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Service Issue 78

Service magazine addresses key issues related to government leadership and service delivery in South Africa. In this, Issue 78, November / December / January 2021/22, a range of topics are discussed that are highly relevant to all public and private sector stakeholders in the country.

Service magazine addresses key issues related to government leadership and service delivery in South Africa. In this, Issue 78, November / December / January 2021/22, a range of topics are discussed that are highly relevant to all public and private sector stakeholders in the country.

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<strong>Service</strong><br />

L E A D E R S H I P I N G O V E R N M E N T<br />

ISSUE <strong>78</strong><br />

NOV/DEC/JAN 2021/22<br />

LIMPOPO’S GOLDEN GROWTH<br />

OFFICE 22: THE NEW WAY OF WORK<br />

OIL AND GAS ON THE RISE IN SA<br />

NELISIWE MASANGO: MINDING THE<br />

GENDER AND RACIAL WEALTH GAP<br />

HEALTHCARE IN SOUTH AFRICA<br />

FOSSIL FUELS DEBATE


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or Search www.vodacombusiness.co.za


contents<br />

S<br />

IN THIS ISSUE | SERVICE, ISSUE <strong>78</strong>, NOVEMBER/DECEMBER/JANUARY 2021-22<br />

SERVE AND DELIVER<br />

A round-up of news, snippets and trends<br />

THE GENDER AND RACIAL WEALTH GAP<br />

Nelisiwe Masango discusses the great<br />

divide in South Africa<br />

OIL AND GAS ON THE RISE<br />

PASA outlines the vital role that gas<br />

can play in SA’s economic recovery<br />

3<br />

SOUTH AFRICA'S ENERGY MIX<br />

Scope grows for renewables<br />

6<br />

VALUE CREATION IN ESG<br />

The civil case for more socially and<br />

environmentally responsible behaviour<br />

10<br />

SOUTH AFRICA’S WATER SECURITY<br />

Collaboration between the private and<br />

public sector can solve the water crisis<br />

12<br />

LIMPOPO: THE GOLDEN GATEWAY<br />

Attracting sector investment growth and<br />

inclusive development<br />

14<br />

HEALTHCARE IN SOUTH AFRICA<br />

How inequity is contributing to inefficiency<br />

in this sector<br />

20<br />

OFFICE 22: THE NEW WAY OF WORK<br />

Unpacking the hybrid model of work<br />

24<br />

ALSO IN THIS ISSUE<br />

IFC<br />

VODACOM<br />

18 NMISA<br />

23 VEOLIA SERVICES SA<br />

30 BCX<br />

34 ESET<br />

IBC<br />

OBC<br />

BCX<br />

VODACOM<br />

32<br />

MUNICIPAL SPOTLIGHT: eTHEKWINI METRO<br />

The playground powerhouse, cosmopolitan<br />

city and mining mandate<br />

NEXT ISSUE<br />

36<br />

<strong>Service</strong><br />

L E A D E R S H I P I N G O V E R N M E N T<br />

ISSUE <strong>78</strong><br />

NOV/DEC/JAN 2021/22<br />

LIMPOPO’S GOLDEN GROWTH<br />

OFFICE 22: THE NEW WAY OF WORK<br />

OIL AND GAS ON THE RISE IN SA<br />

HEALTHCARE IN SOUTH AFRICA<br />

NELISIWE MASANGO: MINDING THE<br />

GENDER AND RACIAL WEALTH GAP<br />

FOSSIL FUELS DEBATE<br />

<strong>Service</strong> magazine | 1


S<br />

editor’s note<br />

Equal service for all<br />

The legacy of apartheid has left South Africa unequal in so many<br />

ways. It excluded a large part of our population from economic<br />

opportunities. Coupled with the slow economic growth of the past<br />

decade, not enough jobs have been created to absorb the unemployed<br />

and new entrants to the labour market. “We must acknowledge that<br />

inequality and privilege do exist in contemporary South Africa,” says<br />

Nelisiwe Masango, founder of Ubuntu Invest (page 6).<br />

“South Africa relies on a progressive tax system and social safety<br />

net to reduce inequality. But the rollercoaster of increased national<br />

debt means that government has had to reduce the scope of fiscal<br />

policy as a leveraging redistributive tool. This leaves much less<br />

available to divert funds to help solve the problems poor South<br />

Africans are facing. If government, however, shifted its collective<br />

mindset to become more responsive, the current situation would<br />

not be so hugely instrumental in perpetuating the problem,”<br />

Masango adds.<br />

Russell Rensburg, director of the Rural Health Advocacy Project,<br />

agrees that South Africa’s institutional frameworks prolong<br />

inequality, rather than address it. He says that publicly funded<br />

healthcare is not allocated based on need but is determined by<br />

each province’s relative share of the population. He believes that<br />

the country must find a way to make sure the availability of care is<br />

spread more evenly throughout the system and that we cannot look at<br />

the private and public sectors separately as one has an impact on the<br />

other. “South Africa’s healthcare system is inefficient – both public<br />

and private. The cost of healthcare is too high. In the long term,<br />

improving the quality of care in the public sector would balance out<br />

people’s need to have expensive medical insurance (page 32).<br />

Due to a relatively small payer base in South Africa, we have<br />

substantial revenue shortfalls, to the extent of R33-billion per<br />

annum just for water. Currently, there is insufficient cash in the<br />

system to afford the entire population water services. A culture of<br />

non-payment exacerbates the issue exponentially. The water sector<br />

needs money to maintain, operate and augment infrastructure.<br />

“The user-pays principle is key to reinstate water security, so<br />

all must pay, and the indigent population receive subsidies after<br />

paying something. I say this as currently there is insufficient<br />

cash in the system to afford the entire population water services.<br />

A thriving economy would reduce our indigent population – the<br />

highest in the world – but to thrive it needs revenue from all. All<br />

successful economies have all paying for water services at levels that<br />

all can afford. We cannot afford these inefficiencies and need to<br />

address them as part of kickstarting our economy,” says Benoît Le<br />

Roy, CEO of the South African Water Chamber (page 20).<br />

While everyone has the right to work, water and health, there is<br />

not equal enjoyment of these rights.<br />

“We cannot rely solely on legislation to solve the problem. We need<br />

a mindset shift. As a society, we can make a conscious choice to<br />

support and invest in small businesses that empower marginalised<br />

sections of the population,” Masango points out.<br />

In the case of Africa, SMEs represent approximately 80% of the<br />

economic activity on the continent. Nowadays, all that is needed to<br />

kickstart an entrepreneurial journey is data, a mobile device with<br />

a browser and social media.<br />

“We must acknowledge that inequality and<br />

privilege do exist in contemporary South Africa.”<br />

Which brings us to the new way of work. The hybrid model,<br />

in the simplest terms, can provide the best of both worlds; the<br />

flexibility to work at home and the freedom to have other priorities<br />

in life. There is no simple approach to effective hybrid working,<br />

but when the right model is in place, businesses have the potential<br />

to truly flourish. Our article on page 36 unpacks all aspects of the<br />

revolutionary hybrid way of work.<br />

Elsewhere, Limpopo is open for business (page 24) and don’t miss<br />

the next edition of <strong>Service</strong>, eThekwini Municipality works towards its<br />

vision of being Africa’s most caring and liveable city by 2030.<br />

Alexis Knipe<br />

Editor<br />

Editor: Alexis Knipe | Publishing director: Chris Whales | Managing director: Clive During | Online editor: Christoff Scholtz | Design: Simon Lewis<br />

Production: Aneeqah Solomon | Ad sales: Venesia Fowler, Tennyson Naidoo, Tahlia Wyngaard, Norman Robson and Vanessa Wallace<br />

Administration & accounts: Charlene Steynberg, Kathy Wootton | Distribution & circulation manager: Edward MacDonald | Printing: FA Print<br />

<strong>Service</strong> magazine is published by Global Africa Network Media (Pty) Ltd | Company Registration No: 2004/004982/07<br />

Directors: Clive During, Chris Whales | Physical address: 28 Main Road, Rondebosch 7700 | Postal: PO Box 292, Newlands 7701<br />

Tel: +27 21 657 6200 | Email: info@gan.co.za | Website: www.gan.co.za<br />

No portion of this book may be reproduced without written consent of the copyright owner. The opinions expressed are not necessarily those of<br />

<strong>Service</strong> magazine, nor the publisher, none of whom accept liability of any nature arising out of, or in<br />

connection with, the contents of this book. The publishers would like to express thanks to those who<br />

Support this publication by their submission of articles and with their advertising. All rights reserved.<br />

2 | <strong>Service</strong> magazine


snippets<br />

S<br />

SERVE AND DELIVER<br />

THE INTER-PARLIAMENTARY UNION ASSEMBLY<br />

In an address at the 143rd Inter-Parliamentary Union (IPU) Assembly<br />

in December 2021, Speaker of the National Assembly, Nosiviwe<br />

Mapisa-Nqakula, noted that the South African delegation was pleased<br />

that the issue of equity in the manufacturing and distribution of the<br />

Covid-19 vaccines was prioritised during the emergency item debate.<br />

This indicates that most countries are united in ending exclusivity and<br />

nationalisation of vaccines, Mapisa-Nqakula pointed out.<br />

The Speaker commended African parliaments for tabling an emergency<br />

item on equity in vaccine manufacturing during an Assembly plenary, which<br />

was fully supported by the rest of the world parliaments.<br />

The Speaker also expressed her pride in how the young delegation<br />

members spoke strongly on a wide range of issues, calling for parliaments<br />

across the globe to demonstrate practical and concrete action to resolve.<br />

This included the issues of women and youth representation to ensure fair<br />

and equitable representation of the world population in legislative bodies.<br />

“It is now time for the older generation to hand over the baton and<br />

allow young people to take over,” she said.<br />

The IPU, a global organisation of national parliaments, facilitates<br />

parliamentary diplomacy and empowers parliamentarians to promote<br />

peace, democracy and sustainable development around the world.<br />

RAMAPHOSA HONOURS FW DE KLERK<br />

“Serving as Deputy President from 1994 to<br />

1996, Mr de Klerk played an important role in<br />

the Government of National Unity, dedicating<br />

himself to the constitutional imperative of<br />

healing the divisions and conflict of our past.<br />

“Deputy President de Klerk’s passing, weeks<br />

before the 25th anniversary of our democratic<br />

Constitution, should inspire all of us to reflect<br />

on the birth of our democracy and on our<br />

shared duty to remain true to the values of<br />

our Constitution.” – President Ramaphosa on<br />

passing of Former State President FW de Klerk.<br />

The Former Deputy President passed away<br />

on 11 November 2021, after an extended period<br />

of illness. He was 85 years of age.<br />

SALGA UPSKILLING COUNCILLORS<br />

SALGA coordinates and delivers the Integrated Councillor<br />

Induction Programme (ICIP) in collaboration with a range of<br />

stakeholders within and outside of government. To be convened<br />

under the theme, “Enabling Ethical and Dynamic Political<br />

Leadership”, the purpose of the induction training is to entrench<br />

the culture of accountability and ethical conduct for the newlyelected<br />

councillors to build a capable developmental local<br />

government that is responsive to the people and communities.<br />

The virtual platform, known as the SALGA Leadership<br />

Village, will be introduced to the nation during the launch as<br />

a ground-breaking achievement that the organisation has<br />

put together to deliver its training programmes, generic and<br />

credit-bearing.<br />

NEW BOARD FOR NYDA<br />

President Ramaphosa appointed the new National Youth Development<br />

Agency (NYDA) Board designating Asanda Luwaca as chairperson and<br />

Karabo Mohale as deputy chairperson. Luwaca is the first female chairperson<br />

of the board, in line with the president’s commitment to advance women<br />

leadership at all levels.<br />

President Ramaphosa said: “I see the NYDA as a vital partner in the<br />

implementation of the Presidential Youth Empowerment Intervention<br />

and ensuring that young people are prioritised as part of the Presidential<br />

Employment Stimulus.<br />

“The new board brings together a group of individuals with diverse expertise<br />

and experience in youth development. I have every confidence that they<br />

will ensure sound governance of the agency and will dedicate themselves to<br />

the critical task of building a better future for the youth of South Africa.”<br />

<strong>Service</strong> magazine | 3


S<br />

snippets<br />

TRUST IN SERVICE DELIVERY<br />

Consulta’s eighth South African Citizen Satisfaction Index (SA-csi) shows<br />

that Citizen Satisfaction and trust in local municipalities to deliver basic<br />

services has dropped to its lowest ebb since the index's inception. The<br />

SA-csi for Municipalities 2021 measures the Citizen Satisfaction and trust<br />

in service delivery in eight category-A municipalities (metros): Buffalo<br />

City, Cape Town, Ekurhuleni, eThekwini, Johannesburg, Mangaung,<br />

Nelson Mandela Bay and Tshwane.<br />

In the 2021 Citizen Satisfaction Index, Cape Town again emerges as the<br />

leader on overall Citizen Satisfaction for the fifth consecutive year. Cape<br />

Town recorded a score of 61.9 out of a possible 100 – but is more than<br />

10 points above the same level score of 51.1 for all municipalities and well<br />

ahead of all other metros polled, which perform either on or below par.<br />

“Local government structures are the only sphere of government<br />

in South Africa where our Constitution stipulates a clear mandate: a<br />

functional body that ensures that citizens are provided with quality<br />

transport and roads; adequate spatial planning and housing; economic<br />

opportunities and development; essential services ranging from utilities<br />

to fire services as well as recreation and an environment to work, live and<br />

thrive in. For millions of citizens, this mandate is nowhere close to being<br />

realised,” explains Natasha Doren, Senior Consultant at Consulta.<br />

The SA Citien Satisfaction Survey 2021<br />

Overall citizen satisfaction score<br />

51.1<br />

Industry<br />

51.1<br />

44.0<br />

Buffalo<br />

City<br />

44.0<br />

61.9<br />

The overall Citizen Satisfaction level, as an average across all metros,<br />

lowest point in five years.<br />

Citizen expectations and perceived quality<br />

The overall expectations index has declined by an alarming 10 index<br />

points to 63.2, from a par of 73.4 in 2020 – the sharp decline in citizen<br />

Cape<br />

Town<br />

expectations signals a worrying breakdown in citizens’ trust in their<br />

metro’s ability to deliver services.<br />

THE SA CITIZEN SATISFACTION SURVEY 2021<br />

61.9<br />

52.2<br />

Ekurhuleni eThekwini Johannesb Mangaung<br />

their citizenry. urg<br />

52.2<br />

Detailed service quality evaluation<br />

The aspects under evaluation in the index include refuse removal,<br />

maintenance of and building new roads, keeping parks tidy, providing<br />

clean drinking water, access to electricity, sewage and stormwater<br />

drainage management and street lighting.<br />

According to the survey, Cape Town is the only metro that delivers<br />

on all these measures at margins significantly above par. Mangaung<br />

performs well below par on all scores, indicating a collapse in all service<br />

delivery aspects that matter<br />

to citizens.<br />

Citizen Trust<br />

Citizen Trust has declined to its<br />

lowest point since the index’s<br />

inception, dropping to a par of<br />

53.6 in 2021, from 60.7 in 2020<br />

and 64.9 in 2017. Cape Town is the<br />

leader on the trust index at 65.1<br />

almost 12 index points above par.<br />

Ekurhuleni (54.8), Nelson<br />

Mandela Bay (53.7), Tshwane (53.4)<br />

and Ethekwini (52.1) follow on par,<br />

while Johannesburg (48.4), Buffalo City (44.3) and Mangaung (38.4) are<br />

well below par on Citizen Trust. All metros show a sharp decline in these<br />

scores compared with 2020, except for Nelson Mandela Bay which<br />

50.1<br />

47.2<br />

32.6<br />

Nelson<br />

Mandela<br />

Bay<br />

50.5<br />

Tshwane<br />

2017 59.3 47.2 68.5 59.8 57.8 57.0 51.3 59.0 57.7<br />

2018 57.4 46.2 65.2 57.6 57.5 55.0 41.1 61.9 56.2<br />

2019 54.0 43.4 64.1 55.7 55.5 49.9 40.5 50.5 51.3<br />

2020 55.7 46.5 66.0 58.4 57.2 51.4 38.9 49.8 53.6<br />

2021 51.1 44.0 61.9 52.2 50.1 47.2 32.6 50.5 50.0<br />

50.1<br />

47.2<br />

remained the same.<br />

32.6<br />

50.5<br />

50.0<br />

Local government is the sphere of government closest to the people.<br />

It follows that the focus of local government should be on its citizens<br />

and delivering what the people need and expect as protected in our<br />

Constitution. An index like SA-csi serves a purpose in that it provides<br />

local government with a scorecard that is marked by the voice of<br />

50.0<br />

Citizen expectations and Buffalo perceived Cape quality<br />

Johannesb<br />

Nelson<br />

Industry Buffalo Cape Ekurhuleni eThekwini Johannes-<br />

Mangaung<br />

Mandela<br />

Tshwane<br />

The overall expectations City<br />

index has Town declined by an alarming 10-index burg<br />

points to 63.2, Bayfrom a par of<br />

73.4 in 2020 – the sharp decline in citizen expectations signals a worrying breakdown in citizens’<br />

