We believe that long-term relationships founded on trust and mutual benefit are vital to our business success, and such belief is outlined in the VBM philosophy. Stakeholder engagement is an important aspect of being a global corporate citizen. Engagement and dialogue contribute to the building and maintenance of relationships.
Due to the diverse nature of our business, both from a geographic and product perspective, Barloworld has a wide range of stakeholders. As a result, our activities may affect particular stakeholders in unique ways. Our patterns of engagement and interaction therefore differ from stakeholder to stakeholder. Information from stakeholder engagement activities is used to benchmark our performance.
| Review of stakeholder relationships | |
| Stakeholders | Methods of engagement |
| Employees | Individual perception monitor Best Company to Work For (South Africa) |
| Employee Value Creation (EVC) framework | |
| Intellectual capital review system | |
| Customers | Various customer feedback mechanisms for example PPC tollfree customer care line; customer satisfaction surveys for motor franchises, fleet services and car rental operations. |
| Shareholders | Investor relations programme |
| Ongoing management interaction | |
| Principals and suppliers | Various principal and supplier feedback mechanisms |
| Communities and NGOs | Group led CSI programme |
In the 31 countries in which Barloworld operates we have 25 716 employees. This lends itself to having a highly diverse and unique group. Many of our employees have long-term service.
The value that Barloworld attaches to each employee is further demonstrated by our commitment to equal opportunities for employment and advancement. Line management are the primary custodians of our principles and they are guided by the Barloworld Code of Ethics.
An analysis of Barloworlds board, executive and senior management levels reveals that more work needs to be done to achieve desirable equity levels within our leadership. We have a broad transformation agenda in our South African businesses, which includes employment equity programmes. We are committed to establishing and maintaining a workforce that reflects the South African demography, particularly the representation of historically disadvantaged South Africans (HDSAs) at all levels of management.

| Barloworld global workforce by occupational level | |||
| Within | Outside | ||
| SA | SA | Total | |
| Board (WW 23,22,21) | 9 | 2 | 11 |
| Executive (WW 20,19,18) | 26 | 17 | 43 |
| Senior management (WW 17,16) | 92 | 79 | 171 |
| Middle management (WW 15,14,13,12,11) | 1 730 | 1 229 | 2 959 |
| Skilled upper/technical (WW 10,9,8,7) | 5 301 | 5 262 | 10 563 |
| Semi-skilled/apprentices/trainee (WW 6,5,4,3) | 5 875 | 3 845 | 9 720 |
| Labourers/unskilled (WW 2,1) | 1 089 | 1 160 | 2 249 |
| Total | 14 122 | 11 594 | 25 716 |
| * WW Watson Wyatt grading | |||

For the success of Employee Value Creation (EVC), continuous engagement is a requirement and this is achieved through regular, structured employee meetings. Performance management and employee development is achieved through balanced scorecards and individual development plans, directly aligned to implementation of business goals.
The success of EVC largely hinges on the development of an understanding of how people and financial aspects of the business are integrated to ensure that value is created for Barloworld and then for our employees. The development of our employees is an intrinsic and necessary element of our journey towards achieving Barloworlds medium-term strategic goals EVC has now been rolled out virtually throughout all our businesses.
Therefore need our employees to learn and develop new capabilities.
Barloworlds desired leadership philosophy and Culture has been adopted by all of our businesses and all leadership initiatives are aligned to this philosophy and approach.
We continue to align our leadership development approach to ensure a common language with desired competencies and behaviours which are applied across the Barloworld businesses to assess key talent.
Barloworlds leadership initiatives, which include the Leadership Development Programme (LDP), Executive Development Programme (EDP), and EDP Alumni (commencing for the first time in January 2007) are Barloworld specific, exposing delegates to the strategic intent of our business, global best practice and action learning projects, make it both practical and value adding. Delegates are drawn from all businesses around the world. These leadership initiatives are the meeting ground for the identified future talent of our business. It is critical not only that Barloworlds leadership development process is properly targeted, but that succession planning is carefully managed. To date 363 managers and leaders (289 LDP delegates and 74 EDP delegates) have benefited since inception in 2000.
manage and develop senior managers by identifying high potential employees with leadership ability/potential, and through benchmarking, opportunities are provided to identify, evaluate and develop future training and development plans/programmes. Managing this assists us to retain our key talent. The ICR system tracks data on these key 200 employees within Barloworld in order for them to be nurtured as vital assets.
