for my business
for specialised risks
I want to
Insurance for specialised risks
Insurance for agriculture
Call us on
For claims related queries
Santam is making concerted efforts to review its business practices on an
ongoing basis to ensure that its approach, methodology and governance related protocols continue to support and complement the group’s vision and
strategic objectives. To establish and maintain sound and ethical governance
practices across the business, key principles, controls and policy making
activities are implemented at all levels of the organisation, guided by
Santam-specific best practices and principle-based governance requirements.
These standards and requirements, in addition to the
board’s fiduciary duties, require the Board to accept
accountability and take responsibility for governance,
ethical leadership, and how decision making should
be approached, governed and executed. The Insurance
Prudential Standards further require the controlling
company of an insurance group such as Santam to
establish a governance framework that provides for
sound and prudent management of the group’s business,
including adequate protection of its clients’ interests.
To this end, the Santam board reviews and approves
the company’s governance policy on a yearly basis as
it emphasises Santam’s approach to sound business
practices and complements its strategic objectives
The board is responsible for directing, administering and controlling the affairs of the company in a transparent, fair, ethical and responsible manner. It performs an oversight role and overriding control over the Santam group
and its subsidiaries.
The figure below provides a high-level synopsis of the group governance structure referred to in the Corporate governance report.
Exercise oversight and determine Santam’s overall objectives
Develop strategies to meet those objectives in co-operation with management
Monitor operational performance relative to the agreed strategic and business objectives
Ensure effective risk management and internal control
Conduct business in accordance with Santam’s code of ethics
Formulate a clear and concise group governance policy and monitor adherence thereto
Delegate and segregate the board’s responsibilities
Evaluate the performance of the board, the board committee structures, individual directors and the effectiveness of the company secretary.
The Board of Directors composition and member profiles
Santam’s board members recognise their responsibility to exercise effective leadership by always adhering to their fiduciary duties, collectively and individually. However, it is of critical importance for the board to ensure that:
• A balanced distribution of power is maintained across board committees at all times.
• No opportunity arises for any individual board committee member to dominate decision making.
• Undue reliance is never placed on any individual board committee member.
The board therefore provides for effective leadership in its board committees by allowing collaboration between board committees through cross-membership. It also allows for coordinated timing of meetings to avoid duplication or fragmented functioning between board committees. When duplication or fragmented functions do occur, the board outlines a process for board committees to handle such matters by delegating specific roles and positions rather than permitting competing approaches.
The various board committees may from time to time also be required to provide input to other committees on matters relevant to those committees’ mandate and scope. The respective committees are then obliged to ensure an appropriate flow of information. In addition, in fulfilment of their duties, board committees are authorised to call on the chairs of other committees, or any of the executive directors, company officials, the group company secretary or any assurance provider, including any employee within the Santam group, to assist them with information, at the company’s cost, subject to the relevant board-approved process. The board committees also have the power to delegate their authority and duties to sub-committees, ad hoc committees or individual members of the committee as they deem appropriate, provided they are not precluded by any legal or regulatory requirement from doing so.
In terms of clause 25.3 of Santam’s MOI, at least one-third of non-executive directors should retire from office each year at the AGM. The directors so to retire will be those who have been the longest in office since their last election. As between directors of equal seniority, the directors to retire will, in the absence of an agreement, be selected from among them by lot. If, at the date of any AGM, any director will have held office for a period of three years since his/her last election or appointment, he/she shall retire at such AGM, either as one of the directors to retire in pursuance of the foregoing or additionally thereto. In the interest of good corporate governance, executive directors will also rotate on a voluntary basis as per a pre-determined schedule of rotation.
It should be noted that a retiring director continues to act as a director throughout the AGM at which he/she retires. The length of time a director has been in office is computed from the date of his/her last election. They are: Monwabisi Fandeso, Preston Speckmann, Junior Ngulube and Dawn Marole.
The above board members have made themselves available for re-election at the upcoming AGM. It is important to note that each of these directors appointed to the board must retire at the next AGM, but are at the same time eligible for re-election.
