Engaging with our stakeholders
We are committed to developing and maintaining quality longterm relationships with our stakeholders who have an interest in our products and services or have a stake in our business. It is through effective stakeholder relationships that we create shared value for the Group and our stakeholders.
Telkom commits to open communication with its stakeholders. We engage with our stakeholders on a range of diverse matters. We strive to engage with and respond to stakeholder concerns appropriately and in a timely manner, keep them informed and disclose how we use their suggestions.
Our stakeholder engagement framework and policy guide how we manage our stakeholder engagements. Our Stakeholder Management programme is structured around identifying stakeholders, engaging with them, understanding their various challenges and expectations, and aligning these to Telkom's strategic and operational objectives and targets.
Telkom's key stakeholder groups are the same as in FY2020. We engaged with stakeholders regularly through appropriate channels.
Stakeholder governance structure
Board
The Board is the ultimate owner of shareholder management matters and is responsible for managing response strategies.
Social and Ethics Committee
The Committee assists the Board in fulfilling its responsibilities by ensuring that key stakeholder relationships are effectively managed.
Group Chief Executive Officer (GCEO)
The GCEO ensures commitment to effective stakeholder management.
Group Exco
The Group Exco meeting plan includes critical stakeholder matters, among other agenda items. The stakeholder management profile is reviewed and discussed. Certain Members are assigned to monitor specific stakeholder groups.
Management
Management implements the overall stakeholder engagement process through the approval of the stakeholder engagement framework and policy.
Monitoring and reporting
Properly assessing stakeholder relationships is critical to Telkom. It allows management to channel time and effort to those relations that are assessed to be relatively weak. We assess the effectiveness of stakeholder engagements and relations through KPIs that are linked to value creation and relationship quality. We ensure this is measured accurately and consistently across the Group. We aim to disclose some of these KPIs in the short to medium term.
Our focus area in FY2021 was on how our stakeholders were impacted by COVID-19 and the interventions the Company took to address these challenges. In FY2022 we will continue to focus on the impact that COVID-19 has on our stakeholders and all other material stakeholder concerns.
How our stakeholders were impacted by COVID-19
COVID-19 has and continues to fast-track digital transformation in companies, and Telkom needs to adapt quickly or risk redundancy. Due to more people working and learning from home, there was a surge in fixed and mobile network traffic as demand for our telecommunications services increased. Our supply chain remained resilient. We continue to assess the adequacy of current inventory levels for short and medium-term consumption. Identifying strategic suppliers ensured that our service requests/orders had high priority, and we reviewed suppliers' business continuity plans.
Telkom frontline employees, such as field service technicians, worked through the peak of the pandemic, as electronic communication services were declared essential. These employees were the most vulnerable, as they continued to serve customers, while 80% of employees were empowered to productively work from home.
Customers were under severe financial pressure, particularly large corporate customers and SMEs, as some of them could not trade during levels 5 and 4 of the national lockdown.
Communities needed access to healthcare information and students were forced to adapt to online schooling.
Telkom played and continues to play its role as a good
corporate citizen in supporting the nation during the
pandemic. Our key
COVID-19 interventions are detailed
on the following pages. Various of these interventions
positively impacted more than one stakeholder group;
however, we have only included each intervention in its
primary stakeholder group.
The value we create for stakeholders
Our communities drive our social licence to operate. We have a responsibility to contribute to the socio-economic environment in which we operate. Civil society and forums can impact our operations.
- Affordable products and services
- Access to communication
- Financial support
- Access to servitudes
- Job creation and business opportunities
- The nature of Telkom's products and services allows it to add value to communities in a broad context
- Our infrastructure allows any person to transact through electronic banking, either from an ATM or a point of sale
- Providing affordable internet connectivity to individuals as well as SMMEs supports local employment and economic growth. This is further enhanced by Skills Development and enterprise and supplier development (ESD) programmes
- Telkom Foundation and other initiatives support communities, with a focus on education
- Partnerships with communities
- Good corporate citizen status
- Youth empowerment
- Enabling SMEs
COVID-19 concerns: Social and educational assistance
- Educational assistance, as students needed to adapt to online learning, which most students could not afford
COVID-19 interventions: Support education initiatives
- Launched our education platform Lightbulb Education
(Social and relationship capital) - Zero-rated access to educational sites for all public universities, technical and vocational educational training colleges and all public schools in South Africa
Customers underpin our existence and drive our reputation and brand. They consume the products and services from which we generate revenue. Customer requirements guide product or service development in terms of new trends.
