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GOVERNANCE AND SUSTAINABILITY

• Corporate Governance Report
• Sustainability Report
  • Introduction
  • BBBEE credentials
  • GPI's sustainable investment strategy
  • The way forward

• HOME   |  
• CORPORATE OVERVIEW   |  
  • • Financial Highlights
  • • Three-year Financial Review
  • • Directorate and Management
  • • Group Structure
  • • Vision & Mission
• COMMENTARY   |  
  • • Chairman's Review
  • • Chief Executive Officer's Report
• GOVERNANCE AND SUSTAINABILITY   |  
  • • Corporate Governance Report
  •     – Board of directors
  •     – Board committees
  •     – Risk management, accountability and audit
  •     – Regulatory environment
  •     – Social responsibility
  •     – Communications
  •     – Dealings in securities
  • • Sustainability Report
  •     – Introduction
  •     – BBBEE credentials
  •     – GPI's sustainable investment strategy
  •     – The way forward
• ANNUAL FINANCIAL STATEMENTS   
  • • Directors' Approval
  • • Declaration by the Company Secretary
  • • Independent Auditor's Report
  • • Company Secretary's Report
  • • Directors' Report
  • • Consolidated Income Statements
  • • Consolidated Balance Sheets
  • • Statement of Changes in Equity - Group
  • • Statement of Changes in Equity - Company
  • • Consolidated Cash Flow Statements
  • • Notes to the Annual Financial Statements

Sustainability Report

Introduction

GPI is in itself the outcome of a successful focus on sustainability. It is a black-controlled listed company that grew from small beginnings.

BBBEE credentials

From a black economic empowerment perspective it has impeccable credentials. Our internal BBBEE evaluation reflects an overall empowerment rating of 60% calculated as follows:

Shareholder empowerment – 19%
Employee empowerment – 9%
Employment equity – 15%
Procurement empowerment – 9%
Skills development – 8%

Corporate social development and enterprise development are conducted through the investments that GPI has significant influence over. Excluding these two categories, GPI’s overall empowerment rating is 75%.

GPI’s sustainable investment strategy

The concept of sustainability is central to GPI’s investment strategy, a key part of which is the channelling of resources into entities where GPI is able to exercise significant influence.

From this position GPI is able to encourage its underlying investments to grow in a sustainable manner, mindful of the interests of all its stakeholders.

GPI’s most significant investment, SunWest, has built up an enviable track record in terms of its focus on sustainability, as has Thuo Gaming WC. Both entities allocate a percentage of their profits to CSI and these resources are dedicated to uplifting the communities within which they operate.

GrandWest’s CSI has become increasingly prominent in the social investment landscape of Cape Town and boasts numerous CSI projects and achievements in its portfolio.

SunWest’s sustainability strategy

The key drivers of SunWest’s sustainability are:

• to be the most admired leisure organisation in the Western Cape;
• being transparent in its reporting on progress on social issues;
• encouraging its supply chain to share its values;
• to benefit the communities it serves; and
• the discouragement of irresponsible gambling.

SunWest has at all times been mindful of its responsibility to all its stakeholders and in this regard the interests of the community it serves are paramount.

To achieve this SunWest is focused on delivering the highest level of corporate accountability and business ethics from directors, executive management and its entire staff. GrandWest operates in a regulated environment. Compliance, mutual trust and constructive engagement with provincial government and its Gambling Board are critical to GrandWest’s ongoing sustainability as an organisation. This receives the highest priority and focus of GrandWest’s management team.

The strict compliance with the conditions of SunWest’s casino licence and the commitments given in SunWest’s bid, which secured this licence, receive the highest priority.

SunWest has made a significant economic contribution to the province and the country, contributing R12,2 billion between 2001 and 2007 to Gross Domestic Product.

SunWest has spawned many new business opportunities and created employment for thousands of people from its surrounding communities and beyond. GrandWest directly employs almost 1 000 people and this does not include the 27 concessionaires who provide jobs for a further 700 people and its 12 outsourced service providers who employ a further 1 500 people, most of whom never had jobs before. GrandWest has therefore been the biggest driver of SunWest’s contribution to Gross Domestic Product.

GrandWest has provided a phenomenal training ground for these first-time employees, many of whom have moved on to other opportunities through the benefit of this world-class training and experience. The Table Bay operation, in addition, provides employment for in excess of 600 people. Thus by 2007 SunWest’s activities were sustaining 6 030 direct jobs and 5 780 indirect jobs, a total of just short of 12 000 sustainable jobs in Cape Town.

These sustainable jobs include employment provided by the CTICC, which SunWest played a pivotal role in launching by providing much-needed intellectual assistance, not to mention the considerable financial assistance afforded it in the form of R140 million in equity. The spin-off benefit of this world-class international convention centre to Cape Town and South Africa has been substantial and is continuing to grow over time.

Perhaps the most rewarding aspect of SunWest’s sustainability focus has been the establishment of GrandWest’s CSI. All the employees of SunWest contribute their time and energy to this very important part of SunWest’s sustainability strategy. Passion and commitment by all members of the team, as well as the board of directors, are the hallmarks of this contribution.

