The group understands that its business is part of the greater environment in which we live, so our actions are shaped by national and international trends in sustainable development. DigiCore is a long-term business and this determines our actions as the group strive to be a responsible corporate citizen and respect the society and environment in which we operate.
The focus of the group going forward is to balance financial growth with our focus on people, especially staff satisfaction, while ensuring we remain committed to equal opportunity employment and stakeholder satisfaction. Sustainability forms the cornerstone of our values and is part of our board’s mandate. It underpins our approach to attracting, retaining and developing our people. It guides our actions in the contribution we make to preserving our environment. It drives our continued cost effective growth. In support of the vision and strategy on sustainability, the group has adopted the Global Reporting Initiative Framework.
The sustainability report has been prepared in accordance with GRI G3.1 guidelines. In terms of GRI reporting requirements, DigiCore has obtained external assurance and the application level C+ report is included in this report and available at the DigiCore registered office.
AWARDS
The ABI Research group operating from offices in North America, Europe and Asia has predicted in its recent analysis of quantitative forecasting of trends in global connectivity and other emerging technologies that Digicore/Ctrack will emerge as world leaders in the fleet management and logistics industry.
SOCIAL
The group human resources strategy and plan were developed, approved and implemented during the review period with six very specific goals:
• Increasing company and individual employee performance • Focus on customer care and ensuring new and existing customers have a positive experience • Training and developing all employees • Identifying and managing talent • Making a difference in our local communities • Automation and a focus on living green.
After identifying these primary goals, very specific and measurable objectives were allocated to each goal, indicating both short and longer-term targets.
Company and individual performance The group developed and implemented a performance management model with specific key performance areas. The first key performance area focuses on position-specific objectives, in other words it provides clear guidelines to all employees on the expected outcomes for each job. Secondly, the model provides for the independent measurement of customer satisfaction and valuable information on the customer experience provided.
During the previous financial year, a competency model was introduced and approved by the executive team, after which each position was analysed to identify the relevant competencies required by employees to meet objectives. The second phase of implementing the DigiCore performance management model will focus on rating employees according to identified and position-specific competencies or behaviours.The DigiCore performance management model will be implemented in the new financial year and will give management the opportunity to obtain a more detailed and specific picture of individual employee performance as well as a clear indication of training and development needs.
The final key performance area is focused on ensuring each individual employee’s personal training and development needs have been identified, after which a personal development plan will be finalized and approved for each employee.
Training and development
As one of the strategic objectives, training and development was identified as a priority for management and every employee in the group. During the review period, the Ctrack Training Centre was established in Gauteng where three qualified and experienced training officers will provide new and existing staff with various training courses. The focus for the year ahead is on the following areas:
• Technical training • Company-specific training such as standard operating procedures, systems and products • Soft-skills training with a focus on customer care, conflict management and problem solving.
The final training and development objective is supervisory, management and leadership training aimed at further developing current and future managers and leaders in the group. The DigiCore performance management model, together with improved recruitment and selection procedures, will greatly assist in identifying future managers and leaders, in turn facilitating succession planning and development of identified employees.
In preparation for meeting our objective to accredit the Ctrack Training Centre as a training provider with the relevant bodies, the team responsible for developing internal training material ensures that all new material is aligned to identified unit standards.
•Technical skills programmes • Auto-electrical learnerships
SOCIAL RESPONSIBILITY
As part of internal group social responsibility, the first programme to be implemented in the new financial year will focus on financial and budgeting education for staff. This is a unit standard-aligned programme developed specifically to educate individuals on managing their finances, budgeting, saving and preparing for retirement.
During the period under review, DigiCore focused its social responsibility on several community projects and charitable causes: • DigiCore actively supports underprivileged people living in the communities in which we operate. Our staff members are encouraged to take part in all initiatives in aid of those less fortunate. • DigiCore’s annual golf day in November 2010 raised R120 000 for Cotlands. • DigiCore recognises the need to support organisations such as Arrive Alive. We believe road-safety education initiatives assist in curbing accidents on South African roads and we contribute a monthly donation to this fund. Given that our customers operate in the transport industry and that our products have the ability to contribute to road-safety, supporting this initiative aligns the objectives of both parties. • Environmental sustainability is a key concern at DigiCore and our partnership with SANParks (the national body responsible for nature conservation) and its exclusive Mokhohlolo conservation experience continues. In addition, we have donated fund to WWF (World Wildlife Fund) to assist with various conservation platforms. • The group participated in the annual Absa casual day event, with employees collectively raising around R3 700 to support the fundraising project for people with disabilities. • In-kind donations of equipment and access to DigiCore fleet tracking systems were made to emergency staff at the 94.7 Cycle Challenge and Cape Argus Cycle Tour events.