2017 59.3 47.2 68.5 59.8 57.8 57.0 51.3 59.0 57.7<br />

trust in their metro’s ability to deliver services.<br />

2018 57.4 46.2 65.2 57.6 57.5 55.0 41.1 61.9 56.2<br />

2019 54.0 43.4 64.1 55.7 55.5 49.9 40.5 50.5 51.3<br />

Detailed service quality evaluation<br />

The aspects<br />

2020<br />

under<br />

55.7<br />

evaluation<br />

46.5<br />

in the<br />

66.0<br />

index include<br />

58.4<br />

refuse<br />

57.2<br />

removal,<br />

51.4<br />

maintenance<br />

38.9<br />

of and<br />

49.8<br />

building<br />

53.6<br />

new<br />

roads, 2021 keeping 51.1 parks tidy, 44.0 providing 61.9 clean 52.2drinking 50.1water, 47.2 access to 32.6 electricity, 50.5 sewage 50.0and<br />

stormwater drainage management and street lighting.<br />

Citizen expectations and perceived quality<br />

The According overall to expectations the survey, Cape index Town has declined is the only by metro an alarming that delivers 10-index on all points these to measures 63.2, from at a margins par of<br />

73.4 significantly in 2020 above – the par. sharp Mangaung decline in performs citizen expectations well below par signals on all a scores, worrying indicating breakdown a collapse in citizens’ in all<br />

4 | <strong>Service</strong> magazine<br />

Table © Consulta


snippets<br />

RISE IN UNEMPLOYMENT<br />

The Steel and Engineering<br />

SEIFSA economist Palesa Molise noted that on aggregate, the data<br />

Industries Federation of<br />

shows that 660 000 jobs in total were lost between the third quarter and<br />

Southern Africa (SEIFSA) is second quarter of 2021. The broader manufacturing sector lost 0.9%<br />

concerned by data released by of total employment, which equates to 13 000 jobs lost between both<br />

Statistics South Africa, showing a further quarters of 2021, while the number of employed people decreased<br />

increase in the unemployment numbers in the from 1 415 000 to 1 402 000.<br />

domestic economy.<br />

Disconcertingly, on a year-on-year basis, the manufacturing sector<br />

The latest Quarterly Labour Force Survey (QLFS) lost 58 000 jobs, representing a decline of 4%.<br />

shows an increase in the unemployment<br />

Molise added that the surge in unemployment numbers, coupled<br />

numbers in the broader domestic economy on a with a very high Gini coefficient of 63.0 in South Africa, is worrisome<br />

quarter-on-quarter basis from 34.4% in the second as this indicates the extent to which inequality is deepening in the<br />

quarter of 2021, to a high of 34.9 in the third quarter. This is the highest country. The issue of unemployment or rather the lack of employment<br />

unemployment rate since 2008. The concerning unemployment numbers opportunities continues to affect not only the economic status or<br />

reflect the impact of Covid-19, stricter lockdown measures, the July riots progression of a country but more importantly the livelihoods of all<br />

and overall depressed economic activity across all major economic sectors. its people.<br />

S<br />

TRANSPORT SECTOR CODES<br />

The Department of Trade, Industry and Competition (dtic) has been Although the dtic has resurrected the process, the timelines after<br />

under pressure to repeal or finalise the Transport Sector Code. The the appointment of the new Sector Council are still unclear.<br />

draft Amended Transport Sector Code made its first and only public According to Oberholzer, transformation to comply with the<br />

appearance in February 2016, making it the only set of Sector Codes Amended B-BBEE or the published version of the draft Amended<br />

that has not yet been aligned to the amended generic B-BBEE Codes Transport Sector Code is significantly more expensive and complex<br />

of Good Practice (Amended Codes). In the past, sector codes were than the current Transport Sector Code.<br />

repealed if they did not align with the Amended Codes after a period. Companies in the transport industry have been pushing for black<br />

Deon Oberholzer, CEO at Gestalt Growth Strategies, says that the ownership for some time now and are increasingly being measured on<br />

call for Sector Council nominations is significant because it shows that black ownership first rather than B-BBEE compliance.<br />

the ministry wants to resurrect the discussions on the transformation In May 2021, the Minister of the dtic, Ebrahim Patel, published an<br />

of the wider transport industry. This may bring years of speculation to a explanatory memorandum that sets out the correct approach and<br />

close and provide some much-needed clarity to the industry.<br />

interpretations for broad-based and employee ownership schemes.<br />

“If the Sector Code had to be repealed in a move similar to what It is aimed at clarifying the requirements if companies want to include<br />

we saw with the Construction Sector Code in 2016, it would shift the employees in a legitimate scheme or engage with a development<br />

responsibility to the industry to come forward with a new proposed scheme that helps with the meaningful development of black people.<br />

Sector Code. Companies in the Transport Sector would have to align Oberholzer concludes saying that companies in the transport<br />

with the Amended Codes until such time. However, there are significant<br />

differences between the Amended Codes and both the current Sector Codes and the Amended Codes because a revision or repeal<br />

sector need to understand the differences between the Transport<br />

and draft Amended Transport Sector Code,” says Oberholzer.<br />

of the codes will have a material impact on their B-BBEE ratings.<br />

<strong>Service</strong> magazine | 5


S<br />

finance<br />

Minding<br />

THE GENDER AND<br />

RACIAL WEALTH GAP<br />

in the 21st century<br />

“You got a dream, you gotta protect it. People can’t do something themselves,<br />

they wanna tell you, you can’t do it. If you want somethin’, go get it. Period.”<br />

- Will Smith, The Pursuit of Happyness [2006]<br />

Stories galvanise many of us. A rags-to-riches movie inspired the life of Nelisiwe Masango, financial markets analyst,<br />

founder of Ubuntu Invest and one of Entrepreneur magazine’s Top 50 Black African Women Entrepreneurs to Watch.<br />

Masango made the decision to one day own a brokerage, after<br />

watching The Pursuit of Happyness [sic], a movie that perked her<br />

interest in money. “My entrepreneurial journey began with the stark<br />

realisation that financial literacy was never prioritised in school. It<br />

is largely unheard of for young people today to be educated about<br />

the stock market.”<br />

She established her first company, Bear Run Investments, in 2013,<br />

a <strong>Service</strong>s SETA accredited training institution that specialises in<br />

investment training. Financial literacy is the driving force behind her<br />

mission to start a movement of fiscally astute individuals.<br />

In 2017, Masango was awarded the African Growth Innovation<br />

and Leadership award by international giant Frost and Sullivan,<br />

alongside Adrian Gore (founder of Discovery). She also represented<br />

South Africa at the 2017 World Forum for Responsible Economy in<br />

France, to discuss how entrepreneurship and financial literacy are<br />

required to build and sustain an effective global economy.<br />

6 | <strong>Service</strong> magazine


finance<br />

S<br />

Today, Masango owns Ubuntu Invest, a top-tier brokerage<br />

that is regulated and licensed with the Financial Sector Conduct<br />

Authority (FSCA) and is confidently backed by established<br />

international technology providers, ensuring that clients are<br />

provided with a safe, compliant trading and investment platform.<br />

Her goal is to give members of her community a chance to regain<br />

their financial confidence by providing them with the relevant<br />

knowledge and tools to capitalise on financial markets. To date, her<br />

company has educated and empowered over 30 000 people.<br />

We must acknowledge<br />

that inequality and privilege do exist<br />

in contemporary South Africa.<br />

“The Nguni term Ubuntu means humanity and is translated as ‘I<br />

am because we are’. One of humanity’s greatest driving forces is the<br />

desire for wealth, despite it being difficult to define. Working towards<br />

virtues such as trustworthiness, compassion, honesty and empathy<br />

creates a different kind of wealth.” Masango explains that our<br />

finances are a direct effect of our virtues, and that’s where Ubuntu<br />

and the spirit of wealth go hand in hand. “As businesspeople in the<br />

financial sphere, we spread the spirit of abundance, knowledge and<br />

generational wealth through entrenching culture and maintaining<br />

a deep understanding of financial markets.”<br />

THE GREAT DIVIDE<br />

“We cannot escape the fact that South Africa is a highly racialised<br />

and gender-biased society. According to Stats SA, the average female<br />

worker earns 30% less than a male counterpart in the same job.<br />

Income distributions show heavily racialised inequality in the South<br />

African labour market. And the reality is, the highest percentage of<br />

people who are unemployed are black. When compared to their white<br />

counterparts, black wage earners are simply earning significantly<br />

less,” Masango points out.<br />

“The legacy of apartheid has left South Africa unequal in so<br />

many ways. It excluded a large chunk of our population from<br />

economic opportunities, and black women remain among the most<br />

disempowered. Coupled with the slow economic growth of the past<br />

decade, not enough jobs have been created to absorb the unemployed<br />

and new entrances to labour market.<br />

“How can we, as a society, move towards ensuring that more women<br />

gain financial independence? We cannot discuss women’s financial<br />

independence and ignore the obvious gender gaps in corporate<br />

circles. Women are provided with fewer opportunities than their<br />

male counterparts. And not to mention the lower salaries. It is<br />

important to have open conversations and find practical solutions<br />

to bridge the gap.”<br />

hard. As a black woman, you must know that to make it, you may<br />

have to work four times harder than your white male counterpart;<br />

three times harder than your white female counterpart, and twice<br />

as hard as your black male counterpart.<br />

“If you accept this, you can and will succeed. Women can take<br />

ownership of their financial independence, and with that comes<br />

the benefit of endless freedom. It should simply be non-negotiable.<br />

Ultimately, women can contribute to their society effectively, run<br />

their businesses and not just be seen as someone that belongs in<br />

the kitchen.<br />

“Our schools have the perfect opportunity to make a lasting<br />

impact on how society solves the inequality problem. It goes beyond<br />

the curriculum. Rather than purely focusing on textbooks, the<br />

concept of inclusion should be taught as a soft skill from a young<br />

age. Immersing young people from diverse backgrounds in each<br />

other’s cultures and belief systems will instil acceptance and respect.<br />

It should be addressed head-on.<br />

“We must acknowledge that inequality and privilege do exist in<br />

contemporary South Africa. Let’s not tiptoe around it. It is through<br />

the acceptance of our privileged positions that we can address<br />

inequality in South Africa. And doing this through play and<br />

conversations on the playground is the perfect place to ‘start the class’.<br />

“The 21st century has brought natural, unexpected bridges to<br />

gaps in societal equity. Communication platforms have given a voice<br />

to women and other marginalised groups. We are now in a better<br />

position to create awareness, market ourselves, rally support and<br />

draw attention to injustices in a way that gets people talking.”<br />

THE STORY OF NELISIWE MASANGO<br />

The Pursuit of Happyness starring Will Smith is based on a true<br />

story. Suffering from financial hardship, Chris Gardner and his<br />

young son find themselves homeless. Gardner doesn’t give up<br />

hope and lands an internship at a prestigious stock brokerage<br />

firm. The pursuit of his dream of a better life (or “happyness”)<br />

is an arduous journey. Through sheer will and grit, Gardner<br />

overcomes insurmountable obstacles, transcends his<br />

circumstances and finds great success.<br />

“The message that I took from the film was not sentimental,<br />

it was practical. It made me aware that the stock market was a<br />

thing. I had no idea it existed until that point and the concept<br />

excited me.<br />

“At 19, I was hungry for prosperity, fresh out of high<br />

school and looking for a way to take on the world. I started<br />

researching the stock market – and through my learning, fell<br />

in love with the industry. My expectations remained realistic,<br />

though. I had no false ideas that I would achieve Gardner’s<br />

level of success in two to three years, so I set a reasonable<br />

goal and hit the ground running.”<br />

BREAKING THE [BREAD] MOULD<br />

“Black women can empower themselves despite the very real gender<br />

and race gap in the workplace. It is important not to allow the<br />

challenges we face to be a reason to give up. It’s about accepting that<br />

the system is flawed and that the only way to defeat it is by working<br />

Ubuntu’s tag line, “Spirit of Wealth” reflects the innate desire<br />

people have to achieve more. Ubuntu Invest aims to provide<br />

clients with the means to live good lives, while pursuing its<br />

vision of creating 100 new millionaires in five years.<br />

<strong>Service</strong> magazine | 7


S<br />

finance<br />

PAYING IT FORWARD<br />

Empowering those who would historically have not been given the<br />

opportunity, despite having the aptitude, starts with a stronger focus<br />

on skills development. This, combined with conscious creation of<br />

employment opportunities at a societal level, has the potential to<br />

reduce inequality – one person at a time.<br />

“South Africa relies on a progressive tax system and social safety<br />

net to reduce inequality. But the rollercoaster of increased national<br />

debt means that government has had to reduce the scope of fiscal<br />

policy as a leveraging redistributive tool. This leaves much less<br />

available to divert funds to help solve the problems poor South<br />

Africans are facing. If government, however, shifted its collective<br />

mindset to become more responsive, the current situation would not<br />

be so hugely instrumental in perpetuating the problem.<br />

“Despite legislation, which on paper is more progressive than it<br />

is in most countries, the reality is that South Africa is still one of<br />

the most unequal societies in the world. The World Inequality Lab<br />

reported that the richest 10% of our population owns more than<br />

85% of household wealth, while over half the population has more<br />

liability than assets.<br />

“We cannot rely solely on legislation to solve the problem. We<br />

need a mindset shift. As a society, we can make a conscious choice to<br />

support and invest in small businesses that empower marginalised<br />

sections of the population – particularly black women and youth.”<br />

THE COMMUNITY LEGACY OF WEALTH<br />

“The cycle of poverty is not easy to break, as it affects more than just<br />

the individual. Socioeconomic factors can inhibit the entrepreneurial<br />

spirit. Great entrepreneurs seek solutions that not only benefit<br />

themselves but help grow their own communities too.<br />

“My vision for South African entrepreneurs is to stabilise the<br />

community in which we find ourselves. We need to afford each other<br />

opportunities that will fully equip us to grow as independently as<br />

possible, but to also create credible businesses that will stand among<br />

experienced entrepreneurs. Our mission, as entrepreneurs, should<br />

be to leave a legacy that creates a desire, and presents attainable ways,<br />

of becoming successful.<br />

The concept of inclusion should be taught<br />

as a soft skill from a young age.<br />

“Partnerships are the secret to a successful enterprise.<br />

Understanding your market, which requires extensive research,<br />

is imperative. You must also be open to criticism as you find<br />

your niche and build your empire. The aforementioned interpretation<br />

of Ubuntu and the spirit of wealth maintains that without<br />

keeping others in mind, even if only as inspiration, success is not<br />

easily achieved.<br />

“To succeed in entrepreneurship, confidence is paramount;<br />

motivation is key, and passion about making a difference in society<br />

is the perfect catalyst. Keep believing in yourself. It takes time for<br />

people to recognise true talent, so do not let doubt put you down.<br />

Your story may just be beginning, and your pursuit of happiness will<br />

pay off, given patience and drive.” S<br />

SELF-HELP ADVICE FROM NELISIWE MASANGO<br />

“Setting up an essential self-employment or business toolkit<br />

in our current circumstances is easier than it was before –<br />

and more affordable. The pandemic has forced everyone<br />

to adapt to digital transformation. Previously, what would<br />

cost well over R50 000 in initial capital fees (for example,<br />

a small office, printer, desktop, Internet contract, etc)<br />

now costs considerably less by virtue of the new motto,<br />

‘I’m working remotely’. Nowadays, all you need is data,<br />

a mobile device with a browser and social media to<br />

kickstart your entrepreneurial journey.”<br />

8 | <strong>Service</strong> magazine


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S<br />

oil and gas<br />

Oil and gas on<br />

the rise in SA<br />

Petroleum Agency South Africa CEO, Dr Phindile Masangane, outlines the vital role that gas can play<br />

in driving South Africa’s economic recovery and in ensuring a transition to a clean energy future.<br />

