The business landscape has changed considerably over the last decade, with all stakeholders in the value chain demanding greater outputs (Jensen, 2010). Shareholders are expecting sustainable returns on capital investments; top management is expected to achieve greater efficiency and sustainable financial growth; and employees and organised labour are demanding equitable rewards (financial and non-financial).

With the rise in social consciousness and economic pressures, management sees the need for their organisations to adapt more rapidly. News headlines are dominated by organisations engaged in labour disputes around wages, reorganisation initiatives (retrenchments) or internal employee announcements regarding business process re-engineering projects. In June 2015, unions − representing around 1.3 million public servants, inclusive of nurses – threatened to walk out from wage talks, raising the risk of a protracted strike (Reuters, 2015).

Remuneration strategy, policy and systems to support the modern business environment are of great importance and come under increasing scrutiny. This is evident where management seeks to motivate employees to deliver on shareholder expectations and improve efficiency and effectiveness. The practical reality is that an organisation’s performance (financial or non-financial) can be positively or negatively influenced by employees in various ways. The combination of employees and IT sets the tone for an organisation’s core capabilities. Competencies or capabilities are essential for the execution of organisational strategy, and these competencies are mainly the sum total of education, experience, knowledge and skills. Therefore, if a company is to compete on its intangible assets – its employees – it has to be informed and demonstrate thought leadership around what motivates employees to achieve and exceed their full potential.

Consequently, the Remuneration Committee (“the Committee”) completed a detailed analysis of the reward principles for the organisation. The principles and supporting strategies may be amended, based on ongoing analysis conducted during the creation of reward practices, policies and procedures that support the business strategies.


The AfroCentric Group is committed to developing, implementing and upholding sound total reward strategies and practices and applying reward principles consistently across the entire organisation and within those businesses where it owns the majority shares.

The reward strategy and philosophy:
  • Is consistent with and aligned to the vision, mission, values, and business objectives of the Group
  • Pursues the best interests of the Group, its shareholders, and its broad internal and external stakeholder base
  • Offers an appropriate mix of remuneration
  • Is fair, equitable and transparent
  • Is market-related
  • Is driven by and shows a commitment to rewarding performance, integrity, quality and innovation
  • Articulates a distinctive value proposition for current and prospective employees, which assists in:
    • Enabling the attraction, motivation and retention of high-calibre employees who have the skills, capabilities and values needed by the organisation
    • Allowing for the development of the full potential of all employees
    • Recognising and encouraging exceptional and value-adding performance
    • Achieving maximum motivational impact and desired behaviour through remuneration and reward programmes and practices
    • Creating sustainable employee satisfaction and engagement


AfroCentric aims to manage its remuneration and rewards in line with generally accepted reward practice. This includes, among others, the pursuit of the guiding principles below. These principles not only underlie the Group’s approach and rationale for its total rewards value proposition, they also provide a guiding framework for all its reward programmes, processes and policies.

Strategies and processes will be developed and implemented in relation to each guiding principle, according to the parameters set out below. The guiding principles for AfroCentric Group and the related strategies and processes the Group is working towards are:
  • A consistent and fair job evaluation system and process which forms the basis for reward management
  • Internal equity balanced with external competitiveness through reliable benchmarking
  • 'Determinants of pay' which include performance and position in the scale
  • Reward policies and practices aligned to the achievement of overall business strategy and objectives
  • Fair reward and effective performance management which motivates a high performance culture
  • A cost-to-company approach which includes company contributions to employee benefits, to allow employees the flexibility to manage their own benefits and reward portfolios according to their needs
  • An appropriate mix of total rewards, including financial and non-financial rewards
  • Relevant, transparent and fair career development opportunities which form part of total rewards offered
  • Reward communication which is comprehensive, transparent and timely
  • Line managers with active and defined roles in reward management
  • Proper reward governance standards maintained at all times


The value of a total reward strategy and related policies lies in the meaningful integration of different reward elements, contributing to improved organisational performance and employee engagement.

