This Integrated Report aims to provide readers with material information and insights about performance for the financial year from 1 January to 31 December 2018. In terms of external factors, risks and opportunities, we take a longer-term view to enable readers to effectively assess value creation abilities, sustainability and prospects. Although this Integrated Report is primarily aimed at our shareholders, we take a systemic and strategic reporting approach. This is part of our commitment to transparent and relevant stakeholder reporting, and is enhanced through personal interaction and feedback.
We have transitioned to fully online integrated reporting. The investor centre on the Sanlam website contains the full Annual Reporting Suite, supplemented by additional information on sustainability, governance, shareholding and archived information. We are therefore able to update some of our information continuously and readers are able to quickly find information on specific topics by using the search functionality.
We no longer provide a separate sustainability report – the information related to all sustainability matters are contained in the sustainability portal on the website. Readers are able to select, combine and print sections according to their preference.
The new ordinary shares issued in April 2018 in anticipation of the Saham Finances acquisition resulted in a 1,6% increase in the weighted average number of shares in issue, with a similar dilution in earnings per share. The dilution will decrease once the increased participation in Saham Finances’ earnings is consolidated from the effective date of Sanlam’s acquisition of the remaining 54% stake in Saham Finances.
The content of this report is comparable to the 2017 report in terms of the entities covered, the measurement methods applied, and timeframes used for financial and non-financial data.
We continue building on the last few years’ efforts to integrate and improve our financial and non-financial reporting. In 2017 we explained the process we followed to identify financial resilience and prosperity as the theme encapsulating material sustainability matters. We continue applying this theme, with further refinement after a consultative process with the five clusters during 2018. These matters are specifically addressed in the cluster reports and in the online sustainability section of our investor relations site.
In 2018 we focused on our business model to describe what we offer to which clients where, and how we reach them. We are more specific about the inputs we require – key relationships and capabilities rather than six capitals – and we quantify the outcomes to illustrate value creation.
We recognise that Sanlam’s scale and federal operating model presents a challenge when developing one simplified business model. Therefore, we continue to address detail aspects of our business model in different narrative sections of the report.
This report (within the context of the Annual Reporting Suite) adheres to the following regulatory requirements and reporting guidelines:
We follow a combined assurance approach to support the integrity of information. This approach comprises internal management and audit functions, and external service providers. The financial data was subject to independent assurance by EY. EY provided an audit opinion on the Shareholders’ information and on the Annual Financial Statements. The opinion states that these elements of the Annual Reporting Suite comply in all material respects with the basis of accounting described in each.
Feedback on this report and the Annual Reporting Suite is welcomed. Please contact Sanlam Investor Relations on IR@sanlam.co.za
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Sanlam Limited (Sanlam) is the holding company of the Sanlam group of companies, which operates through several subsidiaries, associated companies and joint ventures. Sanlam Life Insurance Limited (Sanlam Life) is the largest operating subsidiary and the holding company of most of Sanlam’s operations in emerging markets. Sanlam Limited and all of its subsidiaries, associated companies and joint ventures are referred to as Sanlam or the Group.
Sanlam Limited is listed on the Johannesburg Stock Exchange (JSE), with a secondary listing on the A2X and the Namibian Stock Exchange (NSX).
This report covers the activities of Sanlam in South Africa, the Rest of Africa, India, Malaysia and selected developed markets, with the emphasis on South African operations, which contribute 72% to net result from
All subsidiaries, joint ventures and associate companies recognised in the Annual Financial Statements are included, apart from investments in consolidated funds (collective investment schemes and similar investment funds). These are consolidated in terms of International Financial Reporting Standards (IFRS) by virtue of Sanlam’s shareholding, but do not form part of the Group’s strategic operations.
For some non-financial metrics, only the South African operations are included, based on their relative size. The metrics to which this limitation applies are indicated where relevant.
Santam is a separately listed entity. Therefore, its employee data is not included in Group numbers; however, it is included in Financial Sector Charter (FSC) Scorecard reporting and where Group-wide programmes are discussed.
This report includes comprehensive forward looking information through the disclosure of Group Equity Value (GEV) information. Instead of only providing limited future growth and earnings information, GEV provides a valuation of future expected earnings from Sanlam’s life and non-life operations. Detailed disclosure is provided in respect of the main valuation assumptions used, sensitivities to the main assumptions as well as an indication of the accuracy of assumptions used through the annual disclosure of variances between actual experience and the assumptions used in the calculation of GEV.
In this report, including the GEV disclosures, certain statements are made that are not historical facts and relate to analyses and other information based on forecasts of future results not yet determinable, relating, among others, to new business volumes, investment returns (including exchange rate fluctuations) and actuarial assumptions. These statements may also relate to future prospects, developments and business strategies. These are forward looking statements as defined in the USA Private Securities Litigation Reform Act of 1995. Words such as ‘believe’, ‘anticipate’, ‘intend’, ‘seek’, ‘will’, ‘plan’, ‘could’, ‘may’, ‘endeavour’ and ‘project’ and similar expressions are intended to identify such forward looking statements, but are not the exclusive means of identifying such statements. Forward looking statements involve inherent risks and uncertainties and, if one or more of these risks materialise, or should underlying assumptions prove incorrect, actual results may be different from those anticipated. Forward looking statements apply only as of the date on which they are made, and Sanlam does not undertake any obligation to update or revise any of them, whether due to new information, future events or otherwise. Any forward looking information contained in this report has not been reviewed and reported on by Sanlam’s external auditor.
The Board of directors acknowledges its responsibility to ensure the integrity of the Sanlam Integrated Report and evaluated its preparation and presentation. In the opinion of the Board, the Integrated Report was prepared according to the IIRC’s Framework and addresses the material matters pertaining to the long-term sustainability of Sanlam, and presents fairly the integrated performance of the Group and the impacts thereof.
Johan van Zyl
Ian Kirk Group Chief Executive