STAKEHOLDER ENGAGEMENT

We subscribe to a partnership approach in the way that we conduct our business. So as to develop and nurture positive relationships, we strive to engage constructively with our key stakeholders via formal and informal channels and through scheduled and ad hoc interactions.

While our shareholders are primarily concerned with value creation, government and local communities look to us to create direct and indirect job opportunities, improve community infrastructures and protect the environment. Our stakeholder process is therefore underpinned by management’s responsibility to remain visible and accessible to all stakeholders, and we will continue to emphasise open and transparent dialogue in order to anticipate trends and make changes where possible to the way we operate.

OUR STAKEHOLDER UNIVERSE

Our Board accepts its duty to present a balanced and understandable assessment of the Group’s position in reporting to stakeholders, and the greater demands for transparency and accountability regarding non-financial matters. The quality of the information is based on the principles of openness and substance over form. The integrated annual report seeks to address matters of significant interest and concern to all stakeholders and to present a comprehensive and objective assessment of the Group, so that all stakeholders with a legitimate interest in the Group’s affairs can obtain a complete, fair and honest account of its performance.

Key stakeholders

The table below sets out the Group’s key stakeholders, how these engagements are undertaken and the key issues pertaining to them.

STAKEHOLDER TYPES OF ENGAGEMENTS INTEREST AND KEY ISSUES
Investors
–Shareholders, BEE
partners, investing
community and banks
Company announcements published in the press, on SENS and posted on the RCLFOODS website
Annual General Meeting
CEO and CFO engagement with financial media
Communication with shareholders and investment analysts:
  Press announcements
  Trading updates
  Investor teleconference
  Ad hoc meetings on request
  Conferences
Integrated annual report
RCL FOODS website
  • Financial results – relevant and timely reporting
  • Sustainability of the business
  • Strategic priorities, growth markets and plans BEE
  • Key market conditions and forecasts
  • Key growth areas
  • Business risk management
  • Operational performances and opportunities
  • Trading outlook
  • Engagements with bankers in respect of the Group’s potential funding requirements
Consumers
  • Consumer care line
  • Surveys
  • Media campaigns
  • Consumer immersions
  • Websites
  • Product/brand experiences
  • Positive brand experience
  • Ethical and non-collusive business practices.

    (Refer here for the further information on consumers)
Business partners and customers
  • Conferences/workshops/functions
  • Surveys
  • Advertising
  • Product/brand awareness campaigns
  • Interactions via email/websites
  • Site visits
  • Newsletters
  • Interaction of dedicated sales teams with specific customer groups
  • Call centre operations
  • Price
  • Service
  • Customer solutions/requirements
  • New product/service development
  • Organisational improvements

    (Refer here for more information on business partners)
Employees
  • Group newsletters
  • Company newsletters
  • News boards
  • Intranet
  • Tip-offs Anonymous confidential hotline
  • Open-door policy with management
  • Road shows
  • Leadership and senior leadership engagement sessions
  • Work-team engagement sessions
  • Employee contracts
  • Routine and specifically scheduled functional and cross-functional meetings
  • Workshops and training sessions
  • Conferences
  • Emails/letters
  • Create awareness on new processes, technology and continuous learning
  • Accessibility of key information across the entire business
  • Establishment of a talent management framework ensuring that skills and competency profiles are in line with requirements, incorporating recruitment, assessment and selection, employment equity and BEE considerations, career pathing, succession planning, leadership development, staff development/training, employee retention, performance management and leadership development
  • Implementation of a formal integrated safety, health and environmental risk management system to promote workplace safety

