastics are expected to account for 15% of the total emissions allowable by 2050 if humanity is to limit global warming to 1.5°C.”

Executive Secretary of the INC Secretariat on Plastic Pollution, Jyoti Mathur-Filipp, says there’s a need for rapid, ambitious and meaningful global action to curb plastic pollution. “At INC-1, we can lay the groundwork needed to implement a lifecycle approach to plastic pollution, which would significantly contribute to ending the triple planetary crisis of climate change, nature and biodiversity loss, and pollution and waste.”

Plastics SA report

In efforts to tackle plastic pollution, countries across the globe have taken recycling as one of the main solutions to deal with the challenge. In its latest industrial production, recycling statistics, Plastics SA stated that South Africa recycled 344,527 tons of plastics during 2021 - representing a 10% increase over previous years.

Plastics SA Executive Director, Anton Hanekom, said while they welcome this growth, more needs to be done to show support to the local recyclers and take the industry to greater heights. “In order for recycling to be effective, certain principles must be in place: products must be designed for recycling; the necessary systems must be in place to collect recyclable waste from the solid waste stream as early as possible; specifications must be in place for incoming recyclable waste in the sense that standards must be developed and adhered to for the recycling processes and subsequent recyclate, and environmental claims must be substantiated. While plastics collection and recycling have improved slightly, we are still not back to pre-Covid year levels recorded in 2019,” he said.

He added that recyclers, like the rest of the country’s manufacturing sector, were negatively impacted by economic challenges caused by load shedding and rising transportation and energy costs.

The report also showed that the country’s unemployment rate reached a new high of 35.3% in the fourth quarter of 2021, with more than 50 000 jobs lost at the time. According to the report, the manufacturing and construction industries were particularly affected the most and unfortunately, the plastics industry did not escape this trend.

“Although our calculations show that approximately 57 400 informal jobs (e.g., waste pickers and employees of smaller entrepreneurial collectors) were retained in the collection industry this year, formal employment in plastics recycling slipped by 11% to 5 533 formal jobs. Females account for 23% of the workforce and are preferred for more detailed jobs such as waste sorting. The majority of the functions, however, require physically stronger male workers due to the physical nature of their work. A small number of contract workers (4% of the total) are hired on an as-needed basis to sort incoming recyclable waste during peak periods. This figure has dropped yet again as businesses reduce the number of jobs and instead buy sorted, cleaner waste to cut operational costs,” Anton reported.

Plastics SA stated that since 2012, South Africa’s recycling production has increased by 36%. As a result, the percentage of recycled content in new products has risen from 14.8% in 2012 to 16.7% in 2021. “Industry initiatives such as the SA Plastics Pact, individual company pledges and the ongoing efforts by recyclers, are encouraging the use of recycled plastics in a variety of industries. However, more needs to be done to accelerate the overall circularity of plastics. Developing new endmarkets for recycled plastics is critical to ensure the industry’s long-term viability,” they said.

They added that there is no doubt that we are at a point in history when “society’s relationship with plastics is changing.”

Plastics SA has made it clear that the plastics industry, government, and society all want to reduce plastic waste and leave the environment in a better state for future generations. “Domestic waste management has entered the public consciousness,

and many industries and consumers share a desire to reduce waste and avoid waste going to landfill, leaking into the environment, or being shipped offshore.

They went on to say that the plastics industry is working hard to ensure that plastics remain sustainable and have a positive impact on people and the environment.

“We are doing this by striving to transform the traditional linear economy - in which plastics are typically disposed of at the end of their service life, into a plastic circular economy where plastics remain in circulation for longer periods of time and are reused and recycled at the end of their life span.

“Considering the greater context of global events and local developments affecting the industry, we believe the 2021 results are satisfactory and in line with our expectations. We are aware of our shortcomings and where additional work is

required. However, just as birds sing after a storm, we would like to express our heartfelt gratitude and appreciation to every company, individual employee, partner, and supplier who assisted us in weathering a very difficult and tumultuous period in our history. As an industry, we will continue to work harder, embrace innovation, and aim higher in order to meet our own and society’s expectations,” Hanekom concluded.

Local companies getting involved

To celebrate Marine Month in October, a retailer in South Africa joined hands with local recyclers and became the first South African retailer to remove singleuse plastic bags from all its food markets. The company said this is key to realising its vision for a zero-packaging waste-tolandfill which includes the phasing out of unnecessary single-use plastics and for all their packaging to be reusable and/or recyclable.

Since announcing this vision, the retailer has also removed single-use plastic straws, utensils, lollipop sticks and cotton bud stems as well as made significant packaging improvements.

In a statement, Woolworths Foods Chief Technology and Sustainability Officer, Latiefa Behardien, said they are deeply committed to their zero-packaging waste-tolandfill vision and delighted to have reached this target. She said the beginning of this journey, they have prevented more than 120 million* single-use plastic shopping bags from entering overburdened waste streams and the environment.

“A critical component for the rollout to over 400 food markets was to ensure that our customers had a cost-efficient, durable reusable bag option that was also made locally. We partnered with a local blackowned supplier and over the last few years have created a sustainable business that in turn created much-needed jobs in a tough economic environment. In 2019 they started with 118 employees which has grown over the last three years to 302 employees,” said Behardien.

This move was hailed by the industry with some stating that the retailer was taking a task to educate their consumers about adopting more reuse actions in their daily lives and supporting local enterprises.

Council for Scientific and Industrial Research (CSIR) Pathways Report

In November 2022, the Council for Scientific and Industrial Research (CSIR) released the Pathways Report which outlines the process of using the Pathways tool in the South African context. The report shows that South Africa, like most countries, is faced with growing plastic consumption and disposal, and with it, the leakage of plastic into the terrestrial and aquatic environment.

“Currently, approximately 37% of households in South Africa do not have weekly waste collection services, leaving 29% of all household waste uncollected, which is often disposed of improperly. Furthermore, the waste that is collected is sent to landfill, but many municipal landfill sites do not function effectively in terms of waste treatment and containment (noncompliant landfills),” the report said. The report further stated that the modelling for South Africa shows that there is no single solution to address the plastic pollution problem.

According to the report, There are four main strategies to address plastic pollution; namely –

• Reduce Demand by reducing plastic consumption and substituting plastics with alternatives. A reduction in plastic consumption involves design for re-use, the elimination of problematic and unnecessary plastics, and the introduction of new delivery models that avoid or reduce the need for packaging (examples include refill services, shifting products to services, e-commerce, and dispensers). Substituting plastics with alternatives involves switching from plastics to alternatives such as paper, coated paper, and compostable bio-based materials; but with careful consideration to maintain functionality requirements and to ensure that these alternatives do not incur additional environmental impacts.

• Increase collection through improvements in waste collection services. Currently, not all South African households have weekly waste collection services, and a large proportion of waste is disposed to open dumps, which are frequently burnt (an informal waste management practice aimed at reducing waste volume). Improving waste collection can make plastics more readily available and amenable for recycling while reducing the potential for plastic pollution.

• Increase recycling of plastic by diverting plastic waste away from disposal to recycling. Recycling plastic reduces the need for virgin polymers in the production of new plastic products. An increase in the collection and sorting of plastics will be required to make plastic material available for recycling, and five-year collection and recycling targets have been mandated by the recent Extended Producer Responsibility (EPR) regulations (R1187 of 5 November 20204 ).

• Improve disposal by improving waste management infrastructure and practices. Currently, landfill is the predominant waste management solution in South Africa, and there is negligible dedicated waste thermal treatment (without energy recovery). However, not all municipal landfills are properly managed or compliant with legislation, and many do not effectively contain plastic waste in situ. Improved safe disposal to sanitary landfills that ensure containment will be needed to reduce plastics leaking into the environment.

By Fiona Wakelin

E-waste management in South Africa

Electronic waste disposal in South Africa is governed by the National Environmental Management Waste Act 59 of 2008, the National Environmental Management Act of 1998, and the 2020 National Waste Strategy; the e-Waste Association of South Africa (eWASA) was established in 2008 to manage the establishment of a sustainable environmentally sound e-waste management system for the country.

“In order for us to be compliant with the National Environmental Management: Waste Act and the Industry Waste Management Plan (IWMP) whereby manufacturers, wholesalers, retailers, and distributors of electrical and electronic equipment are obligated to take back and recycle all types of end-of-life products, eWASA has registered as a PRO in all three sectors, i.e. Electrical and Electronic Equipment, Lighting as well as Paper and Packaging. All three of these sectors have their own types of packaging which need

to form part of our strategy as we aim to create a “one-stop shop” for our members,” - Keith Anderson, Chief Executive Officer of eWASA.

So what is e-waste? The answer is in the term itself: “e” stands for everything electrical and electronic, anything that you need to plug into an electrical power source - the list is long, and growing. Not only has the variety of these goods increased in recent years but with built-in obsolescence, a strategy that is woven into money-making manufacturing the world over, the mountains of e-waste generated are becoming Himalayan. One small device, which is adding to the pile is the cell phone:

“In 2022, almost 47 million South Africans accessed the internet through any kind of mobile device. In 2027, this figure is projected to amount to almost 58 million mobile internet users, up by 20.77 percent from 2022.” - statista

The Department of Forestry, Fisheries and the Environment estimates an annual national average of 360 000 tonnes of e-waste makes up 5% to 8% of municipal solid waste and is growing at a rate three times faster than any other.

What do you do with your electronic devices when they reach the point of no return? Light bulbs, cell phones, cell phone chargers, lamps, dead stoves, TVs, defunct DVD players, fridges, fax machines,

batteries, battery chargers etc.? They can’t be treated as ordinary, everyday disposable rubbish.

E-waste contains several hundred different substances such as lead, mercury, arsenic, cadmium, selenium, hexavalent chromium and flame retardants that create dioxin emissions when burned and unsafe handling and disposal of e-waste can have significant, irreversible effects on the environment, such as the pollution and

degradation of air and water quality and soil contamination. So dumping in landfills is a dangerous long-term non-solution and there are other more environmentally friendly ways forward.

Twin opportunities – waste disposal and job creation

Just as we have recycling and upcycling, e-cycling is a system in which electronic resources are reused in multiple ways.

“E-cycling creates jobs, retains more value in the industry and the repaired electronics gives people access to low-cost technology.

“E-waste is also extremely valuable as a rich source of secondary raw material. From every 1 million recycled mobile phones approximately 16,000 kilograms of copper, 350 kilograms of silver, 34 kilograms of gold and 15 kilograms of palladium can be recovered.” - Go Legal

The Western Cape alone is estimated to have generated between 43 290 – 68 501 tonnes of e-waste in 2020 with a market value estimated at between R55.2 – R109.8-million per year. The province is an important e-waste aggregation node for the Eastern Cape and Northern Cape, and a key source of e-waste for Gauteng’s pre-processors and processors.

Dismantled materials and components, and aggregate materials from other provinces, are transported to Gauteng for processing or are exported. South Africa has a well-developed network of formal and informal collectors and consolidators, with some e-waste reaching preprocessors and refurbishers. 2022 Waste Market Intelligence Report,

Green Cape

An exciting, innovative e-waste project listed on the Gauteng e-government website is the partnership between the government and a tertiary institution. Launched in March 2022 by Gauteng Premier David Makhura and MEC Nomantu Nkomo-Ralehoko, the Gauteng Department of e-Government together with the University of

Johannesburg (UJ) has developed an e-Waste Management System to help address both the mounting e-waste and the current unemployment crisis in Gauteng.