Digicore made smaller donations to the following deserving charities • Rubica trust • D.A.N.C.E • SA Guide Dogs • Anne van Dyk Cheetah Sanctuary • Sports upliftment - junior showjumping, cycling • Oliver’s House • Wierdabrug Polisiestasie • Vrystaat Nasorg • National Sea Rescue Insutute • Blind SA • UDDI • The Association for the Aged • Westrand Fire Fighters Club • Customer Charity Golf days • Insurance Institute Cape • South African Community Fund • Girls and Boys Town • Westcliff School • Solidariteit Bursary • Association for the Aged
INTERNATIONAL WORK OPPORTUNITIES
We recently announced that certain specific international vacancies or opportunities will be made available to all employees in the group to assist in sharing knowledge and experience between various international subsidiaries. The initiative has been met with great enthusiasm from employees across the globe.
TRANSFORMATION, RECRUITMENT AND SELECTION
The group is committed to transformation. More specifically, the objective for the new financial year is to identify talented individuals from previously disadvantaged groups, both internally and externally.
Personal development plans will then be developed for identified employees to enable them to successfully apply for positions at all levels in the group.
Employment equity in the group is monitored by two separate committees, namely a transformation committee comprising executive and non-executive board members as well as an employment equity and training and development committee comprising employees of all races, genders and occupational categories.
To sustain our business performance into the future, we believe the profile of our employees at all levels should more accurately reflect the demographics of our country. The group has therefore further enhanced its black economic empowerment policy that contains an employment equity programme and various guidelines on developing previously disadvantaged individuals.
Equal employment opportunities are offered to all prospective employees without discrimination. These policies are designed to attract, motivate and retain quality staff at all levels.
The group has a zero-tolerance approach to any perceived or real discriminatory practices that may hamper the creation of an equal opportunity workplace and any reported or identified instances are thoroughly investigated and resolved. During the past financial year, no issues were reported.
Vacancies are advertised internally and existing employees are given preference wherever possible. If no suitable internal applicants are identified, the position is advertised externally using the same employment equity criteria.
Automation and living green
The DigiCore group is committed to protect the environment and living green. Accordingly, various initiatives were successfully implemented during the previous financial year. In addition, the following systems were developed and implemented to ensure that various human resources functions are paperless and completed electronically: • Performance appraisals • Personal development planning • Group training needs analysis • Various human resources filing systems.
These systems will result in significantly more efficient processes and procedures with a positive effect on the environment in terms of less waste.
* South African operations only
STAFF RETENTION
DigiCore is committed to creating a work environment that attracts and retains the right calibre of staff, admittedly any company’s most valuable asset. As a result, a retention strategy was developed with both financial and non-financial benefits.
The group employs approximately 1 000 permanent staff across the globe. DigiCore’s employees are fundamental to the sustainability of the business and, therefore, creating an environment conducive to attracting, developing and retaining talent is a crucial focus for the group.
All employees are remunerated fairly and equally with a guaranteed cash package and company benefits. Benefits paid to salaried employees include company contributions to medical aid, retirement funding and a group life scheme. Benefits paid to all wage earners employed by the group are regulated by the Metal and Engineering Industries Bargaining Council. Regular communication sessions are held with wage earners regarding their membership, benefits and rights associated with this representative body. Profit-share performance bonuses are paid to all levels of staff based on company, divisional and personal performance criteria. Key employees have ownership in the company by being allocated options in the share incentive trust.
HEALTH AND SAFETY
The health and safety of all employees, and the well-being of the communities in which we operate, are an important component of the group’s business practices.
DigiCore ensures that all our branches and fitment centres operate and adhere to the Occupational Health and Safety Act, 1993 (No 85 of 1993) and our manufacturing division adheres to ISO 9001:2008 standards. DigiCore’s health and safety policy as well as contingency procedures are very comprehensive and available for all staff to view in electronic format from their desktops. Staff are encouraged to go through these regularly to familiarise themselves with the detail. All permanent staff enjoy the benefit of joining the group’s medical aid scheme, for which DigiCore pays two thirds of the monthly premium. We also provide our staff with wellness days and eye-screening tests each year.
