Chairman’s Report
"It has been a year like no other for SANBS and the entire world…
It is through the resilience of all SANBS employees that we continued to deliver an outstanding set of results across all metrics in our scorecard in the midst of trying circumstances"
Ansie Ramalho
CHAIRMAN, BOARD OF DIRECTORS
INTRODUCTION
It is with great pleasure that I welcome you to this Integrated Report for the South African National Blood Service (SANBS), which is a demonstration of our integrated thinking and commitment to value creation for our stakeholders and sustainability for the future.
After serving 6 years as a donor elected non-executive Director, my tenure as Chairman of SANBS commenced on 22 January 2021. My predecessor, Getty Simelane retired at the AGM held on 21 January 2021 as her maximum nine-year tenure as board member came to an end. I would like to extend my appreciation to Getty for her support as I transitioned into my new appointment and for her exemplary leadership and fortitude in setting an excellent platform on which to continue delivery on the iHEALTh strategy and future proofing SANBS through innovation.
I am committed to oversee and support the future success of SANBS.
OUR CONTEXT
External Environment
It has been a year like no other for SANBS and the entire world.
The enduring effects of the Covid-19 pandemic and successive lockdowns have continued with far reaching adverse economic impact across our country, including the widening inequality in our society and implications on health care services. When considering the strong, direct relationship between economic conditions and the health of our population, it paints a concerning picture for the future of the health care industry.
For the SANBS specifically, it is these conditions that will put the pricing of blood and related products under pressure. In addition, the direct impact of Covid-19 on the supply (collection) of and demand for blood in the short term resulted in periods of shortage and in the long term may irrevocably affect collection strategies as South Africa settles into the “new normal”. Furthermore, medical aid membership may become unaffordable for even more South Africans and result in an increase in public sector patients, placing further strain on debt collections for SANBS for blood and related products and services.
Unfortunately, the SANBS was also not spared from the recent protests and looting in KZN and Gauteng. Our collections branch at Queensmead Mall in Durban was vandalised together with three other facilities in different parts of KwaZulu Natal. As a result, we were sadly forced to shut our doors and cease collections for 4 days to ensure the protection of our employees, donors and property. It also had a temporary effect on the movement of blood and samples to SANBS processing and testing facilities and other functions of blood banks. As political and social instability increase, these risks are similarly on the rise.
In addition to these challenges, policy uncertainty, lack of energy security, environmental concerns, technological developments and cyber threats are realities within our operating environment.
Evolving Regulation
The regulatory landscape remains top of mind with NHI pending. With the shrinking tax base and more demands on the fiscus, there are uncertainties as to how the NHI will be structured and funded and its potential limitation on private medical schemes. This could potentially have a direct impact on SANBS revenue streams. NHI, however, also presents an opportunity as access to health care must become more equal, resonating with the mission of SANBS to provide blood to all who need it. There are also moves afoot for SAHPRA to regulate blood products. We continue to work with both the DoH and the regulator as an active participant in and contributor to these developments.
Internal Environment
During these challenging and difficult times, it was especially pleasing to see how staff rallied and worked together to meet the challenges of the pandemic. Donor-facing staff were directly impacted with a number of them having contracted the virus or having had to isolate and despite this, the SANBS was able to continue collections and meet the demand for blood.
This same team spirit and energy were also evident in other projects conducted during trying circumstances, such as Patient Blood Management (PBM), research innovation in response to Covid-19, the debtors task team as well as the build and move to Mount Edgecombe to mention only a few. In all of these projects cross-functional teams rallied, united by the common purpose, ´trusted to save lives´. These experiences served to infuse all of us at SANBS with a new appreciation of how collaboration and resilience are mutually reinforcing.
Our organisational culture is an important driver of our value-creation efforts and values. The SANBS DNA index (as the measurement of our culture journey) continues to make great strides in an upward trajectory as we tackle our disablers and enhance our enablers. In 2021 we had 1972 employees participate in the process compared with 1805 in 2020. In our final score, we achieved our target of the 10% increase to 1.31 from the previous score of 1.19 (original baseline was 1.10). Staff engagement increased with monitoring of this in individual performance scorecards.
A key decision over the reporting period, given the effects of Covid-19 and the financial sustainability of the organisation, was the adjustment of the SANBS’ budget downwards in line with the expected decrease in demand and sale of blood products, and cost-saving endeavours that were introduced. SANBS must, as an ethical imperative at all times, provide blood to anyone who needs it regardless of the recipient’s ability to pay. We are grateful that we have been able to continue to do so over this period, safeguarded by healthy reserves that protects the organisation against at least some of the consequences of unexpected and high impact events, including the loss of income. It is our intention to continue on this course.
A top of mind focus was on efficient and flexible business continuity management and planning; the need for which was heightened during these times of uncertainty.
SANBS unveiled 7500m2 state-of the art laboratory in Mount Edgecombe – public can view testing and processing of blood from donor to patient
GOVERNANCE
The Board remains committed to fulfilling its mandate of providing an enabling corporate governance framework and supporting the SANBS’ management to deliver on its strategy.
There were several Board and leadership changes during the period under review.
Changes in management
The Board bid farewell to its former CEO, Dr. Jonathan Louw on 31 December 2020. Jonathan held the post of CEO for three years and was instrumental in the overhaul of the SANBS strategy in service of our purpose: Trusted to save lives. This birthed our well documented iHEALTh, anchored by our vision, mission and core values and which has guided operations since 2019. I have no doubt that Jonathan’s contribution to SANBS will be felt for years to come!