Premier David Makhura said the e-Waste Management partnership, will enable the provincial government to coordinate efforts for the disposal and recycling of e-waste across the Gauteng City Region. This was reinforced by MEC Nkomo-Ralehoko:

“The e-waste management system will also assist in inspiring creativity amongst the youth, to be able to recycle and create something meaningful from discarded gadgets. This will further assist in stimulating the economy through SMME support and job creation” said the MEC.

University of Johannesburg Deputy Vice-Chancellor: Research and Internationalisation, Professor Saurabh Sinha, expanded on the possibility of job opportunities created by the e-waste management system and the training that this would require:

“To achieve this goal, a blended learning approach will be followed. The Johannesburg Business School and the Institute for Intelligent Systems will develop a series of online, asynchronous short learning programmes that entrepreneurs in the province can access. We want to unlock solutions that not only address issues such as e-waste but also create a value chain that speaks to SMMEs and the informal sector through the creation of a circular economy,” said Sinha. Innovative projects such as these are not only good news for the environment, they achieve the vital objectives of job creation, poverty alleviation and training and lead to long-term sustainability.

Sources:

SUSTAINABILITY INITIATIVES

WHAT IS GOVERNMENT DOING TO ENSURE A SUSTAINABLE FUTURE?

By Fiona Wakelin

In this article we take a look at what the public sector is doing to embed sustainability principles in departmental policies and programmes and focus on government initiatives aimed at ensuring sustainable environmental practices.

Department of Agriculture, Land Reform and Rural Development

National Biosecurity Hub

In October 2022 the Minister of Higher Education, Science and Innovation, Dr Blade Nzimande, and the Minister of Agriculture, Land Reform and Rural Development, Thoko Didiza, launched the National Biosecurity Hub in collaboration with the University of Pretoria.

“The Hub, an initiative of the Department of Science and Innovation’s (DSI)

Agricultural Bioeconomy Innovation Partnership Programme, will facilitate collaborative efforts in the national system of innovation to support the prevention, reduction and management of crop and animal disease and other matters related to food safety in South Africa – and will be coordinated by Innovation Africa at the University of Pretoria.

“Comprising industry, academia, science councils and government role players, the Hub will contribute to sustainable agricultural production and the safe trade of agricultural products, services and processes” - DALRRD

Department Forestry, Fisheries and the Environment + SANBI

Groen Sebenza

In 2013 the South African National Biodiversity Institute (SANBI) embarked on a major skills development and job creation pilot programme - Groen Sebenza - a Jobs Fund Partnership Project funded by the National Treasury.

“Groen Sebenza is aimed at developing priority skills in the biodiversity sector

to create sustainable job opportunities for unemployed graduates and nongraduates (school leavers with a matric certificate) for two and a half years.

“Groen (in Afrikaans meaning green) Sebenza (meaning work in isiZulu) brings young South Africans from previously disadvantaged backgrounds together with experienced biodiversity professionals to learn, grow and eventually gain the competence and confidence to embark on rewarding and meaningful biodiversity careers.

“The programme partnered with 43 host institutions across the country from all tiers of government, NGOs and the private sector and has equipped the participating young people, called Pioneers, with various life and generic skills training e.g. computer literacy, workplace communication, career guidance, leadership and project management skills” - SANBI

In 2022 the Groen Sebenza Phase II Programme was funded to the value of R300-million for the next three years, aiming to recruit 1 050 unemployed graduates (from Diploma to PhD level)

SUSTAINABILITY INITIATIVES

and place them nationally in different organisations (government and non-governmental) where they will be trained and mentored in the management of environment/biodiversity.

Green Scorpions

The Environmental Management Inspectorate (EMI) - known by the South African public as the Green Scorpions - are government officials at national, provincial and local level who are responsible for the compliance and enforcement of environmental legislation.

The Green Scorpions have 3 focus areas:

• Biodiversity, protected areas (green)

• Integrated coastal management (blue)

• Pollution, waste, impact assessment (brown)

Illegal hunting, poaching and entry into protected areas are among the most common illegal activities the Scorpions have to deal with.

They have a growing force to fight these crimes. As of 31 March 2020, the national EMI Register (kept by DFFE) reflected a total of 3 568 EMIs, comprising 3 158 from national and provincial authorities and 426 from municipalities. This is up from 2 675 in 2019. In addition, in municipalities, the 426 designated environmental management inspectors reflect an increase from 382 in the same period.

Local Authority EMIs per province:

The purpose of the Expanded Public Works Programmes - which now fall under the Department of Forestry, Fisheries and the Environment – was to combine job creation, poverty alleviation with sustainable environmental practices. We focus on the 8 programmes and the people employed by them, who, whilst not receiving much prominence in the press, are working hard at conserving our most precious resources:

Working for Forest

Forestry is one of the sectors that has the potential for job creation whilst ensuring the sustainable use of natural resources. As part of the Government Greening Programme, the DFFE will coordinate and facilitate the planting of two million trees annually, for the next five years.

Working for Land

Working for Land is all about encouraging and supporting sustainable land use practices, raising awareness and promoting resource conservation ethics. It is a sustainable resource utilisation programme based on community partnerships and cooperation - DFFE

Working for Wetlands

Working for Wetlands’ mandate combines wetland rehabilitation with employment creation – the programme supports small businesses, and transfers skills to its beneficiaries and in its job creation strategy deliberately targets women, youth and people with disabilities. To ensure sustainability, the following 5 key areas are interlinked:

• Wetland protection, wise use and rehabilitation

• Skills and capacity development

• Co-operative governance and partnerships

• Knowledge sharing

• Communication, education and public awareness

Working for Water

Working for Water (WfW) is one of the longest-standing and most successful examples of payments for ecosystem services (PES). Started in 1995, the programme employs local community members to get rid of invasive alien plants – thereby maximising water flow. Over the last 27 years WfW has cleared more than one million hectares of invasive alien plants and provided jobs and training to approximately 20 000 people. The programme is globally recognised as one of the most outstanding environmental conservation initiatives on the continent

Working on Fire

When the fires are raging and the helicopters are circling and the brave firefighters are risking their lives you can be sure that this is the Working on Fire (WoF) programme in action. Working on Fire (WoF) was launched in September 2003 as part of the job creation initiative and now employs more than 5 000 young men and women from marginalised communities who have been fully trained as veld and forest fire fighters.

Working on Waste

The WorkingonWaste (WoW) programme’s core purpose is the achievement of social and ecological sustainability through the implementation of sustainable waste management practices. WoW does this by:

• Creating and supporting mechanisms for the protection of environmental quality

• Creating sustainable livelihoods through recycling of waste (waste collection and minimisation)

• Supporting the use of environmentally friendly waste disposal technology

• Promoting community environmental education and awareness

16th Air Quality Governance Lekgotla

The Air Quality Governance Lekgotla is an annual event which gives government officials the opportunity to share experiences, best practices and to agree on possible solutions/mechanisms in addressing common challenges faced by the government in air quality management. This year the theme was “Strengthening Air Quality Management Systems” and the keynote address was given by Deputy Minister of Forestry, Fisheries and the Environment, Ms Makhotso Magdeline Sotyu.

Working for Ecosystems

Working for Ecosystems aims to reverse environmental degradation through ecological restoration and maintenance programmes. It aims to regain natural habitat composition, structure and function and thereby enhance ecosystem services, such as: carbon sequestration, water regulation and purification, reducing the risk of natural disasters by improving landscape/ catchment stability and resilience. This will improve livelihoods security and productive potential of land, improve natural species diversity, and promote the development of a market for ecosystem services and pro-poor economic development and empowerment in rural areas. – DFFE

“According to the IPCC 6th Assessment Report, Africa remains amongst the world’s regions most vulnerable to climate change. “As a country, we face a double burden of worsening air quality, and climate vulnerability. Action plans to give immediate effect to a Just Transition by shifting to cleaner and more competitive energy generation technologies, as well as the reducing emissions intensity of the economy to achieve net zero carbon dioxide by 2050, have direct benefits to reducing air pollution,” –Hon. Makhotso Magdeline Sotyu

With so much doom and gloom prevalent in mass media, it is salutary, once in a while, to take a deep dive behind the scenes and see what is being done in South Africa to ensure environmental resilience and sustainability on planet A –because there is no planet B.

Sources:

SANBI

National Environmental Compliance and Enforcement Report

Official Guide to South Africa 2020/2021

DFFE

DALRRD gov.za

Image credits

iStock

CSIR

Pexels

With the ongoing fuel hikes the country has seen this year, there have been calls for the South African automotive industry to consider introducing electric vehicles (EVs) to the South African market. The question remains: with all the power challenges South Africa is facing, what will it take to achieve this goal?

Responding to a parliamentary Q&A session in March this year, Transport Minister Fikile Mabula told members of parliament that the Department of Trade, Industry and Competition (DTIC) had developed a “Green Paper on New Energy Efficient Vehicles” which aims to establish a clear policy foundation that will enable South Africa to coordinate a long-term strategy that will position the country at the forefront of advanced vehicle manufacturing as well as advanced vehicle-component manufacturing.

Mbalula was asked about the fact that globally the automotive future is increasingly looking electric due to growing regulatory moves, “including forthcoming bans on sales of internal

combustion engine vehicles and ongoing improvements in battery and charging technology and how would the trend toward electric mobility play out in the Republic’s transport industry and the opportunities and challenges associated with the country’s electric transport future.”

CHALLENGES

Mbalula highlighted anxiety among consumers that became key in discussions around electric vehicles as one of the challenges they identified. “Although this has dramatically been alleviated with the recent provisioning and upgrade of over two hundred charging stations throughout the country, it still remains a key challenge which we are constantly engaging among one another as government departments to resolve,” he said.

He went on to say that the issue of the constrained power grid from Eskom that also becomes a challenge for the overall uptake with a key issue of how these vehicles will be recharged should a major power outage should occur, or even

during the regular load shedding intervals.

“The Department is are [sic] also very cognisant however to the challenges that will occur for this shift in vehicle technology to occur, especially if it would be ‘mass uptake’...

“The first challenge is that the tax regime (import duties) for electric vehicles in South Africa has created a situation of barrier to trade. Compared with the around 18% import duty currently added to the price of a vehicle with an internal combustion engine landing in South Africa, an all-electric vehicle is taxed by up to 25%, Thus [sic] pushing the electric vehicle out of the typical affordability market also puts the electric car into being classified as luxury, irrespective of the type, or model of the car. The import duties are currently being imposed by the Department of Trade Industry and Competition.” - Fikile Mbalula.

He added that there are also efforts to build electric vehicles in South Africa,

to keep the auto industry at the “cutting edge of new market developments and to maintain our export capacity for key markets such as the EU and UK, whom have both set new targets and deadlines to reduce the number of fossil fuel reliant vehicles on their roads.

He said the country needs charging infrastructure – and must expand beyond the existing two hundred charging points for electric vehicles in South Africa using the agreed SABS standards.

popular. In this case, these include the BMW i3 and the Nissan LEAF.”

