2019 Sustainable Business Report

SAFARICOM SUSTAINABLE BUSINESS REPORT 2019 INTRODUCTION OUR BUSINESS OUR MATERIAL TOPICS STAKEHOLDER ENGAGEMENT CONCLUDING REMARKS 8 MESSAGE FROM THE CHAIRMAN As Chairman of the Board, it is my pleasure to present our eighth annual sustainable business report. As this report describes, we continue to frame sustainability as a business response to the challenges we face as a society, and as a central facet of our purpose: to transform lives. In FY19 we sharpened our focus on the customer, providing affordable products and services, segmenting our product offering, innovation and development, and delivering our SDG- related commitments. CHANGES IN OUR OPERATING ENVIRONMENT By many accounts, last year was a challenging period for our business. While the information and communications technology (ICT) industry, like other sectors, had anticipated an economic turnaround after the prolonged electioneering period, depressed credit growth and strained consumer budgets made real recovery challenging. Several external economic, political and regulatory issues had a significant impact on the company and, in turn, a knock-on effect on progress towards achieving both our business and sustainability objectives. Increased taxes, especially those on mobile phone services, affected our customers’ ability to consume our products and services. The drought and rising inflation depressed discretionary spending among our customer base. The recovery of the tourism sector and governance issues in both the private and public sectors also had their effects. Nonetheless, our inclusive approach not only helped propel our sustainability agenda forward, but also enabled us to strengthen partnerships and deepen community engagement, which in turn contributed towards keeping the business steady in a challenging operating environment. SUSTAINABILITY PRIORITIES, STRATEGY AND CHALLENGES During the year under review, the sustainability priorities of the Board were keeping Safaricom customer-focused and taking on board the findings of a report commissioned by the Communications Authority, which is likely to affect our operating regulations significantly. We continue to establish numerous partnerships to enable us to achieve our SDG-related ambitions and have began integrating the goals into our employees’ annual performance targets. LOOKING AHEAD We remain confident that, despite the challenging business environment, we will continue to execute our strategy, seeking out new growth opportunities within and beyond the borders of Kenya and staying true to our purpose of transforming lives. This will enable us to remain purpose-driven and profitable as we grow value for our shareholders, deliver shared value to a broader stakeholder base and position Safaricom as a business that is fit for the future. Nicholas Nganga Chairman and Non-Executive Director Safaricom PLC “We continue to frame sustainability as a business response to the challenges we face as a society, as well as a central facet of our purpose to transform lives.”