The board considered and supported these rotations. Therefore, it is recommended to shareholders that they consider and cast a vote for the re-appointment of these
board members. A brief curriculum vitae of each director standing for election or re-election at the 2023 AGM is available.
Santam’s approach to succession planning applied at board level is to a large degree influenced by applicable regulatory requirements and Santam-specific empowerment and talent management strategies. One of the board’s core objectives is to establish and maintain continuity while ensuring the effective transfer of skills as and where applicable. This is in addition to the board’s composition and size complementing and supporting the execution of Santam’s strategy. The nominations committee assists the board in addressing the gaps of current and future board members (if any) through mentorship and development programmes.
The nominations committee, in consultation with the chairs of the board committees, reviews and identifies any skills gaps that might occur at board or board committee level. It also considers the outcome of the annual board and board committee performance evaluations. Before any new appointments to the board are made, regulatory approval is sought, after which shareholder approval is obtained at Santam’s AGMs in the event of new appointments or re-elections. The shareholders elect and appoint, and the board inducts, develops and removes board members as and when required.
The board’s retirement policy in terms of Santam’s MOI stipulates that directors will cease to hold office at the AGM following their 70th birthday – unless, prior to this date, the majority of the board reached consensus and agreed to extend their term for one year.
The group company secretary oversees the induction of new directors, including the directors of subsidiary companies, and facilitates the ongoing training requirements of board members. The board’s induction programme focuses on Santam’s business, the statutory requirements applicable to the group, board matters, and the board’s duties and governance responsibilities according to each director’s specific needs. Furthermore, the group company secretary keeps the directors abreast of applicable legislation and regulations, changes to rules, standards and codes, and governance-related developments that could affect the group and its operations. Ongoing support and resources are provided to board members as required to extend and refresh their skills, knowledge and understanding of the business.
During the year under review, training was provided for as a standing item on the agendas of each board and board committee meeting. This was to ensure that board and committee members were able to effectively and efficiently execute their fiduciary duties. Board training also assisted to keep the board abreast of any topical issues, complex and technical business-related aspects, industry trends, risks and regulatory aspects, to name only a few.
There is a close correlation between the performance of the board and the performance of the organisation it provides oversight over. Continuous performance assessments give the board an opportunity to review and improve its performance and enable it to reflect on its roles and responsibilities, its culture and its relationship with management. Board
effectiveness evaluations also enable the board, the nominations committee and the group company secretary to identify board training needs.
During the year under review, a board effectiveness evaluation was conducted with the assistance of an external service provider. The evaluation took the form of an online questionnaire drafted in line with best practices as espoused by King IV. Board members were requested to rate questions on the board’s performance on a scale of 1 (poor) to 5 (excellent). In addition, pre-selected members attended confidential one-on-one interviews with an external facilitator to dive deeper into the scoring results and trends. All individual responses and views expressed were kept anonymous and confidential. Areas of assessment included the board’s role and responsibilities, composition, key board role players, the culture at a board level, the board committees, and the independence classification of board members. The governance areas reported on in the assessment feedback included quantitative and qualitative components.
Group Executive Committee composition
Santam’s Exco comprises the group chief executive (Chair), the heads of the respective businesses within the Santam group as well as the group office functionaries and support services business units. The members of Group Exco have each been designated by the Prudential Authority as a “key person” under the auspices of sections 14 and 15 of the Insurance Act.
Group Exco supports and assists the group chief executive officer with the operational management of Santam, subject to statutory and delegated limits of authority. Although specific deliverables are often assigned and delegated to the members of Group Exco, through the office of the group chief executive, Group Exco’s primary responsibilities include the execution of the group’s strategy, co-ordination, performance monitoring and reporting.
