Highlights

Corporate governance

• The successful launch of the bank’s revised vision and values focused on aligning high standards of governance and ethics with daily operational realities.
• The bank kept pace with the implementation of new regulatory frameworks, including money laundering control and consumer protection legislation.
• The group was included on the JSE SRI Index (JSE Limited Socially Responsible Investment Index) and the Dow Jones Sustainability Index.

Economic performance and contribution

• Group financial performance was in line with stated targets: Return on equity (ROE) of 27,8% (ROE normalised of 25,2%); headline earnings per ordinary share 23% up (normalised 19% up).
• Wealth created by the group increased by 11% to R23 billion, with 43% allocated to employees; 14% to governments; 18% to shareholders; and 25% retained to fund future growth.
• Good progress was made towards meeting charter targets. In 2005 we achieved an audited score of 80,73% and an A rating (still to be confirmed by the governing body of the charter).
• The value attributable to employees participating in the Tutuwa initiative amounted to R1,5 billion at year-end.
• The bank was involved in empowerment financing deals worth R8,6 billion in 2005.
• Standard Bank was rated South Africa’s most valuable brand (worth R10,2 billion) in South Africa’s Most Valuable Brands survey, conducted by Interbrand Sampson.
• Five supplier summits that focused on improving supply chain management and supplier transformation were held across the country.
• Liberty Life purchased Capital Alliance Holdings Limited on 1 April 2005.

Social performance

• The bank extended its financial services reach in South Africa through various products including MTN Banking and the Mzansi Blue Account.
• Employment equity targets in 2005 for gender and racial representation were reached. The percentage of black managers in South Africa has increased from 19% in 2000 to 37% in 2005.
• A health risk management programme was adopted by the bank to assist in guiding employees toward a healthier lifestyle.
• The bank spent R60 million on social responsibility initiatives.
• Liberty Life spent R18 million on social responsibility initiatives.

Environmental performance

• The bank formalised an environmental policy and compiled an environmental legislation register.
• The bank was involved in the financing, development and successful inauguration of a Geothermal Power Project in Nicaragua.
• A new Occupational Health and Safety learning programme was developed.

Challenges in 2005

• Managing the resources involved in ensuring compliance in an increasingly complex regulatory environment.
• Managing the implementation of the charter.
• Executive focus areas and reporting lines were restructured to meet the needs of a more globally competitive environment in which we operate.
• To attract, motivate and retain talent within the organisation.
• For Liberty Life, dealing with the rulings by the Pension Fund Adjudicator and the accompanying negative publicity.

Looking ahead we will:

• Continue to embed sustainability thinking and practice across all operations.
• Continue the process of reaching our charter targets.
• Continue to improve people management to make Standard Bank an employer of choice.
• Encourage employees to “live the values”.
• Continue making our values a definitive part of the Standard Bank brand experience for all stakeholders.
• Finalise a revised code of ethics to align with our values.