Autotrader CEO, George Mienie, states that one of the trends that the country needs to bear in mind is the move to EVs. “According to the International Energy Agency, global sales of electric cars (including fully electric and plug-in hybrids) doubled in 2021 to a new record of 6.6 million, with more now sold each week than in the whole of 2012. And we’re seeing the move to EVs here in South Africa too. This is confirmed by our data; EV searches (not by fuel-type but searches of the available models) have increased by 102% year-on-year while EV advert views have increased 134% year-onyear,” he says.

Mienie continues: “Coupled with this trend, we’re seeing a growth in fuel-type searches. It is especially interesting to see that hybrid searches are up by 129% while electric fuel type views (i.e. the number of times car adverts are viewed) have increased by 133% year-on-year. The message is clear: we are in the midst of great change. The question is this: is our industry refuelled and ready to deal with –and indeed, capitalise on it?”

- George Mienie.

THE BREAKTHROUGH AGENDA REPORT

road transport sector, “countries and manufacturers should align target dates for all new vehicles to be zero emission, to shift investment more quickly towards the new technologies and accelerate their cost reduction. Zero emission vehicles accounted for around 9% of global car sales in 2021; this should reach about 60% by 2030.”

The report states that South Africa has the most coal-intensive economy of the G20 - depending on it for 87% of its electricity.

“The Just Energy Transition Partnership (JET-P) was developed in cooperation with South Africa and France, Germany, the European Union, the United Kingdom, and the United States, who agreed to provide an initial commitment of USD 8.5 billion through just transition interventions, power sector decarbonisation, and economic diversification into future energy sectors, including electric vehicles and green hydrogen.”

One of the key messages for the road transport sector states that: “The transition to zero-emission road transport is at a relatively early stage in terms of global market adoption, but progress is accelerating rapidly, with substantial takeup of electric cars, urban buses, and twoand three-wheelers in many countries.

CAR INDUSTRY REPORT

Autotrader released its 2022 Mid-Year Industry Report, shedding light on the wider automotive landscape, globally and locally.

According to Autotrader, the reporting period for this study covers the first six months of 2022, with over 13 brands and over 21 models featured in the top 10, across various categories.

The report revealed that EVs were “listed 141 times, registering an average price of R1 870 721 as well as a mileage of 21 313 km and an average year model of 2020.

“The most available Models were the BMW i3, Porsche Taycan and the Audi e-tron. Based on the research from the Annual AutoTrader Electric Car Buyers Survey, vehicles which are within the sub-R600 000 price range continue to be the most

At COP26 last year, world leaders gave the International Energy Agency (IEA), the International Renewable Energy Agency (IRENA) and the UN Climate Change HighLevel Champions the tasking of developing an annual Breakthrough Agenda report to provide an independent evidence base and expert recommendations for where stronger international collaboration is needed.

The Breakthrough Agenda is a “commitment to work together this decade to accelerate innovation and deployment of clean technologies, making them accessible and affordable for all this decade. To kick start this Agenda, countries endorsed Breakthrough goals to make clean technologies and sustainable practices more affordable, accessible and attractive than their alternatives by 2030 in the power, road transport, steel, hydrogen and agriculture sectors.”

The first annual report of the 2022 Breakthrough Agenda Report, released in September, showed that in the

They said the sector is more advanced in its low-carbon transition compared to other transport subsectors, such as shipping and aviation. “There are already nearly 18 million zero emission cars, light commercial vehicles, buses and trucks on the roads, plus more than 36 million electric two-and three-wheelers. In 2012, just 120 000 electric cars were sold worldwide but by 2021 more than that number were sold each week, totalling 8.7% of global sales; yet, there remains a long way to go (IEA, 2022a),” the report noted.

According to the report, The Breakthrough goal for road transport endorsed at COP26 is: “Zero emission vehicles are the new normal and are accessible, affordable, and sustainable in all regions by 2030.”

Rapid progress on deployment, cost reduction, availability, and sustainability are all that will be required to meet this goal.

TABLE OF RECOMMENDATIONS FOR ROAD TRANSPORT SECTOR

1. Governments should agree on a timeline by which all new road vehicle sales should be zero emission, with interim targets for countries taking into account their level of economic development and ability to scale up infrastructure, and should align policies with this target. Pathways compatible with 1.5 °C indicate that a target date should be around 2035 for cars, for example. Vehicle manufacturers should commit to the same timelines for 100% zero emission vehicle production. This will send a clear signal to industry and unlock larger economies of scale and faster cost reductions, making the transition more affordable for all countries.

2. Governments should collectively agree a common [sic] understanding of the technologies that are consistent with the goal of zero emissions road transport, in order to send a clear and unambiguous signal to industry. This will accelerate economies of scale for key technologies, accelerating the pace of innovation and cost reduction, making ZEVs affordable sooner for more people.

3. Governments should exchange best practice in policy to mobilise investment and accelerate deployment of charging infrastructure, in consultation with vehicle manufacturers and infrastructure investors. This should be complemented by a broader scaling up of technical and financial assistance to developing countries at city, provincial, national and regional levels. This will help to mobilise private investment, and ensure all countries are able to access the benefits of the transition to zero emission vehicles.

4. Governments should work together and with industry to avoid further divergence of standards for charging infrastructure. There are already several competing charging standards for light-duty vehicles; for heavy-duty

vehicles, avoiding further divergence could limit wasteful investments in multiple charging types, and accelerate the adoption of zero emission trucks. Aligning standards for hydrogen refuelling stations can reap similar benefits. Doing so will decrease costs and facilitate the transition in vehicle importing countries

5. Governments should work together and with industry to agree harmonised standards to ensure sustainability and social responsibility along the electric vehicle battery supply chain, including the extraction and processing of minerals and the recyclability of battery modules. As a priority, these standards should minimise batteries’ lifecycle emissions and the adverse social and environmental impacts associated with their production, seek to extend their durability and promote reuse, repurposing and recycling of their components. Similar standards on fuel cell value chains, including information on platinum and other catalyst materials’ content and origin, should be put in place. Harmonised standards will send a clearer signal to the global market, and facilitate compliance by battery and vehicle manufacturers that sell to multiple markets.

6. Vehicle importer and exporter countries should agree on harmonised regulations on vehicle trade to improve vehicle efficiency and safety in international trade in used vehicles. These rules should govern trade in zero emission vehicles as well as internal combustion engine vehicles, supported by strong mechanisms to enforce compliance. This will help prevent ‘vehicle dumping’, locking developing countries into higher emitting vehicles.

(Source: Breakthrough Agenda Report)

Sources:

AutoTrader Mid-Year Car Industry Report 2022 | IEA | The Breakthrough Agenda Report 2022 | Parliament Monitoring Grou p

“Whether you are in the public sector, the private sector, supply chain or an interested individual, PSL has something for you.”

By Courtenay Webster & Raylene Watson

It is no longer enough for companies to focus on creating profit alone. Investors, regulators, and wider society are demanding that companies take an active role in addressing environmental and social issues alongside financial returns. Financial flows into environmental, social and governance (ESG) funds more than doubled between 2020 and 2021 and, on average, more than one third of consumers are willing to pay more for sustainable products or services.

A concerning factor given the financial flows and increasingly discerning consumer is that, according to The Global ESG Survey, 51% of investors found that the social element of ESG investment strategies is simply

a tick-box approach. This is largely because social efforts and impacts can be difficult to measure and analyse. Companies have therefore mainly focused on the environmental element, such as climate change mitigation, as their leading benchmark for investment decisions.

Having said that, the COVID-19 crisis exacerbated and highlighted deep-seated social inequalities, and there is increasing concern of the impacts that climate change can have on vulnerable populations. Due to these concerns and the growing number of socially conscious consumers and investors, social efforts have been evolving from only being in the realm of public relations

to being an integral part of corporate strategy and consumer and investment decisions.

A familiar, yet impactful, approach businesses can take to help further their social license to operate is leveraging corporate social investment (CSI) to build awareness of the business’ brand and create overall value drivers.

Not just a nice-to-have

CSI refers to a company’s contributions - beyond its normal business activities – to social development, aiming at improving the lives of disadvantaged communities and individuals. Examples of CSI initiatives include Duracell donating free batteries to families in need after natural

disasters, and Colgate-Palmolive giving free dental screenings and oral health education to millions of children around the world.

Black Economic Empowerment Act of 2007, a company’s CSI contribution should be at least 1% of net profit after taxes (NPAT).

Companies should leverage this CSI spend as a value driver. A well-thought-out and comprehensive CSI programme is not just a nice-to-have; it is a valuable component of business success. Whilst CSI is not undertaken to create direct revenue, there are benefits to the company, such as enhanced brand recognition, building a social license to operate, building future pipelines, and establishing business partnerships.

brand reputation, it needs to be aligned to your overall business strategy. It is vital that your initiatives are in line with the company ethos, vision, and mission, and that there is a clear link between the community needs and the business’s operational pillars. This ensures that your CSI programme is associated with your core business outputs.

In addition, having a good understanding of the local community needs and being able to respond to these further allows the business to collect much needed market intelligence. This helps the business create new innovative products and new approaches to the market, establishing a competitive advantage.

One of our clients in Kenya produces mattresses. As part of their CSI programme, they donate mattresses to boarding schools. The question asked when reviewing the efficacy of this programme was: how will this donation benefit the business in the medium to long term? The client outlined how good sleep is linked to good education. Students will be more attentive at school and perform better, leading to a more prosperous and productive future when entering the workforce. These children will associate our client’s mattress with a good night’s sleep, and when they are in a position to purchase their own mattress as working adults, they will become a customer themselves. In this way, our client is utilising their CSI spend to build their future customer base.

CSI has embedded itself into business vocabulary, as companies have been increasingly expected to engage with it over the past 20 years. In South Africa, CSI is a mandatory obligation. In terms of the Codes of Good Practice within the Broad-Based

CSI programmes can also generate comradery, satisfaction, and commitment to the execution of a common strategy amongst employees and other stakeholders.

CSI and your business strategy

For a CSI programme to operate effectively and improve your company’s credibility and

Once you have your formal CSI strategy with objectives and deliverables in place, you should regularly measure, evaluate, and adjust your CSI programme to ensure your activities continue to correspond with your company’s strategic CSI objectives.

Sources:

Global Sustainability Study 2021 | CNBC |

The ESG Global Survey 2021

AGILITY AND CHANGE MANAGEMENT - THE NEW NORMAL

By Tom Marsicano, CEO of ‘and Change’

We’ve likely reached the point where it’s okay to speak of a post-pandemic world. Many people, organisations, and even countries have accepted that COVID-19 is another disease we will have to bear and that it is fundamentally changing our ways of working. Flexible working arrangements, implementation of new technologies, and remote working are all becoming commonplace, as many recent studies have shown. All of these require significant organisational change.

recently participated in research exploring this changing world of work, and fascinating insights are already starting to emerge. Prosci, change management experts who developed the change management methodology that we follow, are currently updating their study on the contributors to “change success” and how the pandemic has altered them.

While the full research report is scheduled for release early next year, some key findings have been released, such as a whopping 70% of the over 1 000 global respondents confirming that how change is managed has changed –either moderately or significantly.