We provide fire extinguishers and first-aid kits to all vehicles in our workforce and go the extra mile to ensure our technicians conform not only to our standards, but also our corporate customers’ requirements, thereby ensuring we operate in a healthy, hygienic and safety conscious environment at all times.
During the year, we identified first aiders and health safety representatives among our employees and have provided the required health and safety training. No incidents were reported during the review period.
HIV/AIDS
The group acknowledges the seriousness of the HIV/Aids epidemic and is committed to creating a supportive and non-discriminatory working environment. Digicore continues to take a proactive approach, as the group fully understands the economic impact of this pandemic.
Cover and treatment for HIV/Aids is a prescribed minimum benefit for all medical aids in South Africa and our employees on medical aid enjoy coverage accordingly. Employees can access HIV/Aids counselling through the group’s medical aid scheme.
HIV/Aids training for all staff has been identified as a priority for the new year.
Communicating with stakeholders and the investment community DigiCore recognises the impact of its business on diverse stakeholders and is intent on delivering timely, consistent and transparent communication to all, including employees, shareholders, clients, suppliers, government and the communities in which it operates. The group is committed to a culture of open communication, both internally and externally.
We continuously ensure that, where practical, financial and nonfinancial information is accurately and timeously disseminated and that the group is positioned favourably. The following stakeholders are regularly engaged.
EMPLOYEES
Communication with all employees takes place frequently through the mediums of written memorandums, staff meetings and the new intranet. The group encourages operating companies to actively and regularly engage with employees. Various internal communication channels ensure employees’ information and communication needs are addressed.
No significant topics have been raised by employees.
SHAREHOLDERS AND INVESTORS
Communication with investors and shareholders takes various forms, primarily via the annual and interim reports and circulars published to shareholders. The board encourages shareholders to attend the annual general meeting, details of which are contained in this report, and shareholders’ meetings that may take place from time to time.
Regular investor roadshows and meetings are held with analysts and institutional shareholders after the release of financial results. Press releases are issued immediately on the release of important information. Further details on the group appear on our website, on the JSE Securities Exchange News Service and in the press from time to time.
No significant topics have been raised by shareholders.
SUPPLIERS AND CUSTOMERS DigiCore communicates regularly with customers and suppliers to add further impetus to the drive for sustainability.
COMMUNITIES
We continually engage with the communities in which we operate. More detail can be found under social responsibility.
ENVIRONMENT
Our environment policy
DigiCore is committed to achieving a real and sustainable positive impact on the broader community in which we live and work. We believe it is essential that both as a company and as individuals we should operate in an environmentally conscious manner. Our objective is to minimise the impact of our business activity on the environment, wherever possible. This includes ensuring our suppliers do likewise and that we persuade our customers to consider environmental matters wherever possible.
The group’s direct activities do not pose any threat to the environment in which it operates. The manufacturing division adheres to ISO 9001:2000 standards, which ensures that the work environment is healthy and safe.
A management review has concluded that DigiCore’s most significant area of impact on the environment is the use of natural resources. Our significant natural resource use includes power, water, fuel and consumables such as paper and IT equipment. We recognise our impact on the environment comes from:
• Electricity to heat, cool and power office equipment • Gas for heating • Travel by air, road and rail to visit customers and conduct internal meetings • Water in offices used for a variety of purposes • Resources such as paper • Waste including paper, plastic and consumable IT equipment.
Our objectives are to:
• Evaluate future energy use to see how we can use low-energy systems • Further enhance the fuel-management programme across our fleet operation to drive efficiencies and better manage use • Avoid unnecessary travel on business by using video conferencing and telephone communication where possible • Use the most environmentally friendly mode of transport, where necessary, consistent with business needs • Reduce overall resources consumed • Aim for a paper-free office culture • Use either recycled or certified paper (FSC or Forest Stewardship Council) for all hard-copy correspondence, wherever possible • Consider environmental criteria when choosing services and goods.