Group Exco comprises a diverse group of skilled and experienced executives. The human resources and remuneration committee (HRRC) appoints each of these executives on the recommendation of the group CEO. In addition, the HRRC periodically reviews and assesses their performance over time. These performance evaluations are based on a pre determined set of targets and key performance indicators that are derived from the group CEO’s key performance areas, which in turn are aligned to the execution of Santam’s FutureFit strategy. One of the most significant changes that occurred during the reporting period was the incorporation and provision of ESG-related key performance indicators in the performance contracts of the members of Group Exco.
To ensure that Group Exco (as a collective) is able to deliver on its mandate, it is of fundamental importance that the individuals serving as members of the committee possess the requisite skills, expertise, attributes and experience. The
group strategy refresh process that was recently embarked on necessitated a comprehensive review of the organisational structure, including the business operations. This resulted in the board reviewing the appropriateness of the group’s operating model that was abolished with effect from 31 December 2022.
The responsibility for corporate citizenship resides with the board. The board
is ultimately accountable and responsible for setting the direction for how
the company responds to the applicable laws and regulatory requirements
in those jurisdictions in which it operates, to industry codes and standards,
and to Santam’s company-specific requirements. Considering the growing
interest and expectations of stakeholders regarding environmental, social and
governance (ESG) related aspects, Santam regards its efforts to contribute
to positive change as instrumental to creating value for its stakeholders.
More information regarding the execution of Santam’s strategy and the group’s approach to ESG can be accessed in Santam’s 2022 integrated report, the remuneration report and the company’s verified broad-based black economic empowerment scorecard.
During the reporting period, Santam was actively involved in several industry-driven interventions aimed at empowering people and supporting them to become financially literate. This excludes the investments made and resources allocated by Santam to uplift local communities through social, economic and development (SED) initiatives, and in particular to empower and create sustainable opportunities for small, medium and
micro enterprises (SMMEs). The group’s recently launched Home+ initiative is an example of the successes achieved to date in this regard.
Care: Serving with empathy and consideration, knowing that everything we do leaves a lasting impact and legacy.
Collaboration: Unlocking our Winning As One spirit by focusing on a better outcome for all, achieved through partnership and an open-minded approach to everything..
Innovation: Always striving for continuous improvement in order to create value for our stakeholders, our society and our world.
Integrity: Unwavering in our pursuit to do the right thing; resolute in our commitment to what’s good for all stakeholders.
Santam has a well-established code of ethics that includes the standards and norms of acceptable behaviour. The code is reviewed and approved by the board on a regular basis. It is further underpinned and supported by policies relating to specific areas, including the group’s business integrity policy, anti-bribery and anti-corruption policy, conflict of interest policy and whistleblowing policy.
In light of the 2021 ethics survey as well as emerging trends and risks, the code of ethics is currently being re-drafted. This is a consultative process, drawing on input from representatives from various disciplines. The ethics office also held focus groups during 2022 to obtain feedback from employees on areas where guidance was needed, whereas employees received online training on the current code of ethics and the list of supporting policies.
One of the milestones achieved to date was the development of Santam’s supplier code of conduct. This code is published on the group’s supplier portal and provides induction training for existing and prospective suppliers.
During the reporting period, the ethics office also conducted a roadshow at various local branches. The objective was to raise awareness around ethical conduct in general and to provide training on ethical “blindness” and impasses and how to better deal with these. More work in this regard is planned for the 2023 financial year
A key responsibility of the ethics office is to monitor the implementation of the group’s conflict of interest policy, which is reviewed and approved on an annual basis. Employees are required to declare all actual, potential and/or implied conflicts of interest on the company’s human resources e-platform, and reports are presented regularly to the GEMC. Undisclosed conflicts of interest by employees remain a key focus area, and the ethics office responds to this by rolling out regular interventions across the business. These include raising awareness of the guidelines that have been developed in this regard, as well as the available training material on managing conflicts of interest.
Conflicts of interest that are from time to time divulged by the members of the Santam board are reported to and monitored by the group company secretary.
Santam is committed to conducting all aspects of its business with integrity. Integrity entails doing business in an honest, ethical, fair and transparent manner and in compliance with all applicable laws and regulations. Bribery and corruption undermine a culture of trust and create an unstable operating environment for the group, which negatively impacts on fair market practices.
