Our trade-offs and key considerations

Operating responsibly and sustainably

We create value and deliver on our strategy by transforming the stocks of our capital through our business activities. We seek to operate responsibly and sustainably, thereby maximising value creation and minimising any negative impacts.

Apart from creating and preserving value, there are instances where value is diminished through our activities.

When making decisions on how to manage our business, we consider the trade-offs between capitals: we aim to maximise positive outputs and outcomes and limit negative outcomes. These are highlighted in our business model.

Making strategic trade-offs is key to ensuring we are well positioned for the future. We assess the availability and quality of capital inputs, balance the short and long term objectives and take tough decisions to create long-term value.

FINANCIAL CAPITAL

Our financial capital consists of the pool of funds that is available to us to collect blood, conduct research and development, provide services and invest in technology, people and growth.

It is largely obtained through grants, financing and generated through our operations. Refer to our CFO report .

Stakeholders Impacted
Key considerations and activities

In an ongoing challenging external and internal operating environment, from a financial capital perspective, our focus in 2021 was on:

  • Collections
  • Securing three important grants in support of Covid-19 research
  • Continuing to build alternate sources of income streams (albeit these were hampered by Covid-19)
  • Supplementing cost discipline measures
Trade-offs
  • We leverage financial capital to invest in our business. This has a positive impact on human, intellectual and the social and relationship capitals
Effect on business model
  • Our strategy aims to support delivery of our medium term targets, while we will continue to maintain a strong balance sheet (especially reserves) to protect us against any potential downside risks

Human CAPITAL

Our human capital refers to our people.

Our overarching objective is to create a rewarding place to work by providing a holistic offering to our people that spans a range of services intended to enhance the health, wellness and work-life balance. Refer to () for more information.

Stakeholders Impacted
Key considerations and activities

Given the impact of the pandemic, our focus on our employees (Human Capital) has been a top priority and further heightened our 2021 focus on:

  • Ensuring the health and safety of our people at all times
  • Complying with government expectations, and fulfilling our EVP with amplified attention on wellness, improved WFH capability – including equipment and ergonomic furniture (manufactured capital)
  • Amplifying communications (with an emphasis on online communications)
  • Continuing our culture journey
  • Redeploying staff to areas requiring additional resources
  • Creation of cross-functional teams
  • Significant investment in learning and development initiatives, with substantial conversion to online training
Trade-offs
  • Covid-19 has fast-tracked the adoption of working-from home-practices, underpinned by appropriate IT support to make this happen, as well as the way we operate through our head office, Mt Edgecombe and other sites in South Africa
  • Investment in initiatives negatively impacts our financial capital in the short term but positively impacts our human, social and relationship capitals, which, over the longer term, enables us to have the people and capabilities required to execute our strategy and meet performance targets
  • Our appeal as an employer of choice, (especially for employees who relate to our purpose, love science and medicine), and our brand value, in turn, increases our intellectual capital
Effect on business model
  • Within the context of the evolving world of work, we seek to develop relevant and value adding people practices, driving upskilling, engagement and productivity, as many of our employees are enabled to work remotely or apply a hybrid of part office/workplace and part WFH

Intellectual CAPITAL

Our intellectual capital includes our know-how, innovations, research and development, digital advancements and brand; ensuring that we remain sustainable and able to deliver on our purpose; enhancing reporting and decision-making.

Stakeholders Impacted
Key considerations and activities

In an increasingly complex world thwart with the effects of the pandemic, our 2021 year drove:

  • Building and maintaining a strong brand that resonates with donors and other stakeholders - with significant value adding research and development performed
  • Substantial investment in a new BECS (ongoing)
  • Maintaining an agile management approach
Trade-offs
  • Our investment in research and development, in particular relating to researching/understanding Covid-19, saw the reliance on the outcomes of the research by South African medical authorities in their decision making for the choice of vaccines to be rolled out etc. Reliance by international medical authorities and stakeholders has also increased with pleasing acknowledgement and positive effect on our reputation
  • This contribution to international and national health agendas had a positive effect on the building of our brand (intellectual capital) but impacted an already stretched workforce (human capital) in a tough pandemic environment where extensive new and additional requirements were expected of management and some employees
Effect on business model
  • Significant focus on R&D has seen and increased reliance on our employees for their valued and valuable insights/ contributions and has resulted in successful attraction of grant funding for R&D
  • Our agile approach and adaptability has resulted in fast-paced decision making capability, in the pandemic induced new normal

Manufactured CAPITAL

Our manufactured capital includes our business structures and processes, including physical assets, infrastructure (corporate offices and sites), products and services Through these, we are able to provide a personalised, safe and efficient experience to advance our purpose of being trusted to save lives; ensuring our long-term sustainability. Refer to ‘I’ in performance against strategy for more information.