The research focuses on several contributors to change management in transformed organisations following the advent of the pandemic, such as:

• How employees contribute and work;

• How to purposefully overcome obstacles to build a more agile environment to direct people’s energy and innovation;

• How to develop new tactics for mobilising change agents in the hybrid work environment;

• How to deploy adjusted work patterns;

Over the past 25 years, research has shown that the most potent contributor to success is active and visible sponsorship – the leaders or leadership bodies that oversee and take ownership of a given organisational change. This factor goes beyond budget approval and mandating change; it’s about executives remaining visible and actively supporting change in their everyday behaviour and actions. Recently, this has changed – to a point – but the changes vary across different industries, types of change, and organisational cultures.

As work patterns shifted to a more hybrid approach, executives have had to create more opportunities to share and receive feedback on why the changes are happening and the need for their people to change.

How communications happen has also had to change. In some cases, there has had to be far more focus on strengthening feedback mechanisms and increasing repetition to emphasise the message of change. More so than before, people leaders need to

articulate the sense of the change and help their people connect with how the change affects them personally. The Prosci research showed that communications specialists who operate within project teams or impacted operational areas expressed an increased call on them to better structure communications so that recipients more easily fit messages into the “bigger picture”.

Engagement emerged as the area of change for both people leaders and employees, with more change for employees than for leaders. Our own experience as a change management consultancy showed that employees expressed a greater need for balance between the attention given to them as contributors and to them in the specifics of their work.

As their lives have become more complex, they need coaching and guidance on balancing work and life. In a sense, increased autonomy to determine work hours introduced the need for better decision-making and planning to ensure they continue to perform well at work. People leaders who responded more to these emerging needs achieved more employee engagement and could therefore ask them to change quicker and more radically when circumstances demanded.

In the context of remote working, adaptations arose from the need to give employees a sense of control and stability in the workplace. Tactics included increasing the variety of communication channels and media and increasing the frequency of feedback on performance and recognition. Virtual training boomed

during the pandemic and has remained a favourite route even if there is now the option to revert to in-person learning. Personal coaching is now also more in demand which puts pressure on people managers to find more time to interact and better ways of measuring and managing output.

These adaptations are reflected in recent research that showed that 63% of South African professionals say their productivity increased while working from home, with 31% sharing that their productivity stayed the same even after transitioning into the remote work set-up.

Ultimately, we are seeing that the pandemic has taught us all how to become more agile in the face of global change. Adaptations that promoted agility included pivoting to incremental, iterative change. This approach works better when there is more freedom to fail on the road to success for the overall change. Learning has been divided into smaller segments, allowing people to absorb new skills quickly and turn them into abilities sooner.

While this agility can sometimes give a feeling of chaos – or even lead to change fatigue – leaders need to provide the anchor of stability, embodying a sense of calm and confidence in the team’s ability to thrive in a new way of working.

It’s a brave, exciting time for change managers, with the prospect of a step shift in how change is led. It calls for intentional and empathetic engagement that remains output focused but casts off the shackles of old management thinking and work habits.

Sources: Mckinsey | Michael Page |

NEW CHANCES TO GET IT RIGHT POST COVID

4 TIPS TO BUILDING A HOLISTIC WORKPLACE AND ATTRACTING TOP TALENT

By Cheryl Benadie, CEO, Whole Person Academy

This pandemic has forcibly removed the figurative workplace masks we all knew we were hiding behind: pretending that we were ok with the collective notion that work was a place we went to, instead of something we did that felt meaningful and fulfilling.

Before COVID-19, 85% of the global workforce was disengaged in their jobs, proving that what we felt in the workplace was pressure to perform instead of enjoying the pleasure of accomplishment. We now accept that the previous system was broken, resulting in a feeling of disconnection. The good news is that we still have the power to rewrite the script and make things whole again. Embracing wholeness at work requires a shift from the disjointed, once a year wellness day that barely touches the surface of employee needs. Relationships, career, finances – we call it the wholeness triad – it is all interlinked in the way that people show up in the world of work. Who people are in their personal lives mirror the way they interact in their professional relationships. The way people manage their personal finances has a direct effect on the levels of financial stress they experience, which ultimately impacts their work performance. There is no escaping this: who we are shows up in the workplace and with the blurring of personal and professional lives due to enforced remote work, we are at a pivotal time in history to make intentional shifts that will ultimately impact the longevity of our organisations.

What will it take to cultivate wholesome work in your organisation?

1. Courageous leadership: This is a time for a rise in servant leadership –senior executives who approach their leadership roles as a responsibility to serve, not a title to abuse. Cultivating wholeness at work, which involves the process of integrating personal and professional lives so that there is a growing congruence, requires servant leadership. Employees are flailing. A recent TransUnion study revealed that nearly 8 out of 10 (78%) South Africans are struggling financially due to the impact of the Covid-19 crisis. Helping employees to deal with this financial stress will demonstrate an inclination to support the whole person in the workplace and will go a long way in enhancing engagement in current roles.

2. Turn the flywheel: The Flywheel effect is a concept developed in Jim Collin’s book Good to Great. Being consistent at doing the work that is really needed to shift organisational culture will eventually lead to building internal momentum “until a point of breakthrough, and beyond.” What is needed at this time is thoughtful and intentional transformation, which only really comes by working inside out. There are no ‘sexy’ shortcuts to building a great organisation – it requires a clear focus on building the people that are the ‘living’ stones of your organisation.

3. Commit to continual employee development: The emerging generation of employees, both Millennials and GenZs, want employees to not just say they care about mental health but also have policies in place that prove it. Investment in continual training and development at all stages of the employee life cycle is needed to cross skill, upskill or reskill employees, helping them to navigate the everchanging demands of the evolving marketplace.

4. Invite employees to be co-creators: The latent potential for creativity and innovation lies in the people already working in your organisation. Creating a compelling vision that aligns with the values of the individual taps into deep levels of intrinsic motivation. Most people want to make a difference at work, they want to feel like their work matters, they want to know that what they contribute is valuable. It might be ‘messy’ to allow all the voices in the organisation to be heard but allowing employees to bring their whole selves to work will have profound and surprising results.

Employers who embrace the revolutionary idea of cultivating wholeness at work will become more focused on who the employee is becoming in the doing of their work and will ultimately build holistic workplaces that will attract top talent.

Smile Foundation transforms the lives of children with facial abnormalities and severe burns through the best possible surgical and psychological care.

We are currently based in 12 of South Africa’s leading hospitals where we invest in development programs and purchase much needed medical equipment for departments specialising in plastic and reconstructive surgery.

With the compassion and support of our benefactors and teams of medical staff, we can sprinkle a little bit of magic into the lives of these children and give them a future full of joy.

Please donate to help us continue our work and support children in need.

FRAMING THE FUTURE OF YOUR BUSINESS

INTERVIEW WITH EAS DIRECTORS, KURT ROELANDT, NATHAN PILLAY & ALFIE NAIDOO

KURT ROELANT Director NATHAN PILLAY Director ALFIE NAIDOO Director

Envision Advisory Services (EAS) is a boutique management consultancy offering advisory services (eg. Strategy, Operations, Programme Management, ESG, M&A) in combination with analytics and technology offerings. Here Directors Kurt Roelandt and Nathan Pillay explain how ESG fits into their service offering, the effect ESG could have on South Africa and more.

Where do you see ESG advisory in your offering?

Currently ESG is top of mind and several clients reach out to us to find out more to get a better understanding of what the impact is

on their business going forward. This can range from how to measure CO2 equivalents, how carbon offsets work to which principles and guidelines to adhere to.

There are many angles to ESG ranging from strategic direction, setting the metrics and targets to effectively implementing the transition plan.

We see a lot of companies telling a good story; however, there are deliberate decisions to be made and actions to be taken to navigate a complex, at times uncertain process. Embedding ESG as a strategic topic within an organisation is key to building and maintaining a profitable and purposeful brand.

What are the 3 things that will keep a CEO awake from an ESG perspective?

As mentioned earlier lots of promises have been made in the annual reports. For senior leaders it will be important to put in place concrete action plans with realistic targets to fulfil the promises made

Secondly, avoiding the reputation crash of poor or incomplete disclosure, compliance amongst different stakeholders’ groups (standards) will be important to prevent being called out for greenwashing.

Thirdly, finding the balance in the transition strategy between

investments for carbon reduction versus the uncertain profitability impact of them

How will the global approach to ESG affect South Africa?

Several jurisdictions are implementing regulations impacting the competitiveness of South African companies e.g. the European Carbon Adjusted Mechanism (CBAM) which will levy a tax based on the carbon emissions levels of imports. This requires an imperative for export driven companies to review their carbon footprint and implement mitigation measures.

How has technology impacted your business model?

Technology is at the heart of our business. Many of our client engagements are technology-led or have very strong technical enabling

components, e.g. to drive operational efficiency, enable organisational change and manage risk and productivity. This includes providing bespoke software solutions to enable business capabilities.

Do you have specific technology developed for ESG?

We repeatedly hear from clients their frustration and lack of access to accurate consistent data, with which to make ESG-related decisions. In response, we developed Ethicaa scalable, easy-to-use ESG data capturing and reporting platform to help clients navigate the changing ESG journey.

Do you have exciting plans for the coming year?

We like to share our research and insights with the market, so we focused on finding ways to fast track that

aspect and at the same time to use Ethica as an enabler for companies to quickly get on the ESG scorecard.

We are also looking forward to developing our growing footprint in Africa as we see a lot of interesting opportunities.

SME s IN AFRICA MUST FOCUS ON HEALTH AND SAFETY IN THE WORKPLACE

By Brondwyn Douglas, ESG Officer at Spear Capital

According to the World Health Organisation, over 1.1 million people die of occupational injuries and work-related diseases worldwide each year. That’s quite a shocking statistic. In addition, the risks in workplaces that can cause bad health among workers and the community are approximately 10 to 20 times higher in developing economies. In these environments, as few as 10% of workers have access to occupational health services.

This is particularly true in Africa. The continent is highly industrialised, and industrial manufacturing carries a far greater risk of injuries than, say, the services sector. In addition, many of the sectors on the continent that propel the economy are labour intensive, increasing the risk of occupational incidents and injuries if health and safety is not prioritised.

This is specifically the case for businesses classified as small- and medium-sized (SMEs), since the situation is more severe among them than in the corporate and multinational sector. Where the business is very large, it faces far more regulation and usually has the resources available to implement the necessary measures, but this is not true of SMEs.

A concern is the lack of enforcement of health and safety policies. When an SME knows that there is little chance that their occupational health and safety (OHS) practices will be audited or assessed by the authorities, the business is less likely to focus on this element.

In recent years, however, an unexpected event like the COVID-19 pandemic brought occupational health and safety into the limelight once more, with businesses having to make some hard decisions about operational practices, geared to limit the risk of the workplace becoming a site of infection. The pandemic reminded the business community of the risks of reputational and financial damage if we do not focus sufficiently on health and safety.

There are various actions that SMEs should take in order to position OHS as something of significance for the business. Here are a few key actions:

• Ensure senior management buyin to OHS and make resources available for its implementation

• Understand the risks associated with tasks, equipment and the workplace environment and build in measures to mitigate these

• Constantly train staff. Use a variety of methods to achieve this and make use of competency assessments to gauge the understanding and knowledge among staff

• Reward safe behaviour to build and reinforce a positive OHS culture

• Capture data on:

The focus in the business world in recent years on the application of ESG standards means that there should be a far greater focus on OHS in the workplace. The ideology around ESG today is essentially to do no harm. That’s why health and safety is a fundamental element of ESG: it ensures that everyone’s right to an environment that is safe to live and work in is protected.