Today the biggest threat to humanity is climate change and the biggest<br />

threat to South Africa’s social stability is the high unemployment<br />

rate, which has primarily been caused by economic stagnation.<br />

As the global economy recovers from the devastating effects<br />

of Covid-19, demand for oil and gas has gone up significantly. If<br />

there was ever a need for proof that oil and gas still drive the global<br />

economy, recent statistics demonstrate the trend.<br />

The world’s developed economies industrialised on the back of<br />

oil and gas production and use. Now, just as Africa is on the cusp of<br />

being a significant gas producer and is making plans to use such gas<br />

for power generation, industrialisation and economic growth, the<br />

negative effect of greenhouse gas emissions on the environment has<br />

become undeniable.<br />

The urgency for action to mitigate the risk of climate change<br />

is no longer debatable. Between 1990 and 2018 the top five<br />

emitters worldwide produced more than 50% of greenhouse gas<br />

emissions. During the same period South Africa contributed 1%<br />

to global emissions. This is by no measure insignificant, and as a<br />

responsible global citizen South Africa must take steps to reduce its<br />

carbon footprint.<br />

The UN Framework Convention on Climate Change was<br />

established in 1992 to coordinate the global response to mitigate<br />

the threat of climate change, and specifically to get countries to<br />

commit to policies and plans that will ensure that the average global<br />

temperature rise is kept less than 1.5°C above pre-industrial levels.<br />

The International Energy Agency (IEA) proposes that to<br />

achieve this goal the world’s energy sector must reach net-zero<br />

emissions by 2050. In its global energy net-zero 2050 pathway, the<br />

IEA acknowledges that there is no single pathway to this goal, as<br />

developed and developing countries face different socioeconomic<br />

challenges and have contributed disproportionately to greenhouse<br />

gas emissions to date.<br />

Country-specific pathways<br />

What a number of environmental interest groups seem to be ignoring<br />

in the IEA Net Zero by 2050 report is the acknowledgment that there<br />

will be a differentiated approach to a clean energy future, taking into<br />

consideration the cost of the new clean energy technologies and the<br />

economic consequences of transitioning for each country.<br />

South Africa’s economy has been predominantly powered by coal,<br />

which is also a significant contributor to the country’s economy in<br />

terms of GDP as well as employment. Of all primary energy resources<br />

coal is the most carbon-intensive, and South Africa therefore has a<br />

relatively high carbon-intensive economy, contributing about 1% of<br />

annual global greenhouse gas emissions.<br />

In addition to coal, South Africa imports oil, gas and petroleum<br />

products for its energy needs as the upstream petroleum industry is<br />

still at a nascent stage. The two recent world-class gas discoveries in<br />

the Outeniqua basin off the south coast of the country are the largest<br />

petroleum discoveries made in South Africa.<br />

The development of these discoveries has the potential to<br />

replace more than 2 300MW of diesel-fired electricity generation<br />

in Gourikwa, Dedisa and Ankerlig, thereby reducing the carbon<br />

emissions from these plants by more than 50% while eliminating<br />

sulphur oxide and nitrogen oxide emissions, which are also harmful<br />

to the environment. Gas is therefore an obvious bridge to a lower<br />

carbon future in South Africa.<br />

Importantly, these gas discoveries could restore the gas-to-liquid<br />

refinery in Mossel Bay to full production and profitability, saving<br />

about 1 200 direct jobs. A complete shutdown and abandonment<br />

of this refinery would not only lead to job losses at the refinery, but<br />

the effects would reverberate throughout the town of Mossel Bay<br />

and the Southern Cape region, since the refinery contributes about<br />

R2-billion a year, or 26% of the Mossel Bay economy, and 6% to the<br />

Southern Cape economy when producing at full capacity.<br />

The Petroleum Agency South Africa awaits the licensee of these<br />

gas discoveries submitting its production right and environmental<br />

authorisation applications when the exploration right expires, or<br />

earlier. The Agency expects the licensee to use world-class technologies<br />

and standards to minimise the effects of the gas and gas condensate<br />

production on the environment, while maximising the in-country<br />

benefit or local content from this development to support South Africa’s<br />

economic recovery. These discoveries could indeed support both the<br />

country’s economic recovery and its transition to a clean energy future.<br />

International interest<br />

Petroleum Agency SA (PASA), which encourages exploration<br />

and regulates the oil and gas industry, has noted the significance<br />

PASA AT A GLANCE<br />

Petroleum Agency SA (PASA) evaluates, promotes and<br />

regulates oil and gas exploration and production activities<br />

in South Africa and archives all relevant geotechnical<br />

data. The Agency acts as an advisor to the government<br />

and carries out special projects requested by the Minister<br />

of Mineral Resources and Energy.<br />

MISSION<br />

To promote, facilitate and regulate<br />

exploration and sustainable<br />

development of oil and gas<br />

contributing to energy security<br />

in South Africa.<br />

VISION<br />

A diverse upstream industry<br />

contributing to energy security<br />

through sustainable growth in<br />

exploration and development<br />

of oil and gas.


oil and gas<br />

S<br />

The Brulpadda and<br />

Luiperd discoveries of<br />

gas and condensate are<br />

the largest hydrocarbon<br />

discoveries made in<br />

South Africa to date.<br />

Shell International Limited<br />

of international oil companies committing to exploration off South Africa’s coast. Increased<br />

confidence by such companies can only lead to growth in the industry and with the massive gas<br />

finds in the Rovuma Basin off Mozambique, there are sure to be more companies interested in<br />

South Africa’s potential.<br />

In addition to adjudicating on coastal fields, the agency has awarded coalbed-methane-gas<br />

exploration rights in KwaZulu-Natal and natural gas exploration permits in the Free State.<br />

Natural gas also lies offshore to the west of South Africa in the Atlantic Ocean (Ibhubesi). Block<br />

2A of the Ibhubesi gas field north-west of Saldanha is estimated to have reserves of 850-billion<br />

cubic feet of gas.<br />

Dr Masangane says the two recent world-class discoveries “place South Africa in pole position to<br />

be a notable gas-producing country”. Once indigenous gas becomes available, it becomes much easier<br />

for the domestic gas market to develop, including beneficiation of gas to chemicals.<br />

“The Brulpadda and Luiperd discoveries of gas and condensate are the largest hydrocarbon<br />

discoveries made in South Africa to date,” she says. “These results are for only two drilled prospects<br />

in the Paddavissie feature where three further prospects remain to be drilled. There could be<br />

sufficient gas to feed the Mossel Bay plant at full capacity for more than 40 years.”<br />

The drilling campaign has long-term benefits to South Africa which include introducing frontier<br />

deep water (>1400m) exploration drilling, building confidence and potentially shifting petroleum<br />

exploration activities to private international oil companies (IOCs), de-risking deep-water acreage.<br />

This will encourage other IOCs to take risk in drilling deep-water prospects, which could result in<br />

the country discovering more oil and gas resources.<br />

South Africa’s coastal provinces stand to benefit from an increase in oil and gas activity. Special<br />

Economic Zones (SEZs) in the Western Cape (Saldanha and Atlantis), the Eastern<br />

Cape (Coega and East London) and KwaZulu-Natal (at Richards Bay) could<br />

each identify a niche in which to operate.<br />

Saldanha SEZ is already marketing itself as a centre for the marine<br />

sector and the oil and gas industries. The Saldanha Bay Industrial<br />

Development Zone (SBIDZ) is central to the plan to grow the sector in<br />

the Western Cape.<br />

The Western Cape Provincial Government and the National Department<br />

of Trade, Industry and Competition (dtic) invested R500-million in the<br />

development of core infrastructure at the Saldanha Bay IDZ. The SBIDZ<br />

has signed a lease agreement with the Transnet National Ports Authority.<br />

The Western Cape’s status as an oil and gas hub was enhanced with<br />

the opening of an open-access liquefied petroleum gas (LPG) import<br />

and storage terminal at Saldanha Bay. A public-private partnership<br />

is behind the R1-billion terminal, the largest of its kind in Africa.<br />

Investors include Sunrise Energy, the Public Investment Corporation<br />

(PIC), Royal Bafokeng Holdings and the Industrial Development<br />

Corporation (IDC). S<br />

Follow PASA on Twitter – @sa_petroleum.<br />

MEET THE CEO<br />

Dr Phindile Masangane was appointed as<br />

the CEO of the South African upstream oil<br />

and gas regulatory authority, Petroleum<br />

Agency South Africa, in May 2020. Before<br />

then, Dr Masangane was an executive at<br />

the South African state-owned energy<br />

company, CEF (SOC) Ltd, which is the<br />

holding company of PASA.<br />

Dr Masangane was responsible for<br />

clean, renewable and alternative energy<br />

projects. In partnership with private<br />

companies, she led the development<br />

of energy projects including the deal<br />

structuring, project economic modelling<br />

and financing on behalf of the CEF<br />

Group of Companies. Her responsibilities<br />

also included supporting the national<br />

government in developing energy policy<br />

and regulations for diversifying the<br />

country’s energy mix.<br />

In 2019, Dr Masangane was Head of<br />

Strategy for the CEF Group of Companies<br />

where she led the development of the<br />

group’s long-term strategic plan, Vision<br />

2040+ as well as the group’s gas strategy.<br />

From 2010 to 2013, Dr Masangane<br />

was a partner and director at KPMG,<br />

responsible for the Energy Advisory<br />

Division. She successfully led the capital<br />

raising of $2-billion for hydro and coal<br />

power plants expansion programmes of<br />

the Zimbabwean power utility, ZESA/ZPC.<br />

An alumnus of three universities, Dr<br />

Masangane has a BSc (mathematics<br />

and chemistry) from the University of<br />

Swaziland, a PhD in Chemistry from<br />

Imperial College, London and an MBA<br />

from the University of the Witwatersrand.<br />

Dr Phindile Masangane,<br />

CEO of PASA


S<br />

energy<br />

Scope grows for renewable<br />

energy in SA<br />

With the recent announcement that South Africa has signed a US$8.5-billion deal at<br />

COP26 to shift away from coal-powered energy, the country’s commitment to a just energy<br />

transition has been reconfirmed. Good news for South Africa’s sustainability aspirations, is<br />

that renewable energy technologies have caught up with their fossil fuel competitors.<br />

By Nicola Rump and Rob Gardiner, SRK Consulting<br />

The awarding of preferential bidder status to<br />

eight companies in March [2021] [1] demonstrated<br />

what could be regarded as something of a turning<br />

point in perceptions about renewables. The Risk<br />

Mitigation Independent Power Producer Procurement<br />

Programme (RMIPPPP) had called for bids to supply<br />

2 000MW to meet the immediate electricity supply gap,<br />

and another 11 813MW from various energy sources.<br />

The bids came from private producers who<br />

planned to use energy sources ranging from liquified<br />

natural gas (LNG) and diesel (mainly as back-up)<br />

to solar photovoltaic (PV) technology and battery<br />

energy storage systems (BESS). This provided a<br />

useful opportunity to gauge how the cost differential<br />

had closed between renewable energy generation and<br />

storage on the one hand, and fossil fuel options on<br />

the other.<br />

Pivoting out of the fossil fuel economy,<br />

of course, will fundamentally disrupt<br />

our coal industry over time.<br />

The final awarding of bids was based on valuefor-money<br />

propositions. Technology improvement in<br />

renewable power generation and battery storage is<br />

continuously driving down costs. This can be clearly<br />

seen in the cost comparison between the preferred<br />

bidders, as outlined [2] by the Department of Mineral<br />

Resources and Energy (DMRE).<br />

COMPARABLE COST<br />

In its announcement in March [2021], the DMRE<br />

noted that the prices for the proposed solutions<br />

ranged from R1 468 per megawatt hour (MWh) to<br />

R1 885 per MWh – with a weighted average price<br />

of R1 575 per MWh. This indicates that there is no<br />

longer much difference in the comparison, especially<br />

when factoring in the externalised costs of burning<br />

fossil fuels. While the US Energy Information<br />

Administration puts the carbon dioxide emissions<br />

of LNG at almost half [3] that of bituminous coal,<br />

there are growing arguments against South Africa<br />

becoming over-reliant on LNG.<br />

Such arguments and others against the use of fossil<br />

fuels have as much to do with the country’s general<br />

air quality as with our climate change commitments<br />

in terms of the Paris Agreement. According to the<br />

World Health Organization [4] , we are rated 30th in<br />

the world in terms of polluted air – with 56 milligrams<br />

of pollutant per cubic metre. By comparison, China’s<br />

air had 90mg/m 3 , placing it 15th in the rankings;<br />

the world’s cleanest air can be found in Finland, at<br />

just 12mg/m 3 .<br />

Similar environmental concerns exist in relation<br />

to the impact of fossil fuels on our increasingly<br />

scarce water resources. The exploitation of coal has<br />

taken its toll on water quality in mining regions,<br />

and considerable water volumes are also used in coal<br />

preparation and coal-fired power stations. Climate<br />

change will make rainfall more variable and difficult<br />

to predict, exacerbating water risks going forward.<br />

INNOVATING WITH RENEWABLES<br />

The point that is emerging quite strongly is this: the<br />

cost competitiveness of leveraging renewable energy<br />

through technologies such as solar PV is really no<br />

longer in question. The focus has shifted to questions<br />

of scalability and base load. The exciting trend<br />

here is the rapid growth of battery storage, with its<br />

potential to overcome to some extent the natural<br />

cycles inherent in renewables.<br />

Like all innovations, this field is replete with<br />

opportunities and challenges. Ideas need to be<br />

practically applied before they can be proven,<br />

Nicola Rump,<br />

Principal Environmental<br />

Scientist, SRK Consulting.<br />

Rob Gardiner, Partner,<br />

Principal Environmental<br />

Scientist, SRK Consulting.<br />

12 | <strong>Service</strong> magazine


energy<br />

and ongoing implementation will build an iterative process<br />

of continuous improvement. For South Africa, the DMRE<br />

announcement in 2021 of the increased licence threshold<br />

for renewable energy production by private developers from<br />

one megawatt (MW) to 100MW is an important step forward.<br />

There is certainly a level of pent-up demand for opportunities<br />

like these in the mining sector – and this can pave a path of<br />

technological exploration on our home soil.<br />

Fortuitously, the positive run in commodity prices may place a<br />

number of our local mining companies in a good position to roll<br />

out their private energy generation plans sooner rather than later.<br />

It is clear that, with the unrelenting rise in utility electricity prices<br />

– combined with national energy shortages threatening security of<br />

supply – mines and industry have a solid economic justification for<br />

capital expenditure in this direction. Their success in implementing<br />

such schemes – combined with the growing contribution from<br />

private producers in the Renewable Independent Power Producer<br />

Procurement Programme (REIPPPP) – will inform the extent to<br />

which South Africa will need to rely on gas as a “stepping stone”<br />

to a cleaner energy future.<br />

COMPETITIVE ADVANTAGE<br />

South Africa’s higher-than-average solar-radiation levels [5] range<br />

between 4.5 and 6.5 kilowatt hours per square metre (kWh/m 2 ) in<br />

a day, giving us a clear competitive advantage in pursuing solar PV<br />

options. Our annual 24-hour global solar radiation average of about<br />

220 watts per square metre (W/m 2 ) puts us well ahead of the US with<br />

150W/m 2 , and the level of about 100W/m 2 for Europe and the UK.<br />

We can also take advantage of the high efficiencies of the<br />

latest global technologies in solar PV panels. Such is the pace<br />

of development in this field, that we could expect to see a trend<br />

in private solar energy developers upgrading their panels and<br />

related equipment even before their 20-year off-take contracts<br />

with the national utility expire. This opens the door to a highly<br />

cost-effective increase in solar-powered electricity output from<br />

existing solar farms. Where a solar energy facility is already in<br />

place – complete with infrastructure and compliance permits –<br />

it is likely that power production can be raised considerably by<br />

replacing original panels with new, more efficient substitutes.<br />

INEVITABLE CONSEQUENCES<br />

Pivoting out of the fossil fuel economy, of course, will<br />

fundamentally disrupt our coal industry over time; this has raised<br />

many justified concerns among stakeholders, especially in terms<br />

of job losses and impacts on local economies in coal-producing<br />

regions. However, the country’s electricity parastatal has taken<br />

one step closer to reducing its dependency on coal, as South<br />

Africa signed a breakthrough deal at the COP26 climate change<br />

discussions in Glasgow, Scotland.<br />

The deal includes grants and loans from the US, Germany,<br />

Britain and France, which will assist Eskom in rolling out<br />

renewable energy projects, reducing its greenhouse gas emissions<br />

and supporting a just energy transition from coal-fired power.<br />

Despite the positive shift, there are also concerns relating to<br />

the rate at which solar panels will reach obsolescence, and the<br />

environmental impact of disposing of old models. Questions<br />

like these will need to be answered creatively and responsibly,<br />

to ensure that core principles of sustainability are applied as<br />

technology advances.<br />

Recent trends, though, have brightened the outlook for<br />

leveraging renewable energy for South Africa’s sustainable<br />

development. Seizing the regulatory opportunity for private<br />

power generation – and making the most of cost-efficient and<br />

clean technology – will contribute towards the country’s movement<br />

in the right direction. S<br />

REFERENCES<br />

1. https://www.gov.za/speeches/minister-gwede-mantashe-media-briefing-announcingpreferred-bidders-risk-mitigation-ipp<br />

2. https://www.gov.za/speeches/minister-gwede-mantashe-media-briefing-announcingpreferred-bidders-risk-mitigation-ipp<br />

3. https://www.eia.gov/tools/faqs/faq.php?id=73&t=11<br />

4. https://businesstech.co.za/news/trending/69495/the-worlds-most-polluted-cities/<br />