We welcomed Ravi Reddy into the position of CEO from January 2021. Ravi is in a strong position to lead SANBS with his experience of 36 years in the organisation and his tenure as COO, serving on the SANBS Exco for 20 years. Speaking to the calibre of person that he is, Ravi was recently appointed to the International Society for National Blood Transfusion (ISBT) as an honorary member and was the first African to receive the American Association of Blood Banks (AABB) President’s award.
In March 2021, Jackie Thomson left the organisation after serving 6 years as Medical Director. We thank Jackie for her contribution to SANBS over her tenure, most notably her work done on further developing and strengthening the role of the Medical Director and her team within SANBS and more generally the passion she brought to our organisation.
We welcomed Karin van den Berg to fulfil the position of Medical Director from 1 May 2021. Karin has 13 years of experience with SANBS and has a wealth of knowledge gained in heading up the research facility. She was also instrumental in spearheading the country’s Covid-19 convalescent plasma clinical trial in response to the pandemic.
Our new CEO and Medical Director were internal appointments which is testament to robust succession planning and the SANBS talent management framework. This allowed a seamless transition into these new roles with leadership already aligned and committed to the iHEALTh strategy and organisational culture and values.
Board appointments
At the last AGM, two of our donor non-executive directors; Faith Burn and Phindile Mthethwa retired by rotation and stood for re-election. Both were elected by Council and we were glad to welcome them back. Sadly, another two of our six donor directors, Rob Theunissen, the current Audit Committee Chair and Dr Patricia Knox Chair of the Clinical Governance Committee will retire at our AGM on 20 November 2021. They will not be eligible for re-election as they would have served a full nine-year term.
Concerning the category of board appointed (as opposed to Council elected) directors, the board had one vacancy to fill at the start of this reporting period. In our preparation for filling the existing vacancy and the donor director positions which will become vacant at the end of this calendar year, the Board through its Nomination Committee, has mapped the ideal skill-set for the SANBS Board to its current skills, also taking into account the skills that will be lost at the end of the year, as well as over the next few years due to retirement of directors who will have served their nine-year term.
As far as the board appointed director vacancy was concerned, the board decided to not only fill the one vacant position but to make two new appointments. These two appointments brought the total number of board appointed directors to three which is the maximum number director appointments by the board allowed in the MoI. This decision was made by the board to ensure succession and continuity of membership of the Audit Committee particularly in light of the disclaimed audit opinion on the annual financial statements. As a result, Thabo Mokgatlha and Shauket Fakie joined the Board from 16 April 2021 and 1 December 2020 respectively. As will be noted elsewhere in the report, both Shauket and Thabo are registered CA(SA)s with valuable and complementary experiences that they bring to the SANBS Board.
We welcomed Manickavallie Vaithilingum, a highly qualified and experienced in the medical field onto the Board from 1 July 2020. For nomination for election by Council at the AGM at the end of the year, the Board is targeting donor director candidates with a strong medical track-record as a further aspect of our succession planning and to broaden the existing medical knowledge and experience on the Board.
We also hope to bolster current board skills with proposing a legally or commercially skilled candidate(s).
Appointment of Company Secretary
Avril Manduna was appointed as Company Secretary effective 1 August 2021. She joins SANBS with a depth of experience and we look froward to working with her.
POSITION OF SANBS TO DELIVER VALUE INTO THE FUTURE
It is through the resilience of all SANBS staff that we continued to deliver an outstanding set of results across all metrics in our scorecard in the midst of trying circumstances.
We also hope to achieve an improvement in SANBS’ disclaimed audit opinion on the Annual Financial Statements following the positive steps of capacity being bolstered in the Finance function. Financially, SANBS is in a good place to continue delivering on its mandate and to progress with executing the iHEALTh strategy.
From a leadership perspective, we will focus on further strengthening succession planning and build on what has already been achieved throughout our transformation culture journey.
As we make greater strides towards automation, I am confident that the rollout of the Blood Establishment Computer System (BECS) system will make a big difference on how our organisation is managed with increased data analytics and intelligence to inform decision making and enhance operational efficiencies.
Another aspect to look forward to is the revised and approved Target Operating Model (TOM), the implementation of which will bring about a reorganising of management structures which are process based rather than on the silos of operational functions. This we trust will bring better integration across our entire business.
CONCLUSION AND APPRECIATION
In conclusion, in these unprecedented times of volatility and uncertainty, we all seek certainty. Overcoming challenges, failure and dealing with life’s unexpected events can be overwhelming and trigger stress and anxiety.
Although there are some things that are beyond our control, such challenges can also present huge opportunity for accelerated growth, exploration and new innovative ways of doing things which has been evident in how the SANBS teams have risen to the challenge, and maintained momentum.
We acknowledge and salute both our front line staff who risked their safety and that of their families on a daily basis to ensure our blood donor centres were fully operational, as well as our staff working remotely who have demonstrated agility to apply integrated thinking, increase cross collaboration and prioritise and maintain momentum with our strategic and operational projects in support of our iHEALTh strategy.
I would like to extend my gratitude to the Board, Executive, staff and Council for their unwavering contributions and support.
A special thanks is extended to our courageous donor stakeholder group; without whose contribution we would not be able to deliver on our purpose of saving lives.
Thank you to each and every donor for selflessly providing the lifesaving gift of life without expectation of reward.
I am optimistic about the future of SANBS and the opportunities that we have identified, which will deliver optimal results for our employees, donors, patients and other stakeholders.