GREEN BUSINESS
DigiCore has adopted a fuel-management programme across its fleet to drive efficiencies across the operation. This involves managing consumption levels and using best-practice expertise to reduce our carbon footprint, including:
• Using fleet and fuel technology to achieve operational savings • Maintaining vehicle performance through effective maintenance and servicing procedures • Reviewing and managing kilometres per litre and tyre pressure • Encouraging improved driving behaviour to avoid speeding, hard braking, over-revving and vehicle idling • Optimising routing, scheduling and job allocation to reduce wasted mileage and improve fuel efficiency • Office buildings have started using the green range of cleaning products.
The DigiCore group product range contributes to green business through a range of initiatives summarised below.
Lead-free – RoHS compliant
RoHS (restriction of use of hazardous substances) is part of a growing wave of environmental regulations or green initiatives. The RoHS directive requires that six hazardous substances be removed from all electrical and electronic equipment:
• Lead • Mercury • Cadmium • Hexavalent chromium • Polybrominated biphenyls (PBBs) • Polybrominated diphenyl ethers (PBDEs)
Products destined for the European and UK market are RoHS compliant and carry the required labelling. Although the automotive industry is currently exempt, DigiCore’s policy is to be compliant.
DigiCore is also committed to making better use of energy at company sites, including a ‘close-down’ procedure where staff are encouraged to switch off lights, computers and air conditioning before leaving the office. In addition, reducing waste is a focal point for the company by reducing the amount of materials we use, reusing wherever possible, and recycling any waste.
WEEE
The waste electrical and electronic equipment regulations (the WEEE regulations) implement provisions of the European parliament and council directive on waste electrical and electronic equipment. This directive aims to prevent WEEE arising, to encourage reuse, recycling and recovery and to improve the environmental performance of all operators involved in the lifecycle of electrical and electronic equipment, by setting criteria for the collection, treatment, recycling and recovery of waste electrical and electronic equipment.
It makes producers responsible for financing most of these activities; retailers/distributors also have responsibilities in terms of the take-back of waste electrical and electronic equipment and providing certain information. Private householders must be able to return complete this type of equipment without charge. Producers will be required to finance the collection, treatment, recovery and recycling of their products when they reach end of life and become waste.
The directive came into force in August 2005 although some individual EU member country laws deviate from this date.
Although DigiCore subscribes to the WEEE directive, our distributors carry the responsibility for compliance. Our products have been identified with the prescribed labelling as per the directive.
HOW DIGICORE’S PRODUCTS ASSIST IN ENVIRONMENTAL SUSTAINABILITY
The main reason customers buy DigiCore’s fleet management products is to improve efficiency, particularly lower vehicle running costs and lower fuel use.
Vehicles produce CO2 emissions as a result of the fuel used. Ctrack monitors vehicles’ movements, speed, engine RPM, unnecessary idling and other details. Better control of these parameters reduces the amount of fuel used and therefore CO2 emissions. Ctrack also assists companies to reduce unauthorised use of vehicles and the result is less distance travelled and therefore less fuel used.
Ctrack software allows companies to specify CO2 emissions quantities by vehicle group as well as expected fuel consumption. Based on the distance travelled and the calculated fuel that would have been used, CO2 emissions values are calculated and reported.
Some examples of savings are: • Thames Water cut fuel consumption by 10% Saved 161,000 litres of diesel Reduced CO2 output by 429 tonnes • The Royal Mail cut fuel use by 10% in 8,000 vehicles Saved £4.4 million Reduced accidents by 20% Incidents of speeding dropped by more than 60%
In addition, recycled paper is used for all the litho printing for Ctrack and more than 20% of all our products used are supplied locally.
Packaging
Ctrack’s packaging uses minimal plastics and comprises at least 98% recyclable cardboard. The actual details of the packaging are as follows: Solo Cardboard 108g Plastic 0.9g = 99.17% cardboard Assist Cardboard 26g Plastic 0.4g = 98.5% cardboard
Carbon disclosure project
DigiCore is a registered participant in the project. We have completed the CDP6 questionnaire, where we provided information on various aspects of carbon emissions. Upon receipt of feedback further participation will be pursued.
DigiCore is successfully iso 9001/2008 accredited
ISO 9001/2008 is a quality management standard and monitoring system that helps both product and service organisations achieve standards of quality that are recognised and respected throughout the world.
Since 2002, DigiCore has upheld its standards and has again been accredited. Our association with ISO 9001/2008 brings many benefits to all stakeholders in the business.
