Transformation: A competitive Advantage?
While broad-based transformation and employment equity are moral, social and legal imperatives, they are also economic imperatives that have a direct impact on the sustainability of South African businesses.
“We know that meaningful socioeconomic transformation is essential to the future viability of South Africa, especially in relation to the levels of social and economic inequality that persist in the country,” says Andrew Skudder, Sustainability Director of Murray & Roberts.
As a corporate citizen and leader in the engineering and construction economy, Murray & Roberts is committed to contributing to a sustainable future for South Africa through its core purpose of delivering infrastructure to enable economic and social development in a sustainable way. The Group has achieved commendable progress in transforming all elements of its business – and this is reflected in its level 2 BBBEE rating.
s Murray & Roberts has black shareownership of 45,5% in terms of the construction charter, which includes the Letsema broad-based share scheme initiated in December 2005 to facilitate true broad-based black economic empowerment shareholding, consisting of:
- • the Letsema Sizwe Broad-Based Community Trust formed to benefit previously disadvantaged community groupings
- • the Letsema Khanyisa Black Employee Benefits Trust to benefit qualifying black employees and their immediate families for education and compassionate needs
- • the Letsema Vulindlela Black Executives Trust to benefit qualifying current and future black executives.
MANAGEMENT CONTROL & EMPLOYMENT EQUITY
The Group’s employment equity approach provides for equal opportunity and fair treatment in employment. While this enables compliance with South African employment equity legislation, Murray & Robertsemphasises diversity to maximise its talent pool, strengthen capacity and increase innovation by introducing different ways of thinking. An Employment Equity Framework with stretch targets has been adoptedand will be rolled out in FY2015. The objective of the Employment Equity Framework is to drive rapid transformation with the aims of recruiting and promoting a significant number of historical disadvantaged South African (“HDSA”) candidates, developing and achieving stretch employment equity plans, accelerated HDSA development and retention and affirming accountability for transformation with all leaders. 75% of South African-based employees are black, while 10% of all employees are women. Approximately 60% of all levels designated as management in the domestic market are black, and 12% women.
Murray & Roberts provides a wide range of training, learning and career development opportunities for its people. In the 2014 financial year, investment in formal employee training and development was approximately R259 million globally. In South Africa, R65 million was spent on training and development, 67% of which was spent on black employees.
The Group plays a leading role in addressing the skills deficit in South Africa through public sector initiatives, including the requirements of the Accelerated and Shared Growth Initiative for South Africa that govern its involvement in the power generation projects, particularly the Eskom power programme. PREFERENTIAL PROCUREMENT
Murray & Roberts is committed to the principle of supporting local economic development in the economies within which it operates with the aim of supporting Government and client localisation strategies.
The Group has made a significant investment in its plant and equipment over the past three years with a cumulative capital expenditure of more than R3,0 billion. This investment has created more jobs both directly and indirectly and provides a platform for future growth and economic development. Verified preferential procurement as a percentage of total procurement spend increased to 79% of the South African operations’ procurement expenditure of approximately R8,5 billion. Procurement from black women-owned suppliers improved significantly over the past several years to R714 million per annum respectively.
Considering that Murray & Roberts subcontracts between 70% and 80% of its building work, the company’s Enterprise Development Programme holds tremendous possibilities to sustain and grow many smaller and developing contractors. Murray & Roberts currently supports 24 partners. The extent of this programme spans financial support through direct funding, early payment and preferential credit terms, as well as extensive mentoring and business support assistance. The Group also provides business management and technical support to help build capacity and expertise. The total value of enterprise development initiatives across the Group was R71,8 million in 2013.
Murray & Roberts has a long track record as a good corporate citizen. For more than 50 years, the Group has engaged in social upliftment activities aimed at redressing inequalities of the past, while simultaneously supporting developmental objectives needed to sustain economic growth in the future. The Corporate Social Investment, the Letsema Sizwe Broad- Based Community Trust and the Letsema Khanyisa Black Employee Benefits Trust programmes serve as the conduits through which Murray & Roberts engages in community development and realises its goal of positively impacting on individuals, its employees and communities. The programmes are aligned with the overall business strategy, focusing on development in the core areas of mathematics, science and technology education and support for women’s empowerment, youth development, supporting people living with disabilities, orphans and vulnerable children, and promoting highperformance sports development.
LOOKING TO THE FUTURE
While significant progress has been made to transform our society and economy in the first 20 years of democracy in South Africa, imbalances and inequalities still exist. Murray & Roberts is committed to the ideal of improving the quality of life of all South Africans and will continue to use its resources where it can make the most impact in achieving these goals, as true transformation can only come from a culture and attitude dedicated to building a sustainable industry and economy together.
Limpopo is one of the poorest provinces in South Africa; it has a high rate of unemployment and a large community of unskilled workers. It was against this backdrop that Murray & Roberts decided to invest R27 million in a 6 000m² artisan training centre in Lephalale, close to the company’s operations at Medupi Power Station.
The training centre is providing skills to over 700 people from the local community who will become artisans skilled in rigging, welding and a number of other skills critical to the construction of Medupi.
It is a partnership between Murray & Roberts, the FET College in Lephalale, Gijima AST, which provides training, and the merSETA. Training at the centre is based on the Accelerated Artisan Training Programme (AATP) module which was introduced by the merSETA to address the skills shortage in the country. The course consists of 26 weeks of institutional training at the Tlhahlong Centre, followed by workplace experience at Medupi. Once completed, workers have access to a nationally recognised certificate of competency.
As the lifespan of a project is finite, local unskilled and semi-skilled workers at Medupi also have access to training programmes that prepare them for life beyond the project.