Our 4 347 employees are the foundation upon which we are able to deliver on client and investor expectations. It is therefore important that we treat them with respect and safeguard their well-being.
Human resources (HR) has been transitioned into the group’s shared services model. This means that its divisional HR heads are supported by HR business partners who reside within the divisions. They are accountable for implementing strategy and are supported administratively by the central shared service resource that oversees tasks such as hiring, employee induction and exits, and administration of leave. In addition, the group has designated centres of excellence responsible for centrally developing strategy related to leadership, learning, reward, benefits, employee relations, well-being and transformation.
Employee engagement is generally conducted at a business unit level, however we also conduct an annual group-wide engagement survey to measure satisfaction.
Based on employee input and company need, we have identified our most material employee issues as:
Creating a compelling employer value proposition
In order to attract and retain a workforce equipped to deliver our unique offering, we need to ensure that we have created a work environment that appeals to the type of people we want to employ. To this end, Alexander Forbes revisited its employer value proposition (EVP) in 2016, aiming to enhance its status as an employer of choice and to more clearly articulate the benefits we offer our workforce. The exercise was based on a combination of raising awareness of our existing offering while making improvements as needed.
We believe that our positive work environment is influenced by how and where work takes place. Our headquarters at 115 West Street in Sandton was designed to inspire innovation and collaboration among our employees. Through a combination of open plan workstations and informal gathering spaces, there is a place to accommodate all kinds of working scenarios and requirements. This type of environment has been important for encouraging the group’s move towards a collaborative, holistic philosophy in line with our group strategy.
In 2014, following the group’s listing, we granted each Alexander Forbes employee 1 000 shares. We topped these up with a further 200 shares per employee during the financial year. The funding for this top-up allocation was made available from the senior management short-term bonus pool in recognition of the contribution made by more junior employees. These have a vesting period of three years and help to align employee interests with the company while supporting their financial well-being. Since the original allocation of shares the group paid dividends which flowed through to employees.
In 2016 we identified the opportunity to encourage employees to serve as ambassadors to the company. We now offer each employee 100 megabytes of free Wi-Fi data per day and encourage them to share their experience with Alexander Forbes on social media in line with our social media policy. The extra data also helps them to look after their personal matters as required and is intended to increase productivity.
We realise that our employees’ work/life balance is important and aim to support them with flexible working arrangements when the nature of their job allows. The recent economic downturn has depressed hiring throughout the group, and as a result, some employees are finding the workload and pressure growing. These sentiments were reflected in our annual employee engagement survey, which showed our engagement index score declining to 60.9 (2015: 63.8). While this is a decline from the previous year, we feel it is nevertheless in line with the industry. We continue to work closely with our employees to ensure they are able to perform their jobs without neglecting the other things that matter to them.
The strength of our EVP is an important tool for attracting and retaining the best talent. In 2016, we hired 803 new employees, up from 2015 (733). This increase accompanies a 6% growth in overall headcount (4 347, up from 4 111 in 2015), primarily as a result of hiring in the front line sales, administration and contact centre environment in South Africa and within the AfriNet businesses.
Total employee turnover increased to 10.5% (2015: 9.6%), largely due to higher turnover in entry level roles within the financial services division. This trend is in line with the industry norm; however we are making concerted efforts to improve employees’ understanding of the group’s EVP and strengthen career progression initiatives.
Dipesh Radia was one of 19 employees to receive the coveted SuperSERVE Platinum award during the year.
He went above and beyond the expectations of his role to resolve a task previously considered ‘undeliverable’ over a single weekend. In doing so, Dipesh secured more time for his colleagues to assess client refunds in detail, ensuring that only valid requests are processed.
Says Mr Radia, ‘I was pleasantly surprised when they called my name for the Platinum Award. The SuperSERVE awards are a great gesture to formally thank staff members for going the extra mile. Because I treat Alexander Forbes with the same care as I would if it was my own business, I was glad to have been recognised for my effort. It definitely motivates me to always give my best in everything I do. Thank you Alexander Forbes.’
All employees receive at least two formal performance reviews each year. These are facilitated by the HR department and delivered by line management. In 2016, we focused on improving the quality of these discussions to ensure that employees receive clear guidance on what is expected of them and how they are performing against these expectations. Survey results indicate that employees feel they receive valuable guidance from leadership in these discussions.