    (Refer here for further information on employees)
Trade unions
  • Meetings with management and representatives
  • Meetings with employees
  • Recognition/cooperation agreements
  • Wage reviews
  • Working conditions
  • Employee benefits
Local communities and municipalities
  • Support of local charities, partnering with local schools and other CSI projects
  • Company newsletters and advertising
  • Sponsorships and the promotion of community events and organisations
  • Regular meetings with municipalities and civil organisations
  • Community upliftment
  • Partnership opportunities
  • Local business investments
  • Employment opportunities
  • Sustainability impact
  • Training opportunities
  • Participation in the Carbon Disclosure Project
Government and political (national government, provincial government, SARS and other regulatory/industry bodies)
  • Regular meetings with relevant authorities
  • Participation in key industry bodies (see Participation in Industry bodies here)
  • Audits and inspections
  • Foreign government engagements
  • Road Freight Associations
  • Ports Authorities (Durban and Maputo and other regions)
  • Associations: Maputo Corridor
  • Environmental issues
  • Use of scarce resources
  • Creation of employment
  • Compliance with relevant standards and legislation
  • Transparent disclosure of levels of compliance
  • Tackling industry issues
  • Interactions and support of key industry bodies
  • Commenting of policy proposals
  • Forming partnerships to grow the economy and for better futures for society
  • B-BBEE
  • Reduction in value chain cost engineering
  • Service
Media
  • Advertising
  • Announcements
  • Press releases
  • Share price updates
  • Engagements when strategic and newsworthy events occur
  • Company sponsorships and community engagements
  • Brand communication
  • Promotions
  • Community updates
  • Financial results
Suppliers
  • Direct relationships with suppliers to enable partnerships
  • Meetings
  • Workshops
  • Vendor audits are conducted where necessary
  • Service level agreements
  • Collaboration on synergistic Group procurement policies
  • Joint customer and supplier meetings and workshops
  • Fair procurement principles
  • Sustainability impact
  • Reduction in value chain cost engineering
  • Price
  • Service
  • B-BBEE Status
  • Product Supply Innovation


PARTICIPATION IN INDUSTRY BODIES

As a Group we have active representation on and/or interaction with the following key industry bodies. A complete list of industry bodies is available on the RCL FOODS’ website at www.rclfoods.com.

INDUSTRY BODY KEY INTERACTIONS
Animal Feed Manufacturers Association (“AFMA”)
  • RCL FOODS is involved in AFMA with representatives serving on the AFMA board of directors. Quarterly board meetings are held with the intention of improving the quality and impact of feed manufacturing companies in South Africa and handling any issues that affect, or may affect, the industry and its associated members. There is special focus on food and feed safety. The board is made up of senior members from the feed milling industry and includes the major players as well as some of the smaller companies. Various sub-committees have been set up to proactively handle various issues and topics with regards to technical, trade, training and other issues. Representatives from the Group serve on these committees and meet on a regular basis to debate and give recommendations on various topics.
Consumer Goods Council of South Africa (“CGCSA”)
  • The CGCSA, established in 2002, is an organisation that represents the entire consumer goods industry and lists all products with GFSI. The CGCSA facilitates engagement between stakeholders (such as government) and the industry. RCL FOODS is one of 12 000 member companies participating in exhibitions, meetings and forums.
Institute of Packaging South Africa (“IPSA”)
  • IPSA is a non-profit organisation dedicated to the development of the art and science of packaging in South Africa. It represents the interests of its members in this country. IPSA is a full member of the World Packaging Organisation (“WPO”). Rainbow’s Packaging Development Manager is a full IPSA member and attends speaker evenings, workshops, seminars, conferences and annual general meetings. Membership provides access to information from the WPO and global best practices.
Packaging Council of South Africa (“PACSA”)
  • This voluntary industry body has members in three broad categories – converters, who are the revenue generators in the industry; associates or raw material suppliers; and affiliates, being customers and major recyclers. PACSA represents views of its members on national issues with particular focus on environmental matters.
South African Sugar Association (“SASA”)
  • SASA promotes sound and sustainable environmental practices within the industry in line with national legislation and international requirements. This is achieved through knowledge transfer of sugar cane environmental research, including the development of best management practices; through the South African Sugar Research Institute; support of environmental committees located in the sugar cane producing areas; and collaboration with organisations such as the World Wide Fund for Nature. These interventions promote and facilitate sustainable environmental management.
South African Veterinary Council (“SAVC”)
  • Rainbow’s national veterinarian is actively involved with setting board examination question papers (poultry diseases and management) for veterinarians who qualified outside South Africa and wish to register with the SAVC in order to practise in South Africa.
The South African Poultry Association (“SAPA”)

