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OUR BUSINESS
Despite ongoing and unforeseen challenges presented by the external environment and embedding of our revised Target Operating Model, bringing about a restructure of our organisation, it is through the fortitude of our employees that we were able to deliver yet another set of outstanding results and solid financial performance for the financial year
Ansie Ramalho CHAIRPERSON, BOARD OF DIRECTORS
OUR BUSINESS
Despite ongoing and unforeseen challenges presented by the external environment and embedding of our revised Target Operating Model, bringing about a restructure of our organisation, it is through the fortitude of our employees that we were able to deliver yet another set of outstanding results and solid financial performance for the financial year
Ansie Ramalho CHAIRPERSON, BOARD OF DIRECTORS
I welcome you to this Integrated Report for the South African National Blood Service (SANBS), as we celebrate 21 years since SANBS was formed in 2001.
As Board members of an organisation trusted to provide safe, quality blood products, our focus remains on sound governance, strong and ethical leadership and sustainable value creation for all our stakeholders.
I welcome you to this Integrated Report for the South African National Blood Service (SANBS), as we celebrate 21 years since SANBS was formed in 2001.
As Board members of an organisation trusted to provide safe, quality blood products, our focus remains on sound governance, strong and ethical leadership and sustainable value creation for all our stakeholders.
The external environment poses a number of risks to SANBS. The slow growth in the economy and rising inflation resulting in weakening social conditions such as poverty, poor health and unemployment. These are also the conditions that breed civil unrest as was seen in July 2021, which resulted in damage to SANBS blood clinics in KwaZulu-Natal (KZN). When the well-being and health of the population suffers, this limits the pool of potential donors while at the same time increasing the demand for blood-related products.
With the rise in oil prices as a result of the war in the Ukraine, there is an increase of the cost of doing business and our blood and related products and services. In addition, the weakening of the South African Rand (ZAR) against the Euro and US Dollar (USD) impacts major supplies (services and products) that are denominated in foreign currency. In an ideal world SANBS would be able to recover these costs from the main consumers of our products, notably private patients, medical schemes and government hospitals. However this is not an entirely feasible option – largely due to an inadequate government health care budget. These cost-recovery challenges may grow as medical aid membership becomes unaffordable for more South Africans, resulting in a growing number of public sector patients, thereby placing further strain on debt collections.
Environmental challenges including climate change and loss of biodiversity will further adversely affect social conditions and have an impact on all business as they are embedded in the societies in which they operate. Events such as the catastrophic floods experienced in KZN in April this year, compound the challenge of collecting blood and meeting blood demand.
Another risk that we need to factor into our operations going forward is the increasing medical-specialist skills shortage, which will have major implications for the South African health care sector. Indications are that this will worsen over the long term, with enormous cost implications for the country.
A key focus of the year was embedding the Target Operating Model to create further efficiencies in support of executing on our iHEALTh strategy. Management structures were realigned, ensuring integration across our entire value chain. To facilitate this new model of operating, two new executive positions were created, and I am pleased to report that we are already reaping the benefit of a significantly more integrated approach – to projects specifically and operations in general. In addition, our robust succession planning facilitated filling the two new positions with internal candidates. That, together with the fact that the Medical Director was also an internal appointment, meant that several new opportunities were created for internal promotions down the leadership chain. It also had the benefit of ensuring the continuity and stability of our operations.
Business continuity management and planning, especially during the floods in KZN, enabled the business to respond with agility to reroute testing to Gauteng. SANBS unfortunately lost the participation of many of its regular donors during the pandemic, and with many businesses opting for a hybrid workplace model, conditions have not returned to pre-Covid levels. This has presented both challenges and new opportunities for innovative, non-traditional blood collection strategies to meet blood demand, the details of which are highlighted in our report under SANBS @ a Glance.
To address the disclaimed audit opinion on the FY2021 Annual Financial Statements, capacity and skills were bolstered in the Finance Department bringing about process and control improvements which resulted in an unqualified audit opinion this year.
Quality and safety of blood products remain a non-negotiable. Our quality remains of the highest standard, having achieved 100% ISO 15189 accreditation of our laboratories and Donor Centres.
Our focused efforts to improve our B-BBEE level from a non-compliant status (FY 2021: Level 5) yielded positive results with SANBS achieving Level 4 B-BBEE status.
We are also pleased that Mount Edgecombe was awarded a Greenstar certification (5-star rating) and it is our intention to replicate this model with the upgrade of our Constantia Kloof premises.
The external environment poses a number of risks to SANBS. The slow growth in the economy and rising inflation resulting in weakening social conditions such as poverty, poor health and unemployment. These are also the conditions that breed civil unrest as was seen in July 2021, which resulted in damage to SANBS blood clinics in KwaZulu-Natal (KZN). When the well-being and health of the population suffers, this limits the pool of potential donors while at the same time increasing the demand for blood-related products.
