Pick n Pay Stores Limited

Social and ethics committee report

The social and ethics committee operates in accordance with the requirements of the Companies Act and King III, and is governed by a charter that is reviewed and approved annually by the board.

In line with the Group’s vision and culture, the objectives of the committee are to ensure that high ethical standards are applied in all areas of the business, as well as to review and approve the policy, strategy and structure for managing the social issues in the Group. The Group’s principle of “doing good is good business” is the cornerstone of the work done by the committee.

Role of the committee

The committee oversees the monitoring, assessment and measurement of the Group’s activities in the following areas:

• Ethics and code of conduct compliance
• Environmental, social and governance issues, including human rights, corruption, employment equity and transformation
• Social and economic development
• Relevant stakeholder relations
• Empowerment and transformation
• Enterprise development
• Corporate social investment
• Ethical treatment of animals
• Local, ethical and sustainable procurement
• Integrity of food products and ingredients
• Relevant regulatory, statutory and legislative compliance

The committee relies on management for the implementation of strategies and initiatives.

Composition of the committee

The social and ethics committee is chaired by an executive director, Suzanne Ackerman-Berman. Her position as director of transformation, chairman of the Ackerman Pick n Pay Foundation and head of the Pick n Pay Small Business Incubator, as well as her philanthropic work, makes Suzanne uniquely qualified to chair the committee. Other committee members comprise independent non-executive director, Lorato Phalatse, members of management responsible for corporate affairs and for human resources, the company secretary, senior management and technical experts on areas of mandate. Care has been taken to ensure that all levels and areas of expertise across the Company are represented on the committee.

Frequency of meetings

Director representation	Status	16 May   2013	6 August   2013	28 November   2013	13 February   2014
Suzanne Ackerman-Berman	Chairman and executive director	P	P	P	P
Lorato Phalatse	Non-executive, independent director	P	P	P	P
P = present

Period under review

During the period under review, the committee:

• presented its report to the shareholders at the AGM held on 25 June 2013;
• formalised the code of ethics, which was approved by the Board and published on our website, www.picknpayinvestor.co.za;
• continued to review relevant policies;
• reviewed mechanisms to encourage ethical behaviour such as the whistle-blowing policy, which was confirmed as adequate by the committee;
• regularly reviewed consumer complaints, which are also monitored by senior management, in line with the Consumer Protection Act; and
• considered the Company’s Level 6 rating for broad-based black economic empowerment (BBBEE) performance. The focus areas were employment equity, skills development and enterprise development. The Group is currently reviewing its plans and social responsibility structures in order to align with the newly promulgated revised BBBEE codes.

As a result of the Group’s commitment to conducting business in a sustainable manner, the Company remains on the Socially Responsible Investment Index of the JSE.

A review has been conducted of work done to date. The committee is of the view that, in all material respects, it has achieved its objectives for the 2014 financial year. There were no items reported on that would indicate non-compliance with the requirements of the social and ethics committee as required in terms of the Companies Act.

Suzanne Ackerman-Berman
Chairman: social and ethics committee

14 April 2014