CEO's Statement

We proudly present the Santam Sustainability Report for the year ended 31 December 2007. This report is a companion to the Santam Annual Report that covered our financial performance, governance framework, risk management systems and ethical codes

We regard these elements as a core part of our sustainability philosophy and central to our financial performance and therefore urge you to read both reports.

In previous years, we set up governance and management structures to address business sustainability, including establishing a Board committee to deliberate on sustainability issues. Last year we focused on two core questions: how do we ensure that sustainability is core to financial performance and vice versa, and how do we ensure that sustainability becomes ingrained in all that we do?

We have come a long way in answering these questions and achieving the goals we have set.

To ensure that our efforts are measured, our thinking and actions are led, stimulated, coordinated and consistent, we have established dedicated positions and appointed staff to take custody of enterprise development, environmental management, stakeholder relations and management of the overall co-ordination of business sustainability. This does not, however, remove the responsibility for sustainability practices from each and everyone of us at Santam.

As indicated, we have spent time reflecting on what sustainability means to our business performance. As a basic principle we recognise that reporting on sustainable practices should be a consequence of business actions, and not an end in itself. Therefore, to be a sustainable business, we have to change the way we behave, and sustainability – as a common set of values that influence management practices – must become entrenched. Being a sustainable business defines the way we go about our daily activities: it is not an afterthought, nor a set of actions that are addressed in isolation from regular business.

Our decisions were based on a number of local and international initiatives: the JSE’s Socially Responsible Investment (SRI) Index, the performance indicators of the Financial Sector Charter (FSC), government’s Codes of Good Practice for Broad Based Black Economic Empowerment (BBBEE), Section 4 of the King II Report on Corporate Governance, and the latest Global Reporting Initiative (GRI) reporting framework. However, whilst we considered each of these fully, our focus was specifically on what it takes to be a sustainable business in the short-term insurance industry in South Africa.

Following the initial formulation of a sustainability framework, we involved all business managers in the process to ensure that our framework was relevant, comprehensive, and consistent with our existing business systems. By consulting all business managers we inculcated a sense of ownership of sustainability issues amongst those responsible for day-to-day operations and, in so doing, began to embed a sustainability-oriented way of thinking in our business.

This framework identifies 10 main sustainability objectives and 40 unique sustainability elements that we consider crucial to us and, by extension, South Africa. For each element, we have identified managerial responsibility points and systems to support the implementation of this framework. We view our sustainability framework as a work in progress, and recognise that ongoing effort is needed to refine the elements and integrate the framework with our business operating systems to ensure the concept of sustainability is embedded in our business.

In the end, our long-term prospects are integrally connected to all our stakeholders and we therefore invite those with an interest in our business to comment on this Sustainability Report, and to present their views on how we can work together to best address the challenges and opportunities of the future.

Ian Kirk
Chief Executive Officer

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