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accountability
Risk Mitigation Further detail
R2. Competitive landscape
The competitive landscape has intensified over the
course of the year. This resulted in a sharp increase
in the unsecured lending book exposure in South
Africa prompting calls from various government
organs including parliament for a much closer
scrutiny of the unsecured lending industry.
R3. Perception of unsecured lending
The substantial growth in unsecured lending has
received significant focus from stakeholders and
media, and has created negative perceptions of
the sustainability of the unsecured lending
industry and of lending practices.
R4. Ability to recruit and retain appropriate
skills
The long term success of any organisation is
predominantly dependent on the quality and
retention of employees and their commitment
and passion for the business. The failure to retain
skilled employees or to keep them motivated
may lead to increased costs and deteriorating
performance.
The considerable increase in competition
recently, as well as the substantial growth in our
business has made the recruitment, retention
and employee satisfaction top priority in ABIL.
R5. Growing ABIL’s customer base
ABIL’s strategy is to continually improve our
customer value proposition by translating scale
and critical mass into greater customer value. To
achieve and maintain the scale, we have
to continue to broaden our customer base in our
chosen market segment.
We have sharpened our focus on managing
emerging risk on a market segment basis. In
addition, we have closely engaged with
government and regulators to share available
information, data analysis and emerging trends.
The group will continue this partnership with
government and regulators.
ABIL has also further improved its own
competitiveness through:
■ Active future target market segmentation;
■ A substantial distribution expansion programme;
■ A range of new and innovative products; and
■ A new customer interface that has improved
service to customers.
ABIL has engaged extensively with regulators,
industry bodies and stakeholders to raise
awareness of the risks of high growth in the
industry and has helped reposition the risk so
that participants took note and implemented
more sustainable practices.
In addition it was involved in consumer and
media education to improve the awareness of
the value added by the industry when used in a
sustainable and responsible way.
A number of strategies are implemented to
mitigate this risk, including an appropriate suite
of reward and benefit structures for existing
employees and ongoing refinement of an
attractive employee value proposition.
ABIL spends a significant amount of time and
energy in dialogue with our people.
While attracting new customers remains core in
growing the customer base, the group has also
placed emphasis on customer retention and
customer rehabilitation as part of its sustainability
strategy. Focusing on new customers and
growing customer numbers is necessary but not
sufficient without focusing on customer
retention. The group’s scorecards now also
include customer retention as one of the key
areas to focus on.
■ Strategic review –
page 38
■ Letter to
stakeholders –
page 28
■ Letter to
stakeholders –
page 24
■ Material issues –
page 36
■ Stakeholder
engagement –
page 44
■ Strategic review –
page 38
■ Employee section in
the web based
sustainability report
– pages 134 to 181
■ Strategic review –
page 38
African Bank Investments Limited | Integrated Report for the year ended 30 September 2012 115