As part of our commitment to conduct business with integrity, the group adopted a zero-tolerance approach to bribery and corruption. This approach is governed by a formal policy and applies to all business activities in any jurisdiction where the group operates. To this end, Santam is committed to:
• Uphold all laws and regulations countering bribery and corruption.
• Have safe, appropriate and accessible reporting mechanisms where concerns of bribery and corruption can be reported.
• Provide protection for whistleblowers by committing to act against anyone who victimises, intimidates or attempts to victimise whistleblowers for making reports.
• Act swiftly in reporting and thoroughly investigate all incidents of bribery and corruption.
• Provide regular training and create awareness around bribery and corruption.
• Proactively understand and manage the risk of bribery and corruption in our business operations.
The group’s anti-bribery and anti-corruption policy sets out the overall framework for combating financial crime while specifying tight principles to be adhered to. It is further supported by the insurance fraud risk management policies adopted by all licensed insurers in South Africa, as required by the Prudential Standards on the Governance of Insurers in terms of the Insurance Act.
Anti-money laundering and the countering of the financing of terrorism (AML/CFT) also continue to be a focus area for Santam, other industry players and regulators globally. The group has deployed several solutions to ensure compliance with AML/CFT regulatory requirements and enforce targeted financial sanctions. In addition, a heightened approach was adopted to enhance the level of scrutiny when onboarding new clients and transacting with existing clients. The board is pleased to report that to its knowledge, no material losses were suffered during the reporting period due to fraudulent activities.
Santam remains committed to conducting its business ethically, responsibly, and in compliance with all applicable legislation, regulation, adopted industry codes and standards, and all internal policies and sound corporate governance principles.
One of the key roles the risk committee fulfils is to advise and assist the board in overseeing the governance of compliance by setting the direction for how compliance should be approached and addressed within the business. The group has no appetite for deliberate, ignorant, or premeditated violations of applicable legislative requirements or non-compliance with company standards, internal policies or governance principles. To this end, Santam strives to conduct its business with due skill, care and diligence to minimise
violations and non-compliance incidents arising from negligence.
The board, supported by the risk committee, has oversight of the implementation of Santam’s corporate culture and business strategies. This includes the group’s compliance strategy and risk appetite in alignment with Santam’s long-term interests and viability.
Management is responsible for ensuring the implementation of the business objectives and strategies that are developed in line with the group’s compliance strategy and risk appetite. The group compliance function is responsible for promoting and monitoring the group’s compliance culture. The group compliance officer (supported by the various compliance functions within the business clusters and subsidiaries) also facilitates the management of compliance through analysing statutory and regulatory requirements as
well as monitoring the implementation and execution thereof. The risk committee and the board receive regular reports on material compliance matters through the group compliance officer, who is suitably skilled and experienced. He reports functionally to Santam’s group chief risk officer.
Santam’s management recognises the importance of identifying, mitigating and managing its risks, which includes managing the compliance risks facing the business and
continuously seeking ways to improve its internal processes to ensure these are appropriately aligned to the applicable legislative requirements. Through this process of continuous enhancement of its internal processes, Santam aims to mitigate any risks facing its policyholders.
Non-compliance incidents are continuously being monitored at various levels across the group. These incidents include reporting obligations to operational management within the businesses, their respective executive committees and risk committees as well as the various subsidiaries’ boards of directors. In addition to the above reporting and escalation
protocols, compliance incidents are also recorded within the group’s risk management processes to ensure that the risk management team is aware of them.
Santam acknowledges the fundamental role that IT governance and digital transformation fulfil in conducting business in a highly competitive environment. IT is therefore regarded as a strategic focus area that supports and underpins the Santam group strategy. The board, supported by the risk committee, is ultimately accountable for the management and governance of IT. It is for this reason that IT management and governance are deemed essential for the group to achieve its FutureFit strategic objectives and why it is deeply entrenched in how Santam operates.
