AVBOB Integrated Annual Report 2018

Economic performance Weak economic growth in South Africa and an uncertain political environment resulted in low consumer and business confidence. The weak economy, growing slower than the population meant that on average South Africans were getting poorer. Every measure of confidence trended downwards through most of the year. South African economists predict that households will remain under pressure due to rising fuel, electricity and food costs. As inflationary pressures are building up, a sharp rise in inflation can have a negative effect on demand and may lead to policy cancellations and increased costs. We braced ourselves for a difficult economic environment recognising that policy uncertainty as well as global economic factors were constraining growth in South Africa. Against this negative background it is a credit to the executive team that the Group produced a year of excellent results in very difficult economic circumstances. Social performance AVBOB has served South Africans from all walks of life for a century and we are committed to serving our people for decades to come. We believe that Corporate Social Investment requires more than a once-off donation to a worthy cause and must be aligned with the Group’s long-term goals and objectives. We are sincere in our endeavours to improve the quality of people’s lives by making meaningful contributions to and investments in their future. Just like many other organisations around the world, we have accepted the responsibility to play a leading role in building our society. Education is a societal issue and five years ago AVBOB decided to invest in the future of young SouthAfricans through the donation of fully functional container libraries to previously disadvantaged primary schools in all nine provinces of the country. When the library project commenced in 2013, our aim was to donate 10 libraries to schools in Gauteng. However, when we realised the huge need for libraries in schools, it was decided to increase the investment to 30 libraries. This was increased to 40 and during 2016, the number was again increased to 50. The donation of AVBOB’s 50th container library took place at Michausdal Primary School in Cradock in the Eastern Cape Province. We believe that the container library project will facilitate many other exciting new initiatives which will inspire the learners to read and to apply their newly acquired knowledge and skills. For our centenary year we decided to further invest in education and R150 million was set aside for the renovation, refurbishment and building of schools in all nine provinces. In terms of Black Economic Empowerment, the Group continues to invest in transformational infrastructure, affordable housing and small and medium black enterprises and provides discounted funeral services in disadvantaged communities. Furthermore, offices and service centres are continually being established to provide service and support and give rise to job creation. Our social performance is covered extensively throughout this Integrated Annual Report. Environmental performance Globally, the depletion of natural resources continues to place a strain on the environment and long-term business sustainability is a major issue. The Group recognises that it has an impact on the environment both directly and indirectly and is committed to preserving natural resources in its operations. We are committed to disclosure, transparency andmeasurement of our impact on the environment and 15