On an annual basis, the CEO and executive directors for each business, meet to discuss in detail the progress and development requirements of these senior executives.

39% (which equates to 9 930 employees) of our 25 716 employees have development action plans which are not only linked to their growth in their existing positions but for future opportunities within Barloworld. Training. An average of 1,6% of total payroll is spent on training. This is in addition to the 1% payroll levy paid to the relevant SETAs for our South African businesses. A broad range of technical and behavioural skills development are provided within the businesses focussing occupational levels of skilled upper/technical and semi skilled/ apprentices/trainee employees.
Excellent work continues in the area of technical training in many of the Barloworld businesses. 73% of our focused training head count and 79% of our training spend falls within the technical levels.
PPC currently has 160 trained and accredited assessors in different areas of the business available to assess competencies against the job models. PPC have 48 learners on learnerships at their well established accredited technical training centre. PPCs accredited training centre in Slurry focuses on fitter and turner; electricians; and plater/welders training and testing.
The world class accredited Operator Academy at Barloworld Equipment was established in late 2004 for theoretical and practical training and placed 123 learners on registered learnerships with the MERSETA on the pilot program to selectively move to the different levels. The employees are trained and registered assessors and moderators.
Within Barloworld Motor, the apprenticeship system is actively in place with approximately 308 apprentices registered with the MERSETA. Motor also has registered assessors within the business.
The required level of training investment differs according to businesses operations, and its technical complexity.

Additional programmes that are offered to our employees include retirement seminars, support and generic life skills training, which support continued employability.

| Re- | |||||||||
| trench- | |||||||||
| ments/ | |||||||||
| Resig- | Dis- | Retire- | redun- | Trans- | Recruit- | ||||
| Total | nations | Deaths | * | missals | ments | dancy | fers | ments | |
| Barloworld | |||||||||
| total | 4 030 | 2 721 | 95 | 666 | 256 | 292 | 168 | 4 824 | |
| Cement | 244 | 156 | 23 | 39 | 25 | 1 | 67 | 492 | |
| Coatings | 620 | 354 | 13 | 74 | 52 | 127 | 28 | 390 | |
| Corporate | 38 | 30 | 1 | 2 | 4 | 1 | 10 | 57 | |
| Equipment | 625 | 420 | 24 | 129 | 47 | 5 | 11 | 894 | |
| Industrial | |||||||||
| Distribution | 784 | 473 | 2 | 187 | 46 | 76 | 4 | 698 | |
| Logistics | 232 | 123 | 8 | 49 | 6 | 46 | 6 | 373 | |
| Motor | 1 250 | 1 028 | 19 | 141 | 60 | 2 | 28 | 1 709 | |
| Scientific | 237 | 137 | 5 | 45 | 16 | 34 | 14 | 201 |
For three consecutive years Barloworld has asked its employees for their perceptions about their work experience. The IPM feedback is then analysed by company, location, department and work area which allows in-depth understanding at a business level. Action plans are then development for improvement. In 2006 every business participated in the IPM process, with the majority showing year on year improvement.
Individual perception monitor results* 2005 versus 2006 |
||
| Business unit | 2006 mean | 2005 mean |
| Cement | 3.21 | 3.24 |
| Coatings Plascon South Africa | 2.99 | 2.90 |
| Coatings Africa | 2.72 | 2.67 |
| Coatings Australia | 3.02 | 2.95 |
| Coatings Automotive | 2.97 | 2.98 |
| Corporate South Africa | 3.25 | 3.16 |
| Corporate Botswana | 3.21 | |
| Corporate Namibia | 2.62 | 2.91 |
| Equipment South Africa | 3.01 | 2.97 |
| Equipment Spain | 2.49 | |
| Equipment Portugal | 2.71 | |
| Industrial Distribution | 2.83 | 2.71 |
| Logistics South Africa | 2.96 | 2.86 |
| Logistics International | 2.90 | |
| Motor South Africa | 3.05 | 2.99 |
| Motor Australia | 3.01 | |
| Scientific Laboratory | 2.71 | |
| Total | 2.96 | 2.96 |
| * Rated on a scale of 1 to 4 | ||
All South African Barloworld businesses entered individually into the survey for the second consecutive year. Our businesses have continued to improve their individual mean scores within the survey.