The outcome of performance reviews is now more closely linked to reward. For more detail on our short-term incentive scheme see the remuneration report.
Furthermore, we encourage and reward employees embodying the group values through our SuperSERVE recognition programme. Employees are encouraged to nominate their colleagues who best embody the group’s SERVE principles or demonstrate the Treating Customers Fairly (TCF) principles in their daily work. Rewards for commendable acts range from ‘badges’ to public recognition and up to R15 000 cash prizes. In the year under review, 19 employees were awarded platinum SuperSERVE awards – the highest level – in a formal event held in July 2015.
Our total salary expense for 2016 was R2.97 billion, up from R2.63 billion in 2015. We aim to compensate employees in line with the market but adjust compensation where justified.
Employees’ basic pay includes their salary as well as other benefits such as a car allowance, medical aid contributions, retirement fund contributions and guaranteed allowances.
In 2016, we developed a total reward statement, aimed at improving communication with employees on the various components that comprise their compensation.
The statements capture the salary, bonus, dividends, long-term awards and SuperSERVE rewards paid to each employee in the past 12 months. In addition, it highlights the various benefits they have access to through their employment with the company.
As Alexander Forbes grows and evolves, so too should our employees. We remain committed to developing the skills and experiences of our workforce, enabling them to pursue successful careers in support of our strategic intent.
In 2016, we spent R34 million on training as calculated by the Financial Sector Code (2015: R49 million). This enabled 2 268 employees to gain new skills through programmes including:
In addition, we provided bursaries to 278 individuals, of whom 76% were black (African, Indian, Asian or Coloured) in terms of B-BBEE classification. Furthermore, 48 individuals participated in our internship programme (84% black) and 81 participated in our learnership programme (75% black).
Each year, we re-evaluate our curricula and make adjustments based on the needs of the business. In 2016, the retail cluster’s business and distribution enablement team began to develop a retail academy with the purpose of delivering technical, skills and personal development. Once launched, the academy will aim to embed a culture in which all retail employees serve as brand ambassadors of the group’s services and solutions.
Learning happens not only in training sessions but also on the job. The new cluster structures introduced across the group have given employees the opportunity to broaden their product and business knowledge. This new operating model creates opportunity for further development.
Alexander Forbes takes a three-pronged approach to supporting its employees’ wellness. By addressing the physical, emotional and financial aspects of their well-being, we ensure that they are equipped to meet their full potential, both in the workplace and beyond.
All employees participate in our medical aid schemes unless opting out through their partners’ medical aid. This gives them access to a range of benefits, including a disease management programme. Our headquarters in Sandton contains a physiotherapist, a spa and a Wellness Clinic that was enhanced in 2016 through additional services such as the provision of annual flu vaccines and an on-site doctor. A series of wellness events give employees access to voluntary HIV counselling and testing (VCT) as well as other medical check-ups and information. Furthermore, employees are entitled to holistic health risk assessments that help to flag and address risk to their well-being. In 2016, 700 employees in SA took advantage of this offering.
Our employees’ emotional well-being is also important. Through our wellness programme they gain access to a range of counsellors who can provide advice on legal, marital and other social issues via telephone and face-to-face meetings as well as e-mail. E-care newsletters provide employees with information on managing stress, obesity and other issues they face.
During the year we piloted our financial well-being day programme with our own employees, encouraging them to learn more about protecting and growing their personal wealth. Advisers helped them to evaluate their own financial habits and recommended tools and products for investing, saving and risk coverage.
We aim to build a workforce that reflects the diversity of the countries we serve. Our performance with this regard is measured against employment equity in the Financial Sector Codes (FSC). In the year under review, the group scored 9.17 out of a possible 15 points for this element of the FSC scorecard, up from 8.32 in the previous year.
At year-end, 68% of our employees in South Africa were black (2015: 66%) and 43% were black women (2015: 42%). While we are generally pleased with the transformation taking place within our workforce, meeting our targets at mid- and senior management levels have been a challenge. Where possible, we aim to draw on our own talent pool to fill vacancies and in 2016, 70% of promotions were black employees. Our workforce is 58% female (2015: 56%).
In the coming year, the retail cluster will officially launch its retail sales academy, ensuring that employees understand the full suite of products we offer as well as the unique nature of the market. We also plan to address the gaps highlighted in the annual engagement survey and enhance the link between proficiency, performance and reward.