5. http://www.energy.gov.za/files/esources/renewables/r_solar.html<br />

REIPPPP BID WINDOW 5<br />

In October 2021, the Minister of Mineral Resources and Energy<br />

announced the preferred bidders selected under the fifth bid<br />

window of the Renewable Energy Independent Power Producer<br />

Procurement Programme (REIPPPP Bid Window 5).<br />

The outcomes of the evaluation resulted in the selection<br />

of 25 preferred bidders, procuring a total of 2 583MW of<br />

contracted capacity, divided, as follows:<br />

• 1 608MW from onshore wind; and<br />

• 975MW from solar photovoltaic<br />

The weighted average Fully Indexed Price of the preferred<br />

bidders, including both wind and solar photovoltaic, is<br />

R473.94/MWh. The 12 wind projects selected as preferred<br />

bidders have a weighted average Fully Indexed Price of<br />

R495.22/MWh, while the 13 selected solar PV projects have<br />

a weighted average Fully Indexed Price of R428.79/MWh.<br />

The appointed preferred bidders will be expected to reach<br />

commercial close around February 2022, subject to the<br />

required regulatory approvals. During this time, the preferred<br />

bidders are also expected to finalise their outstanding<br />

approvals including, but not limited to, obtaining generation<br />

licences from NERSA. The DMRE together with Eskom, as<br />

the buyer of the generated electricity, will also utilise this time<br />

to obtain the required government approval to enter into the<br />

commercial agreements. The appointed preferred bidders<br />

are expected to start generating electricity by the earliest in<br />

April 2024.<br />

<strong>Service</strong> magazine | 13


S<br />

sustainability<br />

Value creation<br />

through ESG<br />

Using the business case for ESG engagement to motivate the civil<br />

case for more socially and environmentally responsible behaviour.<br />

By Carl Reynolds<br />

In the absence of any standardised way of assessing<br />

“sustainability”, across civil, commercial and<br />

governmental spheres, the UN’s Sustainable<br />

Development Goals (SDGs) are slowly emerging as a<br />

convenient lens for multi-stakeholders to understand<br />

their responsibilities in terms of the growing needs of<br />

our society and the planet. Achieving these 17 goals is<br />

arguably the single biggest challenge of our generation<br />

and our success or failure to do so will, ultimately,<br />

determine the course of history.<br />

Various stakeholders will inevitably be motivated<br />

by different means to engage with these goals.<br />

Governments have different needs than businesses, as<br />

do individuals, and so it becomes important to frame<br />

the urgency for change effectively for each sector.<br />

People are more motivated by a moral or ethical<br />

[1] [2]<br />

case for sustainability than by an economic one.<br />

According to research, for individuals the moral case<br />

is significantly more likely to yield results. Companies,<br />

however, have an altogether different set of drivers.<br />

In the case of Africa, SMEs represent approximately<br />

80% of the economic activity on the continent. Indeed,<br />

without harnessing their potential, achieving the SDGs<br />

is not even remotely a likelihood.<br />

Similarly, municipalities, government departments,<br />

public health, public roads and policing all have<br />

a significant role to play in how our generation<br />

addresses the very urgent needs of our modern society<br />

and environment.<br />

With infinitely fewer resources at their disposal, if we<br />

were able to successfully make a case for small business<br />

to address these planetary urgencies, surely the case<br />

for our public sector would be exponentially easier to<br />

motivate? Let’s try:<br />

Most of us will know the difficulties associated with<br />

running a small business. The daily pressures leave<br />

little time to spend on any activity not associated with<br />

profitability. However, if we were to conclusively show<br />

that there are financial benefits to more responsible<br />

business practice and at the same time remove the<br />

combined obstacles of admin and time constraints,<br />

the opportunity to grow an entire economy with<br />

sustainability in its DNA is too big to pass up.<br />

The evidence is unavoidable, companies that score<br />

[3] [4] [5] [6]<br />

high on ESG criteria are better performers.<br />

Neilson reported US companies with a demonstrated<br />

commitment to sustainability were growing at a rate of<br />

4% over the past year. This is compared to a growth rate<br />

of less than 1% for companies without demonstrated<br />

commitments to sustainability. Unilever reports that<br />

their sustainable brands are growing 50% faster than<br />

their traditional brands.<br />

The University of Oxford conducted a literature<br />

review of over 200 studies where they looked at the<br />

relationship between sustainability performance<br />

and financial performance. The findings of their<br />

review included:<br />

• 90% of the studies indicate that sustainability<br />

leadership leads to a lower cost of capital<br />

• 88% of the studies indicate sustainability leadership<br />

leads to increased operational performance<br />

• 80% of the studies show that sustainability<br />

leadership leads to better stock performance.<br />

It has become clear that sustainability must be an<br />

important component to any business strategy in the<br />

coming years and decades to ensure long-term health<br />

and success. As the information and research on this<br />

topic continues to come out, the business case for<br />

sustainability will only become stronger.<br />

So, how do we harness the power of active ESG<br />

management to grow value in companies and investment<br />

portfolios? How can we learn from this strategy to<br />

ensure better service delivery and more responsible<br />

municipalities across Africa?<br />

Although many approaches exist, they can broadly be<br />

divided into the following three categories:<br />

Risk reduction and management. Aside from the<br />

obvious climate-related risks, supply chain disruptions,<br />

A company<br />

labelled as a<br />

sustainability<br />

leader is<br />

400 times<br />

more likely to<br />

also be labelled<br />

an innovation<br />

leader.<br />

___ __<br />

Sustainability is all<br />

about eliminating<br />

waste and maximising<br />

efficiency, which<br />

of course leads to<br />

cost savings.<br />

14 | <strong>Service</strong> magazine


sustainability<br />

S<br />

water shortages and all the environmental risks, consider too the<br />

public relations risks. A proactive approach to sustainability is going<br />

to help companies avoid those PR-related risks in a world of rapid<br />

transparency where information is shared in an instant across the<br />

world. Sustainability also helps mitigate regulatory risks. Across<br />

Africa, municipalities, cities, provinces and governments are<br />

developing climate action plans and developing new policies and<br />

regulations to reduce greenhouse gas emissions.<br />

Risk reduction has long been one of the main drivers for<br />

integrating ESG issues into the investment process. However,<br />

investors are in the business of creating value, not just avoiding risks,<br />

and a compliance mindset anchors the engagement with investee<br />

companies in a risk management frame, with an emphasis on preinvestment<br />

due diligence and post-investment monitoring. These are<br />

often perceived more as burdens and costs to a business, which leaves<br />

much value unrealised during the life of an investment.<br />

Operational efficiencies. The most straightforward benefit of<br />

sustainability, and the easiest to quantify, is the reduced operating<br />

costs. When a business is reducing waste, reducing energy, reducing<br />

water use, reducing greenhouse gas emissions and operating more<br />

efficiently, obviously they will be saving money. William McDonough<br />

is a sustainability thought leader and author of the books Cradle to<br />

Cradle and The Upcycle. McDonough points out that when we look<br />

at nature, there is absolutely no waste. Everything has value and<br />

everything has a purpose. Waste is just the result of design flaw. We<br />

need to rethink and redesign the way we make our products; rethink<br />

the way we operate our facilities and rethink the way we operate as a<br />

society. Sustainability is all about eliminating waste and maximising<br />

efficiency, which of course leads to cost savings.<br />

This approach to resource efficiencies also extends to supply<br />

chains. Not only is risk within a supply chain your own risk, it<br />

is also an opportunity to grow and secure your suppliers (and<br />

therefore supplies). Growing this network of stakeholders makes<br />

absolute economic sense and ultimately builds a flourishing and<br />

networked economy.<br />

Waste is just the result of design flaw.<br />

Likewise, evidence is clear that a happy and engaged workforce<br />

leads directly to increased performance. Involving the workforce in<br />

the bigger picture of a business, particularly one with a vision and<br />

mission, is the surest way to drive both productivity and innovation.<br />

Opportunity identification. Using sustainability as a lens to look<br />

at your business can lead to innovatively creating new ways to get<br />

things done. A focus on sustainability in all aspects of a business<br />

can lead to process changes, new products or services, the use of<br />

new technology, the creation of new technology, new management<br />

techniques and other innovations.<br />

A Deloitte report entitled Sustainability Driven Innovation, studied<br />

hundreds of companies, and labelled them as sustainability leaders<br />

and innovation leaders based on several criteria. The study found<br />

that a company labelled as a sustainability leader is 400 times more<br />

likely to also be labelled an innovation leader.<br />

The case is self-evident but what happens next? How do we<br />

scale these learnings into practical and winning strategies?<br />

Fortunately, there is an array of methodologies to choose from<br />

and a growing field of experts who are keen to show the way. The<br />

thing to keep in mind is that your needs are unique. A framework<br />

is helpful but real engagement with the issues and a targeted<br />

approach are imperative.<br />

AN ORGANISING FRAMEWORK<br />

The creation of value in portfolios from ESG is significant. The<br />

main themes in value creation within portfolios are:<br />

Avoidance of eroding of capital and cost by improved risk<br />

management improvements<br />

• Reducing potential for business interruptions from significant<br />

incidents (health and safety)<br />

• Enhancing supply chain management<br />

• Protecting social licence to operate<br />

The United Nations’ Sustainable Development Goals.<br />

<strong>Service</strong> magazine | 15


S<br />

sustainability<br />

Increased efficiencies in systems, operation and productivity<br />

• Resource efficiencies<br />

• Improved supply chain<br />

• Higher employee productivity and improved employee retention<br />

New product and services growth<br />

• Developing sustainable products and services<br />

• Improving and leveraging sustainability of existing products to<br />

reach new customers or markets<br />

• Brand enhancement and customer satisfaction related to ESG<br />

STRATEGIES: OPERATIONAL BEHAVIOUR<br />

More and more organisations are already setting up internal<br />

ESG departments which cover everything from screening to risk<br />

assessment and implementation strategies. The following are<br />

features of successful approaches:<br />

• Organisations need to communicate to stakeholders their awareness<br />

of the concerns around ESG issues from their communities.<br />

• Organisations need to obtain more in-depth material ESG<br />

understanding in and around the constituencies.<br />

• Compare risk and performance over regional and national levels.<br />

The Conversation<br />

THE BROKEN CHAIN IN SUPPLY<br />

Nearly all company’s operations are backed by a global<br />

supply chain that consists of workers, information and<br />

resources. To accurately measure a company’s ESG risks,<br />

its end-to-end supply chain operations must be considered.<br />

Bloomberg’s ESG measure lists “supply chain” as an item<br />

under the “S” (social) pillar. By this measure, supply chains<br />

are treated separately from other items, such as carbon<br />

emissions, climate change effects, pollutants and human<br />

rights. This means all those items, if not captured in the<br />

ambiguous “supply chain” metric, reflect each company’s<br />

own actions but not their supply chain partners’.<br />

Even when companies collect their suppliers’<br />

performance, “selective reporting” can arise because there<br />

is no unified reporting standard. One recent study found<br />

that companies tend to report environmentally responsible<br />

suppliers and conceal “bad” suppliers, effectively<br />

“greenwashing” their supply chain.<br />

Carbon emissions are another example. Many companies,<br />

such as Timberland, have claimed great successes in<br />

reducing emissions from their own operations. Yet the<br />

emissions from their supply chain partners and customers,<br />

known as “Scope 3 emissions,” may remain high. ESG<br />

rating agencies have not been able to adequately include<br />

Scope 3 emissions because of a lack of data: Only 19% of<br />

companies in the manufacturing industry and 22% in the<br />

service industry disclose this data.<br />

More broadly, without accounting for a company’s entire<br />

supply chain, ESG measures fail to reflect global supply<br />

chain networks that today’s big and small companies alike<br />

depend on for their day-to-day operations.<br />

• Embed collaboration between managers, teams, ESG analysts and<br />

the constituencies.<br />

• Develop a methodology to link ESG with successful service delivery.<br />

• Communicate with their stakeholders, including employees, about<br />

how ESG performance improvements have resulted in successful<br />

outcomes, attain a leadership position among its peers, and help<br />

them realise value at voting booths.<br />

• Agree on an ESG action plan with the councils and embed this in<br />

their mandates.<br />

• Systematically monitor progress and provide ESG support.<br />

In a more practical way, implement a systematic approach for ESG<br />

data collection for public entities. Key is to create and implement<br />

ESG metrics that consist mostly of quantitative ESG indicators (ESG<br />

KPIs). This will save implementing and monitoring time. It also<br />

provides for progress comparison between the different entities and<br />

gives the opportunity to report on thematic achievements.<br />

Start with screening material ESG risks and opportunities to<br />

identify which issues are most material for the region and create<br />

an ESG action plan with goals and responsibilities to address those<br />

material issues. The periodic monitoring and evaluation reporting<br />

need to have a system in place for due diligence and verification.<br />

In the African scenario, small business and ESG are both in<br />

strong growing phases. Helping communities understand what the<br />

best ways are to assess risks and implement strategies can in turn<br />

help companies as well as communities receive the social licence to<br />

operate, which ensures both a company’s and community’s growth.<br />

A better world is within our grasp. The road to this reality is as<br />

simple as it is challenging. Like any journey worth taking, it begins<br />

with a first step and is achieved by following each step with another.<br />

Continuously. S<br />

Carl Reynolds is the<br />

founder and CEO of<br />

Kudos One. He has a<br />

particular interest in<br />

business as an agent<br />

for positive impact.<br />

REFERENCES<br />

1. www.wwf.org.uk/what_we_do/campaigning/strategies_for_change<br />

2. https://www.nature.com/articles/nclimate1767<br />

3. Deutsche Bank (2012) Sustainable Investing: Establishing Long-Term Value and<br />

Performance, https://www.db.com/cr/en/docs/Sustainable_Investing_2012.pdf<br />

4. Gunnar Friede, Timo Busch & Alexander Bassen (2015) ESG and financial performance:<br />

aggregated evidence from more than 2000 empirical studies, Journal of Sustainable<br />

Finance & Investment, http://www.tandfonline.com/doi/pdf/10.1080/20430795.2015.11<br />

18917<br />

5. Matteo Tonello, Thomas Singer, The Conference Board (2015) The Business Case for<br />

Corporate Investment in ESG Practices, https://corpgov.law.harvard.edu/2015/08/05/<br />