GPI can lay claim to much of the credit for SunWest’s achievements with respect to the overall outcome of SunWest’s focus on sustainability through its representation on the SunWest Board and the role of Western Cape Manco, which is jointly controlled by GPI and Sun International.

Western Cape Manco is responsible for the management of SunWest’s empowerment policy, which covers all aspects of empowerment including community empowerment, shareholder empowerment, procurement empowerment and, importantly, employee empowerment. SunWest has made excellent progress as a result of the efforts of this management company while GPI has been intimately involved with this aspect of the operation. Consequently, by 2007 SunWest’s CSI committee, under the guidance of GPI representatives who serve on the Western Cape Manco Board, had overseen the allocation of R22,2 million to social investment projects.

Some of the flagship projects that have benefited from GrandWest’s CSI are:

• Habitat for Humanity, which aims to achieve transformational development by building sustainable communities and providing tools for people to help themselves.
• Blisters for Bread, a charity family fun walk to raise awareness of the hunger and malnutrition of children in the local community.
• Soundtrack 4 Life, which aims to empower learners to make the correct behavioural decisions in order to prevent the spread of the HIV pandemic. This latter programme has already reached over 105 000 learners in 142 schools.
• GrandWest CSI invested almost R2 million in the Shawco Mobile Clinic programme, which provides primary health care to a number of clinics in impoverished areas in Cape Town.
• The award-winning Khanya Programme, which aims to improve teaching and learning in the province through the use of appropriate technology, is a further initiative close to the heart of GrandWest’s CSI through its adoption of 12 schools, which it will equip with computer laboratories. To date, some 482 000 learners and 14 000 educators in more than 560 mainly poor schools, have benefited from this programme.
• In addition, GrandWest’s CSI launched a bursary scheme aimed at providing tertiary education bursaries in the maths, science and technology streams within various higher learning institutions in the Western Cape. It is anticipated that this scheme will provide over 100 bursaries per annum over the next five years.
• Finally, with all the flooding and fires which have devastated many poor communities within the Western Cape, GrandWest’s CSI played a pivotal role in establishing Field Kitchens through their partnership with the Red Cross Society which has provided much–needed relief to these communities in distress.

GPI is SunWest’s biggest local stakeholder in so far as shareholder empowerment is concerned and now owns an effective stake of 33,7% in SunWest, which is in line with what was intended in terms of the original bid, which secured the licence. GPI now has 6 500 direct shareholders and nearly 15 000 indirect shareholders through the founding consortia, most of whom are members of previously marginalised communities.

These shareholders took their savings and invested them in GPI and over the years these shareholders have seen a phenomenal growth in their investment. GPI now holds more than 50% of the SunWest voting shares and will use this position of strength to ensure that shareholder empowerment continues to be maximised over the long term. With the benefits of the regulated gaming environment now firmly entrenched through the elimination of the black market and the achievement of secure tax revenues, the only remaining variable, which still requires some effort, is the empowerment of previously marginalised communities, as shareholders in the gaming industry. In this regard GPI’s continued participation in the benefits flowing from the activities of SunWest is of paramount importance to SunWest and its sustainability strategy. It is for this reason that GPI has managed to achieve a BEE lock-in of between 25% and 35% of its share capital until at least 2012.

Thuo Gaming WC’s sustainability strategy

Thuo Gaming WC has committed to invest at least 5% of its pre-tax profits in its CSI strategy. On 26 June 2008 Thuo Gaming WC invested approximately R700 000 as part of an ongoing CSI programme, which aims to uplift and support the communities in which it operates:

• The QuadPara Association of the Western Cape was presented with a Toyota Quantum – fully customised to accommodate wheelchairs – as well as a dedicated driver for a year, in a sponsorship amounting to R320 000.
• In its drive to facilitate the development of sport in South Africa Thuo Gaming WC further provided R300 000 in sponsorship for 60 representatives from the Western Cape to attend the inaugural Australian Football League South Africa FootyWILD National Championships in Potchefstroom.
• St. George’s Home for Girls in Wynberg, which takes care of some 40 orphaned, abused and neglected girls also received a R15 000 donation to assist with buying much-needed supplies.
• Marsh Memorial Homes in Rondebosch, which care for abused and neglected children, received a further R15 000.
• Thuo Gaming WC also contributed R15 000 towards Creative Access for Street People in order to support their feeding scheme which is currently feeding approximately 180 homeless people every day.
• In addition, Girls’ and Boys’ Town in Kenilworth, Claremont and Macassar also received R10 000.

The way forward

GPI will continue to ensure that its underlying investments focus on excellence with respect to the triple bottom line. GPI firmly believes that, over the long term, shareholder value will be optimised through this focus on sustainability. As GPI develops as an operating company in its own right, it too will contribute to community development. GPI will also ensure that all its activities are undertaken in a fully sustainable manner.

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