Material Issues

Corporate accountability for a sustainable future

Peregrine has initiated an evolving process of identifying and managing the material issues which the Board believes are critical to sustaining future growth.

Material issues refer to matters that substantially affect the Group’s ability to create and sustain value over the short, medium and long-term. This process is informed by issues that matter to the Group‘s stakeholders as well as the operating environment and it supports the Group’s commitment to Integrated Reporting and the application of the principles of guiding frameworks, such as King IV which became applicable for the year ending 31 March 2018.

Set out below are material issues that have the potential to influence the Group’s ability to create and sustain value over the short, medium and long-term. These carry both risks and opportunities for the Group, and are driven by a mixture of issues that have a direct business impact and stakeholder interest as a result of the wider external environment.

Material Issues

Why this is material to the Group

The Group’s Response

Human capital
Skills attraction, development & retention | Employee engagement | Safety, health and environment (SHE)

Employees, their safety, health and environment are pivotal to the existence of the business, they serve as drivers of strategic growth and ensure sustainability of the business

Encourage an owner-managed and entrepreneurial culture, where management own shares in their own businesses

Employees are provided with extensive infrastructure, training and support to ensure they are able to perform their duties professionally and effectively

Competitive remuneration and benefits that appeal to employees’ needs

Interests are aligned through performance bonuses linked directly to the profit performance of each business

Continuous engagement between management and employees to stay abreast of employees’ needs

A holistic approach to employee wellness, recognising that employees are not one-dimensional, they fulfil multiple roles simultaneously, and therefore need to be managed accordingly

Commitment to a safe, healthy and hygienic working environment in compliance with the Occupational Health and Safety Act, 1993 (No. 85 of 1993)

Reputation management
Investor/client relations | Corporate governance | Code of conduct/ethical policy | Expectation management

As a business that operates within the financial services industry, reputation risk management is key, as it influences stakeholder trust and how the business is perceived, which ultimately affects sustainability and profitability

Dedicated and trained staff who are responsible for investor/client relations throughout the Group

Code of Conduct setting out guiding principles for employees and officers of the Group

Commitment to treating the customers fairly (TCF) and actively striving to attain the six TCF outcomes at all times

The Board adheres to the principles of King IV

Peregrine is regulated in multiple jurisdictions and is represented in numerous financial services associations / organisations

Some of the subsidiaries subscribe formally to the Code for Responsible Investing in South Africa (CRISA)

Operational risk management
Internal financial controls | Conduct and ethical behaviour | Risk management | IT management & protection of information | Legal & Compliance

Underpins the Group's deliberate efforts towards responsible investing on behalf of both clients and the Group’s own investments

Comprehensive system of internal controls, as well as sound practices in the areas of human resources and IT risk management

Effective internal audit function

Functioning risk management system

Subsidiary and Group Risk Committee/s

Comprehensive risk matrix and continually reviewing and addressing processes and procedures

Skilled staff dedicated to specific compliance functions as part of the Group risk management framework and the Group Legal and Compliance Forum

External environment
Global economic conditions | Local political and economic conditions | Market conditions | Interest rates & foreign exchange volatility | Regulatory bodies

Impact the environment in which the Group operates locally and offshore

Provider of various licences to Group companies

The Board and management teams in each subsidiary continually monitor political and economic environments

Ongoing monitoring of the changing legislative environment

Market and Market conduct risk is continually assessed to ensure adherence at all times

Income, growth & return
Strategic growth drivers | New opportunities | Organic growth | Innovation | Cost management

Ensures that the Group continues to create risk adjusted returns for its shareholders over the medium to long-term

Unwavering focus on risk adjusted growth and returns at a Group and subsidiary level

All investments are made within an approved investment mandate with set allocation parameters

Investments are measured continually via mark-to-market valuations, sensitivity, concentration and scenario analyses where applicable

Effective diversification at a Group and subsidiary level

The Group continues to focus on growing its business organically, seeking strategic acquisitions and driving cross-business synergies

Continually striving to keep costs under control in pursuit of long-term sustainable profitability

Material Issues

Why this is material to the Group

The Group’s Response

Transformation
Ownership | Employment equity | Skills development | Preferential procurement | Enterprise development | Social-economic development

The Group recognises that it has a role to play in contributing to the enhancement of equality and equal opportunities for all within South Africa

The Group established Nala, a sustainable B-BBEE investment company that has a 20% stake in Peregrine SA Holdings, which enables it and its shareholders, including employees as beneficiaries of the Employee Portfolio Trust, to participate in the earnings of Peregrine’s South African operations

The Group has an Employment Equity Forum that is responsible for formulating and implementing plans developed for local operations in order to ensure compliance in terms of the Employment Equity Act. All employees are given the opportunity to be exposed to training and development, with a focus on internal training and skills transfer to ensure all employees are competent, trained and equipped to function optimally in a highly complex, regulated and technical environment

The Group is committed to developing committed and supportive relationships with
B-BBEE service providers

Certain subsidiaries within the Group have Enterprise Development Expenditure (EDE) agreements in place with black-owned companies as set out below.

The Group is committed to advancing local communities through Socio-economic Development and empowerment programs, with a long-term and sustainable focus