• Incidents, so that you can identify where there are weaknesses in the OHS system

• Near misses, so that you can assess where new or revised mitigation measures may be required. This is a leading indicator and can be crucial in preventing an injury from occurring.

Beyond the need to meet compliance requirements, there may be other reasons for a business to apply a stronger focus on OHS. Businesses that need investment in order to expand may look to private equity firms. In addition to the capital that a private equity investor may bring to the business, there is also significant support and knowledge that is made available, and this may play an important role in helping the business to enforce compliance with health and safety standards. The investor can demand strict adherence to OHS requirements before the business is able to access finance. This would ensure that organisations with a high number of reported fatalities, injuries and incidents would lose out on much needed funding - thereby incentivising their improvement of health and safety practices.

Private equity investors scrutinise management’s attitude to OHS: where the business has the potential and willingness to improve, PE firms will be well-placed to positively impact the business over the long term through supporting the business on its road to improving its safety record and on-theground performance.

Source: WHO

UNLOCKING WFH EMPLOYEE WELLBEING AND PRODUCTIVITY

By Jessie Taylor

While remote working has been slowly becoming more popular, the global pandemic has made working remotely more of a necessity than ever before. But managing a team remotely can come with human resource challenges, such as ensuring employee wellbeing during stressful changes and anxiety around the pandemic.

The potential for increased productivity

Remote working has been a growing trend over the last few years. In the last five years alone, the number of those employees working remotely grew by 44%. This number soared dramatically under Covid-19, as businesses were forced to close under lockdown regulations.

While many businesses are fully operational, large portions of their workforces are still working remotely or spending only part of their workweek in the office – and would prefer to keep it that way. Recruiting firm Robert Walters’ 2021 Salary Survey found that as many as 40% of respondents said they would like to move to full-time remote working, while another 27% said they would want to work remotely at least 50% of the time during this year.

The survey also estimated that some companies had been fast tracked to flexible working by as much as five to 10 years. The shift to remote working has brought some benefits to businesses. The Remote Working in South Africa 2020 study found that the move to working from home had improved productivity in almost a third of companies polled. Companies that had a digital transformation strategy in place before the pandemic increased productivity to 70%. This increased productivity was seen despite less than 40% of South African businesses being ready for remote working when it became mandatory.

The report added that South African trends mirrored the figures being recorded around the world. The study said companies that had transitioned seamlessly, such that 38% of the study’s respondents, said they would allow staff to continue working from home.

Improved business communications

Alongside improved productivity, many professionals have found personal growth and increased happiness through remote working. One such example is that half of the professionals in the 2021 Salary Survey said they had improved on their business communication in a way that office working would not have encouraged. This improvement was primarily attributed to virtual presentations, over-the-phone discussions, and video calls to conduct business. But as workplaces explore this new way of working, HR professionals also have to adjust.

Team members may face challenges such as distractions or isolation while adapting to new technology and changing processes, and it falls to HR professionals to find solutions to this.

Facing remote working challenges

Some of the most common challenges expressed by employees are a lack of in-person supervision – where employees feel as if they don’t have access to managerial support and communication; a lack of access to information; social isolation; and distractions at home.

Fortunately, research is being carried out to pinpoint ways organisations can adapt to the new normal of working. One of the ways to address some of the challenges faced by employees is through communication. This includes creating structured check-ins with

employees and providing different communication technology options that go beyond email. Along with this increased communication, HR professionals will need to relook at their rules of engagement – employees will need guidance on how to navigate these new technologies. For employees experiencing isolation, it may also help to have regular social interactions –this can vary from creating a space to talk about non-work items at the start of a meeting or virtual team building sessions.

Support in holistic approaches

Another critical aspect to consider is employee wellness. More than ever, a holistic approach to employee wellbeing is needed – this includes physical, emotional, mental, and spiritual wellbeing.

Future Workplace’s The Impact of the Coronavirus in the Workplace survey found that many have trouble switching off from work because of the increasingly blurred lines between work and personal life. Around 42% of people reported poor sleep compared to only 29% of those who worked at their employer’s premises. Future Workplace referenced data from VPN providers, which found employees were working longer hours, and often logging on between midnight and 3:00 – a trend that had not been seen before Coronavirus.

This focus on employee wellbeing is especially important, as people grapple with anxiety in dealing with the Coronavirus. While working from home has the potential to boost revenues and increase employee productivity, HR professionals will need to look to ways to transform their internal policies to ensure employee wellness and communication remain at the core of the organisation.

HAPPINESS = PRODUCTIVITY

By Decent Nyoni, Marketing Manager at Profmed Medical Scheme

Throughout my career, I’ve witnessed how the people who are most passionate about what they do, the companies they work for and the customers they serve, are also the most productive. Workplace satisfaction, happiness and productivity are inextricably linked.

I’ve always viewed culture as a critical component in any successful business, because culture fosters and supports personal passions and aligns each employee’s values with the company’s vision and mission. I’m not alone in this belief. Leaders today are putting more and more of an emphasis on culture for this very reason.

Put culture first

Cultivating relationships across your business builds a strong culture. This can be achieved through team building exercises, bonding opportunities and simply creating a space where relationships are encouraged. Great cultures are achieved when people feel a sense of belonging and a shared purpose. In these environments, people want to add value.

Genuinely care about your employees

Most businesses say that their greatest assets are their people, but this sentiment doesn’t always filter down

to employees across the organisation. Every individual in a business should know that their direct supervisor, line manager and CEO cares about them. This cascades down from the top. If a manager feels respected and supported, they will care for their direct reports, who will in turn care for their colleagues. The result is a business that is aligned and working towards the same goals and people who are genuinely friendly and happy when they engage with clients.

People that are treated as individuals who have ups and downs, good days and bad days, days when they need support and others where they can offer support, relax when they’re at work. They feel safe, and the result is that they will treat your business as their own, because in a very real way, it is.

When the Covid-19 pandemic hit and remote working happened almost overnight, the companies with strong cultures and teams who felt cared for were able to make the shift seamlessly, supporting each other and working hard to keep the business going and customers looked after. We saw this in our own business. Despite the enormous challenges everyone was facing, as well as the fear and anxiety of the unknown, we put our heads down and ensured we looked after our members.

high achievers are fulfilled when they complete tasks and can grow and stretch themselves, and so it’s important to ensure your top-achievers are supported in this way or you will lose them to an environment that does challenge and fulfill them.

It’s equally imperative to support your core employees who aren’t necessarily your top achievers but who play important day-to-day roles across the organisation.

One of the best ways to do this is through training and development. Done properly, employees can discover their strengths, gain confidence, and upskill to advance their careers. They’ll also find greater purpose in the work they do because they can see the way their contributions positively impact the business, customers and the ecosystems you operate within. People want to contribute – we’re hardwired for it – so build an environment that helps them to add value and understand the impact they’re making.

Figure out what drives individual employees

The acts of giving and receiving gratitude actually produces serotonin, so a business culture built on reward and recognition directly translates into a company that is filled with happy, productive people.

Enact an open-door policy

An open-door policy creates a culture in which employees are comfortable approaching management for questions and support. This allows employees to provide candid feedback, which then helps employers to keep an eye on potential concerns. while establishing with employees that they are cared for and that their opinions are valuable.

Start right by making hiring more personal

Culture is not a destination. It needs constant nurturing, particularly as new people enter an organisation. However, as much as you will onboard new hires into your culture, it’s always better to start with people who align to the company’s values. If that value isn’t shared, it will be almost impossible to motivate an individual.

Give

your

employees meaning and they will feel fulfilled

I personally know that I’ve achieved the most when I’ve relished what I was doing. Incentivised, goal-orientated,

Everyone is inspired and incentivised in different ways. For some people, the promise of a bonus will motivate hard work. For others, it’s reaching specific career goals or self-development. Most people respond positively to being acknowledged and thanked for the work they do. It’s a small but powerful habit that makes people feel seen and appreciated.

Make interviews personal. Ask questions that delve into a candidate’s ambitions, ideals and how they view the world. Ask them how they will contribute and what work means to them. Each new hire that can align with your purpose strengthens your culture.

KING IV AND THE 'G' IN ESG

By Brondwyn Douglas, Senior ESG Officer, Spear Capital

ESG has proven resilient even among listed investments, where ESG funds have tended to be overexposed to the technology companies that have seen significant falls this year and underexposed to the fossil fuel companies that have seen the biggest gains this year.

Technology companies tend to bring together progressive values, an assetlight approach, and sophisticated HR processes that monitor things like diversity as a matter of course. That makes them a natural fit for ESG purposes.

Investors view ESG as a viable way of achieving returns while having a positive impact on society and the planet. And with a growing number of institutional investors, including pension funds putting strict ESG guidelines in place, it only makes sense for companies of all sizes to meet those guidelines.

While the environmental and social aspects of ESG are relatively easy to measure, governance is not monitored nearly as closely in the South African small to medium enterprise (SME) space as it is among listed companies. But SMEs should care deeply about governance, not only because it makes them a better investment prospect but also because it can help foster a smoother growth path and reduce the chance of falling foul of regulators later on.

Investors in the SME sector have a role to play too. They can help SMEs put the proper governance structures in place to ensure the best possible outcomes for everyone concerned, easing the investment process and setting themselves up for an exit later on.

The consequences of bad governance

Before looking at how SMEs can set themselves up for good governance, it’s worth looking at what some of the consequences of bad governance are. You don’t have to look far to find examples of those consequences either. In late 2022, the collapse of FTX, the world’s second-largest cryptocurrency exchange, dominated business headlines around the globe. The evidence of poor governance that emerged as a result of investigations into the company’s collapse has been nothing short of astonishing.

It was revealed, for instance, that managers at FTX used emojis to approve payments and that company funds were used to buy houses in employee names. There also doesn’t appear to have been an official company roster,

making it impossible to know how many people actually work for FTX. So chaotic were things at the company, that new CEO John Ray III, said that he had no confidence in its financial statements.

Beyond that, Ray (who was previously on the team charged with rescuing Enron) provided the following scorching feedback:

“Nearly every situation in which I have been involved has been characterised by defects of some sort in internal controls, regulatory compliance, human resources and systems integrity. Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here.”

As a result of this endemic chaos, investors (some of whom probably should have known better) have lost billions of dollars.

If that’s what bad governance can do at one listed company, imagine the damage widespread bad governance could wreak in the SME sector. After all, SMEs represent more than 98% of South

African companies and employ between 50 and 60 percent of the country’s workforce across all sectors.

Following corporate prescripts

Fortunately, South African SMEs have easy access to an incredibly valuable resource when it comes to putting good governance principles in place and avoiding the fate of FTX and Steinhoff. The King IV Report, compiled by the King Committee, aims to provide businesses with best practices and guidelines for corporate governance. In doing so, it aims to, “encourage organisations to see corporate governance not as an act of mindless compliance, but something that will yield results only if it is approached mindfully, with due consideration of the organisation’s circumstances.”

Following, as it does, many of the precepts set out in UK governance guidelines, recognised by many as among the most thorough in the world, King IV is an invaluable tool for any business looking to improve its governance.

