Sustainability overview

Extract from 2011 annual report

RMBH is committed to good corporate citizenship practices and organisational integrity in the direction, control and stewardship of the group's affairs. To the extent that it is possible, the directors of RMBH seek to ensure that this commitment is practised and reported on by the company's associate (FirstRand). This commitment provides stakeholders with comfort that the group's affairs are being managed in an ethical and disciplined manner.

This discussion is a limited overview from a RMBH perspective. FirstRand publishes a detailed sustainability review.

RMBH subscribes to a philosophy of providing meaningful, timely and accurate communication to its key stakeholders, based on transparency, accountability and integrity.

The direct stakeholders of RMBH are shareholders, analysts, employees, suppliers, regulators; government and civil society, communities and indirectly customers.

Shareholders

Communication

RMBH's communication practices are designed to allow investors to make decisions about the acquisition and ownership of shares. The company communicates formally with shareholders twice a year when it announces interim and year end results. These comprehensive reports are sent to all shareholders and are accessible on the company's internet site (www.rmbh.co.za). The chairman and chief executive officer meet with investors and investment analysts from time to time.

Ownership

Significant shareholdings are disclosed on page 121. An analysis of the RMBH share price and trading data appears on page 121.

Customers

FirstRand provides a comprehensive range of financial services to South African corporates and individuals. In this regard the integrity of its various brands, their image and reputation are paramount to ensure the sustainability of their businesses, FirstRand regularly engages with its customers to measure satisfaction levels and gain insight into their needs. FirstRand emphasis on innovation encourages new solutions for extending financial services to new markets.

In terms of the Financial Sector Charter, FirstRand is committed to providing financial services to previously disadvantaged communities.

Employees

RMBH together with FirstRand (collectively "the group") believe that employees have an important role to play in sustaining the positive performance of the group. The human resource strategy is to attract, develop and retain the best industry talent. We empower our people, hold them accountable, and reward them appropriately.

The group follows a practice of aligning employee remuneration with shareholders return. FirstRand's division operates across a variety of financial services activities, each with a distinct employment and human resources pressure. The group's remuneration policy takes account of the diverse needs of the group and the implementation of appropriate industry remuneration practices in accordance with the group's remuneration policy. During the current year special attention was applied to the effective application of the Financial Stability Board's Principles for Sound Compensation and the Financial Services Authority's remuneration code of practice.

Compensation consists of the following:

basic salary plus benefits; and, where appropriate,
annual performance related rewards; as well as
share incentive schemes.

Remuneration is based on individual and business unit performance. Annual remuneration reviews encompass all three elements. All employees are required to belong to a medical aid.

Employment equity

In line with the business philosophy of empowerment, each business unit in the group is charged with meeting its targets in terms of plans submitted to the Department of Labour as required by the Employment Equity Act. During the year steps were taken to achieve greater alignment between employment equity performance, talent management and skills development. During the year macro economic conditions continue to negatively impact employee growth which in turn negatively impacted the employment equity component of the group. The group, however, remains committed to the transformation process.

Employee wellness

The group is committed to the health and safety of employees and has implemented procedures to ensure optimal health and safety conditions for employees.

Of growing importance is the impact of HIV/Aids on the workforce and the South African economy in general. The group has adopted an HIV/Aids policy that is based on education, communication, counselling and confidentiality.

Suppliers

The group has established a set of procurement guidelines to assist in meeting their commitment to place business with BEE suppliers. FirstRand has developed a centralised procurement function, the principal objective is to improve the B-BBEE procurement spend and leverage efficiencies through economies of scale with improved coordination of procurement functions.

Regulators

The group is subject to the independent oversight of South African regulatory authorities. The group representatives interact with a wide spectrum of regulatory bodies, including the South African Reserve Bank, the Financial Services Board and the Johannesburg Stock Exchange. The relationship sought is one of compliance and constructive participation in committees with a view to ensuring that South African industry practice remains amongst the best in the world.

The group supports initiatives aimed at infrastructure development, the promotion of democracy and business and government dialogue. The group is represented on the council which oversees the implementation of the Financial Sector Charter.

Communities

All group companies are committed to uplifting the societies in which they operate through following sound employment practices and meeting the real needs of the communities.

FirstRand group companies contribute 1% of its after-tax earnings to the FirstRand Foundation which has, since its inception in 1999, contributed more than R800 million to various community upliftment programmes. In addition, staff in the group is encouraged to give of their time and skills in community related work.

Natural environment

The group is committed to reduce both the direct and indirect impacts its business activities have on the natural environment. Both direct and indirect impacts are regulated through application of relevant legislation, subscription to voluntary external regulations, and ongoing internal self regulation.