CORPORATE SOCIAL INVESTMENT
Since 1918 AVBOB has stood firmly in the service of the people of South Africa due to the great need that exists for funeral insurance and services. As such AVBOB's total business is that of social responsibility which is borne out by our slogan: We're here for you.
AVBOB is highly committed to the social and cultural upliftment of the diverse communities it serves:
- Services has been taken to the people by opening branches in many previously disadvantaged areas.
- Annually a number of sporting events are sponsored.
- Emergency relief in cases of disaster is rendered.
- A number of cultural programmes are promoted.
- Training programmes are presented for staff throughout the country to improve standards and their quality of life.
- The donation of fully-equipped libraries to underprivileged schools.
CSI Policies and Procedures
Introduction
AVBOB has been in existence for almost 100 years and has over the years made countless contributions to charitable organisations and individuals. Over recent years the focus has however shifted to sustainable socio-economic development of the communities in which we operate. Just like many other companies around the world, we have accepted the responsibility to play a leading and positive role in building our society.
Corporate Social Investment (CSI) involves far more than the once-off donation to a worthy cause and requires strategies that are aligned with the AVBOB Group’s long-term goals and objectives. It seeks to improve and uplift the quality of people’s lives by making meaningful contributions and investments into their future.
By forming an integral part of the communities in which we conduct our business, we will endeavour to become good and responsible corporate citizens. We will invest substantially but responsibly through our newly established AVBOB Foundation and our CSI programme will be managed along clear and transparent criteria in accordance with recognised principles of good corporate governance.
The Purpose of the Foundation
The purpose of the Foundation is to ensure that CSI, which is considered a business imperative, is carried out in a proper, regulated and responsible manner to maximise impact and sustainable positive outcomes in communities where it is needed most. A secondary objective is to enhance our brand, both to our customers, other stakeholders and our employees.
Corporate Social Investment Guidelines
- General
AVBOB‘s board will allocate and award a percentage of the AVBOB Group’s net profit after tax (NPAT), in accordance with relevant sector Charter(s)/Department of Trade and Industry Code(s), as the budget to go towards our CSI initiatives. The funds will be managed and controlled by the Foundation’s CSI committee who will consider and assess applications for funding, approve certain projects (in accordance with its mandate and delegation of authority) and make recommendations to the Executive Committee (EXCO)/Board of Directors when required. - Composition of the CSI Committee
The CSI Committee shall consist of at least one senior manager (executive management level) who shall serve as the chairperson of the committee, a manager who will be nominated and appointment by EXCO, the full-time CSI Specialist and four other employees who will be nominated and elected by the employees from AVBOB Head Office. These committee members shall be appointed for a period of 12 months where after their nomination/appointment will be reconsidered and may be extended depending on the circumstances. The CSI Committee shall have the right to appoint ad hoc committee members to assist them with specific projects as and when required. - Delegation of Authority and Mandate
The CSI committee shall have the authority, in accordance with the “Delegation of Powers” policy, to consider and approve the funding of projects and/or initiatives up to R100 000 per project. Details of funded projects will however be presented to EXCO for noting.
All projects/initiatives exceeding R100 000 will be considered and approved by EXCO.
EXCO may decide, in certain cases, to refer an application for funding or project proposal to the Board of Directors for consideration and approval. - Fundraising Principles
The Foundation shall only fund projects that:- Adhere to sustainability principles in terms of funding and capacity;
- Adhere to best practice.
- Are related to:
- Education;
- Health and welfare/wellness;
- Socio-economic development.
- Adhere to accountability and good governance.
- Are aligned with AVBOB Group’s goals and objectives.
- Will enhance the image and reputation of AVBOB.
- Are capable of being assessed and measured to determine results in the short, medium and long term.
- Are aligned to the objectives of the AVBOB Foundation and are beneficial to the intended beneficiaries.
- Are not designed to benefit, alternatively to exclude any particular religious, cultural or political interest group.
- Are not associated with labour/trade union activities and/or political parties.
- Governance Principles
All applications for funding must be done in writing and contain information and documentary evidence as set out in paragraph 6.8 hereof.
All applications for funding of projects shall be formally evaluated and assessed by the CSI committee and their recommendations must take cognisance of the principles set out herein, the AVBOB Group’s policies and procedures, Financial Services Sector Charter, KING III, DTI Codes of Good Practice and statutory Regulations.
Funding will only be advanced to organisations if the CSI Committee and/or EXCO (depending on the monetary value of the project) are satisfied that all funding criteria have been met and written approval has been given.
In the case where the monetary value of the project exceeds R100 000 or where the CSI Committee/EXCO, for reasons determined by them, requires it, a formal agreement will be entered into between all the parties involved.
The CSI Committee will play an active role in the on-going/regular monitoring of funded projects and shall submit written reports to EXCO on a monthly and annual basis to ensure proper and responsible utilisation of the funds.
The CSI Committee shall keep proper records of all requests received, approved and declined and minutes of meetings held.
All CSI Committee members who is or may become involved in any CSI project at any stage should declare and disclose any potential conflict of interest to the committee without delay.
The CSI Committee should guard against undue influence or interference by any person, both internally and/or externally, and no requests for funding other than those received on the prescribed form (see point 6.8 below) and in accordance with the prescribed procedure for submission of applications should be considered. All employees and business associates should be advised that personal referrals, on behalf of an institution, charity, school, NGO etc. are considered inappropriate. Any person who becomes aware of such an institution, charity, school or NGO that may be considered for a donation or financial assistance should advise the potential recipients/beneficiaries to follow the aforementioned procedure and refrain from becoming directly involved in the application to ensure the integrity of the CSI Committee’s processes. - Other Important Strategic and Operational Guidelines
- Integration
Although cognisance should be taken of the Governing Principles described above, our aim is to engage CSI participation from every level of the organisation by:- actively seeking employee and community involvement opportunities;
- effectively communicating these projects via appropriate communication channels;
- actively encouraging all stakeholders, including our own employees, to get involved.