King IV defines corporate governance as the exercise of ethical and effective leadership by the governing body towards the achievement of the following governance outcomes:

• Ethical Culture

• Good performance

• Effective control

• Legitimacy

Whereas its predecessor, King III, had 75 principles for organisations to follow, King III has reduced those to 17, with one applying to institutional investors only. That makes for a simplified, but still effective, guide to governance. For SMEs, especially those operating with an ESG lens, perhaps the most relevant of those is Principle 4.

It states that:

“The governing body should appreciate that the organisation’s core purpose, its risks and opportunities, strategy, business model, performance and sustainable

development are all inseparable elements of the value creation process.”

Putting the right structures in place

Once SMEs have familiarised themselves with the principles laid out in King IV, they can ensure that they put the right structures in place. What those structures look like will depend, at least in part, on where an SME is in its growth journey.

Early on, for instance, the focus should be on ensuring that leadership roles within the organisation are clearly defined. You don’t, for example, want the CEO clearing payroll one month and the CTO doing it the next. Of course, it’s absolutely fine to have fail-safes in place, but everyone should be aware of their evolving roles and responsibilities as the organisation grows.

Later on, when the organisation is looking for funding or to take on debt, it can set up a Board. That Board should, from the outset, be diverse and representative in terms of race and gender.

Another area where SMEs can start putting the right structures in place early on is disclosure. Proper disclosure involves making customers, investors, and any people involved in doing business with the company aware of pertinent information. It’s particularly important for businesses with an ESG focus or which are seeking out investors who operate with an ESG lens. If a business isn’t fully transparent in its disclosures, it can’t get an accurate rating, jeapordising the chances of a complete investment deal. In other words, governance sets the tone for a business’ environmental and societal initiatives. Given that European investors increasingly require disclosure, it’s something that SMEs should get right from the start.

The positive role investors can play

Even with a resource like King IV and the right structures in place, SMEs may still struggle with some aspects of governance. Here, private equity investors have a significant role to play. Most private equity

firms have strict sets of governance guidelines they have to meet. Between advisory boards, investment councils, and various other measures, they’re well set to help out portfolio companies with governance.

That’s especially true for investment houses with international funding or which look to set up portfolio companies for international exits. They likely know the governance requirements in those territories far better than their investees and can guide them through the process. It’s part of being a partner investor that empowers and capacitates investees, rather than simply providing capital and hoping for substantial returns.

As such, private equity investors (particularly those investing with an ESG lens) should actively look for governance opportunities.

Governance only becoming more critical

As the world of business realigns to focus on impact, rather than purely on profit, ESG and governance in particular are becoming increasingly important. By focusing on best practice from the start, it becomes ingrained into the company’s culture. That in turn means that the step-up needed for every additional governance requirement is easier than it otherwise would be.

This means that the company is a more attractive investment prospect and can finalise investment deals far quicker and smoother than would otherwise be the case. And, as international investors increasingly put strict ESG requirements in place, that can be a significant competitive advantage.

Ultimately then, it should be clear that the days of viewing governance as a simple box-checking exercise are long gone. Instead, it should be seen as something that’s not just good for business in general but which is good for every business, no matter how big or small it is.

DRIVING AN ENABLING ENVIRONMENT FOR SUSTAINABLE VALUE CREATION

By Shameela Soobramoney Chief Sustainability Officer at the Johannesburg Stock Exchange

As a conduit between buyers and sellers in the financial markets, the Johannesburg Stock Exchange (JSE) is well positioned to create an enabling environment for sustainable value creation, with the ultimate goal of reducing socio-economic and physical climate risks, while contributing to better financial stability and supporting the transition to a low-carbon economy.

To this end, as Africa’s largest stock exchange, the JSE is committed to the consistent advancement of sustainable practices in business, while also integrating sustainability across its value chain by guiding its markets on the key role that environmental, social and governance (ESG) disclosure plays in investment considerations.

There has never been more urgency or need to drive engagement and advocacy in relation to sustainability by leveraging our vital role as a conduit between business and investors. However, we do this in conjunction with the provision of tools and investment instruments that facilitate responsible investing and reorientate capital flows to increased sustainable development.

To help achieve this, we launched our Sustainability Segment in July 2021, thus giving companies a platform to raise debt for green, social and sustainable initiatives in a trusted, global marketplace. The Sustainability Segment makes it accessible and easy for companies to list and trade sustainability-related instruments to raise funds for activities

directed at sustainable development. The Sustainability Segment was the result of the expansion of the JSE’s Green Bond Segment into a platform where interested issuers can n addition to green bonds, list Social, Transition Bonds, Sustainability Bonds. These sustainable finance instruments are used to raise funding for environmental or climate-related as well as social projects with expected favourable environmental and social impacts.

In December 2021, Nedbank listed a R1.09 billion Green Bond on the JSE, whose proceeds would be used to fund green residential developments. The Bond was floated on the JSE’s Sustainability Segment. Similarly, First Rand Bank earlier this year listed two sustainability

bonds to finance and refinance borrowers looking to invest in green buildings and affordable housing projects. The two bonds have a total value of R2 billion, and are part of a long-term programme to raise R72 billion for FirstRand’s sustainability projects. These are but two examples of the rising capital flow towards sustainability projects and climate action

The need for climate financing in Africa has never been more urgent, especially because it is a region that is most vulnerable to the catastrophic effects of climate change, such as the recent instances of droughts and flooding experienced in the country. A pressing necessity is for capital markets to close the funding gap between the climate action and sustainable development financing needs of developing countries, and the funding promised for these endeavours via various international climate funds and the like. This cannot happen with private market participation.

In addition to providing the financial instruments to fund sustainable projects, just as important is creating a broader enabling environment for sustainable development, especially in light of the pressing needs to meet the 2030 agenda, and the fast evolving global regulation and guidance. To facilitate this, the JSE released its Sustainability and Climate Disclosure Guidance in June this year to promote transparency and good governance by guiding listed companies on best practice in environmental, social and governance (ESG) disclosure. The guidance is based on a combination of global best practice and local relevance to simplify ESG disclosure for companies in a context of several frameworks, guidelines, standards and ratings in the market. It takes an “impact” view and hence relates every indicator to a clear rationale for why the associated practices are meaningful in relation to achieving the aims of sustainable development.

Yet, we cannot drive sustainable development meaningfully without embracing South Africa’s just transition framework to maximise the social and economic opportunities presented by climate action, while minimising and carefully managing potential challenges that can arise.

Enabling a just transition by harnessing climate financing will be key to mitigating socio-economic impacts such as job losses and migration, which is a crucial consideration across the African region. In light of South Africa’s high unemployment figures, retaining jobs will be critical during the transition away from fossil fuels. However, financing must also be in place to compensate for jobs that will be made redundant or those that will be relocated across the fossil fuel value chain. These are key needs that must be addressed through climate action financing if we are to see a just transition.

One of the main themes that emerged from the Climate Change Conference (COP 27) in Sharm El Sheikh, Egypt, is for the critical need for developed nations to deliver on their promises for climate financing for developing economies to enable them to shift away from fossil fuels. That real climate action is now a matter of urgency was succinctly underscored by UN SecretaryGeneral António Guterres, who issued a stark warning at the opening of COP 27: “Humanity has a choice: co-operate or perish. It is either a climate solidarity pact, or a collective suicide pact.”

The summit also thrust a spotlight on the growing concern about the increasing debt burden being placed on developing countries, as many receive climate

funding in the form of debt financing. If we consider that South Africa already has R4.7 trillion debt on its balance sheet, any additional debt obligation will need to be very carefully considered. However, we can also not afford any further delays in the implementation of South Africa’s Just Energy Transition Investment Plan (JET-IP), which was approved by the government at the beginning of November and announced at COP 27 by President Cyril Ramaphosa.

The plan names the priority sectors for projects funding and implementation as green hydrogen, the decarbonisation of the energy sector and the switch to electric vehicles. However, President Ramaphosa warned that an additional R1.5-trillion would be needed within the next five years for the JET-IP to be implemented. A portion of this funding is expected to come from international funders while the balance will be financed locally, and implementation action will be driven in no small part by the private sector.

The JSE plays a pivotal role in creating an enabling environment for better sustainability practices to become entrenched in the markets we serve and facilitate the flow of capital to support the aims of sustainable development and resilient markets and economies. A sustainable business ecosystem is key to supporting the transformation of the economy through a just transition to a better future for us all.

ESG - IT PAYS TO START

By Tom Marsicano, CEO of ‘and Change’

E nvironmental, social, and corporate governance (ESG) isn’t just a buzzword for large corporations. Decades before it entered the current business lexicon, ESG was already a key investment factor for many, whether you called it ‘ethical investing’ or ‘corporate social responsibility ‘. But more conscious strategies are a massive trend right now, with ESG becoming intertwined in financial decisions, brand identities, and organisational mission statements. But this isn’t just a fad – and it’s making its way to markets around the world. Across Africa, we are seeing a rise in ethical investment. South Africa was the second country (after the United Kingdom) to formally introduce the Code for Responsible Investing in South Africa as far back as 2011.

Organisations are becoming more socially and environmentally conscious, and you can see it from the top down. The Johannesburg Stock Exchange recently delivered draft climate and sustainability disclosure guidelines,. South Africa’s own ESG disclosure rate (for rating purposes) has been lauded by The Responsible Investment and Ownership Guide. So yes, ESG is here to stay.

South Africa has always been a forerunner in implementing radically transformative business policies. I would argue that BEE (Black Economic Empowerment) and its current iterations are a brilliant example of

how legislation can affect social change, and I suspect it has laid the framework for many transformative ESG strategies.

However, putting more conscious strategies in place is far from easy for even the largest organisations. Hence, it makes sense that change management skills would be crucial in developing and implementing them. KPMG recognises that at the centre of every ESG program is change management.

“Businesses now have the opportunity to design strategic change agility into their operating model, develop new products,

expand into new markets, forge new alliances, and transform the organisation’s performance. To be successful in this new paradigm, it is necessary to not only manage change but also improve the organisational structure, how people are developed, and how the culture is curated,” a recent report read.

These various developments are at the centre of what we do as change agents.

With global research revealing that 78% of board members and senior executives acknowledge the value of solid ESG performance and business transformation, change management can assist business leaders in becoming more purposeful entities.

All sustainability and social impact work are effectively change-management because managers have to be able to take care of both the technical and people side of these major changes. I mean, suitable technology must be in place to implement a change (structured process, toolsets, assessments and measurements).

However, equally important are the leaders in an organisation who establish why these transitions are necessary so that the change is adopted with minimal resistance. When it comes to something as relevant as ESG, the best leaders will work with their teams to create their strategies, determining what is important to them and

how the organisation can build towards these goals (part of what we change managers call sponsorship). Perhaps it’s reducing carbon footprints, being more financially transparent, and more diversity and inclusion across the company’s teams and processes. By asking what the team values and keeping them informed of these new processes, they’re less likely to resist even the most significant changes. In essence, change managers across all units in an organisation should have the skill sets to engage in these conversations and build these strategies.

organisations should be aware that they can participate in effecting change. It’s understandable that SMMEs (small, micro, and medium enterprises) are already seeing lower profits during an economic recession and may not be keen on implementing more conscious business strategies. But more conscious companies attract and retain more talent, improve their reputation, attract more investor interest, and lower risk overall in terms of health, safety and even litigation.