PPC continued their exceptional performance and over the last four years have achieved the following results – 6th place in 2003, 2nd place in 2004, 1st place in 2005 and 3rd place in 2006. PPC also ranked first in the Manufacturing, Engineering and Production Category for the fourth consecutive year. Barloworld Logistics ranked first in the Logistics, Shipping and Transportation category for the second consecutive year.
3. PPC
15. Barloworld Corporate Office
21. Barloworld Motor
40. Barloworld Equipment
49. Barloworld Logistics
The involvement of employees in decision-making is extensive throughout Barloworld. Barloworld experienced a very low impact on the industrial relations front in the past year. In South Africa, stay-away action and disruption to transport systems occurred as a result of non-work related issues in the form of socio-economic protest action, mainly against poor service delivery. However, none of our stakeholders were materially affected by these protest actions.
Barloworld received 1 017 CVs through the Barloworld website.
Barloworld continued its international assignment programme with the dual aim of leadership development and transferring/imparting its organisational culture on businesses in countries other than South Africa.
With varying frequency, most employee communications are conducted through personal contact that is supported by newsletters, committees, briefings and employee participation forums.
Another communication strategy is through the Barloworld Induction Programme. These facilitated sessions share Barloworld initiatives and strategies with new employees. The programme emphasises the philosophy of VBM and EVC.
Our quarterly newsletter, Building Barloworld, continues to share best practice, strategy and human resource initiatives with all our employees. Supported by the Building Barloworld video and CD, employees are able to meet colleagues from around the world and see Tony Phillips, Barloworlds CEO, sharing business messages and strategies. Almost every business has their own specialised internal publication that focuses on those issues that are unique to that business.
The recognition that access to leadership is important for the adoption of Barloworld goals and aspirations, a direct link to the CEO was developed in 2004 as part of the Barloworld intranet. This programme is called Tony Online and it gives employees access to the CEO through the Barloworld intranet.
The management of OH&S is an integral part of employee value creation and how we do business. As a company operating in different parts of the world, we apply the principles contained in the ILO guidelines on OH&S management systems that include:
We have established formal joint health and safety committees comprising management and worker representatives. These cover all staff in South African operations, in accordance with the Occupational Health and Safety Act. Elsewhere in the world, operations comply with local legislation. We do apply minimum standards and ethics where local legislation does not meet our standards. Furthermore, adherence to the OHSAS 18001 Standard for Health and Safety management ensures consultation with all relevant stakeholders regarding all matters relating to health and safety in the workplace.
The current OH&S management system is structured to ensure that legal compliance is achieved in all our operations.
Regular audits are conducted by Marsh (SA) (Pty) Limited.
Despite the initiatives and processes for managing safety, we regrettably recorded three work related fatalities during the year under review. One of the fatalities was due to a motor vehicle accident in Barloworld Equipment SA and two occurred in PPC as a result of shunting and construction activities. The recording and notification of occupational accidents and diseases across the group comply with group’s best practice and local and international legislative requirements. Accidents and incidents are monitored and trends analysed to prevent reoccurrences. To ensure that OH&S issues are comprehensive, training and communication are considered part and parcel of the OH&S management system. Thirteen individuals were compensated for noise induced hearing loss in South Africa.
With regard to health and safety, no material improvement notices or fines were issued.
| LTIFR | FATALITIES | OCCUPATIONAL | ||||
| DISEASES | ||||||
| Division | 2005 | 2006 | 2005 | 2006 | 2005 | 2006 |
| Cement | 0.40 | 0.59 | 4 | 2 | 9 | 13 |
| Coatings | 1.92 | 1.68 | 0 | 0 | 3 | 0 |
| Corporate and other | 1.18 | 1.97 | 0 | 0 | 0 | 0 |
| Equipment | 5.07 | 3.92 | 4 | 1 | 4 | 0 |
| Industrial Distribution | 1.99 | 4.71 | 0 | 0 | 0 | 0 |
| Motor | 0.59 | 0.99 | 0 | 0 | 0 | 0 |
| Scientific | 1.84 | 1.30 | 0 | 0 | 0 | 0 |
| Barloworld total | 1.94 | 2.31 | 8 | 3 | 16 | 13 |
We have 18 onsite clinics in southern Africa that provide a comprehensive range of wellness programmes to 6 120 employees.