The group’s IT governance framework and reporting system, which are reviewed on a regular basis, further enable the board to reinforce and verify:
• The value that is being derived through the appropriate use of IT.
• That IT change initiatives are aligned to the business strategy.
• That the IT governance framework continues to holistically provide centralised oversight and guidelines in alignment with the broader group governance framework.
The following are the key components of Santam’s IT governance framework
• The implementation of and alignment with the Santam Business Information Technology Services (BITS) group strategy
• The implementation of the group’s IT, information and security policies and standards.
• The alignment and adoption with group architecture for strategic and shared architectural components.
• The maximum use of the group’s IT capability, which includes shared IT infrastructure and applications, the group’s cyber security centre and group technology and infrastructure (GTI) .
• Centralised technology sourcing, with the aim of maximising benefits for the Santam group of companies.
Sound corporate governance principles continually challenge corporates to shift from a “shareholder only” to a “stakeholder inclusive” mindset. This is to ensure that corporate citizens take cognisance of their business practices and how these impact on their stakeholders.
It is for this reason, among others, that Santam adopted a stakeholder-inclusive and stakeholder-centric approach. The objective is for the company to proactively communicate and engage its key stakeholders on material and relevant issues that affect them directly or indirectly. This is achieved through a broad range of communication channels and mediums to encourage stakeholders to respond and provide feedback in a pragmatic manner.
Santam’s key stakeholder categories
Santam’s conduct and business operations impact, influence and affect a diverse group of stakeholders – both internally and externally. The group’s stakeholder categories can be summarised as follows:
CLIENTS: Personal, commercial, specialist and agriculture clients who obtain the required cover through Santam’s products.
EMPLOYEES: Providers of skills and expertise that support the activities inherent to Santam’s business model.
SHAREHOLDERS AND INVESTMENT COMMUNITY: Primary providers of financial capital, and analysts guiding their decision making.
DISTRIBUTION PARTNERS: Brokers etc. facilitating the delivery of our solutions to clients.
BUSINESS PARTNERS AND SUPPLIERS: Providers of products and services that enable Santam to conduct its business activities.
LAW MAKERS AND REGULATORS: Providers of financial stability and a sustainable environment for financial services through prudential and market conduct regulation.
GOVERNMENT: Host governments in the countries where Santam operates. Government policy and plans provide the parameters for socioeconomic development.
ORGANISED BUSINESS AND INDUSTRY: The business sector organising itself across sectors and/or organised bodies in the shortterm insurance industry.
CIVIL SOCIETY: The base from which demand for Santam’s products and services is generated, from which workforce skills are acquired, and from where our business derives legitimacy. Includes trade union federations, political parties and Non-governmental
MEDIA: Decision makers, content creators and journalists (e.g. media owners, media houses, editors, sub-editors, journalists and columnists).
Santam’s key stakeholders are all regarded as pivotal to Santam’s sustainability and inform the way in which the company conducts its business.
During the reporting period, the board reviewed and approved the group’s stakeholder management policy, which was developed in line with the principles and recommendations of King IV. The policy defines Santam’s key stakeholder groups and outlines the basic principles and requirements that govern how Santam engages its stakeholders and monitors and reports on stakeholder interventions. The responsibility to oversee and monitor the implementation of the policy has been delegated to the SES committee.
The most important stakeholder management related developments during the reporting period included climate change-related catastrophes (e.g. the recent floods in KwaZulu-Natal which were regarded as some of the worst natural disasters in years, leading to an unprecedented number of claims, and the Eastern Cape drought), power outages and load shedding, rising inflation caused by the Russia-Ukraine war, and the cost of food, fuel and energy as well as surging interest rates impacting disposable income and leading to an increase in theft.
Santam continues to review its stakeholder engagement methodology to gain a better understanding of stakeholder expectations, interests and requirements. This is to ensure that the group’s efforts are aligned to Santam’s strategy and support its execution.
The group’s main stakeholder objectives can be summarised as follows:
• To proactively unlock growth by analysing key stakeholders’ expectations and how Santam can create and unlock value in a sustainable manner.