It pays to start – even if you must start small. At and Change , we’ve already noted a substantial reduction in our carbon footprint after switching from in-person training to online. It’s fundamentally changed the way we work, but we’re recognising the benefits and helping those we advise implement similar changes.

Smaller organisations may soon see more reasons for being socially and environmentally conscious. Experts believe that tax incentives will play a major role in driving ESG investment. Other fiscal policy measures will ultimately affect market prices and make sustainable business more affordable – and profitable.

It sounds like a costly investment, but it’s been proven that ESG thinking effectively improves efficiency and profitability for organisations of any size. ESG isn’t just for large corporate entities. Even smaller

When these incentives become a reality, there will be no excuse. As leaders, organisations, and society, there is an opportunity to become more sustainable and socially aware. Let’s seize it.

MAKING PROFITS WHILE MAKING A DIFFERENCE THE CASE FOR ESG

By Shaw Mabuto, Partner at Spear Capital

While consumers concerned about their impact on the planet are more likely to support companies with sustainable goals, investors are increasingly demanding that the companies they back meet environmental, social, and governance (ESG) standards too. In fact, ESG assets are on track to reach US$53-trillion by 2025. Notably, pension funds (which control vast amounts of capital in many jurisdictions) are increasingly demanding sustainability from their portfolio companies too.

The most investor-friendly companies going forward will be the ones that lead the way when it comes to ESG. A 2020 study found that 60% of sustainable funds outperformed the market over 10 years.

This is not because they are giving investors what they want. It’s because, fundamentally, ESG principles are what makes a good company. By serving the environment, looking after the social good, and exercising good governance, they’re setting themselves up for longterm success so long as they’re producing products that consumers genuinely want).

With the right backing, innovative companies across the African continent can grow successfully while at the same time making the world a better place and providing returns to their investors. According to the 2019 Morningstar Sustainability Atlas, companies in South Africa have levels of ESG compliance on par with those in Italy, Belgium and Australia.

This is not to say that every ESGfocused company is guaranteed to succeed. Even with all the right policies in place, a company can still make products that don’t resonate with changing consumer wants and needs.

It’s therefore imperative that investors choose funds with experience and a strong record when it comes to backing fundamentally strong ESG companies. Additionally, they should steer clear of only relying on ESG funds that invest in listed companies.

Private Equity (PE) funds, for example, are often capable of identifying companies which have a potentially strong proposition and are more focused on taking a hands-on approach to their success. Without the vagaries of the stock market to deal with, they can take a long-term approach which benefits both the companies in their portfolio and their investors. PE firms are geared not only to generate returns for investors but also to contribute to the overall well-being of the companies they invest in.

As Africa’s most developed economy, South Africa fares particularly well when it comes to carbon risk, carrying levels on par with those of Switzerland, the Netherlands, Denmark, Sweden, Belgium, France, and the US. While ratings will vary across African countries, many South African companies operate across the continent, indicating a widespread willingness to embrace sustainability. It’s also true, however, that as basic

ESG standards become norms, companies will have to take additional steps when it comes to demonstrating their commitment to sustainability. Adopted in 2015, the Sustainable Development Goals (SDGs) are a universal call to action to end poverty, protect the planet, and ensure that by 2030 all people enjoy peace and prosperity. When it comes to achieving those goals, the UN calls on businesses to play their part too.

While there are those in the business world who’ll argue that taking an SDG-focused approach presents unnecessary obstacles, Spear Capital believes that it can provide stronger businesses, economies and societies. Businesses can only gain by better serving and supporting the communities they operate in and by taking a long-term view informed by sustainability.

As people, corporations, and countries look to improve their environmental and sustainability credentials, they will flock to the companies that allow them to do so.

Sources: Financial Times | Morningstar

ESG INVESTMENT OPTIONS WHERE DO YOU START?

By Chantal Marx, Head of Investment Research at FNB Wealth and Investments

The incorporation of environmental, social and governance (ESG) factors into investment decision-making has grown in importance among institutional investors over the last decade, with retail investors starting to take note. But what exactly does ESG investing involve? And where do you start?

ESG investing is a form of social and sustainable investing, means looking beyond “just profits” and “how future-proof a company is” in 30 years’ time? ESG investing is a means of investing sustainably by considering the impact that companies have on the world around them (the environment and social impact) and how they are being managed (governance) and investing in companies that take ESG factors into account. ESG investing is investing in socially responsible businesses.

For example, for a South African mining company to be considered an ESG investment it should practice good corporate governance and protect its shareholders, not pollute water resources, ensuring it is not a source of water pollution, have plans for a rehabilitation programme for when operations reach end of life, and employ and empower women and historically disadvantaged individuals.

Will the mine make the lives of people living in surrounding communities better by bringing employment, infrastructure and sustainable growth to the area … or will it bring migrant labour, a ruined environment, and long-term community health issues?

Am I giving up on performance with an ESG investment?

It has been shown that companies considering the E, the S, and the G tend to do better than companies that do not. In South Africa, ESG strategies have outperformed the JSE over the past decade.

MSCI South Africa ESG Leaders Index versus the JSE All Share Index (total return)

Source: Bloomberg, FNB Wealth and Investments

Let’s look at the mine example again. If the company is focused on ESG issues, odds are it will avoid major industry pitfalls.

• E: Renewable, self-generation of electricity will result in a reduced carbon footprint, lower electricity costs in the long term, and fewer disruptions, thereby improving production, sales, and profitability.

• S: A good relationship with labour communities on and surrounding the mine will mean that the probability of wage strikes and communities targeting the mine during times of unrest declines. Again, resulting in fewer production delays.

• G: A well-balanced board following best governance practice will ensure proper oversight, ethical operations, and ensure shareholders are protected. This will result in strategy being well considered, which may see the mining company avoid bad investments or miss improprieties that could lead to financial loss.

The mine will also be more likely to maintain its mining licence or be granted exploration permits and new mining rights if it takes these issues into account – ensuring that it is around for many more years into the future. At worst, taking these factors seriously may not see your investors perform better than the market but could help you avoid “bad” investments. Here, major public lapses on the ESG front could have offered some red flags to investors in the past. Take Steinhoff as an example – a very low tax rate is a major warning sign that something is cooking, but because this meant that the company was showing higher profits, even professional investors largely glanced over it.

Where to start?

It is a difficult and onerous process to self-identify companies that have a strong ESG focus and, equally important, a track record of implementation. Investing in exchange-traded funds (ETFs) provides a simple solution. Internationally, there are many listed ETFs and exchange-traded notes (ETNs) that focus collectively or individually on the E, S and G. On the JSE the options are still limited but thankfully growing. These ETFs and ETNs will provide exposure to companies that have been carefully selected based on how well they are executing on the E, the S and the G.

• Satrix recently listed its Inclusion & Diversity ETF , which ultimately tracks JSE-listed companies that meet a specific set of ESG criteria including diversity, inclusion, people development, and news and controversies.

• The Sygnia Itrix S&P Global 1200 ESG ETF invests in global securities meeting S&P sustainability criteria. Satrix also has ETFs listed on the JSE that track global and/or emerging market companies with good ESG scores.

• The FNB Social Responsibility ETN provides exposure to the MSCI World SRI Low Carbon Select 5% Issuer Capped Index. The index invests in global companies that have low carbon exposure and high ESG performance.

Another more direct route to incorporating ESG into your portfolio is to look at companies, ETNs or ETFs that are actively investing in industries of the future. This includes companies engaging in environmentally conscious industries such as water and renewable energy, and in areas such as infrastructure, a social good.

• The Satrix Infrastructure ETF listed last year. It tracks the FTSE Global Core Infrastructure Index, offering investors exposure to worldwide listed companies involved in “core” infrastructure activities.

• Sygnia’s Itrix 4th Industrial Revolution Global Equity ETF tracks the performance of companies set to become the behemoths of the future.

• The FNB Global Water ETN (WWETNC/WWETNQ) tracks the iShares Global Water UCITS ETF.

• The FNB Clean Energy ETN (EGETNC/EGETNQ) tracks the iShares Global Clean Energy UCITS ETF.

CLIMATE CHANGE WILL IMPACT HOW INSURERS RE-EVALUATE RISK AND PRICING MODELS

By John Melville, Chief Underwriting Officer at Santam

Since insurance first started centuries ago, premiums have been determined on the basis of client risk profiles, with insurers pooling risk across large numbers of clients to take advantage of the laws of large numbers.

It has always been imperative for insurers to ensure that their premiums reflect clients’ individual risk profiles because otherwise their risk pool would attract higher-risk clients and repel lower-risk clients. When it comes to property insurance (e.g. buildings and contents), companies such as Santam embrace technology to ensure that premiums are fairer and better differentiated between clients. Geolocation or geocoding technology allows insurers to more accurately weigh the risk of a property based on its location. With this information, insurers can generate more accurately priced policies. The World Bank’s Climate Change Knowledge Portal states that fires, floods (caused mainly by storms) and drought have recently given rise to significant social and economic losses in South Africa. This year alone, the severe flooding and landslides caused by heavy rainfall in April resulted in 448 deaths, the displacement of over 40 000 people and the destruction of over 12 000 homes in KwaZulu-Natal.

Fires have also caused major damage over the last few years and seem to have increased in frequency and intensity, from the devastation caused by the fires in Knysna in 2017 to the devastating fire on the slopes of Table Mountain above the University of Cape Town in early 2021.

These natural disasters are expected to increase because of climate change. In fact, fire, flood and drought have been identified as the three primary natural hazards facing South Africa, impacting

our economy and having a major effect on the insurance industry. This has been compounded by the devastation caused by the COVID-19 pandemic.

While natural disasters and even pandemics are not under our control, using technology to assess risk is revolutionising insurance.

Geolocation as a risk mitigation tool for insurers

Increasingly, insurers are implementing location-based underwriting to identify the geographic, location-specific risk profiles of the properties that they are insuring. In fact, this is fast becoming an essential requirement for all types of insurance.

Similarly, insurers having to deal with declining municipal infrastructure risk can attempt to mitigate their exposures by collecting an array of related geolocation-based information about the areas that they insure.

Properties that are in low-risk locations will continue to be insurable on normal terms, while those in higher-risk areas may become increasingly difficult to insure, or lead to higher excesses, higher insurance premiums, and/or additional expenses to meet special risk mitigation requirements imposed by insurers.

Geolocation technologies also have other benefits. During the height of the COVID-19 pandemic, Santam secured an agreement with the National Institute of Communicable Diseases (NICD) to use some of its data to better understand the spread of the pandemic. This simplified the requirement for clients to provide proof of the occurrence of the pandemic within a certain radius of their premises, and enabled the fast-tracking of business interruption claims, saving clients time and effort.

Global impact and losses

With the increasing prevalence of disasters affecting many countries around the world, so too is the prevalence of higher economic losses. When it comes to insurance, the sad reality is that only a small fraction of these losses are insured, with the so-called ‘risk protection gap’ falling on individuals, communities, and governments.

The new EU Adaptation Strategy highlights that affordability and insurability of natural catastrophes is likely to become an increasing concern. In fact, research shows that in the past, only a quarter of the total losses caused by extreme weather and climate-related events across Europe were insured. This strategy also outlines the need for improved climate projections. Unless measures are taken, the rise of these types of climate-related disasters will further widen the related protection gap.