Therefore, the AfroCentric Group’s total reward strategy has three aims:
  • To provide an integrated approach for reward management that effectively attracts, motivates, engages and retains the talent required to achieve the desired business results
  • To align reward practices with business strategy through a process of analysis, and thereby ensure that the reward practices serve the business objectives
  • To adhere to legal, ethical and best practice standards, and to reflect good corporate governance and citizenship by complying with industry and statutory minimum standards
The total reward strategy involves continuous review and alignment to business strategy on the following components:
  • Job profiling and evaluation
  • Market survey and benchmarking
    • Market surveys used
    • Purpose of benchmarking
    • Process of benchmarking
    • Benchmarking market and comparators
    • Job families and core/critical skills
  • Fixed remuneration
    • Pay scale principles and structures
    • Determining salary
    • Remuneration review process
    • Benefits – all non-cash elements of the package (such as medical aid, pension/provident fund contributions, leave etc.) will be benchmarked to determine the Group’s competitiveness in this regard
  • Performance management
    • Role of performance management
    • Link between performance and pay
  • Variable remuneration
    • Role of variable remuneration
    • Variable remuneration programmes
    • Short-term incentive programme (“STI”) – analysis of all STI programmes in place to understand purpose, fit and how it lends itself to the achievement of organisational goals
    • Long-term incentives (“LTIs”) – identify appropriate possible plans/schemes
  • Recognition
    • What constitutes recognition?
    • Role of recognition
    • Recognition programmes
  • The working environment = a rewarding environment
    • The working environment philosophy
    • Working environment initiatives
  • Career development
    • Define and detail how career development forms part of the total reward value proposition
    • Identify and capture the career development practices currently implemented and make recommendations for improvements
  • AfroCentric’s employee value proposition


The Committee was established by the Board to act in the capacity of a Remuneration Committee for the Group.

The role of the Committee, having regard to the law and the highest standard of Governance, is to provide guidance and support to the Board of Directors in fulfilling its responsibilities to shareholders, employees and other stakeholders by ensuring that the employees of the Group are appropriately and equitably compensated for their services to the Group and motivated to perform to the best of their abilities in the interest of all stakeholders. The Committee conducts research on behalf of the Board and engages in benchmarking so as to provide guidance to the Board.

The Committee ensures that the Group Directors and senior executives are correctly appointed and fairly rewarded for their individual contributions to the Group’s overall performance, and to demonstrate to all stakeholders objectivity is practised in determining their remuneration in the interests of the shareholders and the strategic and financial health of the Group.


Fees paid to Non-executive Directors are market-related and the Committee observes market norms and practices, and the additional responsibilities placed on Directors by new legislation and corporate governance principles.

The remuneration of Non-executive Directors is reviewed annually and recommended by the Committee for approval by shareholders at the AGM.

The Chairperson’s remuneration comprises a single composite fee approved annually in advance, to compensate for services as a Director of AfroCentric. This includes services as a Director on multiple boards and committees.

Cover fees for FY2016 and proposed FEES for FY2017

The 2015 fees were presented to the members with a recommendation of an 8.4% increase for the Chairperson and a 4.6% increase for the Non-executive Directors. The rationale for this suggestion was based on the PwC report against the backdrop of the services sector (median quartile for medium cap Company):

The Committee adopted the increase of 8.4% for the Chairperson and 4.6% for the Non-executive Directors’ fees using the rounding-off apparatus and this was approved by the shareholders at the AGM held on 5 February 2016.

  Per meeting 2015   Per meeting 2016  
  (1 February 2015 –
31 January 2015)
(1 January 2016 –
31 December 2016)
Audit Committee Per meeting  
Chairperson 23 320   24 393  
Members 16 960   17 740  
Investment Committee Per meeting  
Chairperson 17 490   18 295  
Members 12 826   13 416  
Remuneration Committee Per meeting  
Chairperson 17 490   18 295  
Members 12 826   13 416  
Risk Committee Per meeting  
Chairperson 17 490   18 295  
Members 12 826   13 416  
Social and Ethics Committee Per meeting  
Chairperson 17 490   18 295  
Members 12 826   13 416  
Subsidiary Board Per meeting  
Chairperson 17 490   18 295  
Members 12 826   13 416