corporate-investment-in-esg-practices/<br />

6. https://hbr.org/2010/05/the-sustainability-imperative<br />

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sustainability<br />

S<br />

ESG: Make or break<br />

Environmental, social and governance (ESG) factors increasingly<br />

drive investment strategies, and new research from PwC finds<br />

ESG has now become a make-or-break consideration for leading<br />

investors globally. Almost half of investors surveyed, 49%, express<br />

willingness to divest from companies that aren’t taking sufficient<br />

action on ESG issues. More than half, 59%, also say lack of action<br />

on ESG issues makes it likely they would vote against an executive<br />

pay agreement, while fully a third say they have already taken this<br />

action. A large majority, 79%, say the way a company manages ESG<br />

risks and opportunities is an important factor in their investment<br />

decision-making.<br />

The PwC 2021 Global Investor ESG Survey captures the views<br />

of 325 investors from around the world, primarily active asset<br />

Attitudes toward ESG risks and<br />

opportunities (% of respondents)<br />

Source: PwC 2021 Global<br />

Investor Survey<br />

managers and analysts with investment<br />

firms, investment banks or brokerage<br />

firms. An additional 40 in-depth interviews<br />

were conducted globally with investors and<br />

analysts having more than a combined<br />

US$11.6-trillion assets under management.<br />

While most investors are likely to act if<br />

companies are not doing enough to address<br />

ESG issues, most also say that they don’t want<br />

a company’s action on ESG to significantly,<br />

if at all, impact their investment returns.<br />

The vast majority, 81%, said they would<br />

accept no more than one percentage point<br />

less in investment returns for pursuit of<br />

ESG goals; nearly half, 49%, were unwilling<br />

to accept any reduction in returns.<br />

Investors want more robust ESG reporting<br />

Investors increasingly want to hear more<br />

from companies about their ESG-related<br />

commitments – 83% surveyed said it is<br />

important that ESG reporting provide<br />

detailed information about progress toward<br />

ESG goals. Greater engagement with<br />

investors is critical, along with transparent,<br />

trustworthy reporting. It is concerning<br />

that only one third of investors surveyed,<br />

on average, think that the quality of ESG<br />

reporting they are seeing is good. Investors<br />

gain greater confidence in ESG reporting<br />

that has been assured – 79% of those<br />

surveyed said they place more trust in ESG<br />

information that has been assured, and 75%<br />

think it’s important that reported ESGrelated<br />

metrics are independently assured.<br />

A consistent set of metrics for measuring<br />

ESG performance would be of significant benefit to investors,<br />

according to the survey. Nearly three-quarters (74%) said their<br />

decision-making would be better informed if companies applied<br />

a single set of ESG reporting standards, and a similar number<br />

(73%) say it’s important to be able to compare ESG performance<br />

across companies.<br />

Climate is the leading ESG consideration for investors surveyed,<br />

with reducing Scope 1 and 2 greenhouse gas (GHG) emissions being<br />

the most-cited (by 65%) ESG issue for companies to prioritise. What’s<br />

more, 82% of investors said it is important that ESG reporting<br />

explains the rationale for environmental commitments, along with<br />

detailed plans on how to reach them. Ensuring worker health and<br />

safety (44%) and improving workforce and executive diversity, equity<br />

and inclusion (37%) are other priority ESG considerations identified.<br />

According to the investors surveyed, ESG strategy starts at the<br />

top. A high percentage of investors (82%) said ESG needs to be<br />

embedded in the corporate strategy, and by a wide margin (66%)<br />

respondents said they are most confident ESG issues are being<br />

addressed if someone in the C-suite is accountable. More than half<br />

of those respondents (53%) think it should be the CEO. S<br />

The Conversation<br />

THREE’S A CROWD<br />

As a company bigger than Walmart in terms of annual sales,<br />

Amazon has reported emissions from shipping that are only<br />

one-seventh of Walmart’s. But when researchers for two<br />

advocacy groups reviewed public data on imports, they found<br />

only about 15% of Amazon’s ocean shipments could be tracked.<br />

In addition, Amazon’s figure does not reflect emissions<br />

generated by its many third-party sellers and their suppliers<br />

who operate outside the US. This difference matters:<br />

whereas Walmart’s supply chain relies on a centralised<br />

procurement strategy, Amazon’s supply chain is highly<br />

decentralised – a large percentage of its revenue comes<br />

from third-party suppliers, about 40% of which sell directly<br />

from China, which further complicates emissions tracking<br />

and reporting.<br />

Another important ESG metric concerns consumer<br />

protection. Amazon prides itself as “Earth’s most customercentric<br />

company”. However, when its customers have been<br />

injured by products sold by third-party sellers on its platform,<br />

Amazon has argued that it should not be held liable for the<br />

damage, because it functions as an “online marketplace”<br />

matching buyers and sellers. Amazon’s foreign third-party<br />

sellers are often not subject to US jurisdiction so can’t be<br />

held accountable.<br />

Yet major ESG rating agencies do not appear to reflect<br />

the supply chain implication on customer protection when<br />

measuring Amazon supply chain performance.<br />

For example, in 2020, MSCI, the largest ESG ratings agency,<br />

upgraded Amazon’s ESG rating from BB to BBB, reflecting<br />

its strength in areas such as corporate governance and data<br />

security, despite its consumer liability risk.<br />

These gaps are also concerns for ratings of companies<br />

such as 3M, ExxonMobil and Tesla.<br />

<strong>Service</strong> magazine | 17


S<br />

water<br />

Water is a basic<br />

human right<br />

Water that is readily available and safe for consumption is important for<br />

public health, and a thriving economy. But what can be done to ensure<br />

water resources for South Africa?<br />

Water often acts as a sink for the multitude of chemicals we use each<br />

day. These chemicals include plastics and organic contaminants, as<br />

well as an array of compounds that are not only used in agriculture<br />

and industry, but also in our daily lives. This mixture of chemicals,<br />

including personal care products, pharmaceuticals, pesticides and<br />

industrial effluents, make their way into the municipal sewage<br />

system and treatment plants and affect our water sources.<br />

THE ROLE OF NMISA IN WATER SAFETY<br />

As a type-3A public entity of the Department of Trade, Industry<br />

and Competition (the dtic), the National Metrology Institute of<br />

South Africa (NMISA) is mandated to maintain the national<br />

measurement of water standards for South Africa and to ensure the<br />

global equivalence of these standards.<br />

The Institute impacts the lives of South African citizens, high-level<br />

calibration and traceability support to industry, to the improvement<br />

of quality of life. The quality of drinking water affects all South<br />

Africans and, as with all measurements, requires the measurement<br />

traceability that NMISA provides.<br />

The effective treatment of wastewater, as well as wastewater<br />

quality monitoring, can be scientifically challenging. With the<br />

Department of Water and Sanitation reinstating the Blue and<br />

Green Drop Programmes in 2021, there is added incentive<br />

for municipal wastewater treatment plants to ensure effective<br />

management processes, specifically regarding quality compliance<br />

and end-point monitoring.<br />

NMISA provides a confidential proficiency testing service<br />

that permits laboratories to assess the accuracy of test results by<br />

following their routine methods, which enables them to test the<br />

effectiveness of their methods and quality assurance programmes.<br />

The proficiency testing (PT) reports assist laboratories to identify<br />

areas of continuous improvement within their current quality<br />

systems. The “organic contaminants in water” protocol has been<br />

designed to support routine analytical testing by laboratories for<br />

organic contaminants in drinking water and pays special attention<br />

to pesticides and polycyclic aromatic hydrocarbons (PAHs).<br />

NMISA participates in water-testing initiatives undertaken on<br />

a continental level. The Institute has contributed to the Southern<br />

African Development Community Cooperation in Measurement<br />

Traceability (SADCMET) Water PT scheme since 2009, by providing<br />

confirmatory reference values for approximately 15 elements (Al,<br />

As, Ca, Cd, Co, Cr, Cu, Fe, K, Mg, Mn, Na, Ni, Pb and Zn) in the<br />

gravimetrically prepared drinking water test samples of African<br />

laboratories. The SADCMET Water PT usually involves more than<br />

70 laboratories (representing 19 African countries) from the testing<br />

field who participate annually and send their results for evaluation.<br />

These results are measured against reference values provided<br />

by NMISA. These results are measured against reference values<br />

provided by NMISA and two independent laboratories to confirm<br />

the gravimetric reference values determined by the coordinating<br />

laboratory, before the critical evaluation of participants’ results, and<br />

suggestions for improvement (where applicable), are reported back<br />

to them.<br />

NMISA provides a confidential proficiency<br />

testing service that permits laboratories<br />

to assess the accuracy of test results.<br />

NMISA is an ISO17043:2010 accredited proficiency testing scheme<br />

provider (SANAS PTS0015), contributing directly to the Sustainable<br />

Development Goals (adopted by the our government) that relate<br />

to universal and equitable access to safe and affordable drinking<br />

water for all. S


Water<br />

is essential<br />

to life<br />

water<br />

S<br />

The accurate measurement of water<br />

quality is critical for the safety of<br />

water that we drink or that is used to<br />

irrigate the crops of the food we eat.<br />

NMISA offers analytical and proficiency testing scheme services.<br />

Proficiency testing schemes are a recognised form of assessing the<br />

technical competence of laboratories performing analyses.<br />

SERVICES OFFERED BY NMISA<br />

Analytical services<br />

• Analysis of perfluorinated compounds (PFCs), polychlorinated<br />

biphenyls (PCBs), polyaromatic hydrocarbons (PAHs), dioxins and<br />

selected pesticides in sludges and sediment<br />

• Analysis of PFCs and selected pesticides in waste and drinking water<br />

• Trace element analysis in water, including toxic elements<br />

Proficiency testing<br />

• Annual proficiency testing schemes for organic contaminants<br />

in drinking water (at the end of November)<br />

• Custom solutions for laboratories proficiency testing scheme needs<br />

Read more about proficiency testing schemes and other<br />

NMISA offerings by visiting our website, www.nmisa.org,<br />

or send an e-mail to pt@nmisa.org<br />

Website:<br />

Facebook:<br />

Twitter:<br />

Instagram:<br />

LinkedIn:<br />

YouTube:<br />

Online store:<br />

www.nmisa.org<br />

National Metrology Institute of South Africa<br />

@NMISouthAfrica<br />

@nmisouthafrica<br />

National Metrology Institute of South Africa (NMISA)<br />

National Metrology Institute of South Africa (NMISA)<br />

https://store.nmisa.org


S<br />

water<br />

South Africa’s water security<br />

The reality of the crisis in our water sector has been a slow-onset one and<br />

very similar to the energy crisis that will take decades to turn around – that is<br />

the nature of such major infrastructure that took nearly a century to build up.<br />

By Benoît Le Roy<br />

The water crisis has fortunately gained centre stage the past few<br />

months which in my opinion is key in bringing in all stakeholders<br />

to mitigate what is an absolute catastrophe for any economy. We<br />

must not lose hope, however, as there are many rapid interventions<br />

that can be implemented, which can only be achieved when the<br />

public and private sector collaborate and support each other. This<br />

is the founding charter of the SA Water Chamber. Water is the<br />

fundamental economic building block for all economic activity.<br />

Whichever way we look at our water availability, we are in a<br />

serious shortfall compared to global averages with half the rainfall<br />

and hence less than half the per-capita runoff available to us with<br />

a serious drying up of our western regions that are traditionally<br />

winter-rainfall areas. We have doubled the population in a few<br />

decades with less water in the traditional sense available.<br />

To add to this issue, we have not maintained our infrastructure<br />

and have not augmented with non-traditional means and still waste<br />

© Brandfoundry.co.za / Pixelfaerie.com<br />

40% in non-revenue water with<br />

90% of it in leaks. So, whatever<br />

augmentation we embark upon, it’s<br />

of no use if it’s a leaking bucket.<br />

While reducing our water footprint<br />

with water-wise approaches and<br />

reusing at scale, we need to fix our<br />

existing distribution networks, much<br />

like Eskom’s failing powerlines.<br />

There are many rapid<br />

interventions that can be<br />

implemented, which can<br />

only be achieved when<br />

the public and private<br />

sector collaborate and<br />

support each other.<br />

The user-pays principle is key<br />

to reinstate water security, so<br />

all must pay, and the indigent<br />

population receive subsidies after<br />

paying something. I say this as<br />

currently there is insufficient cash<br />

in the system to provide the entire<br />

population with water services. A<br />

culture of non-payment exacerbates


water<br />

S<br />

De Beers Group<br />

<strong>Service</strong> magazine | 21


S<br />

water<br />

the issue exponentially; we need money to maintain,<br />

operate and augment infrastructure.<br />

A thriving economy would reduce our indigent<br />

population – the highest in the world – but to thrive<br />

it needs revenue from all. All successful economies<br />

have all paying for water services at levels that all can<br />

afford. Due to a relatively small payer base in South<br />

Africa, we have substantial revenue shortfalls, to the<br />

extent of R33-billion per annum just for water, while<br />

leaking infrastructure adds a further R10-billion per<br />

annum in losses to the system. We cannot afford these<br />

inefficiencies and need to address them as part of kickstarting<br />

our economy.<br />

We had a Water and Sanitation Masterplan published<br />

in 2018 and no meaningful progress has been made in<br />

its then R900-billion programme, which will probably<br />

be over R1 000-billion by 2022. This quantum is more<br />

than double the Eskom debt that has made Eskom illiquid and<br />

unable to replace its very old assets. So where is the funding going<br />

to come from is on everyone’s lips.<br />

Well, the private sector has more than the trillion rand<br />

required but cannot invest in a fundamentally bankrupt<br />

system with high risks. The SA Water Chamber has<br />

worked hard with government and stakeholders to push<br />

for reform to mitigate these risks, and we see all our<br />

proposed reforms in the National Infrastructure Plan<br />

2050 (NIP 2050) draft gazetted in August 2021. We need<br />

cabinet to ratify the final version urgently as this is a key<br />

recipe for unlocking the Masterplan.<br />

So, what does the NIP 2050 say:<br />

• Engage private-sector participation to fund, design,<br />

construct, operate and maintain existing and new water<br />

and waste-water infrastructure.<br />

• Establish independent water producers to attract<br />

private investment, competition and better water prices<br />

in the market.<br />

• Use an independent water regulator, to ensure that<br />

the entire water supply chain is competitive and compliant. This is a<br />

global practice and deemed a precursor to private-sector investments.<br />

• Establish a national support office to back local government’s water<br />

projects as this is where most of the action is in the Masterplan due<br />

to South Africa being very obviously dammed up.<br />

This is, in short, what needs to be done from 2022 for the 2050<br />

target. We, as a chamber, have suggested more frequent KPIs (every<br />

two to five years) to ensure better momentum and accountability.<br />

So, we have the Masterplan and we have the NIP 2050 that<br />

formulates the who, by when and how. What is holding us up we all<br />

ask. Nothing should. The economic downturn of the past decade<br />

that has been accelerated by the pandemic and with onshoring of<br />

many global economies means that we need<br />

to move much faster in reinstating water<br />

security as the founding pillar to reliable<br />

infrastructure and a thriving economy.<br />

We are also finalising a Water and<br />

Sanitation Industrialisation Masterplan<br />

with the dtic that seeks to re-establish South<br />

Africa’s dominance in the supply chains, as<br />

we have over the past two decades become<br />

net importers of most of the supply chain.<br />

From chemicals to plumbing components<br />

to process systems and technology, we are<br />

reimporting often what was developed in<br />

South Africa at a premium.<br />

We can not only create new jobs but also<br />

stimulate massive SMME establishment<br />

on the back of a “Marshall Plan” for water<br />

and sanitation where we all win and export<br />

our products, services and systems while earning significant hard<br />

currency, and possibly attract foreign direct investment, to catalyse<br />

the sector’s momentum. S<br />

BENOÎT LE ROY<br />

Benoît Le Roy is an environmental<br />

alchemist with 40 years of water<br />

engineering experience and is the<br />

CEO and co-founder of the South<br />

African Water Chamber. The chamber<br />

was established to represent the<br />

Water is the fundamental economic<br />

building block for all economic activity.<br />

private water infrastructure sector to<br />

collaborate with and assist government<br />

to implement the national Water and<br />

Sanitation Masterplan. This will not only<br />

reindustrialise the water sector, but it will<br />

also provide a myriad of skilled jobs and<br />

the opportunity to again export waterrelated<br />

products and expertise globally.<br />

22 | <strong>Service</strong> magazine


water<br />

The crucial road to<br />

the circular economy:<br />

the importance of<br />

water reuse in Africa<br />

Cities of the future will have a radically different understanding of<br />

‘waste’. These cities will recognise, and have the technological<br />

capabilities, to harvest and recycle precious resources from “waste<br />

streams”. And the benefits will be greater efficiencies of production,<br />

lower energy costs and greater environmental sustainability.<br />

I<br />

In fact, perhaps such cities aren’t too far away.<br />

Already, facilities such as the Durban Water<br />

Recycling (DWR) Plant and the Goerengab<br />

Water Reclamation Project in Windhoek,<br />

Namibia, which recycle up to 47.5ML and<br />

21ML, respectively, of wastewater per day,<br />

represent landmark – although (frustratingly)<br />

isolated – examples of municipal wastewater<br />

recycling schemes in Southern Africa. Both<br />

these plants are operated and maintained by<br />

Veolia <strong>Service</strong>s Southern Africa.<br />

Why reuse?<br />

Driven by its vision of sustainable<br />

environmental solutions, Veolia offers<br />

among the most comprehensive portfolios<br />

of innovative, low-footprint technologies<br />

available for extracting maximum value from<br />

wastewater, with over 350 proprietary water<br />

treatment technologies in total.<br />

As Chris Braybrooke of Veolia <strong>Service</strong>s<br />

Southern Africa explains, “We see waste as<br />

a resource. As conventional sources of fresh<br />

water become increasingly over-burdened<br />

in the face of continued urbanisation<br />

and rapid population growth, cities will<br />

need to look at alternative sources of<br />

ensuring their future water security. Water<br />

reuse, which can be treated to a wide<br />

spectrum of quality grades for industrial<br />

or potable use, is a critical component of<br />

these strategies.”<br />

The technologies exist to clean and treat<br />

even the dirtiest of wastewater to a potable<br />

standard. That is what is achieved by the<br />

high-tech Goerengab Plant, which uses a train<br />

of efficient sludge treatment technologies<br />

and processes to recycle wastewater and<br />

semi-purified sewage to a standard that is<br />

100% safe for human consumption, and<br />

which supplies up to a third of the City of<br />

Windhoek’s potable water supply.<br />

The 47.5ML of municipal and industrial<br />

effluent recycled by the DWR plant each<br />

day isn’t treated to the same potable grade.<br />

Instead, it is treated to the level required by<br />

the industrial processes of the city’s highvolume<br />

water users like SAPREF and Mondi.<br />

“This water is supplied at half the cost of<br />

conventional bulk water, reducing these<br />

customers' overall water costs while freeing<br />

up a significant volume of potable water<br />

that allow the city to expand and increase<br />

the penetration of its existing bulk<br />

infrastructure to previously unserviced<br />

communities in the greater metropolitan<br />

area,” Braybrooke explains.<br />

Industrial facilities are also implementing<br />

their own on-site wastewater treatment plants<br />

to treat and recycle the water contained in their<br />

waste streams for internal reuse in a drive to<br />

achieve zero liquid discharge. As such, they’re<br />

able to reduce their dependence on municipal<br />

wastewater works, optimise their water use<br />

costs, be self-sufficient in guaranteeing a stable<br />

water supply, and further reduce the risk of<br />

environmental contamination.<br />

What else can we get from sludge?<br />

Water isn’t the only precious resource that<br />

can be produced from sludge, however; and<br />

where dewatered solids from the sludge<br />

treatment process were previously destined<br />

for landfill, today, more and more initiatives<br />

are being deployed valorise such material into<br />

energy production fuels. S


S<br />

economy<br />

Limpopo<br />

Province:<br />

the golden<br />

gateway to<br />

growth<br />

Limpopo Province is gifted with natural<br />

resources and its economic strength in the<br />

primary sectors is an impetus contribution in<br />

the growth of manufacturing. The province<br />

has a keen interest in attracting private sector<br />

investment, with a promise to a long-term<br />

strategic plan focused on inclusive growth.<br />

L<br />

“Limpopo is endowed with vast mineral deposits and<br />

is blessed with fertile soil. It is also a place of immense<br />

scenic beauty, numerous heritage sites and other<br />

natural wonders. We are very clear that the challenges<br />

of poverty, unemployment and inequality will only be<br />

effectively addressed through higher levels of inclusive<br />

economic growth.<br />

For Limpopo, this requires increased investment<br />

in critical areas of the provincial economy, especially<br />

in areas such as mining and mineral beneficiation,<br />

agriculture and agro-processing, as well as tourism.<br />

These industries have tremendous<br />

potential to attract large and<br />

sustained capital investments to<br />

the province.<br />

Investment should contribute<br />

to the development of integrated<br />

industrial value chains that<br />

generate sufficient and<br />

significant added value for<br />

the economy as a whole. The<br />

value chains create further<br />

opportunities for the emergence<br />

of more small, medium and<br />

micro enterprises.<br />

These industries will play a key role in the future<br />

growth and development of the economy of Limpopo<br />

with huge potential for exploration, production<br />

and beneficiation.<br />

Limpopo is open for business.<br />

“Our National Infrastructure Plan aims to<br />

support the integration of African economies and<br />

the development of intra-Africa regional value<br />

chains. Investing in Limpopo is very strategic<br />

because the province shares borders with three<br />

of our neighbouring countries: Botswana,<br />

Zimbabwe and Mozambique.<br />

This means that the province is<br />

positioned as a gateway to a potential<br />

market of 300-million people just in the<br />

SADC region.<br />

“Limpopo is open for business – in mining<br />

and mineral beneficiation, agriculture<br />

and agro-processing, renewable and<br />

alternative energy, and information and<br />

communications technology.”<br />

President Cyril Ramaphosa,<br />

Limpopo Provincial Investment<br />

Conference, 1 September 2021<br />

GEOGRAPHY<br />

The Limpopo Province’s<br />

125 754km² covers about 10%<br />

of South Africa’s land mass and<br />

is home to almost 10% of the<br />

country’s population. The N1<br />

highway is a key reason for the<br />

province’s important role in the<br />

nation’s logistics sector. It passes<br />

through Limpopo from the south to<br />

the border town of Musina and on<br />

to Zimbabwe and its neighbours<br />

in the SADC region. The busy<br />

N11 highway links the province<br />

to Botswana to the west and<br />

Mpumalanga Province to the east.<br />

24 | <strong>Service</strong> magazine


economy<br />

S<br />

ECONOMIC ZONES<br />

FETAKGOMO-TUBATSE SEZ<br />

“Government’s major objective through SEZs<br />

is to change the socio-economic landscape<br />

of the northern region by accelerating the<br />

manufacturing base, promoting industrialisation<br />

and attracting investments. We have to<br />

change the way we operate, and urgently seek<br />

innovative ways to lead the province and this<br />

district out of the current economic challenges.<br />

The existing and projected mining and the<br />

beneficiation outlook for platinum group metals<br />

(PGMs) and chrome drives the establishment of<br />

the proposed Fetakgomo-Tubatse SEZ.<br />

The government’s objective is to achieve<br />

an inclusive economy, and this cannot be<br />

realised if townships and rural areas are not<br />

meaningful participants in the mainstream<br />

economy. We remain convinced that this is the<br />

key element of an inclusive economic growth<br />

trajectory that can lift our people from poverty,<br />

cultivate entrepreneurial potential, establish<br />

dynamic township enterprises and circulate the<br />

‘township rand’ within townships.”<br />

Deputy Minister of Trade, Industry and<br />

Competition, Fikile Majola,<br />

28 October 2021<br />

The Musina-Makhado Special Economic<br />

Zone (SEZ) in the north of the province is<br />

forging ahead. The planning phase of the<br />

LISTING<br />

northern site of this SEZ has been completed<br />

and the provincial government has allocated<br />

R200-million to support the VHEMBE implementation DISTRICT MUNICIPALITY<br />

phase. One of the most significant Physical address: investment Old Parliament, Government Complex,<br />

