Widening our vision, sharpening our focus
Our goal of transforming lives is the nexus at which our commitment to sustainability and our commitment to commercial success meets. We do not see these as separate objectives, but as two sides of the same coin. We cannot continue to transform lives if we are not commercially sustainable and, equally, we are unlikely to be able to transform lives in a meaningful, lasting manner if we focus solely on profits and dividends.
Measuring our wider contribution
We cannot succeed in isolation. Our success is thanks to the support of the people of Kenya as much as it is to our own efforts and, in turn, it ripples back out in support of Kenyan society.
In recognition of this understanding, we are delighted to be able to articulate this reciprocal relationship for the first time in this year’s report.
Thanks to the insightful KPMG True Value methodology, we have been able to quantify both the value we create and erode in the economy, society and the environment, and consider this alongside the financial value we have generated for our shareholders.
The full calculation is available on page 22 of the report and it shows that the total value we created for Kenyan society in FY16 was KSh 414 billion, around 10.9 times greater than the financial profit the company made. It is also gratifying to learn that we sustained over 182,883 direct and indirect jobs during the year, a number that increases to over 845,846 jobs if the wider effects on the economy are included.
The True Value methodology expands the way in which we assess and communicate our transforming lives mission. It reflects our deepening understanding of sustainability and our growing need to understand how the way in which our business operations impact the society and environment in which we operate.
Recognising our weaknesses, as well as our strengths We also launched our new company strategy this year. We simplified our approach by reducing our strategic objectives from seven to just three: ‘Customer First’, ‘Relevant Products’ and ‘Operational Excellence’. As much as it is an expression of our maturing as an organisation, this new approach is a recognition of our areas of weakness as well. We have been guilty of being an overly network-led or technology-orientated company at times in the past. We have also been too focused on developing great products and then searching for customers that might want to use them.
By putting the customer first, the new strategy has flipped this around. We are now focused on finding out what our customers actually require and then creating solutions to meet their specific needs. This more focused approach has required us to restructure internally during the year and, in particular, to become less centralised. We now have six regions and we have devolved many of our operations into these regions, which we believe will get us closer to our customers and able to serve them better.
Corruption remains a significant obstacle
One of the single biggest obstacles to our long-term sustainability and shared prosperity remains corruption. It is disappointing that selfish, short-term enrichment at the expense of our people and resources remains the norm, but I am heartened by some of the hard-won progress we are making within the business community.
Every year, we forge closer ties and partnerships with likeminded companies in the private sector and it was rewarding to be part of the coalition that helped draft the Anti-Bribery Bill, which we hope Parliament will soon pass into law. It was also pleasing to note the enthusiastic response to the Anti-Corruption Conference we co-hosted with the UN Global Compact Network Kenya (GCNK) in December 2015. Over 400 delegates came together, representing a cross-section of the public and private sectors and civil society, and renewed their commitments to helping tackle this challenge.
“Corruption remains one of the single biggest obstacles to our long-term sustainability and shared prosperity.”
High ethical standards for suppliers
As part of our responsibilities to the people of Kenya, we believe in holding our suppliers up to the very highest of ethical standards. Accordingly, we continue to insist that suppliers commit to the Code of Ethics for Businesses in Kenya. Among other responsibilities, the Code requires companies to tackle corruption actively, to introduce internal controls and programmes to achieve this, and to report back to the GCNK annually on progress. We are pleased to note that 269 or 81% of suppliers with running contracts have signed up to date.
“Our tough stance has not made us popular with certain sections of the business community and forced us to make tough decisions at times.”
Although our tough stance has not made us popular with certain sections of the business community and forced us to make tough decisions at times, we remain steadfast in our belief that stamping out corruption is the single most important thing we can do to transform the lives of Kenyans and that it underpins every other effort we make in this regard.
Holding ourselves to the same high standards
It is important to acknowledge that we should hold ourselves — as a company and as individuals — to the same ethical standards and principles to which we ask others to adhere. It is equally important to admit that this is an area in which, I believe, we can still improve. We have come a long way in the last few years, but have we made these ethical principles part of our individual, personal values?