In February 2014, Rainbow resigned from SAPA for reasons explained in the 2014 report, but has retained its representation on the following SAPA sub-committees:

  • Animal Welfare Sub-committee
    A Rainbow representative sits on the animal welfare committee and has drafted a document on “Culling of adult breeders on a farm during the grow-out period” and "Action to take in the event of emergency during transportation of chickens”. The committee consists of consulting veterinarians from broilers and layer industries plus one state veterinarian. The role is to advise SAPA on different aspects of animal welfare.
  • Animal Disease Sub-committee
    The committee consists of all members of the animal welfare sub-committee plus two state veterinarians. The role is to develop a national poultry disease management plan for DAFF.
  • SAPA Food Safety Committee
    Rainbow is represented on this committee where issues with regard to food safety were discussed during the year. Formulation of industry regulation of Independent Meat Inspection and Flavour enhancement is in progress. Furthermore, contributions were also made to the SAPA code of practice, auditing system/body for the industry and cold chain code of practice.
World Veterinary Poultry Association
  • All four veterinarians are members of the association. In 2012, the South African branch won the bid to host the world congress in Cape Town in 2015. Rainbow’s Dr Ntseki is a member of the local organising committee that presented the bid in Mexico and prepared for the 2015 congress that was held in Cape Town.


PARTNERING FOR GOOD

Our customers are managed by multi-disciplinary teams – from sales and marketing to new product development, safety, health, environmental and quality (“SHEQ”), engineering and finance – who ensure that our relationships with these parties are managed in the most efficient, professional and ethical manner. We are committed to ethical and non-collusive business practices.

Independent, accredited auditors conduct announced and unannounced audits at all processing facilities to verify their compliance with regard to food safety, product specifications and quality. These customer audits include, but are not limited to, compliance with the following customers' requirements:

  • KFC
  • Nando's
  • Massmart
  • Steers
  • Wimpy
  • Pick 'n Pay
  • Woolworths
  • Spar

CONSUMERS

Consumers are becoming increasingly proactive with regard to issues such as health and safety, farming practices, animal welfare, product safety and product labelling. We regard these issues as critical to our business and address them in a variety of ways. For further information on stakeholder engagement, refer here.

STAKEHOLDER CONCERNS BUSINESS RESPONSE
Product quality and safety

The Group demonstrates its commitment to product quality and safety through:

  • Appointing product inspectors, processing and engineering personnel to ensure safe products which comply with defined specifications
  • Appointing SHEQ teams to verify processing, food safety, legal and quality compliance by conducting audits
  • Adopting integrated management systems and tools which are used to monitor, trend, verify, validate and report facility standards, equipment standards, processes and activities that impact on processing performance, food safety and product quality
  • Cold chain maintenance during processing, warehousing and transport
  • Ensuring that raw materials, ingredients and packaging materials are traceable, with mock recalls being conducted
  • Compliance with ISO 22000 and FSSC 22000 requirements
Labelling
  • The Group is committed to adhering to labelling regulations
  • Labelling conforms to the regulations in the Foodstuffs, Cosmetics and Disinfectant Act, No 154 of 1972 and complies with R146 and Agricultural Product Standards Act, No 119 of 1990, including regulation R946 and R988
  • Supports the Consumer Goods Council of South Africa (“CGCSA”) and Global Standards (“GS1”) in listing of all products with GS1
  • Labelling of all saleable units with EAN-13 barcodes and cartons with ITF-14 barcodes
  • Carton label reflects production batch number, case number, production date and use-by dates
  • Suppliers of packaging material with pre-printed barcodes are obliged to comply with GS1 standards
Farming practices (Rainbow)
  • The Group subscribes to the British Poultry Council’s Assured Chicken Production Programme that sets the highest standards for the nutrition and welfare of poultry
Animal welfare (Rainbow)
  • Animal welfare audits are conducted by independent accredited auditors throughout our agriculture discipline to verify compliance with animal welfare requirements
Bird housing (Rainbow)
Birds are reared in environmentally controlled houses or temperature controlled and ventilated opensided houses
Birds are able to roam around with free access to feed and water within the houses
By housing the birds the Group mitigates the risk of the birds coming into contact with any wild birds and their faeces, both of which could be carriers of disease
Stocking density of each house on a farm is determined by the floor space of the house and the equipment within the house
Access to all farms and houses is regulated by strict bio-security measures that include
  use of security personnel to control access to farms
  fences around all farms and chicken houses
  personnel shower on entry and exit and wear company garments and gumboots
  footbaths are present at all doors to houses
Feed
  • Feed raw materials are controlled by the Fertilizers, Farm Feeds, Agricultural Remedies and Stock Remedies Act, No 36 of 1947
  • Feed raw materials are mainly maize and soya based ingredients with vitamins and proteins added to ensure the development of healthy flocks
  • Feed formulations are specified by internal nutritionists
  • Raw materials for feed are supplied by reputable accredited suppliers only. New materials are fully tested prior to being approved for use. Internal raw material analysis verifies the Certification of Analysis (“COA”) or Certification of Conformance (“COC”) submitted by suppliers with each batch of raw materials delivered to the feed mills. Raw material microbial status is verified for each batch and salmonella-free feed is supplied. Raw material traceability is tested by conducting mock recalls
Animal health
and safety
(Rainbow)
  • Flock treatment is controlled by the Medicines and Related Substances Control Act, No 101 of 1965
  • Medication, dosages and method of application may only be prescribed by Group veterinarians and withdrawal periods are strictly monitored
  • The Group maintains a “human list” of medicines to eliminate use of human medicines for flock health to protect consumer health
  • Notifiable disease management teams ensure maintenance and verification of the notifiable disease prevention and action programme
  • Animal welfare audits are conducted
  • SPCA regularly inspects the processing plants to ensure that the processes and practices are humane.
Halaal status:
Rainbow




Foodcorp
Chickens are slaughtered by Halaal slaughterers and all ingredients used for Rainbow brands have Halaal status
Inspectors from the South African National Halaal Authority (“SANHA”) and from the Muslim Judicial Council (“MJC”) ensure that all practices are in accordance with Halaal standards
Inspection from the MJC and Islamic Council of South Africa (“ICSA”) ensure that all practices are in accordance with Halaal standards at the following divisions:
  Pieman’s
  Speciality
  Grocery
  Baking
Consumer insight
  • Marketing and product development teams ensure that the Group develops and markets competitive brands at competitive prices
  • The Group keeps abreast of national and international trends, through research and consumer interactions within a variety of target markets

CONSUMER COMPLAINTS

Each subsidiary has a Consumer care line for consumers to give feedback on their experiences with our products. There is personal contact with consumers by designated personnel who manage complaints. All complaints are logged onto complaints databases, tracked, trended and communicated to the business to minimise reoccurrence. Reports are shared with relevant teams and executive management at management reviews. In 2015, Rainbow Farms responded to 99,6% of complaints within 48 hours.

Interaction and engagement with consumers take place through different channels managed at business unit level, as illustrated below:

    Systems used Consumer engagement  
     
Division Business unit Excel Application System Letter Email Consumer call line Twitter Company website HelloPeter .com Other
Consumer Rainbow    
  • In-store Vector Sales Solutions staff
  • Telephone calls
  • Staff shop
  • Group communication
  • Marketing
  • Sales representatives (Pie)
  • Fax (Speciality)
  • Telesales (Beverage)
  • Woolworths (Speciality)
Pie    
Grocery  
Speciality            
Beverage    
Sugar
&
Milling
Sugar      
Milling           Customer complaints received from sales representatives
Feed           Sales representatives
Baking         Sales representatives and truck drivers
Vector All        
  • Call centre
  • Telephone


Through these avenues the Group receives feedback from consumers covering complaints, compliments and queries. Complaints management is not standardised across the Group, therefore some have agreed response times and others don’t. This will be reviewed as we align processes.