Integrated Report 2021

Enabling growth and progress in society

Our community initiatives are designed to create meaningful positive change

Enabling growth and progress in society

Building wealth through economic transformation

Khula Sizwe Property Holdings was established in 2019 when it purchased a portfolio of 57 commercial properties from Barloworld valued at R2.9 billion, which was at a 5% discount.

Enabling growth and progress in society

Barloworld Siyakhula

Our aim is to create value beyond compliance through a measurable enterprise and supplier development (ESD) programme that develops sustainable enterprises that are able to access market opportunities beyond the Barloworld value chain after five years.

Development

Provide beneficiaries with a three to five-year journey offering a support programme tailored to individual beneficiaries’ needs, with a clear development path and measurable targets. The aim is to increase efficiency by introducing annual planning, quarterly reviews and the use of technology to integrate data sources and enhance reporting.

Funding model

Enhance funding sustainability and impact through:

  • an optimal mix of grants and loans
  • early payments and discounts to beneficiaries
  • partnering for co-funding of common initiatives
  • stretching funds to achieve an increased group-wide reach for the programme.
Beneficiary procurement spend

By developing a beneficiary pipeline aligned to commodities, our group presents the greatest opportunity for preferential procurement from our beneficiaries.

Enabling growth and progress in society

Key Siyakhula ESD partnership initiatives

Emerging junior miner support

To support identified emerging miners as key customers of our Industrial Equipment and Services business unit. Barloworld outsources low-risk activities to them and supports them with access to equipment and a range of business support services.

Housing and coupling container model

The aim of this initiative, in partnership with key Industrial Equipment and Services customers, is to promote local procurement and assist with building South Africa’s industrial base in critical sectors. By providing an offtake agreement with the SMME, our customers ensure the sustainability of the business.

In partnership with Caterpillar

Caterpillar committed US$190 000 to the construction of ICT hubs that support ESD and socio-economic development (SED) in the Northern Cape, Mpumalanga and Limpopo. The hubs will focus on skills development, ESD and SED.

Emerging farmer programme

Ingrain supports an emerging farming development programme, which is aligned with the agri-sector.

Cato Ridge trailer project

Salvage Management Disposal (SMD) provides selected towing companies in Cato Ridge with business support and trailers that give them access to a market from which they have previously been excluded because of the slingback equipment they used.

Barloworld Mbewu

Siyakhula financial interventions during FY2021

R45 million was disbursed during FY2021 in support of five 100% black-owned companies, two of which were 100% black women-owned. They were assisted with interest-free loans that provided working capital or assisted with the purchase of machinery the business needed in order to operate. They included engineering companies, a transport company and a Supa Quick franchise.

Assisting retrenched employees to become entrepreneurs

During FY2021 we supported 12 people who had been retrenched from Barloworld Power through the provision of R4.7 million to start their own business installing, maintaining and repairing generators. A further R1 million helped five canteen employees establish a canteen business to serve Barloworld Equipment southern Africa. Siyakhula also helped them purchase a panel van and supported them with coaching and mentorship.

A Standard Bank-Barloworld ESD partnership

Standard Bank (R3.7 million) and Barloworld (R5.3 million) co-invested in a fund that provides diagnostics and development support. Standard Bank also ringfenced R60 million for contract financing of Barloworld SME service providers, and Siyakhula committed to contributing 30% to the funding of SMEs disadvantaged by low credit scores.

Social impact enablers

Barloworld Mbewu

The Mbewu programme drives economic sustainability, transformation and growth with the aim of creating greater social impact. To maximise social value creation it provides financial and non-financial support to social enterprises over a period of three to five years.

Access to funding/
finance
  Capacity
building
  Incubation for three to five
years per social enterprise
 
We define success as:
  • the creation of social value for society by communities
  • successfully pioneering a redistributive entrepreneurship model
  • applying the Barloworld entrepreneurial lens to the creation of social value.

Twenty-nine Barloworld Mbewu beneficiaries completed the first 12-month module of their incubation programme by March 2020; and the second and third modules were completed by the beginning of the financial year. As a result of the skills they developed during their incubation, which included business leadership training, our group of social entrepreneurs has been innovative in solving challenges in their respective communities.

Twenty-nine of these social entrepreneurs have established an income stream that demonstrates their ability to achieve scalability of the social enterprises they have established. This group of entrepreneurs received R11 million in funding and business leadership training. They will also be assisted to access other markets and development funders. The programme has since recruited 20 new cohorts for 2022.

Barloworld Mbewu identified fertile fields with the aim of assisting its entrepreneurs to kick-start their sowing season. It also provided them with wellness support during the Covid-19 pandemic, which included psycho-social support.

Social impact investment

Through the Barloworld Trust, which was first established in the 1970s, Barloworld commits 1% of net profit after tax (NPAT) to socially relevant programmes, which are aligned to our business strategy, to achieve our purpose of inspiring a world of difference and enabling growth and progress in society. On average, the group’s global spend on social impact activities is 1.6% of NPAT. Funding for FY2021 remained flat as the company reviewed its corporate citizenship strategy to align with the new operating environment, which takes Covid-19 into consideration.

The Trust focuses on education and food security, however, a substantial amount of funding was directed at health and welfare initiatives during the year under review.

The impact of the Covid-19 pandemic highlighted the issues of food security, which was a focus of the Trust’s welfare activities during the year under review.

The Trust’s education focus is on providing access to quality education with an emphasis on improving science, technology, engineering and mathematics (STEM) focusing on the training of secondary school teachers. To deliver these education programmes, the Trust focuses on using NGOs with a national footprint involved in advocacy work as well as the practical training of teachers.

Employee volunteerism

At Barloworld employee volunteerism includes workplace giving of funds and goods, hands-on (onsite) volunteerism and skills-based volunteerism, which include both education and business skills. Employee volunteerism was negatively impacted by the Covid-19 pandemic.

An online employee volunteerism platform was launched in August 2021 where employees can nominate an NGO or charity they would like the business to support and which they would also support. The projects being supported can be viewed on a dashboard on the platform.

Enabling growth and progress in society