- A relationship of trust and transparency
- Reliable, affordable and value-rich products and services
- Solutions that support cost management
- Timeous resolution of complaints and issues
- Effortless transactions
- Secure information
- Responsive communication on relevant products and services
- Offering our customers the most compelling voice and data value propositions on the market, be it budget friendly for individuals, or high-value data packages enabling business customers to stay connected while on the move
- Selling space on our communications towers enables communications businesses to access their customers without incurring passive infrastructure development costs
- Through our expertise and experience, we design, implement and manage our customers' operational ICT environments through optimisation of cost and complexity, providing a launchpad for their digital transformation
- By investing in e-commerce marketplace platforms, we help small and medium businesses to grow, which supports local employment and economic growth
- Affordable products and services and a compelling value offering
- Quality and improved network coverage
- Good customer experience
- Customer retention
- Increase in market share
COVID-19 concerns: Severe financial pressure
- Affordability of data
- Sufficient data to work from home and for online schooling
- Ability to manage liquidity and pay suppliers
- Ability to continue to trade on online platforms
COVID-19 interventions: Alleviate financial pressure
- Reduced data prices and increased speeds and broadband bundle sizes
- Granted payment holidays and extended payment terms during levels 4 and 5 lockdown
- Offered SMEs free access to the new Yep! marketplace and desktop applications since the launch of Yep! in May 2020
- Adapted stores to comply with COVID-19 health and safety protocols
- Improved online shopping and online access to Telkom products on various platforms
Media, opinion makers and influencers drive reputation and brand perception
- Access to information
- Responsiveness
- A relationship of transparency and trust
- Educating the public
We provide information and context on technical and operational developments as well as thought leadership on issues affecting our industry.
- Enhanced reputation
- Positive brand positioning of Telkom's products and services
Government and regulators publish policies, legislation and regulations that impact the cost of doing business and our ability to derive a reasonable return on investment. Regulators issue critical licences such as those necessary to use the radio frequency spectrum. They provide a regulatory and disclosure framework that grants confidence to capital providers. Noncompliance with legislation and regulations can result in penalties and fines.
- A relationship of trust and transparency
- Compliance
- Quality and affordable products and services across South Africa
- Effective competition in the market
- Confidence of capital providers in the market
- Contributes to the fiscus through financial contributions such as tax payments, licence fees and contributions to the Universal Service and Access Agency of South Africa
- Enables government's social and economic development mandate through investment in networks and infrastructure
- Shapes government policies through robust engagement with government, regulators and competition authorities, and participation in industry forums. Supports local procurement and employment and value-adding corporate social initiatives (refer to communities and suppliers and business partners)
- Fair regulations/policies that encourage investment
- Effective competition
COVID-19 concerns
Government: The effects of COVID-19 on society
- Curbing the spread of COVID-19
Communication challenges
COVID-19 interventions: Support a nation through crisis
- Developed a COVID-19 management solution in partnership with others (refer to the COVIDConnect case study)
- Donated 1 500 devices and data to the Department of Health to assist with track and trace
- Availed our training centre as an additional quarantine site
- Formed a disaster relief fund for the Red Cross in support of frontline healthcare workers
- Implemented various obligations under relevant regulations published by ICASA and the Department of Communications and Digital Technologies
- ICASA issued temporary radio frequency spectrum to deal with COVID-19 communication challenges
Image: Telkom direct store
Employees possess the intellectual capital required for all core and supporting business processes. They are our strategic partner in ensuring the Group's sustainability through performance, culture and skills.
