CORPORATE GOVERNANCE

Stakeholder Relations

A summary of the group’s engagement with its various stakeholder groups is provided in the following table:

STAKEHOLDER GROUP	PRINCIPAL METHODS OF ENGAGEMENT	KEY ISSUES AND CONCERNS RAISED BY THE STAKEHOLDERS	HOW WE ARE RESPONDING
Employees	Regular dialogue and communication sessions Break-aways Team-building exercises Notice boards Newsletters Union meetings Training and development initiatives Intranet E-mail Store visits by senior managers Staff meetings National electronic engagement survey	Requests relating to employee benefits.	Human resources policies are all available to staff through our intranet. Ad-hoc requests are discussed on an individual basis, either in person, telephonically or via e-mail.
Institutional shareholders and investment analysts	Presentations arranged through the Investment Analyst Society Regular local and international investor relations meetings with executive directors and senior management	Consistency of trading performance particularly with respect to the Foschini brand.	Performance is improving and the processes being implemented should ensure consistent results in future.
Shareholders	Annual reports SENS announcements Profit announcements Annual general meetings Advertisements Group website E-mail	Consistency of trading performance particularly with respect to the Foschini brand.	Performance is improving and the processes being implemented should ensure consistent results in future.
Banks and other financial institutions	Regular meetings with senior management	Bank facility reviews and general banking issues.	There are no specific areas of concern.
Customers*	Interaction with store and head office staff Customer call centre Through our website E-mail and SMS Monthly statements Advertising Sponsorships Store promotions and competitions	Customers most frequently raise specific issues relating to an in-store experience.	We monitor issues raised by customers via our Customer Services Call Centre, our websites and we are linked to external customer service websites.

Suppliers	Suppliers participate in task teams and sessions with the group aimed at further developing our supply chain initiatives Communication with store and head office staff Regular site visits Audits and meetings Video conferencing Requests for general and compliance information and supplier fora	Longevity and sustainability of relationships between the group and suppliers. Illegal imports are increasingly impacting on the competitiveness of the local supply base.	TFG Merchandise Procurement division ensures responsible management and quality assurance in procurement practices. Formalised processes are in place to evaluate existing and potential suppliers, and monitor supplier performance. TFG Merchandise Procurement assists suppliers requiring corrective action to be taken in order to ensure compliance. The group meets with SARS and DTI through the NCRF to address concerns around illegal and under-invoiced imports.

Government and regulatory authorities	Formal meetings with government departments and business organisations Written and oral submissions regarding relevant draft legislation	On occasion government and regulatory authorities approach the group and/or the Retail Association (of which the group is a member) requesting input on draft legislation. Recently the group has been extensively involved with the drafting and content of the Consumer Protection Act’s Regulations and various Notices*; written submissions on the draft Regulations were sent to the Department of Trade and Industry. In addition meetings were held with the Department. We have also submitted comments on draft energy efficiency standards. Business Unity South Africa (the Retail Association is a member) communicates to its members any government and regulatory authority concerns as regards businesses, and also provides opportunities for member organisations to meet with government and regulatory authority representatives, submit comments on draft laws and be represented at formal interactions between business and key government and regulatory representatives.	The group submits comments on draft laws to the relevant government department or authority. The group will also assist the Retail Association with submissions on draft laws. Government representatives may ask for clarification on a submission or ask for suggested wording for draft laws. Where government and regulatory authorities approach the group with a concern or question they may have on the law, we will either meet with the government or regulatory representative in person or submit a written reply.

Department of Labour (DoL)	Via e-mail Ad-hoc meetings Inspections in stores	Key issues of interest include implementation of employment equity plans, and ensuring compliance with legislation regarding PAYE, COIDA, skills levies, and employment equity.	We engage on a continuous basis with the DoL on various issues, including our employment equity plans. We provide proof that the payments as required by relevant legislation have been completed.

Unions	Annual wage negotiation meetings Ad-hoc meetings as per workplace disputes	Issues pertaining to wage negotiations. Workplace disputes.	We strive to gain consensus in terms of wage demands, and we manage any workplace disputes and determine an agreement. Where it is policy related, this could necessitate a policy change.

Community	Community social investment initiatives undertaken by the group and by staff members Meetings with social investment representatives Sponsorships Advertisements Website and media releases	The most frequent questions we deal with are (a) requests for information on how we fund, from external stakeholders wanting to apply for funding; and (b) questions from internal stakeholders wanting to know more about our CSI activities.	NGOs requesting CSI funding are referred to our CSI website for information. If they believe that their application meets our funding criteria, they can submit an application. These applications are screened by the CSI department. Shortlisted projects are visited before a final decision is made. All successful and unsuccessful applications are acknowledged in writing. Funding is usually allocated for a maximum period of three years. We engage with our internal stakeholders via annual communication campaigns involving various channels of communication. From time to time, staff are also invited to participate in or support CSI activities.

Retailers' Association	Monthly meetings Correspondence via e-mail	Common issues relevant to the members of the association; this could be of a legislative or socio-economic nature that could have a direct impact on our business.	Active engagement on how to approach these matters as they will impact our business in order to determine whether a collaborative/ business-only approach should be implemented.

Retail and Wholesale SETAs	Monthly meetings Correspondence via e-mail	Common issues relevant to training and development within the wholesale and retail sector; this could be of a legislative, socio-economic nature and could have a direct impact on the skills levy refunds received by our business.	Continuous engagement with the SETA regarding mandatory and discretionary skills levy refunds and requests for the approval of learnerships.

CCMA	Meetings in the form of a conciliation/ con-arb or arbitration process Telephonic queries Written correspondence regarding referrals sent to the CCMA/ TFG	Issues referred to the CCMA are that of dismissals, retrenchments or any disciplinary process where the employee is dissatisfied with the outcome.	Defend the matter with specific focus on the substantive and procedural issues pertaining to those dismissals/disciplinary actions.
Labour Courts	Advocate representation at the Labour Court	Review of arbitration awards as set down by the CCMA and the merits pertaining to that case; defence of the award as set down by the CCMA.	Reasons for the dismissal of the award received at the CCMA; response to the applicant in defence of the award received at the CCMA.

Implications of Consumer Protection Act
The Consumer Protection Act became effective on 31 March 2011. TFG reviewed all its business processes and practices to ensure compliance with the Act. In line with TFG’s values and ethics, the Act reflects TFG’s aim of upholding customers’ rights and honouring the customer protection afforded in terms of the Act. Compliance with the Act affects almost all areas of TFG’s business, ranging from selecting suppliers, marketing, providing safe and quality end-products to consumers, rendering services of exceptional standards, ensuring that TFG’s customer service obligations extend beyond marketing, customer selection and purchase of products or services, to customer service after making a purchase. Complying with the Act and embracing its principles is a cornerstone in maintaining our sustainable business model.