- AVBOB Foundation and CSI objectives The AVBOB Foundation intends to accomplish the following in the communities which we operate:
- To focus our funding and attention on projects that will have long lasting impact or effect in communities that are financially disadvantaged;
- To involve all stakeholders within those communities through proper consultation;
- To assist and empower individuals and groups within communities to become self-sufficient;
- To create working models that can be replicated in other areas or communities.
- Resource allocation
The AVBOB Group commits to direct and indirect financial investments in responsible initiatives and activities and will allocate funds to worthy causes throughout the course of every financial year. - Tax exemption
Beneficiaries will not be required to have a Section 18A status, which provides for the deductibility of donations made to certain public benefit organizations. However it is preferable that a potential beneficiary has a Section 18 A status. - Sustainability
The Foundation will prefer to support projects that are striving towards selfsustainability and the parties involved should agree on timelines and completion dates to ensure that projects become sustainable after a fixed period of time. Applicants and potential beneficiaries should also be informed hereof as a condition for funding. - Fund allocation
Portfolio weighting
The CSI Committee should develop benchmarks for fund allocation to ensure effective social investment. The following portfolio weighting maybe used as a guideline:
Primary projects: between 60% and 70%;
Secondary projects: between 20% and 30%;
Ad Hoc donations: up to 10%. - Employee community involvement
The AVBOB Group encourages employees to get actively involved in CSI projects which may be in the form of:- Cash/Payroll deductions: Direct debits, tithes, gifts, donations;
- Direct involvement (ie offering time and labour) in community projects: Individuals are encouraged to engage in a range of projects within the community they serve or live;
- Team Challenges: staff may become involved in projects and may do so as a department or specific interest group;
- Time off from work to be involved in the aforesaid will be arranged with the appropriate line managers and supervisors as and when the need arises.
- Applications for funding and beneficiary selection
All applications for funding must be submitted in writing on the prescribed form (reference number 80532) and format required and approved by the CSI Committee. The following information must however be acquired in all cases:- Name and contact details of the individual or organisation requesting CSI assistance;
- A detailed description of the project;
- Details regarding all other institutions (eg NGO’s) involved;
- Details of the stakeholders and intended beneficiaries;
- Planned or proposed objectives and outcomes;
- Realistic and comprehensive budget;
- Plans for sustainability;
- What form of assistance is required from the Foundation?
- Financial details, bank details and tax exemptions etc.
- Evaluation
The CSI committee must assess and evaluate applications by taking the following criteria into consideration:- The nature of the project and project model;
- Project sustainability;
- Transparency;
- Quality controls and management;
- Accountability/Responsibility;
- Alignment to AVBOB Group strategies, vision, mission and values;
- Level or extent to which the project addresses community issues or problems;
- Project viability and acceptability;
- Level and extent of community involvement and support;
- Level and extent of risks involved; expected contributions from various other role-players or stakeholders;
- Costs and other financial considerations;
- Possible reputational risk or risks associated with AVBOB Group image;
- Any other vital issues or considerations affecting the potential success of the project.
- Approval process
Applications for funding or requests will be submitted and considered by the CSI Committee. In the event where the committee requires more detail or a more in depth assessment or evaluation of the project, the stakeholders, beneficiaries etc, and the applicant(s) may be requested to make further presentations, arrange a site or physical inspection of the project. Once the committee is satisfied that no further inspections/assessment or evaluation is required, the application or proposal will be approved or declined and processed.
If the project is approved, the Foundation and other parties will enter into an agreement which shall include timelines and deliverables.
- Integration
- Voting process
- Each application for funding will be voted on by the members of the committee via a show of hands;
- Each member shall be entitled to one vote;
- In the event of an equality of votes, the Chairperson of the committee shall have the deciding vote or may decide to submit the application to EXCO in which case their decision shall be final.
- All resolutions passed by the committee must be minuted, signed by the chairperson and forwarded to all committee members.
- Quorum
At CSI meetings, three members, including at least one member appointed by EXCO shall constitute a quorum. - Resource acquisition
Should the need arise; the CSI Committee may request the temporary appointment of a specialist or consultant to assist them in executing their duties set out above. The cost of such consultant/specialist will be included in the project cost and form part of the overall budget. In the event where such specialist services will exceed an amount of R30 000, the committee shall obtain the permission of EXCO beforehand. - Recognition and advertising
Whilst achieving long lasting socio-economic developmental impact is the core objective, the AVBOB Group brand should receive some level of recognition for its CSI activities.
The CSI Committee should therefore consider ways and means to achieve this. The level and extent of the exposure will depend on the nature of the project and it may vary from a subtle display of the logo to extensive media coverage depending on the circumstances.
The Committee should also take cognisance of the importance of CSI communication and should, wherever possible endeavour to create awareness to social investment activities by regularly informing stakeholders.
CSI Reports must be produced on a monthly basis for consideration and scrutiny by EXCO. Other forms of internal communication such as the AVBOB Group newsletter will be utilised to keep staff members informed and involved. - Additional responsibilities of the CSI committee
- The CSI committee shall also be responsible for:
- The drafting and submission of the scorecard element of under the DTI Code(s) and Financial Services Sector Charter and reports to the Board of Directors;
- The preparation of the CSI insert in the annual report which will be included in the sustainability section of the Integrated Report;
- To review the charter/policy on an on-going basis and to submit proposed amendments to the charter/policy on an annual basis.