pledges received is from Tusk Venda the Street, Chinese Thohoyandou 0950<br />

enterprise, Shaanxi CEI Investment Postal address: Holdings, Private Bag X5006, Thohoyandou 0950<br />

which has made a commitment Tel: +27 of 15 $5-billion<br />

960 2000/2008 | Fax: +27 15 962 0904<br />

for a vanadium and titanium Website: smelter www.vhembe.gov.za<br />

project.<br />

An Environmental Impact Assessment<br />

is currently underway for Collins the southern Chabane Local Municipality<br />

site, where a range of projects Tel: +27 is 15 851 planned. 0110 | Fax: +27 15 851 0097<br />

A total area of 7 262ha has Website: been www.lim345.gov.za<br />

designated<br />

for the SEZ, which is located 40km south of<br />

Musina and the border with Makhado Zimbabwe Local and Municipality<br />

Tel: +27 14 718 3300<br />

Fax: +27 14 717 2931<br />

Website: www.waterberg.gov.za<br />

Bela-Bela Local Municipality<br />

Tel: +27 14 736 8000 | Fax: +27 14 736 3288<br />

Website: www.belabela.gov.za<br />

Lephalale Local Municipality<br />

Tel: +27 14 763 2193<br />

Fax: +27 14 763 5662/086 534 3440<br />

Website: www.lephalale.com<br />

50km north of Makhado. Tel: A revised +27 15 519 business 3000 | Fax: +27 15 516 1195<br />

plan for an SEZ at Tubatse Website: in the www.makhado.gov.za<br />

eastern<br />

Modimolle-Mookgophong Local Mun<br />

part of the province has been submitted<br />

Tel: +27 14 718 2000 | Fax: +27 14 717 4077<br />

to national government. Musina Local Municipality<br />

Website: www.modimolle.gov.za<br />

The key element of this Tel: proposed +27 15 534 SEZ 6100 is | Fax: +27 15 534 2513<br />

mineral beneficiation and Website: servicing www.musina.gov.za of the<br />

Mogalakwena Local Municipality<br />

mining industry.<br />

Artist impression of Musina-Makhado Special Economic Zone.<br />

Tel: +27 15 491 9600<br />

The revitalisation of Thulamela industrial parks Local Municipality<br />

Fax: +27 15 491 9755<br />

throughout the province is ongoing. The parks at Seshego, enterprises. The focus is on the agro-processing,<br />

Tel: +27 15 962 7500 | Fax: +27 15 962 4020<br />

Website: www.mogalakwena.gov.za<br />

Nkowankowa and Thohoyandou have recorded good manufacturing, storage and recycling sectors.<br />

Website: www.thulamela.gov.za<br />

occupancy rates with the clustering The provincial government Thabazimbi has Municipality<br />

identified five<br />

together WATERBERG of related DISTRICT businesses MUNICIPALITY Agricultural Development Zones (ADZs) across the<br />

Tel: +27 14 777 1525<br />

making supply-chain management province, including the Mopani District within which<br />

Physical address: Harry Gwala Street, Modimolle 0510<br />

Fax: +27 14 777 1531<br />

and logistics easier for small the Marula Hub is located.<br />

Postal address: Private Bag X1018, Modimolle 0510<br />

Website: www.thabazimbi.gov.za<br />

MUNICIPALITIES IN LIMPOPO PROVINCE<br />

Metropolitan/District Municipality<br />

Boundary<br />

Local Municipality Boundary<br />

District Municipality<br />

Local Municipality<br />

BOTSWANA<br />

Thabazimbi<br />

North West<br />

Lephalale<br />

Lephalale<br />

Thabazimbi<br />

Limpopo Economic Development Agency<br />

Waterberg<br />

Lephalale<br />

Waterberg<br />

Bele-Bela<br />

N11<br />

Mogalakwena<br />

Mookgophong<br />

Bela-Bela<br />

Mokopane<br />

N1<br />

Modimolle-Mookgophong<br />

Local Municipality<br />

Gauteng<br />

Modimolle<br />

Alldays<br />

Blouberg<br />

N11<br />

Capricorn<br />

Molemole<br />

R81<br />

Musina<br />

N1<br />

Makhado<br />

POLOKWANE<br />

Polokwane<br />

Ephraim<br />

Mogale<br />

Musina<br />

Greater Groblersdal<br />

Makhado<br />

Lepele-Nkumpi<br />

Makhuduthamaga<br />

Vhembe<br />

Tshipise<br />

Greater Letaba<br />

Tzaneen<br />

Greater Tzaneen<br />

Fetakgomo-Greater<br />

Tubatse<br />

Sekhukhune<br />

ZIMBABWE<br />

Thohoyandou<br />

Thulamela<br />

R81<br />

Greater<br />

Giyani<br />

Mopani<br />

Ba-Phalaborwa<br />

R40<br />

Maruleng<br />

Mpumalanga<br />

Kruger<br />

National<br />

Park<br />

Kruger National<br />

Park District<br />

Management<br />

Area<br />

Phalaborwa<br />

MOZAMBIQUE<br />

Kruger National<br />

Park District<br />

Management<br />

Area<br />

LIMPOPO BUSINESS 2018/19<br />

94<br />

<strong>Service</strong> magazine | 25


S<br />

economy<br />

MINING AND MINERALS BENEFICIATION<br />

Limpopo’s assets include the largest diamond mine in South Africa<br />

(De Beers Venetia Mine), the biggest copper mine in South Africa<br />

(Palabora Mining Company), the biggest open-pit platinum mine<br />

in the country (Anglo America’s Mogalakwena) and the biggest<br />

vermiculite mine in the world. The province has 41% of South<br />

Africa’s platinum group metals (PGMs), 90% of South Africa’s<br />

red-granite resources and approximately 50% of the country’s<br />

coal reserves. Antimony, a highly strategic mineral found in large<br />

quantities in China, is another of Limpopo’s major assets. In 2019,<br />

the mining sector in Limpopo employed 48 <strong>78</strong>2 workers and paid<br />

out R39.7-billion in wages and salaries.<br />

Increased demand for PGMs has been a trend for some years,<br />

driven by the vital role played by PGMs to reduce pollution in<br />

the automotive sector. This has been boosted more recently by<br />

applications for renewable energy and now by supply constraints<br />

brought about by Covid-19 with production volumes down and<br />

shipping made more difficult throughout 2020.<br />

University of Cape Town economist Dr Gracelin Baskaran has<br />

argued that PGM miners in Limpopo and elsewhere should be<br />

focussed on the role that they can play in the transition to clean<br />

energy. The world’s biggest polluters have all recently adopted more<br />

stringent legislation on vehicle emissions and the EU is looking to<br />

hydrogen as the means to achieve carbon neutrality. After noting<br />

that several miners are investing in mechanised mining operations,<br />

Dr Baskaran wrote in Business Day, “Attracting supply chain<br />

investments in manufacturing hydrogen fuel cell technology is an<br />

excellent opportunity for Limpopo given the sector’s growth.”<br />

The province has 41% of South<br />

Africa’s platinum group metals.<br />

De Beers Group<br />

Above and below: De Beers Venetia Mine.<br />

The mining sector was less affected by shutdowns due to the<br />

Covid-19 pandemic than many other industries. Record prices for<br />

some commodities ensured that mining houses were able to post<br />

excellent results in June and July 2021 and expansion projects, such<br />

as the purchase of new rights by Amplats (platinum), the conversion<br />

to underground mining by De Beers (diamonds) and increased<br />

volumes promised by Exxaro (coal), point to confidence in the future<br />

of the sector and the resource beneath the ground.<br />

The provincial government records that the province will be<br />

receiving a total investment from mining of R36.3-billion in the<br />

period to 2025.<br />

Commodity prices have buoyed the mining sector in 2021.<br />

Rhodium palladium, platinum and gold collectively rose in price by<br />

more than 50% in the course of 2021. These are all minerals that<br />

occur in Limpopo.<br />

Northam Platinum announced a 73.6% improvement in headline<br />

earnings for the six months to the end of December 2020. Sales<br />

revenue rose by 51.9% to R11.9-billion in that period.<br />

In March 2021, Implats announced headline earnings of<br />

R14.5-billion, an increase of 328% over the previous year and a<br />

reflection of all these trends.<br />

Merafe Resources reported improvement in the production<br />

of ferrochrome for the first quarter, up by 3% to 103 000 tons.<br />

This was achieved despite Covid-19 protocols and the fact<br />

that the Lydenburg smelter was placed on care and maintenance.<br />

The improvement was attributed to better efficiency at the<br />

functioning smelters.<br />

Glencore (with a 79.5% stake) and Merafe Resources jointly own<br />

chrome mines in Limpopo on the eastern limb of the Bushveld<br />

Igneous Complex (Helena, Magareng and Thorncliffe), the Lion<br />

smelter complex near Steelpoort and the Lydenburg smelter.<br />

New mines and expansion projects<br />

Botswana Diamonds told Engineering News in July 2021 that it was<br />

“not far off declaring a major resource at Thorny River”. Thorny<br />

River is close to the Marsfontein mine, which was a highly profitable<br />

mine for De Beers and Southern Era. Botswana Diamonds, whose<br />

business address is in the Republic of Ireland and whose registered<br />

office is in London, has invested R20-million in exploration


economy<br />

S<br />

De Beers Group<br />

consortium comprising ITOCHU<br />

Corporation, Japan Oil, Gas and<br />

Metals National Corporation and Japan<br />

Gas Corporation.<br />

Beneficiation plans<br />

The soils of Limpopo are rich in platinum<br />

group metals, coal, copper, diamonds,<br />

gold, iron ore, nickel, rare earth minerals<br />

and tin. Limpopo contributes 4% of coal<br />

mining in South Africa, according to<br />

the National Department of Mineral<br />

Resources and Energy, but it is likely<br />

that within the next three decades, the<br />

province will be supplying about half of<br />

The De Beers Venetia Mine is the largest diamond mine in South Africa.<br />

South Africa’s coal.<br />

Limpopo’s Waterberg coal field<br />

projects in South Africa and has started selling diamonds found contains about 75-billion tons of coal. Exxaro’s two coal mines in<br />

at Thorny River.<br />

Waterberg represent 3-billion tons of measured coal resources, and<br />

Rustenburg Platinum Mines (RPM), a subsidiary of Anglo 1.8-billion tons of indicated coal resources. This is where Exxaro<br />

American Platinum (Amplats), has bought the prospecting rights operates its giant Grootegeluk mine.<br />

for two blocks close to its existing Mogalakwena PGM mine, southwest<br />

of Polokwane near Mokopane. The blocks were purchased from on a 1 200ha site. Originally intended to supply the nearby power<br />

Nine plants serve a 4km-long and 120m-deep opencast mine<br />

Atlatsa and provides space to expand what is already the world’s plants, Exxaro is now eyeing the export market with countries such<br />

biggest and richest opencast PGM in the world. Atlatsa and RPM as Ethiopia, Egypt and Pakistan potential markets.<br />

are in a joint venture which runs the Bokoni mine near Polokwane. Mineral beneficiation is a key component of the Musina-Makhado<br />

A new mining right has been granted to Platinum Group Special Economic Zone (MMSEZ) in the far north of Limpopo and<br />

Metals (PTM) in the northern part of the Bushveld Complex. coal is needed for the making of steel.<br />

The Waterberg project will be operated by PTM on behalf of In 2018, nine Chinese companies committed to investing more<br />

Waterberg Joint Venture Resources which comprises Mnombo than $10-billion in projects related to the zone’s four main areas<br />

Wethu Consultants, Japan Oil, Gas and Metals National of activity: a coking plant, a power plant, an alloy factory and the<br />

Corporation, Hanwa Company, PTM and Impala Platinum. manufacture of steel.<br />

Implats intends expanding production at its Two Rivers The planned Fetakgomo-Tubatse Platinum SEZ will focus on<br />

PGM mine by 180 000oz. The project will take four years and at an the beneficiation of PGM, magnetite, vanadium and chrome. The<br />

anticipated cost of R5.7-billion.<br />

other strong mineral focus in the eastern part of the province is at<br />

De Beers is expecting its Venetia underground project to start Phalaborwa where Palabora Copper, a subsidiary of Palabora Mining<br />

delivering its first ore in the second half of 2022. Investment in Company, produces about 45 000 tons of copper annually, most of<br />

the project will amount to about $2.1-billion, from the start of the which is sold domestically.<br />

project in 2013 through to 2025. The investment is expected to<br />

extend the life of the mine to 2045 and possibly beyond that date. ONLINE RESOURCES<br />

An updated feasibility study published in 2020 showed good Mapungubwe Institute for Strategic Reflection: www.mistra.org.za<br />

results for Platreef’s palladium, platinum, rhodium, nickel, Minerals Council South Africa: www.mineralscouncil.org.za<br />

copper and gold project. Ivanplats, a subsidiary of Ivanhoe Mines, Department of Mineral Resources and Energy: www.dmr.gov.za<br />

is the majority shareholder in the Platreef project. The local South African Institute of Mining and Metallurgy:<br />