With the rise in oil prices as a result of the war in the Ukraine, there is an increase of the cost of doing business and our blood and related products and services. In addition, the weakening of the South African Rand (ZAR) against the Euro and US Dollar (USD) impacts major supplies (services and products) that are denominated in foreign currency. In an ideal world SANBS would be able to recover these costs from the main consumers of our products, notably private patients, medical schemes and government hospitals. However this is not an entirely feasible option – largely due to an inadequate government health care budget. These cost-recovery challenges may grow as medical aid membership becomes unaffordable for more South Africans, resulting in a growing number of public sector patients, thereby placing further strain on debt collections.
Environmental challenges including climate change and loss of biodiversity will further adversely affect social conditions and have an impact on all business as they are embedded in the societies in which they operate. Events such as the catastrophic floods experienced in KZN in April this year, compound the challenge of collecting blood and meeting blood demand.
Another risk that we need to factor into our operations going forward is the increasing medical-specialist skills shortage, which will have major implications for the South African health care sector. Indications are that this will worsen over the long term, with enormous cost implications for the country.
A key focus of the year was embedding the Target Operating Model to create further efficiencies in support of executing on our iHEALTh strategy. Management structures were realigned, ensuring integration across our entire value chain. To facilitate this new model of operating, two new executive positions were created, and I am pleased to report that we are already reaping the benefit of a significantly more integrated approach – to projects specifically and operations in general. In addition, our robust succession planning facilitated filling the two new positions with internal candidates. That, together with the fact that the Medical Director was also an internal appointment, meant that several new opportunities were created for internal promotions down the leadership chain. It also had the benefit of ensuring the continuity and stability of our operations.
Business continuity management and planning, especially during the floods in KZN, enabled the business to respond with agility to reroute testing to Gauteng. SANBS unfortunately lost the participation of many of its regular donors during the pandemic, and with many businesses opting for a hybrid workplace model, conditions have not returned to pre-Covid levels. This has presented both challenges and new opportunities for innovative, non-traditional blood collection strategies to meet blood demand, the details of which are highlighted in our report under SANBS @ a Glance.
To address the disclaimed audit opinion on the FY2021 Annual Financial Statements, capacity and skills were bolstered in the Finance Department bringing about process and control improvements which resulted in an unqualified audit opinion this year.
Quality and safety of blood products remain a non-negotiable. Our quality remains of the highest standard, having achieved 100% ISO 15189 accreditation of our laboratories and Donor Centres.
Our focused efforts to improve our B-BBEE level from a non-compliant status (FY 2021: Level 5) yielded positive results with SANBS achieving Level 4 B-BBEE status.
We are also pleased that Mount Edgecombe was awarded a Greenstar certification (5-star rating) and it is our intention to replicate this model with the upgrade of our Constantia Kloof premises.
SANBS’ Board in accordance with the Memorandum of Incorporation (MoI), comprises of donor directors (elected by the National Council) of which there can be a minimum of six and maximum of ten, and three Board-appointed directors.
In the knowledge that the Board would lose very experienced members during the FY 2022, we placed emphasis on ensuring that the necessary skillsets were replaced in new Board appointments. We have mapped the current skills to the ideal skills for an effective SANBS Board, giving specific consideration to skills to be lost at the end of directors’ tenures.
SANBS’ Board in accordance with the Memorandum of Incorporation (MoI), comprises of donor directors (elected by the National Council) of which there can be a minimum of six and maximum of ten, and three Board-appointed directors.
In the knowledge that the Board would lose very experienced members during the FY 2022, we placed emphasis on ensuring that the necessary skillsets were replaced in new Board appointments. We have mapped the current skills to the ideal skills for an effective SANBS Board, giving specific consideration to skills to be lost at the end of directors’ tenures.
In conclusion, amid trying times for our country and globally, I am confident that SANBS is in a good position to continue delivering on its mandate and to progress with executing the iHEALTh strategy.
I am especially proud of the resilience of the SANBS teams as they continue to rise above the challenges and obstacles we face with energy and passion.
I would like to extend my gratitude to the Board, Executive and staff for their unwavering contributions.
A special thanks is extended to our donors without whose contributions 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 the SANBS and the opportunities that we have identified, which will deliver optimal results for our employees, donors, patients and other stakeholders.
Ansie Ramalho
CHAIRPERSON, BOARD OF DIRECTORS
In conclusion, amid trying times for our country and globally, I am confident that SANBS is in a good position to continue delivering on its mandate and to progress with executing the iHEALTh strategy.
I am especially proud of the resilience of the SANBS teams as they continue to rise above the challenges and obstacles we face with energy and passion.
I would like to extend my gratitude to the Board, Executive and staff for their unwavering contributions.
A special thanks is extended to our donors without whose contributions 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 the SANBS and the opportunities that we have identified, which will deliver optimal results for our employees, donors, patients and other stakeholders.
Ansie Ramalho
CHAIRPERSON, BOARD OF DIRECTORS