Customers and users benefit by receiving products that are: • Conforming to requirements • Dependable and reliable • Available when needed • Maintainable
People in the organisation benefit by: • Better working conditions • Increased job satisfaction • Improved health and safety • Improved morale
Owners and investors benefit by: • Increased return on investment • Improved operational results • Increased market share • Increased profits
Society benefits by: • Fulfillment of legal and regulatory requirements • Improved health and safety • Reduced environmental impact • Increased security
TO THE SHAREHOLDERS OF DIGICORE HOLDINGS LIMITED
Integrated Report
Scope of our engagement We have carried out a limited assurance engagement in relation to the disclosure of selected strategy and profile disclosures, management approach and performance indicators in terms of the Global Reporting Initiative Framework (“GRI”) and the relevant Sector Supplement (collectively the “GRI G3.1 Guidelines”) contained in detailed DigiCore Holdings Limited’s (“the Group”) Integrated Annual Report (“the Report”) for the year ended 30 June 2011. Our assurance engagement has been planned and performed in accordance with the International Standard on Assurance Engagements ISAE 3000 “Assurance engagement other than Audits or Reviews of Historical Financial Information”. This standard requires that we comply with ethical requirements and plan and perform the assurance engagement to obtain limited assurance on the selected profile disclosures, management approach and performance indicators as per our terms of engagement.
The scope of our engagement, as agreed with the board of directors, was as follows: • To obtain a limited level of assurance on the fair presentation of the selected strategy and profile disclosures, management approach and performance indicators reported by the Group in its Report in accordance with the GRI G3.1 Guidelines.
In obtaining this limited level of assurance we specifically considered the application of the following principles and guidance in terms of the GRI G3.1 Guidelines: o Report content: – materiality – stakeholder inclusiveness – sustainability context – completeness
o Report quality: – balance – comparability – accuracy – timeliness – clarity – reliability
o Report boundary: – control – significant influence.
• To obtain a limited level of assurance that the Group’s Report has achieved the Application Level of C+ in accordance with the Application Level Criteria set out in the GRI G3.1 Guidelines.
The Director ’s responsibilities
The Report was prepared by the directors of the Group, who are responsible for the collection and presentation of information within the report. In addition, the directors are responsible for maintaining adequate records and internal controls that are designed to support the integrated reporting process.
Responsibility of the independent assurers
Our responsibility in performing our assurance activities is to express a conclusion on the subject matter and criteria in accordance with the terms of reference and scope for this engagement.
Subject matter and criteria
The subject matter consists of selected strategy and profile disclosures, management approach and performance indicators relating to economic, environmental and social indicators as defined by the GRI G3.1 Guidelines. The selected performance indicators were chosen by management of the Group, primarily on the basis of stakeholder interest. The criteria used to evaluate the Report consisted of the relevant guidance contained within the GRI G3.1 Guidelines.
Level of assurance
Our procedures were designed to obtain a limited level of assurance on which to base our conclusions. The procedures conducted do not provide all the evidence that would be required in a reasonable assurance engagement and accordingly, we do not express a reasonable level of assurance. While we considered the effectiveness of management’s internal controls when determining the nature and extent of our procedures, our limited assurance engagement was not designed to provide assurance on internal controls.
Limitations of our work performed
Non-financial data is subject to more inherent limitations than financial data, given both the nature and the methods used for determining, calculating, sampling or estimating such data. We have not carried out any work on data reported in prior reporting periods, nor in respect of future projections and targets. We have not conducted any work outside of the agreed scope and therefore restrict our opinion to the agreed strategy and profile disclosures, management approach and performance indicators.
Independence
The firm and all professional personnel involved in this engagement are independent of the Group and our team has not performed any work for the Group that may conflict with our ability to express independent assurance over this Report.
Our conclusions
Subject to the limitations of our scope and work performed as noted above, we provide the following conclusions:
Fair presentation:
• Nothing has come to our attention that cause us to believe that the Report is not, in all material aspects, fairly presented in accordance with the specified principles and guidance in terms of the GRI G3.1 Guidelines for the year ended 30 June 2011.
Application level:
• Nothing has come to our attention to cause us to believe that the Report prepared by the Group does not, in all material aspects, achieve the application level C+ in accordance with the Application Level Criteria set out in the GRI G3.1 Guidelines for the year ended 30 June 2011.
PKF (Jhb) Inc. Registered Auditors Chartered Accountants (SA) Registration number 1994/001166/21 Director: T Schoeman Johannesburg 19 September 2011
G3 Content Index - Application Level