I believe that the time is right for us to think about our own ethical values. Individually, we need to decide on the standards of behaviour to which we will hold ourselves accountable. Are we, for instance, people who will act with honesty and integrity, no matter the consequences? Do we do the right thing, even if it isn’t in our own best interests?
“Are we people who will act with honest and integrity, no matter the consequences?”
These are important considerations for us as a company and, accordingly, I was pleased to be able to take part in the ‘I do the right thing’ campaign during the year, which encouraged us to become aware of our own ethical values and to take personal ownership and responsibility for these.
Helping restore dignity to refugees
Chakula Chap Chap is perhaps the partnership from this year of which I am proudest. A collaboration with the UN World Food Programme (WFP) and the Kenyan government, the partnership is helping refugees in Kakuma acquire food aid conveniently and with dignity.
Kakuma in northwestern Turkana County is home to over 180,000 refugees, most of whom fl ed from their homes because of the ongoing civil war in South Sudan and are living in extreme poverty.
Chakula Chap Chap, which means ‘Food Fast Fast’ in Swahili slang, is an initiative that enables refugees to use the M-PESA platform to obtain food from accredited distributors within Kakuma. Instead of waiting in lines for handouts and sacks of basic foodstuffs, refugees can use their food aid allowance to purchase the food they want, when they want, in much the same way that we might shop at a supermarket.
The initiative has restored the self-respect and dignity of the Kakuma refugees and created employment and business opportunities for them within the camp.
Helping to keep Kenyans safe
Another partnership between Safaricom and the Government of Kenya, and perhaps the biggest, has been the deployment of the National Surveillance, Communication and Control System. The handover of the state-of-the-art system, which has connected 195 police stations in Nairobi and Mombasa to 1,800 CCTV cameras, was completed in November 2015. The system is a response to the very real, and growing, threat of terrorist attacks and we remain proud of our non-profit role in building a system that will help the National Police Service to protect the safety of Kenyans and to save lives in an emergency.
Seeking to transform lives
Other notable projects from the year include: our M-Tiba health payment system, which is already helping over 10,000 low income earners save towards their healthcare expenses and receive donations; the Fertilizer E-subsidy programme, through which 20,798 farmers have successfully redeemed 29,705 bags of fertilizer; and Shupavu 291, an SMS and USSD-based education platform that enables students to take quizzes, search for information and even ask teachers questions in real-time.
Supporting innovative local entrepreneurs
We have always been a pioneering, proudly Kenyan company and we remain dedicated to supporting innovative local entrepreneurs in every way we can, which is why I am pleased to be able to report that the venture capital fund we set up last year has already borne fruit.
Exciting local start-up, Sendy Limited, which offers a motorcycle on-demand delivery service based in Nairobi, has become the fi rst recipient of investment and we look forward to seeing them grow.
The Safaricom Spark Fund is an expression of our commitment to stimulating innovation within the Kenyan developer community and I hope that we will be able to announce further investments in other Kenyan start-ups in the near future.
“I am satisfied with our progress overall, but I remain convinced that we can do a lot more to address emerging sustainability issues faster and to ensure that sustainability is even more deeply and meaningfully integrated into our personal values and daily functions.”
A year of transition and evolution
As I look back over the year, I am proud of our many achievements and the way that we have continued to push beyond traditional commercial boundaries in order to have a positive impact on society as a whole. In many respects, it has been a year of transition as we have embedded our new strategy and regionalised our structure, but I believe that both of these tasks have been largely completed and I look forward to reaping the benefits of this evolution in the year ahead.
“I am satisfied with our progress overall, but I remain convinced that we can do a lot more to address emerging sustainability issues faster and to ensure that sustainability is even more deeply and meaningfully integrated into our personal values and daily functions.”
In closing, I am satisfi ed with our progress overall, but I remain convinced that we can do a lot more to address emerging sustainability issues faster and to ensure that sustainability is even more deeply and meaningfully integrated into our personal values and daily functions. In this regard, I am excited about the prospect of using the recently launched Sustainable Development Goals to help us achieve this ambition and I look forward to reporting on our progress in this regard next year.