community has a 26% stake with the other owners being a Japanese www.saimm.co.za


S<br />

economy<br />

AGRICULTURE AND AGRO-PROCESSING<br />

The provincial government is putting considerable resources into<br />

agricultural infrastructure. This includes upgrading old irrigation<br />

schemes and building new ones, building a packhouse, investing in<br />

processing equipment at a tomato paste factory and constructing and<br />

supplying Farmer Production Support Units around the province.<br />

These all constitute attempts to bring small-scale farmers into the<br />

value chain at a point where more money can be made. Limpopo<br />

is home to some of South Africa’s largest commercial agricultural<br />

enterprises who are drawn to the fertile and varied soils that the<br />

province has to offer. This is one of the reasons why Limpopo<br />

punches above its weight in exports.<br />

One of the country’s biggest exporters, ZZ2, is in the process of<br />

building a giant new packhouse at its headquarters in Mooketsi. As<br />

one of the country’s largest agricultural companies, ZZ2 is famous<br />

for the large quantity of tomatoes and avocados produced but<br />

the company’s product range is also big: mangoes, onions, dates,<br />

cherries, apples, pears, stone fruit, almonds and blueberries.<br />

Potatoes are grown in great quantities in Limpopo, together with<br />

75% of South Africa’s mangoes and tomatoes. Statistics in many<br />

categories are impressive: papayas (65%); tea (36%); citrus, bananas<br />

and litchis (25%) and 60% of the country’s avocados.<br />

Agro-processing is strong in several parts of the province, with<br />

Pioneer Foods, McCain, Granor Passi, Kanhym, Westfalia and<br />

Enterprise Foods all prominent, but this sector still has potential<br />

to grow. Limpopo has been a major contributor to the country’s<br />

excellent export record: fruit and nuts from the province’s eastern<br />

regions are hugely popular in international markets and Limpopo’s<br />

commercial farmers are extremely efficient.<br />

Ephraim Mogale Local Municipality, which forms part of the<br />

Sekhukhune District Municipality, calls itself the “agricultural hub<br />

of choice” and about 345ha of cotton has been planted, which will<br />

benefit 74 small-scale farmers in the area. The projected harvest<br />

is 522 tons and an estimated 300 seasonal jobs are expected to be<br />

created during the harvesting period.<br />

The Olifants River (also known as the Lepelle River) supports varied<br />

and intensive citrus, grape, cotton and vegetable cultivation, much of<br />

which is transported to the markets of the densely-populated areas<br />

to the west in Gauteng. The Joburg Market and the Tshwane Fresh<br />

Produce Market are the primary destinations of the municipality’s<br />

products. Cattle ownership is common among subsistence farmers.<br />

Marble Hall, where the South African Cotton Ginners<br />

Association (SACGA) has its headquarters, is the principal town<br />

in the municipality. Other schemes are at various stages of<br />

development: 100ha of land is being cleared for cultivation at<br />

the Mogalatjane Irrigation Scheme; 41ha has been identified at<br />

Tswelopele Irrigation Scheme in Fetakgomo Tubatse Municipality<br />

and agreements are due to be signed at Kolokotela and Setlaboswana<br />

irrigation schemes.<br />

Farmer Production Support Units (FPSU) will provide services<br />

for primary production, post-harvest handling, storage and see to<br />

the coordination of transport logistics. The FPSU in Vleischboom<br />

has been completed and the unit at Masala is nearing completion.<br />

The Limburg Citrus project in the Waterberg District intends<br />

to establish 500 citrus orchards and a packhouse, which will<br />

support 300 jobs. About 2 200ha at Tshivhase, Mphaphuli and<br />

Tshakuma are to be planted with macadamias while 800ha at<br />

Afrupro, Makgoba and Morebeng will receive avocado plants.<br />

These projects are expected to create a total of about 2 600 jobs<br />

for locals.<br />

Enhancing the value chain is the aim of further projects related<br />

to grain and cotton in Sekhukhune, vegetables in Mopani, red<br />

meat in Waterberg, and potatoes in Capricorn.<br />

Export contributions<br />

The percentage contribution of Limpopo agriculture to national<br />

agriculture is 7.6% although its contribution to provincial GDP is<br />

just 2.3%. Agro-processing has enormous potential to expand in<br />

every subsector.<br />

Limpopo’s fruits and vegetables form an important part of<br />

South Africa’s export basket. Companies like ZZ2 are major<br />

contributors to the country’s annual production of 120 000 tons<br />

of avocados. Of the current crop, about half is currently produced<br />

in two Limpopo regions, Letaba and Tzaneen. Exports are rising<br />

exponentially. In response to this demand, and the potential of<br />

the Chinese market, almost 1 000ha per year of new land is being<br />

planted with avocados in South Africa.<br />

The same amount of new macadamia planting is underway<br />

every year, according to the Macadamias South Africa (SAMAC),<br />

adding to the existing 19 000ha.<br />

The other big sellers are mangoes and tomatoes. Limpopo<br />

grows three-quarters of South Africa’s mangoes and two-thirds<br />

of its tomatoes. The Waterberg District produces large quantities<br />

of red meat while Capricorn has potatoes in abundance, Vhembe<br />

in the north specialises in citrus and subtropical fruits. Mopani<br />

has those fruits too – and the Mopani worm. The Sekhukhune<br />

region in the south-east produces grain and the marula fruit that<br />

goes into Amarula cream liqueur.<br />

Westfalia is another huge enterprise, part of the Hans<br />

Merensky Group, and it is the world’s largest avocado grower. It<br />

also produces significant quantities of mango, litchi, citrus and<br />

macadamia and has three agro-processing plants in the province.<br />

Greenway Farms supplies about 45% of the fresh-market carrots<br />

consumed in Southern Africa under the Rugani brand.<br />

VKB Milling runs white maize mills in Mokopane, Lydenburg<br />

and Louis Trichardt and sells via the Magnifisan brand. VKB also<br />

has eight silos and 29 retail outlets in the Limpopo region.<br />

ONLINE RESOURCES<br />

Agro-Food Technology Station, Limpopo University: www.ul.ac.za<br />

Citrus Growers Association: www.cga.co.za<br />

Cotton South Africa: www.cottonsa.org.za<br />

Hortgro (Deciduous Fruit Producers): www.hortgro.co.za<br />

Macadamias South Africa: www.samac.org.za<br />

South African Subtropical Growers’ Association: www.subtrop.co.za<br />

Limpopo’s fruits and vegetables form an important part of South Africa’s export basket.<br />

28 | <strong>Service</strong> magazine


economy<br />

Limpopo has 53 provincial nature<br />

reserves and three major national parks.<br />

TOURISM<br />

The combined land area of Limpopo’s national, provincial and<br />

private game and nature reserves is 3.6-million hectares. Some<br />

Limpopo nature reserves are to be commercialised using privatepublic<br />

partnerships. Among the first reserves to be part of the<br />

programme are Masebe, Rust de Winter and Lekgalameetse. The<br />

Limpopo Department of Economic Development, Environment and<br />

Tourism (LEDET) is responsible for 53 provincial nature reserves.<br />

Three major national parks – Kruger National Park,<br />

Mapungubwe in the north and Marakele in the Waterberg – are<br />

run by South African National Parks (SANParks) and attract large<br />

numbers of tourists every year.<br />

The provincial government has committed to enhancing<br />

the value of Limpopo’s two UNESCO World Heritage Sites,<br />

Makapans Valley and Mapungubwe Heritage Site. This is<br />

also a priority programme in the National Tourism Sector<br />

Strategy. The Waterberg Biosphere Reserve is a UNESCO<br />

protected site.<br />

Tourism is a key sector in the economy of Limpopo, and<br />

as such is part of a new planning initiative called Impact<br />

Catalyst. In addition to a broad examination of the sector,<br />

specific thematic areas of focus include the game-farming<br />

sector, an important and lucrative subsector of tourism.<br />

Wildlife farming and hunting generates enormous<br />

amounts of money but South Africans who were<br />

previously excluded by law still have limited access to<br />

this sector. According to calculations done by a professor<br />

SA Tourism<br />

in tourism at the North-West University, Peet van der Merwe,<br />

trophy and biltong hunters contributed a combined R13.6-<br />

billion to the South African economy in the 2016/17 season. The<br />

number of direct jobs created in this period in Limpopo was<br />

17 806 (The Conversation).<br />

The newest casino licence was awarded to Peermont Global<br />

Resorts for the official launch and operation of the Thaba Moshate<br />

Casino, Hotel and Conference Centre in the Greater Tubatse Local<br />

Municipality. There are 237 limited pay-out gambling machines in<br />

the province, and licences of one sort or another generate more than<br />

R50-million for the provincial government. S<br />

Mapungubwe National Park.<br />

<strong>Service</strong> magazine | 29


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S<br />

healthcare<br />

Healthcare in South<br />

Africa: how inequity is<br />

contributing to inefficiency<br />

South Africa has a two-tiered, and highly unequal, healthcare system. The public sector<br />

is underfunded while most South Africans can’t afford the exorbitant cost of private care.<br />

To balance the scales, the government tabled the National Health Insurance Scheme.<br />

By Russell Rensburg, Programme Manager Health Systems and Policy, University of the Witwatersrand<br />

The proposal was to provide universal healthcare by<br />

buying services from health professionals through<br />

a National Health Insurance Fund. These services<br />

would then be delivered at private and public facilities.<br />

But there are many unanswered questions about how<br />

exactly this scheme will work and many doubts about<br />

it. Russell Rensburg is the director of the Rural Health<br />

Advocacy Project, which champions equitable access to<br />

quality healthcare for the country’s rural communities.<br />

He shares with us how the gaps may be plugged.<br />

What has the pandemic exposed about South Africa’s<br />

healthcare system?<br />

Firstly, South Africa’s biggest problem is that the health<br />

needs of its people exceeds capacity.<br />

Secondly, most people actually don’t know their health<br />

status, which delays access to care.<br />

Thirdly, the way the system is funded perpetuates<br />

inequality.<br />

Russell Rensburg, director of<br />

Rural Health Advocacy Project.<br />

What are the solutions?<br />

There’s a massive opportunity to reform the system.<br />

The biggest lesson that’s been learned from Covid-19<br />

is that if there is poor health utilisation at the lower<br />

levels, people are at increased risk of severe illness<br />

and death due to Covid-19. Comorbidities are a risk<br />

factor for Covid-19. If the health sector did a better job<br />

of diagnosing and treating people living with diabetes<br />

at the community level, for example, the outcomes<br />

would be better.<br />

If the country had a strong primary healthcare<br />

network with competent, well-trained community<br />

health workers, it would have had a better chance of<br />

containing the spread of Covid-19 as well as linking<br />

people to care sooner so that deaths could be reduced.<br />

We also need to look at the efficiencies of hospitals.<br />

Some fundamental questions need to be asked, such<br />

as are we doing the work that should be done in a<br />

hospital? Yes, it’s hard to turn people away. But so<br />

much is being done poorly in public sector hospitals.<br />

Many are falling apart.<br />

Another area that needs close attention is explicit<br />

prioritisation. Given the levels of poverty and<br />

inequality in the country, there should be explicit<br />

priority setting in determining who accesses key services<br />

such as surgery and when. Who benefits from that at<br />

the moment? Is access based on how close someone is<br />

to the system? For example, people who live in Cape<br />

Town or Johannesburg have a better chance of getting<br />

an elective surgery like a hernia repair.<br />

The World Health Organisation says those people<br />

with the least coverage need to be prioritised before<br />

expanding access to others with more access to<br />

care. While everyone has the right to health, there<br />

is not equal enjoyment of that right. For example<br />

in the current response to Covid-19, how quickly<br />

___ __<br />

Given the levels of<br />

poverty and inequality<br />

in the country, there<br />

should be explicit<br />

priority setting in<br />

determining who<br />

accesses key<br />

services such as<br />

surgery and when.<br />

32 | <strong>Service</strong> magazine


healthcare<br />

S<br />

The Conversation<br />

people can access testing, care or even vaccination<br />

is determined by their ability to pay. This is neither just<br />

nor fair.<br />

As the country considers the development of a<br />

comprehensive primary healthcare package, it should<br />

look at prioritising services where lower-income<br />

groups enjoy the least access. South Africa should also<br />

consider a universal pricing and admission criteria.<br />

Access to medical schemes shouldn’t lead to<br />

over-enjoyment of capacity. The Competition<br />

Commission conducted a five-year investigation into the<br />

country’s private health sector. One of its findings was<br />

that South Africa admitted more people to ICU than<br />

other countries with comparable data.<br />

Patients shouldn’t be treated better simply because<br />

they can afford to pay more. The high cost of private<br />

care has detrimental effects on public healthcare.<br />

If most doctors work in the private sector, there<br />

will be a limited number of doctors working in the<br />

public sector. These two markets affect each other. If<br />

the cost of private healthcare isn’t reduced, the costs<br />

will increase for everyone. Which means that the public<br />

health sector will suffer over the long term as it struggles<br />

to keep up with the cost of care.<br />

How should South Africa manage the unequal nature of<br />

healthcare provision?<br />

The country must find a way to make sure the availability<br />

of care is spread more evenly throughout the system. We<br />

can’t look at the private and public sectors separately.<br />

One has an impact on the other.<br />

South Africa’s healthcare system is inefficient – both<br />

public and private. The cost of healthcare is too high.<br />

In the long term, improving the quality of care in the<br />

public sector would balance out people’s need to have<br />

expensive medical insurance.<br />

South Africa’s institutional frameworks perpetuate<br />

inequality, rather than address it. Publicly funded<br />

healthcare is not allocated based on need but determined<br />

by each province’s relative share of the population.<br />

In this scenario, funding for the Western Cape and<br />

Eastern Cape provinces would be roughly the same –<br />

despite vastly different implementation context. When<br />

you consider the vast area covered by the Eastern Cape,<br />

it is clear the current arrangements do not address<br />

inequality of access.<br />

When health services were officially desegregated<br />

in 1988, South Africa’s spending in the former mainly<br />

white provinces was R172 average per capita. Public<br />

sector healthcare expenditure was R55 in areas<br />

designated under apartheid for black people. Known as<br />

the “homelands”, it’s where most black South Africans<br />

were forced to live.<br />

Patients shouldn’t be treated better simply<br />

because they can afford to pay more.<br />

Many of these inequities have persisted with a<br />

disproportionate spend on health infrastructure in large<br />

metropolitan areas. This has led to an under-investment<br />

in primary healthcare where the 80% access services.<br />

The system needs to be more responsive at the levels<br />

where the majority are likely to access it. This means<br />

moving services out of facilities and being proactive in<br />

engaging with people through lower-level workers, such<br />

as community health workers.<br />

Doing this would ease the burden on facilities and<br />

health workers could diagnose people at early stages of<br />

disease and infection – before they get sick.<br />

South Africa has followed this approach with<br />

community testing of HIV. It also saw the effectiveness<br />

with the community screening and testing at the<br />

beginning of the Covid-19 pandemic in March 2020.<br />

There are no simple solutions to South Africa’s health<br />

crisis, but we have a once-in-a-generation opportunity<br />

to begin addressing the crisis. The improved electronic<br />

vaccine registration system can contribute to a better<br />

understanding of where people are, the investment<br />

in diagnostics can lay the platform for expanded<br />

screening and diagnostics and the introduction of<br />

reforms like the NHI can facilitate better cooperation<br />

between the public and private sector. Failure to act on<br />

these opportunities will show our disregard for the lives<br />

and living of the 80% of the population trapped in a<br />

poverty and under-development. S<br />

<strong>Service</strong> magazine | 33


S<br />

technology<br />

2022’s most demanding<br />

IT role: the remote<br />

IT security expert<br />

Nowadays, the office is either the old, traditional office space, home, a<br />

coffee-shop, or a combination of all of these. This has made managing<br />

devices more complicated because, for many of today’s workforce, the<br />

line between home devices and office devices itself is blurred.<br />

Steve Flynn, director of sales and<br />

marketing at ESET SA<br />

Unfortunately, most people lean toward efficiency more<br />

than security.<br />

Typically in an office-based environment, IT<br />

administrators can manage the hardware and software<br />

on the network more closely, while the hybrid-work<br />

scenario changes all of that. This makes limiting the<br />

use of devices to a single network and protecting them<br />

far more complex.<br />

The challenge is compounded by the growing threat<br />

of cybercrime. The global ESET Threat Report for the<br />

first half of 2021 showed a rise in threats targeting<br />

remote workers. And as employees blend remote work<br />

with office time, these threats are set to increase.<br />

The reality is that the more time employees spend<br />

out in the field on potentially unsafe public wi-fi<br />

networks, the higher the risk of becoming a victim<br />

___ __<br />

Businesses need to<br />

ensure that employees<br />

enjoy the same level<br />

of protection whether<br />

they’re using their<br />

devices at home or<br />

through any other<br />

connection, even their<br />

mobile devices.


technology<br />

S<br />

of cybercrime. And nowadays, with almost 60% of <strong>Service</strong><br />

Message Blocks (SMBs) stating they’d not be able to recover<br />

from the financial impact of a data breach, these risks can<br />

be ill-afforded in today’s challenging operating environment.<br />

Businesses need to ensure that employees enjoy the same<br />

level of protection whether they’re using their devices at home<br />

or through any other connection, even their mobile devices.<br />

ESET’s consumer offering, which includes the ESET Smart<br />

Security Premium product, boasts a host of new features and<br />

improved protection across devices, including mobile phones.<br />

At the forefront is LiveGuard, which provides an additional<br />

proactive layer of protection against new and unknown<br />

threats cropping up in the landscape. LiveGuard employs<br />

technology originally built for businesses to safeguard their<br />

diverse networks from both known and never-before-seen<br />

types of threats.<br />

It is enterprise-grade security for regular users. A cloud<br />

sandbox pulls suspicious files – whether downloaded by web<br />

browsers, email services like Microsoft Outlook and Mozilla<br />

Thunderbird or extracted from archives or USB drives –<br />

to a secure cloud platform for analysis first. This virtually<br />

eliminates the chance of infecting the device and those on<br />

the network it connects to and allows for safe migration<br />

between networks whether at home, the office, or anywhere<br />

in-between.<br />

Equally threatening is malware and ransomware, for good<br />

reason. Ransomware attacks continue to evolve to catch<br />

unsuspecting users. LiveGuard protects against these sorts<br />

of threats regardless of the “gift wrapping”, they come in.<br />

LiveGuard, and its cloud sandbox, lowers the risk of you<br />

being the employee that brings malware to work and threats<br />

and negatively impacts productivity and employment. S<br />

As employees<br />

blend remote work<br />

with office time,<br />

these threats are<br />

set to increase.<br />

<strong>Service</strong> magazine | 35


S<br />

business<br />

Office 22:<br />

the new way<br />

of work<br />

There is no going back to working 9 to 5 – all has<br />

changed irrevocably. The hybrid model – part<br />

remote, part in-person – looks set to become<br />

the new modus operandi. Is it the way forward?<br />

Craig Raath and Morag Phillips, executive<br />

directors, 21st Century, share their perspectives.<br />

“At the beginning of the pandemic, organisations<br />

were largely concerned about how they were going to<br />

control employees and manage performance,” says<br />

Raath. “After just a few weeks, however, leadership in<br />

many organisations actually observed that performance<br />

had improved.<br />

“In fact, a great number of people were arguably<br />

working too hard. The narrative has changed rather<br />

dramatically now because we are over a year into this<br />

new way of living. And organisations are struggling<br />

with engagement rather than output per se. They<br />

are grappling with their sense of community, with<br />

information sharing and silo behaviour. That’s the<br />

consequence of working remotely while still trying to<br />

drive an integrated culture.<br />

in the office for collaborative events and they get to<br />

experience culture too. In online meetings, most<br />

conversations are agenda driven. The interpersonal<br />

aspect is lacking. Hybrid working brings that aspect<br />

back to life and work.<br />

“For employers, there are serious cost saving<br />

implications if you get the hybrid balance right, and<br />

you are also unlocking one of the best employee value<br />

propositions (EVP) through engagement opportunities.”<br />

Raath continues, “As the new generation matriculates,<br />

There is never a simple black and white approach to effective hybrid working.<br />