• To respond effectively to stakeholder-related aspects (e.g. by engaging government on material matters that affect the broader society.
• To act as a catalyst for positive change through investment in transformation initiatives (e.g. financial inclusion, employment equity, skills development, preferential procurement and investment in SMMEs).
• To establish and maintain partnerships for risk reduction while addressing the risk protection gap – by providing insurance and risk solutions in a good and proper way in all markets where Santam operates (noting that climate change-related disasters are becoming a reality and are widening the risk protection gap).
• Displaying leadership and foresight as a good corporate citizen by effectively engaging on Santam’s flagship partnerships for risk and resilience (P4RR) programme, CSI, Black Broker Developer programme, etc.
Santam’s investor relations team facilitates communication with the company’s shareholder community. In addition, each stakeholder category has an executive custodian assigned to it, and is linked to senior managers who are responsible for stakeholder engagement and progress reporting. A colour-coded RAG status tracker has also been deployed to monitor and track the effectiveness and “health” of the group’s stakeholder relationships over time.
At Santam, the board has an oversight role and exercises its ethical responsibilities, rights and obligations through elected representatives in the various companies the group has invested in. The board is ultimately accountable to ensure that the Santam group promotes good governance by investing responsibly. This objective is achieved through the investment committee, the group executive committee and the respective governance structures in each subsidiary. In addition, each of the executive committees within the Santam group of companies is responsible for ensuring that Santam’s investments are managed according to board-approved policies and investment mandates.
Santam also subscribes to the Code for Responsible Investing in South Africa(CRISA). CRISA was launched in 2011 to encourage institutional investors and service providers to integrate ESG aspects into their investment criteria and decision making. Since 2011, significant advances have been made in the regulatory and governance sphere relating to responsible investment and stewardship. CRISA 2, launched in September 2022, contains five voluntary principles for stewardship and responsible investment as key components of the South African governance framework. These are:
Principle 1- ESG integration: Investment arrangements and activities should reflect a systematic approach to integrating material ESG factors.
Principle 2 - Stewardship: Investment arrangements and activities should demonstrate the acceptance of ownership rights and responsibilities, diligently enabling effective stewardship.
Principle 3 -Capacity building and collaboration: Acceptance and implementation of the principles of CRISA 2 and other applicable codes and standards should be promoted through collaborative approaches (as appropriate) and targeted capacity building throughout the investment industry.
Principle 4 - Governance: Sound governance structures and processes should be in place (including at all levels of the organisation) to enable investment arrangements and activities that reflect and promote responsible investment and diligent stewardship, including proactively managing conflicts of interest.
Principle 5- Transparency: Investment organisations should ensure disclosures are meaningful, timeous and accessible to enable stakeholders to make informed assessments of progress towards the achievement of positive outcomes.
The CRISA 2 principles apply primarily to asset owners, asset managers and service providers in the investment value chain who are involved in investment activities, and who wish to voluntarily align themselves with the principles.
Santam, and its fund manager, further subscribe to the United Nations Principles of Responsible Investment and the Code of Responsible Investing by Institutional Investors in South Africa (“the Responsible Investing Codes”).
During the year under review, Santam (through its investment committee) reviewed and amended its internal governance structures’ terms of reference to ensure alignment to CRISA 2. This included the board granting its approval in November 2022 to the proposed amendments that were incorporated in the group’s responsible investing policy, which forms an integral part of the Santam group investment policy.
The responsible investing policy aims to ensure alignment between Santam’s investment practices and the principles outlined in the Responsible Investing Codes and King IV. At the same time, Santam’s overall investment objective is to maximise its after-tax investment returns within the approved Santam group risk appetite framework – i.e. subject to the group’s investment management principles. However, it remains key that the board-approved group investment strategy at all times consider and protect the interests of the group’s policyholders. No strategy that might adversely affect the Santam group’s ability to repay its insurance obligations, as and when they become due, will be considered.
By clicking accept, you agree to this, as outlined in our cookies policy.