- A relationship of trust and transparency
- Job security
- Fair remuneration and recognition and reward for performance
- Development and career progression
- A non-discriminatory and safe work environment
- Flexible work environment
- We provide employment and career development opportunities in a non-discriminatory environment, supported by an integrated, accessible and flexible Employee Wellness programme that extends to employees' families. Our remuneration includes various benefits to enhance value to employees
- Learning and Development programmes are aimed at fostering employee engagement, broadening our employees' skill base and developing skills for future leadership
- Productive, innovative and competent workforce
- Talent attraction and retention
- Ethical leadership
COVID-19 concerns: Employee wellbeing and safety
- Psychological impact of the pandemic on employees
- Exposure to the risk of transmission
COVID-19 interventions: Protect the health of employees
- Provided free testing and counselling to employees and their families through our wellness partner, ICAS
- Empowered approximately 80% of employees to productively work from home
- Supplied all necessary personal protective equipment (PPE) to frontline employees
- Conducted extensive internal communication engagement on COVID-19
- Launched a Mental Wellness programme to help employees cope with changes and loss
- Adapted stores to comply with COVID-19 health and safety protocols
- The Company is planning to provide free vaccinations for employees as well as a vaccination site
The investor community creates access to equity and debt markets. It drives demand for Telkom shares, thereby impacting our market capitalisation.
- Long-term sustainable return on investment
- Stabilisation of debt levels
- A relationship of trust and transparency
- Access to management
- Clearly articulated investment case
- Improved ESG disclosures
Telkom provides a sustainable return on the investments of financial capital providers through dividend payments, share price appreciation, capital and interest payments on bonds and interest repayment on loans.
- Access to equity and debt markets
- Investor confidence
- Fair valuation of share price
- Positive credit rating
COVID-19 concerns: Telkom's ability to manage COVID-19
- Telkom's liquidity and leverage
- Loan covenants and loan facilities
- Group profitability in a depressed economy given exposure to constrained industries
- Telkom's ability to continue with capital investment
COVID-19 interventions: Build financial resilience
- Cash preservation
- Strengthened balance sheet
- Sustainable cost management
- Disciplined capital allocation
Refer to the financial capital section.
Organised labour supports sound labour practices and assists in communicating labour-related matters. It is a strategic partner in shared value between Telkom and our employees. This relationship can influence the Group's strategic plans and operations through industrial action.
- A relationship of trust and transparency
- Proactive consultation on business changes that impact employees and collaboration on agreements
- Stable workforce
- Continuous commitment to drive skills development and employment equity progress
- Employees allowed to exercise their right to freedom of association
- Access to the workforce
- Support for shop stewards
- Facilitation of fee deduction
- Constructive relationships
- Satisfactory solutions to disputes
COVID-19 concerns
- Access to meetings scheduled for various forums
- Keeping abreast of COVID-19 developments
COVID-19 interventions
- Organised labour sessions continued through virtual channels
- Regular COVID-19 sessions were conducted with organised labour to discuss infections, raise challenges, etc.
Our value-adding partnerships with our suppliers and business partners allow us to deliver high-quality products and services to customers.
Suppliers underpin our value chain and directly influence raw materials and other input costs.
Business partners often represent Telkom to customers. Suppliers and business partners impact our ability to meet customers' expectations.
- Increased two-way communication
- Joint contractual obligation management
- Performance visibility and feedback
- Adherence to payment terms
- Effortless transactions
- Suppliers and business partners generate revenue through supplying their products and services to Telkom at fair terms
- Telkom provides a platform to partners, suppliers and service providers to make their products available to the market and strengthens their brands through association with and/or accreditation by Telkom
- We provide training and support to our subcontractors where relevant and required
- Our Enterprise and Supplier Development (ESD) and Transformation programmes support local procurement as far as possible. We also support local employment through supporting and developing local contractors
- Supporting local procurement, employment and upliftment of small and medium businesses
- Leading broad-based black economic empowerment (B-BBEE) status
- Joint market opportunities
- Supplier sustainability
COVID-19 concerns
- Lower volumes
- Late payment
- Supply shortages
COVID-19 interventions
- Fair distribution of volumes where possible
- Early payments to SMEs
- All payments are done on SAP, with daily detailed reporting which improved the turnaround time
- Mapped Telkom's high-risk supplier footprint to manage global supply shortages