Over the past three years we have embarked on an initiative to promote knowledge of employee HIV status. In South Africa, approximately 7 500 employees participated in “Know your Status” campaigns at 114 sites during the past two and a half years, with a 78% response rate. Of the participants, 6.8% are HIV positive. The prevalence amongst our employees in other southern African countries varies between five and 20% as determined by anonymous testing or “Know your Status” campaigns. Since adoption of the “Know your Status” programme, over R2 million has been spent on this programme and other prevention initiatives like anonymous testing.
Seventeen employees were placed on ill-health retirement or died as a result of Aids-related conditions at companies served by our onsite clinics. This equates to a staff turnover of 0.32% of employees per annum, down from a peak of 0.56% in 2004. This reduction is attributed to the greater use of antiretroviral medication.
The number of employees and their dependants on antiretroviral medication in South Africa include at least 93 via medical aid schemes, 33 through the company sponsored programme and nine via State facilities.
| Employees | |||||
| attending | Employees | % who | |||
| pretest | who know | HIV | % HIV | know | |
| Division | counselling | status | positive | positive | status |
| Cement | 1 925 | 1 904 | 122 | 6.4 | 95.1 |
| Coatings | 1 112 | 933 | 83 | 8.4 | 75.6 |
| Corporate and other | 618 | 557 | 73 | 8.2 | 62.7 |
| Equipment | 2 019 | 1 863 | 90 | 4.8 | 72.7 |
| Motor | 2 729 | 2 347 | 122 | 5.2 | 77.2 |
| Barloworld total | 8 234 | 7 501 | 485 | 6.8 | 78.1 |
At Barloworld we apply the principles contained in the ILO Guidelines on human rights and all conventions. Barloworld has developed policies and guidelines in relation to employment, labour relations, health and safety, and training and development that accord with the Universal Declaration of Human Rights, the Fundamental Human Rights Conventions and the provisions of the Constitution of the Republic of South Africa, which has an exceptionally strong orientation towards human rights as well as a formal Bill of Rights.
Legal protection of human rights varies in the countries in which Barloworld operates. Where gaps exist between the companys policy or guidelines and the law of the relevant country, the approach adopted is to follow fairness in principle and implementation, with applicable law as the minimum requirement.
All employees are engaged on terms which conform to the labour standards of the relevant country. In South Africa, conditions of employment are closely regulated and a body of legislation and industry charters prescribes employment measures designed to rectify historic prejudices suffered by large numbers of the population.
A number of business units have operations in Zimbabwe. The financial results from these operations have not been included in the group results due to the current economic situation in that country. Our businesses continue to operate and we currently employ 628 people in Zimbabwe. There has been pressure from external sources and investors to withdraw from these operations but we believe that the situation in Zimbabwe will improve. Withdrawing will cause further suffering for our employees and will not benefit our shareholders or any other stakeholders.
One charge of discrimination has been laid against Barloworlds industrial distribution operation in the United States with the Equal Employment Opportunity Council (EEOC). The complaint was initially dismissed but a second filing has been made and a decision on this matter is still pending.
For the year under review, there were no incidents of child, compulsory or forced labour in the company.
In the case of dismissal, a formal appeal may be lodged with the head of the relevant department. Such an appeal will be heard by the senior manager on site.
If this is successful, the employee will be reinstated retrospectively with no loss of basic employment benefits. Should an appeal fail, the dismissal will become effective in terms of the original notification.
The Barloworld grievance procedure is intended to create an environment that is conducive to good employee relations by taking prompt and fair action when employees have legitimate complaints. These grievance procedures consist of formal channels for resolving problems as early as possible. Responsibility for settlement of grievances vests in line management. In presenting a grievance, an employee may not be placed at a disadvantage through lack of knowledge or skill. There is a facility for representation by any other permanent employee. An interpreter would not be classified as such a representative.
Barloworld guarantees employees and their representatives, if any, that the use of the companys grievance procedure will not jeopardise either their respective positions or the merits of the case. This acts as a non-retaliation policy.
| 2008-08-05 Barloworld -- re-pricing of BBBEE initiative |
| 2008-07-28 Barloworld -- appointment of director |
| 2008-06-12 Barloworld - 10% BEE deal |
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