Stakeholders Impacted
Key considerations and activities

Exploring innovative solutions to increase collections and blood supply, through:

  • Smart Fridges
  • Drones
  • Mobile donor centres
  • Alternative donor collection points
Trade-offs
  • Exacerbated by the ongoing pandemic and associated levels of lockdown and more recently the unrest in KZN and Gauteng, access to, and frequenting of our conventional collection points was negatively impacted. We must therefore not only maintain our sites, but actively invest in our new, alternative and innovative collection mechanisms - thereby reducing our financial capital but increasing manufactured capital intellectual capital, social and relationship capital
  • Maximising digital opportunities in the future will reduce our carbon footprint
  • Further automation may reduce human capital
Effect on business model
  • The need and demand for blood in South Africa continues – in an environment impacted by a pandemic (and more recently the riots in KZN and Gauteng) which heightens the importance of constantly innovating and executing our INNOVATION initiatives in our iHEALTh strategy

Natural CAPITAL

Our natural capital includes our environmental stewardship for both our internal operations and our products and services. Our internal aspirational targets assist in minimising our impact on natural resources, enhancing operational resilience against supply constraints (for example, water and power). Refer to (greening strategy) for more information.

Stakeholders Impacted
Key considerations and activities
  • We execute against a SANBS greening strategy that informs the decisions we make regarding our environmental impacts
  • Of most significance is the design, construction and now use of our Mt Edgecombe facility that was awarded a 5 star rating for Design
  • The nature of our business requires significant travel (and related costs) given a country-wide footprint. Travel was curtailed substantially due to lockdowns
Trade-offs
  • While certain business activities impact our natural capital (for example, use of fossil fuels and related emissions), these positively impact human, social and relationship and the financial capitals
  • Making long term decisions for sustainability and in particular our significant investment in Mt Edgecombe and investment in initiatives to conserve natural capital (like our energy efficiency and water conservation initiatives) reduce financial capital but increase natural, human, intellectual (brand) capital and social and relationship capital
  • The full use of drones will further reduce our carbon footprint and positively impact particularly our natural capital, as well as all of the other five capitals
Effect on business model
  • Our Mt Edgecombe is the standard setter for ourselves and will be the basis on which all our future building designs will be developed where possible

Social and Relationship Capital

Our social and relationship capital relates to our interactions with our stakeholders.

Developing and maintaining quality relationships with all our stakeholders is key to our sustainability and is a focus in all our interactions.

For more information refer to our stakeholders .

Stakeholders Impacted
Key considerations and activities
  • The effects of Covid-19 continue to ravage lives and life as we knew it. As the SANBS, we have stayed on course, focusing on what is expected of us to be trusted to save lives
  • We have heeded the call to play a national and international role in the understanding and fighting of the pandemic with critical research and studies
  • We have built confidence in our employees and donors that we care about, ensuring safe and healthy environments to work in and to donate blood
  • We have considered enhancing the understanding of the journey of blood for all our stakeholders in the design of Mt Edgecombe and we intend to be the beacon of a responsible corporate citizen by replicating this where we can at our other operations
  • We assess relationships to understand different needs and interests during these difficult times, especially our community, donors and our own people, responding appropriately to each group through our deliberated decisions, actions and performance
  • We have taken significant steps in promoting B-BBEE by improving our rating to a level 5
Trade-offs
  • Stakeholder-related investments in initiatives reduces our financial capital in the short term but positively impacts our social and relationship capital, which, over the longer term, enables us to have the community of stakeholders that are loyal and supportive to our brand, providing our social license to operate
  • Our appeal as an organisation to support the essential service of collecting blood and as an organisation that advances medical science, research and development and our brand, in turn, increases our intellectual capital
Effect on business model

Ongoing and evolving ways of engaging the hearts and minds of our stakeholders in the visible evolution of how we run our business though world-class:

  • innovation
  • research and development, participating in local and international initiatives