“Observing the widespread trends happening<br />

around us, we have found that there’s a real need for<br />

organisations to set up a robust process and put models<br />

in place to get the balance right. Having said this, we<br />

acknowledge that a hybrid model and remote working is<br />

not possible for every job or industry. Where it is possible,<br />

it has huge potential.”<br />

Phillips adds, “The hybrid model, in the simplest<br />

terms, can provide the best of both worlds; the flexibility<br />

to work at home and the freedom to have other priorities<br />

in life, like going for a run in the morning or sleeping,<br />

instead of commuting in the traffic for example.<br />

“When employees are at the office, their presence<br />

is intentional, not forced. People are choosing to be<br />

a hybrid approach is going to be the expectation. And<br />

the companies that get this right are going to have a<br />

strategic advantage over those who haven’t, because<br />

it’s going to be extremely attractive, in terms of the<br />

EVP, for organisations that have the right boundaries<br />

in place but also provide employees with psychological<br />

safety, in that they have a community.”<br />

“There is never a simple black and white approach to<br />

effective hybrid working. You must effectively balance<br />

intentional presence with recognising individuality<br />

and taking advantage of the technology and tools<br />

at your disposal. When the right model is in place,<br />

businesses have the potential to truly flourish.”<br />

* 21st Century is a remuneration and HR consultancy.<br />

___ __<br />

As the new generation<br />

matriculates, a hybrid<br />

approach is going to<br />

be the expectation.<br />

36 | <strong>Service</strong> magazine


usiness<br />

S<br />

IT BUILDING BLOCKS TO OPTIMISE HYBRID WORKING<br />

Within this new model, organisations need to harness technology to optimise both<br />

the employee experience (retain talented staff) and efficiency (be competitive).<br />

By Ramyani Basu and Joshua Swartz<br />

The first step is to consider how views have evolved over<br />

the past 18 months.<br />

• [UK] 85% of people working from home want to combine<br />

both home and office working in the future, according<br />

to a survey by the Office for National Statistics.<br />

• [US] 80% of large companies plan to introduce “hybridguided”<br />

flexible working arrangements, according to a<br />

survey by real estate services and investment company<br />

CBRE. 44% of remote workers, at least some of the time,<br />

report feeling isolated or disconnected, according to a<br />

survey conducted by the Society for Human Resource<br />

Management.<br />

• [Europe] 57% of employers think investing in flexibleworking<br />

technology is essential to attracting and<br />

retaining talent, according to a poll for Ricoh Europe.<br />

Yet only 35% of the respondents fully trust remote<br />

working staff, with 39% suggesting their people don’t<br />

work as effectively as in the office.<br />

Research findings point to a strong demand for hybrid<br />

working, while also highlighting the potential pitfalls.<br />

Implications for organisation<br />

1. As employees rethink the necessity of in-person<br />

meetings, the use of virtual interactions and digital<br />

tools has skyrocketed, placing a premium on network<br />

capacity and stability.<br />

2. Technical support must be carefully considered.<br />

Stepping away from 9 to 5 has created demand<br />

for cover outside of traditional core hours and variable<br />

capacity for peak periods. Managing these issues,<br />

while delivering help remotely wherever possible, is<br />

a challenge.<br />

3. While new technologies are required to help colleagues<br />

connect with one another, it’s not a given that they<br />

will take to these immediately. It will be necessary to<br />

provide new virtual training, on-boarding, and support<br />

for the digital workplace.<br />

All told, the future of work is going to be hybrid,<br />

digitally driven – and more complex to manage.<br />

With increased barriers to communication and the<br />

need to work across remote and non-remote teams, the<br />

employee experience needs to be more collaborative<br />

than ever. To provide employees with the flexibility they<br />

want, companies need an ecosystem of tools that allows<br />

staff to work where, how and when they like. And with<br />

workplace expectations influenced by the consumer<br />

digital landscape, firms will feel the pressure to provide<br />

a seamless experience across multiple devices – both<br />

business and personal, online and offline channels, and<br />

a far wider spread of onsite and offsite locations.<br />

It can’t be done without IT, but what are the key<br />

elements needed?<br />

THE FIVE BUILDING BLOCKS<br />

The post-Covid employee experience will continue to<br />

evolve; however, market leaders are making moves in<br />

the following areas:<br />

1. Devices. There are many options, from limited and<br />

off-the-shelf only to total bring your own device (BYOD)<br />

flexibility. Many companies have typically occupied a<br />

space somewhere in the middle, but along with lockdowninduced<br />

home-working, some have shifted toward a<br />

flexible or BYOD model that enables employees to use<br />

both the company and personal equipment they rely on.<br />

Leading firms are offering a select, best-in-class range<br />

of devices and services, accompanied by clearly-defined<br />

boundaries around BYOD.<br />

2. The IT support structure. As advances in technology<br />

and user needs have increased, there has been a move<br />

away from the traditional tiered system, in which<br />

issues and tickets are prioritised, escalated and<br />

dealt with by dedicated teams.<br />

Instead, leading firms are adopting more productbased<br />

support models, whereby employees are trained<br />

to use self-service and automated tools to solve most basic<br />

issues, leaving IT service experts free to focus on more<br />

complex problems.<br />

3. Apps and software. The potential scope is wide,<br />

from total control by IT to employees having the<br />

ability to download any software independently. Most<br />

companies choose to allow a certain level of freedom,<br />

although some industries are more tightly bound by<br />

compliance requirements. Working remotely means<br />

thinking differently about previously common tasks,<br />

such as taking screenshots and printing: the hybrid<br />

model adds another level of complexity for IT as it seeks<br />

to offer a user-friendly experience while maintaining<br />

business security and confidentiality. Leading firms<br />

are managing the balance by offering a fixed suite of<br />

managed technologies, accompanied by a clear, fast route<br />

to fulfill bespoke software requests.<br />

4. People and skills. As the support model becomes<br />

product-based, the IT service team evolves. Instead of<br />

a tiered structure, with skill levels ranging from basic<br />

<strong>Service</strong> magazine | 37


S<br />

economy<br />

The future of work is going to be hybrid, digitally driven – and more complex to manage.<br />

experts devoted to hardware and software,<br />

while their developers focus on automating basic<br />

support and creating new resolution tools.<br />

5. Security and access. The seamless experience<br />

across multiple devices that today’s employees<br />

expect is also driving the need for a greater level<br />

of connection security. Leading firms are now<br />

tending toward dual-factor authentication in<br />

both the customer environment and for<br />

employees to access secure company virtual<br />

private networks (VPNs) for remote working<br />

and support. They are developing up-todate<br />

protocols to allow physical access, where<br />

required, in a Covid-safe way.<br />

The hybrid opportunity<br />

Where companies have tackled the challenges<br />

The Conversation<br />

Figure 1. The five building blocks.<br />

to expert, the team is divided into two: highly-skilled<br />

support staff focused on solving complicated issues, and<br />

a development team that builds and releases tools for<br />

employee self-service. Leaders in this area have product<br />

ESTABLISHING THE ENVIRONMENT<br />

Numerous recommendations exist on the best way to<br />

develop a hybrid model. Here are a few of the best ideas:<br />

Meeting too often or with little purpose – that is,<br />

meeting for the sake of meeting – leads to fatigue. Not<br />

everyone needs to be at every meeting, yet finesse from<br />

management is required to make sure no-one feels left<br />

out. And meeting-free days can help with productivity and<br />

allow employees a block of uninterrupted time to focus on<br />

complex projects.<br />

Listening to employees is critical to making sure the<br />

hybrid environment is working. Continually seeking<br />

feedback, through one-on-one conversations, focus<br />

groups or human resources surveys, is important too.<br />

So is recognising and rewarding employees with in-person<br />

or virtual kudos for their achievements. Performance<br />

incentives, such as financial rewards or tokens of<br />

appreciation, help develop a supportive culture that<br />

increases employee commitment.<br />

Finally: both managers and employees must be<br />

transparent in their communication and understanding<br />

of hybrid plans. Policies must be in place to define what<br />

tasks happen in the office and remotely. Access to reliable<br />

communications is essential, particularly for remote work.<br />

All employees must receive the same information at the<br />

same time, and in a timely manner. After all, whether in<br />

the office or online, workers don’t want to feel they’re the<br />

last to know.<br />

Organisational efficiency and effectiveness<br />

presented by Covid-19 and used them as an<br />

opportunity to drive a new way of working, success has followed. Benefits<br />

range from faster decision-making to increases in productivity, focus and<br />

efficiency; boosted morale and collaboration; better work-life balance; and<br />

colleagues who are easier to reach than ever before (see Figure 2).<br />

Conversely, doing nothing is not an option. To maintain morale,<br />

organisational leaders urgently need to implement hybrid working in a<br />

way that meets employees’ new expectations. Research shows most workers<br />

seek a flexible, collaborative and seamless experience that combines the<br />

best of remote and in-person interaction. If they fail to meet that demand,<br />

organisations will struggle to thrive in the post-pandemic world.<br />

Figure 2: Those that have tackled the pandemic challenges<br />

have found success. “BAU” refers to “business as usual”.<br />

Listening to employees is critical to making<br />

sure the hybrid environment is working.<br />

Courtesy: kearney.com<br />

38 | <strong>Service</strong> magazine


economy<br />

S<br />

THE TICKING MENTAL HEALTH TIMEBOMB<br />

Workplaces worldwide are facing a mental health crisis of unprecedented scope: the effects of almost<br />

two years of anxiety, uncertainty and fear will transition into another period of flux as we enter 2022.<br />

Debbie Goodman, Group CEO of Jack Hammer, a global group<br />

of executive and leadership coaching companies based in Cape<br />

Town, says while on the surface an attitude of keeping calm and<br />

carrying on has prevailed until now, people, regardless of their level<br />

in the corporate hierarchy, are not okay. As a result, companies<br />

are increasingly putting in place proactive mental wellbeing<br />

programmes above and beyond anything they have done in the past.<br />

Goodman says 2020 was a year of upheaval and swimming against<br />

the tsunami of challenges that arose to survive. When 2021 came,<br />

there was hope that things would improve and normalise to some<br />

degree. Now, with 2022 on the horizon and reality hitting home<br />

that equilibrium is likely a long way off, it is crucial that substantial<br />

interventions are put in place to support the entire workforce – from<br />

entry-level staff to the top.<br />

“As we return to the hybrid workplace in January 2022, we will<br />

all be bringing the trauma of the past two years with us, embarking<br />

on another year of ongoing uncertainty.<br />

“So where before, some progressive companies recognised the<br />

importance of the mental wellbeing of their staff, not only from<br />

a humanitarian and empathetic position, but also in recognition<br />

of the importance mental health plays on productivity, creativity,<br />

teamwork and ultimately the company’s, we now have a situation<br />

where mental health has moved from its periphery position into a<br />

front-and-centre issue.”<br />

“Probably the most salient insight that can be taken from this time<br />

is that we all have a basic need for routine and certainty for our ne<br />

rvous systems to be able to function optimally. Constantly being in a<br />

state of high alert, and expecting danger and upheaval, as a matter<br />

of course, do not make the best foundation for workplace excellence.<br />

It is therefore incumbent on leaders to provide as much safety and<br />

certainty to their teams as possible.”<br />

Goodman suggests the following framework:<br />

Flexible routines. Regardless of remote, all-in-at-office, or hybrid:<br />

make sure that the arrangement is linked to a routine, albeit a<br />

flexible one. Even if companies allow workers to choose what works<br />

best for them, this trust should not equate to a free-for-all. Total<br />

autonomy is counterproductive and destabilising for everyone. The<br />

sweet spot is combining boundaries and structure with a good dose<br />

of flexibility.<br />

Communication. Leaders must communicate regularly regarding<br />

(realistic) expectations so that people can plan their lives and achieve<br />

a greater degree of certainty. Even where things remain uncertain,<br />

this should be shared as well. A lack of communication creates<br />

anxiety whereas frequent engagement, even if it is to share that<br />

the jury is still out on a specific matter, puts people at greater ease.<br />

Reassurance. People continue to be fearful about the future<br />

and job security, many constantly worrying that this day could be<br />

their last, especially if a company has undergone retrenchments.<br />

Although it may be impossible to offer any real certainty about the<br />

future, assure people they will have their jobs, which will go a long<br />

way to having them breathe more easily. It helps to shift focus from<br />

anxiety over the future to the deadlines of the day.<br />

Model and normalise. Many leaders can answer yes to at least<br />

two or three of the following questions: Are you feeling stressed?<br />

Anxious? Burnt out? Exhausted? Depressed? Fearful? Most of<br />

your staff will suffer from some of these as well. It is important to<br />

normalise the fact that you, as leader, are also impacted by these<br />

issues, and model positive responses to address mental health.<br />

Mental illness has been skirted around in modern times, with<br />

people far more willing to admit to physical ailments rather than<br />

mental ones. But as leaders, it is time to ensure wellbeing challenges<br />

are recognised and accommodated without stigma, Goodman says.<br />

ESTABLISHING THE ENVIRONMENT<br />

Goodman’s latest book, The Living Room Leader – Leadership faster than anyone thought possible, and where leaders<br />

Lessons for a Hybrid Future, has shot to the top of Amazon’s uncovered innovative ways of managing their teams, boosting<br />

bestseller list within days of its pre-sale launch in the USA productivity, and engaging customers – often from the living<br />

[November 2021]. The book explores the status quoshattering<br />

lessons learned during the pandemic, where it with extraordinary business leaders from all over the world,<br />

room or kitchen table. The book features anecdotal interviews<br />

was proved that companies can pivot their business models plus research studies and her own wealth of experience.<br />

PRACTICAL TIPS<br />

Systematic check-ins. Making<br />

an overt effort to connect became<br />

the approach during Covid, helping<br />

companies survive and overcome<br />

hurdles. Over time, business-as-usual<br />

prevailed again, but making regular<br />

personal connection will be crucial<br />

in 2022 to identify issues early and<br />

arrange for support timeously.<br />

Regular rest. Smart companies have<br />

already instituted enforced breaks, like<br />

designating the last Friday each month<br />

as a company-wide leave. Others are<br />

offering unlimited leave (with conditions),<br />

rotating leave for teams, or half days.<br />

Figure out a leave strategy that might<br />

work for your organisation and beta test<br />

it to see how people respond.<br />

Wellness support. For companies with budget and<br />

infrastructure, it is a great step in the right direction<br />

to invest in professional psychological counselling<br />

at company expense for those who need it. Another<br />

option is group-support sessions facilitated by trained<br />

coaches. The way this benefit is provided is critical –<br />

the promise of confidentiality and non-judgment must<br />

be ironclad and a solid bedrock of trust in relationships<br />

between management and staff is essential.<br />

<strong>Service</strong> magazine | 39


S<br />

economy<br />

CYBER THREATS. GLOBAL VIRUSES<br />

As the holiday season approaches, supply chain and logistics, e-commerce<br />

and retail, and the travel industry see predictable increases in consumer<br />

and business activity – making them more vulnerable to cyber threats.<br />

McAfee Enterprise and FireEye recently released Cybercrime in a Pandemic World: The Impact<br />

of Covid-19, revealing the imminent need for organisations to strengthen their cybersecurity<br />

architecture. The findings indicate that during the pandemic, 81% of global organisations<br />

experienced increased cyber threats with 79% experiencing downtime due to a cyber<br />

incident during a peak season.<br />

“Ninety-four percent of IT professionals want their organisation to improve its overall<br />

cyber<br />

0<br />

readiness. Businesses must do more and need an intelligent security architecture<br />

for managing today’s sophisticated threat<br />

· 90% of<br />

landscape,” Bryan Palma, CEO of the newlycombined<br />

company.<br />

South African<br />

organisations<br />

“Ninety-seven percent of South African<br />

experienced<br />

IT professionals say that their organisations<br />

increased cyber<br />

threats during could place a greater emphasis on overall<br />

85<br />

Covid-19 cyber-readiness and strategies to prevent,<br />

protect and react to potential threats,” says<br />

Carlo Bolzonello, country manager for<br />

McAfee, SA. “This is really critical in the<br />

South African context, as it shows that local<br />

security professionals understand their<br />

weaknesses, and they have identified what<br />

they need for them to do their jobs better.” S<br />

85% of organisations experienced downtime<br />

due to cybersecurity risk during peak season<br />

NEED TO KNOW<br />

While South African cyber threats have<br />

intensified, the findings prove that<br />

organisations have not effectively prioritised<br />

security during Covid-19:<br />

saw an increase In<br />

60% ONLINE ACTIVITY<br />

37%<br />

had their technology<br />

and security<br />

BUDGETS REDUCED<br />

suffered from DOWNTIME<br />

66% due to a cyber concern<br />

80%<br />

find maintaining a<br />

SECURITY TEAM<br />

more challenging<br />

during peak periods<br />

40 | <strong>Service</strong> magazine


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