It will be important for governments and insurance and reinsurance companies to work together to protect vulnerable individuals and businesses who are unable to access affordable insurance in future. There are many examples of public-private partnerships around the world that facilitate access to subsidised insurance e.g. FEMA, the National Flood Insurance programme in the USA, Flood Re in the United Kingdom, and the African Risk Capacity (ARC) Group in Africa.

The need for resilient environments

Another important driver of human and economic losses arising from these hazards relates to the resilience of the environments where people live and work.

This includes the quality of public infrastructure and laws, ranging from stormwater drainage, land-use and urban planning controls, fire-fighting capabilities, and environmental management in general. Environmental management considers factors such as foredune management to prevent ocean flooding, riverbank vegetation and estuarine management and the removal of exotics that burn at high temperatures.

Impact on insurance

The insurance industry has been impacted significantly by the increase in these hazards. Santam’s flood and storm damage claims from the KZN floods reached over R4-billion this year alone.

Key impacts include:

• Increasing (re)insurance premiums: Globally, reinsurers are cutting back on the capacity that they make available for catastrophe reinsurance, with the pricing for the capacity that they do provide increasing. This inevitably must be passed on to buyers of property insurance.

• Insurance may become unavailable in some instances or more restrictive in others, with insurers making greater use of location-based geo-analytical tools to assess the local flood, fire, and other risks. These analytics will be used to exclude certain types of cover in high-risk areas or impose high excesses in certain locations.

Preparation is key

By anticipating, preparing and recovering, the insurance industry can better manage the impact of these severe weather hazards.

Essentially, insurers such as Santam aim to provide clients with cover on a sustainable and appropriate basis, which requires that sufficient premiums are collected to pay claims.

Expert risk assessments of properties that are particularly exposed to perils such as floods and fires are vital. Based on these, an insurer may require its clients to take action to improve the protection or resilience of their properties in the event of a catastrophe

A catalyst for economic recovery

Insurance is a powerful catalyst for economic recovery after a natural disaster and this has powerful implications for economies around the world. Economies that are uninsurable can suffer permanent damage after natural disasters and can end up in long-term economic stagnation because of it.

Society has a powerful interest to work together to ensure physical resilience so that the mechanism of insurance can be put to work. It has also been shown that insurance-led recoveries tend to be far quicker and more efficient than government-led initiatives to recover from a disaster.

Insurers using geolocation tools to re-evaluate risk and pricing models are changing the face of insurance. Location technology is not only valuable when accessing and managing risks, but also has an enormous role to play in managing insurance claims and even in detecting and minimising insurance fraud. This really is the future of insurance, and Santam is proud to be spearheading this in South Africa.

MANAGING ESG RISKS FOR YOUR BUSINESS

By Asavela Lumkwana CA(SA), Agile Capital Associate

The development, execution, and reporting on the impact of ESG strategies is becoming a norm for business. ESG is a great tool for identifying relevant risks that can threaten the bottom line of a business. We need to look at ESG through the lens of what opportunities it can reveal within the market. When talking and assessing ESG, one must break it down to its subcomponents to fully understand the holistic objective of addressing Governance, Social and Environmental issues.

Out of the debates at COP26 in 2021 came the Glasgow Climate Pact that focused on steps that must be taken to ratchet down on the use of coal and other fossil fuels. What was most interesting to note from the convention was the $8.5-billion package of grants and concessional grants that were provided to South Africa to help speed the transition away from coal. This presented a material business opportunity for entrepreneurs to focus on Green Energy which in turn would also alleviate the pressure on the overstretched Eskom grid.

These developments further highlight that the focus on ESG has the ability not just to change communities for the better, be used as a risk assessment tool but it also is an avenue for new investment and business opportunities.

Social

The S in ESG is one that tends to get overlooked when talking about ESG. The central question of Social is how businesses can better manage their relationships with the internal staff and external communities.

COVID-19 has put a spotlight on how businesses manage their relationships with staff. Employee mental wellbeing has been at the forefront of managing working conditions and staff morale but only to those businesses who

understand the role they need to play towards their staff.

The up-skilling and development of a diverse pool of employees is also an important aspect of the Social considerations, steadily becoming crucial to business growth. Shown to improve not only staff morale but overall business performance – staff retention and diversity has an impact on bottom line earnings. Part of being a sustainable business means being able to attract, develop and retain a diverse range of top talent.

A White Paper by Cloverpop has found that inclusive teams make better business decisions up to 87% of the time and they make decisions twice as fast within half as many meetings. Similar research has been done by the Harvard Business review and McKinsey with similar conclusions.

Governance

South Africa has among the best standards globally for corporate governance thanks to the King reports, and with King IV addressing sustainable development and corporate citizenship, companies are now seen to be accountable and responsible for business decisions.

The PwC Global Private Equity Responsible Investment Survey 2021 states that ultimately, the governance of both firms and portfolio companies will determine the value creation strategies that are being shaped to meet the challenges of our changing

world. As articulated well by Piyush Goyal: “The speed of decision making is the essence of good governance”.

Conclusion

The SAVCA Private Equity Industry Survey which speaks to how Private Equity firms are creating value indicates that 80% of respondents are in agreement that there is an increase in discussion around the importance of ESG in the sector, although further actions are needed to implement these while creating value. ESG information and performance is directly related to revenue and costs – whether it’s waste or water usage, or sustainability within a supply chain. By monitoring how organisations manage these variables, companies are able to continually fine tune and improve performance in these areas. We believe that ESG is able to drive returns and that being proactive about ESG can be a source of competitive advantage.

WE’RE ALL CONNECTED ACTING LOCALLY AND THINKING GLOBALLY

By Abigél Sheridan, Founder of Chic Mamas Do Care and Love it Again

The concept of sustainability as we know it today came to light in 1987 in the famous Brundtland Report produced by several countries for the UN. It was defined as meeting ‘the needs of the present without compromising the ability of future generations to meet their own needs’.

For the first time, a concept had been established to relate humanity’s development with the need to manage resources in the best way possible. This meant a very important change in terms of sustainability, mainly ecological. It also represented something extremely important – framing it in the economic and social context of human development.

As a student back in 1999, when sustainability was still a buzzword, I debated that third world environmental degradation had its roots in the structure of the world economy. Today, we have a better understanding of the depth of the matter and no business or any human activity should be done without considering the impact of its action on the sustainability scale.

Sustainability is now the driving force of our existence and the survival projection of our species; ‘act locally, think globally, and think locally, act globally’ became all and the same. Our interconnectedness and our natural world are undeniable.

Global warming, destruction of natural resources, deforestation, desertification and soil loss, and diminishing land and water productivity result from the Industrial Revolution and human demand exceeding environmental support capacities. Continued population growth will also cause increased poverty and famine since

productivity is exhausted on land. Humankind has been irresponsible for its actions and has been careless regarding long-term living conditions, keeping the basic elements of life alive (water, earth, air, etc.).

Is this still the case in 2022?

International Environmental Agreements and Sustainable Development Goals (SDGs) are in place to tackle the problems now more than ever. The UN is implementing integrated solutions across the globe to respond to complex development challenges and accelerate progress towards the SDGs. The key elements are integrated policy and programming, innovation and learning, data and analytics and financing. A collaborative network of policies and players are connected via sophisticated systems.

Where do we develop?

Development must mean eradicating extreme poverty and hunger. Living

in Africa, we have to rethink our values and our self-sufficient local systems to meet the needs of the people. Surely western industrial development cannot be the goal, at least not in the old sense. With the advancement of technology and the impact of newly developed innovations, with some clever incentives and leadership management, Africa can lead sustainable solutions for many sectors within economies: renewable energy resources, advanced technological revolution, waste management systems, organic farming, to name a few. Sustainability sounds much closer to us if we understand the relationships between our ‘natural assets’ and the way forward.

The four pillars of sustainability

Social, Economic and Environmental factors have long been key to sustainability; human capital joined the list. It may be one of the most important as the health and well-being of individuals plays a vital role in a healthy community and paves the way for future generations.

Investment in a highly evolved education system and knowledge/ skill-based programmes positively shape our lives. “Human sustainability encompasses the development of skills and human capacity to support the organisation’s functions and sustainability and promote the wellbeing of communities and society” (RMIT University 2017).

Improving social equality, economic sustainability, environmental conservation and protection of the global ecosystems are all interlinking visions for future generations. But isn’t it the individual who is the central driving force of the sustainable development of any nation? Can any vision be realised without the greatness of the people?

The UN Sustainable Development Program identified 17 goals, which are important to consider for the future of our planet and the growth of humanity. These are:

1. No poverty

2. Zero hunger

3. Good health and well-being

4. Quality education

5. Gender equality

6. Clean water and sanitation

7. Affordable and clean energy

8. Decent work and economic growth

9. Industry, innovation and infrastructure

10. Reduced inequalities

11. Sustainable cities and communities

12. Responsible consumption and production

13. Climate action

14. Life below water

15. Life on land

16. Peace, justice and strong institutions

17. Partnership for the goals

These are the blueprint for peace and prosperity for our people and planet. All members of the United Nations adopted this Agenda (2030 Agenda for Sustainable Development) in 2015.

The questions are: how seriously are we taking these commitments for the future of humanity as a whole without seeking ‘selfish’ interests? And can we create strong and lasting partnerships on a global scale where we keep these goals in sight, for our human family to evolve together.

Sources: United Nations

CLIMATE CHANGE IS DRIVING UP PRICES - WHAT CAN BE DONE?

MEET SANJEEV RAGHUBIR

KEY TAKEAWAYS FROM THIS PODCAST:

• Climate change has a direct and indirect impact on climate change, such as driving up prices

• Large business can play a role in supporting vulnerable communities from the impacts of climate change

• The floods in KZN have opened up more conversations about climate change

• “Look at your materiality in terms of a business”

• Businesses need to constantly look for opportunities to make operations more sustainable

• The UN Sustainable Development Goals set a good standard for doing good business

• Companies who are on a net zero transition need more support from policies and regulators

Sanjeev Raghubir is leading the Shoprite Group’s environmental and social sustainability efforts, bringing with him an appreciation for the impact they can have on development and business practices. A speaker at the Old Mutual Future of Sustainability Summit, Sanjeev holds multiple degrees, including an MBA and began his career at the CSIR, as an environmental engineer.

In this Business Unusual Podcast, Tonie Samkange, CEO of ThePRHouse, speaks to Shoprite Group Sustainability Manager, Sanjeev Raghubir, about the effect climate change has value chains, the lessons Shoprite has learned in their sustainability initiatives, what large business can do to help communities to deal with climate change and what the future holds for value chains.

• Sustainable practices like recycling open up opportunities for large business to drive economic activity by supporting the informal sector

Sanjeev’s job is to establish a sustainability strategy and implementation plan for the biggest retailer in Africa, the Shoprite Group, to minimise its environmental footprint across its value chain. Sanjeev started his career at the CSIR where he worked as an environmental engineer. In 2003 he moved to Nestlē South Africa as the Corporate Safety, Health and Environmental Sustainability Manager, looking after this portfolio in the Southern and Eastern Africa region. Sanjeev holds a degree in chemical engineering, an honours degree in environmental engineering and an MBA. He’s passionate about environmental and social sustainability, and believes that all business and all development should be conducted with particular focus on sustainability.

FIVE REASONS

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