1. Board-level statement from the Group PFO of continued support to the UN Global Compact.
2. Our Commitment to Human Rights.
3. Our Commitment to Labour Principles.
4. Our Commitment to Environment Principles.
5. Our Commitment to Anti-Corruption Principles.
I am pleased to confirm that Lonrho Limited reaffirms its support for the Ten Principles of the United Nations Global Compact in the areas of Human Rights, Labour, Environment, and Anti-Corruption.
In this, our fourth submission as Lonrho Limited since the acquisition in July 2013, we describe our actions to continue to improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations. Current examples are given through this Report from Lonrho’s subsidiary businesses across the Group. We are committed to sharing this information with all our stakeholders using our primary channels of communication.
The Board remain aware of the importance of the Sustainable Development Goals (SDGs) agreed in New York in September 2015, and of the supporting role that Lonrho as a business can play – including through our continuing commitment to the UNGC. Four SDGs identified by the Board are of particular relevance, through our operations on the ground:
SDG 2 – Zero hunger
SDG 8 – Decent work and economic growth
SDG 9 – Industry, Innovation and Infrastructure
SDG 12 – Responsible consumption and production
We will continue to refine the support we can bring to these and other relevant SDGs and their subsidiary targets, and work within the UNGC and other appropriate frameworks to maximise the support that a business like ours can bring to globally-important agendas.
Lonrho Group respects human rights and where possible promotes the rights set out in the International Bill of Human Rights to avoid causing or contributing to adverse human rights impacts through our activities and relationships.
Lonrho Group acts with due diligence to avoid infringing the right of others and always addresses any negative human rights impacts related to the business.
Lonrho Group makes voluntary and positive contributions to support human rights by creating diverse and inclusive workplaces, investing in communities, and by engaging employees and communities to promote collective action.
Lonrho Group uses the framework provided by the UN Guiding Principles to monitor, influence and improve the business practices of our operations, as well as those of our suppliers and business partners. We will work with others including industry, NGOs, trade unions, business partners and governments to mainstream the integration of human and labour rights into business.
Effective grievance mechanisms, as described in the UN Guiding Principles, are critical in ensuring that human rights including labour rights are respected. Lonrho has a detailed individual grievance mechanism that provides guidance for our businesses.
Employees across our businesses are encouraged to speak up and bring to our attention any breach of Code. This is detailed in the Employee Handbook / Code of Business Conduct. Employees can report their concerns to their line manager, local Human Resource colleagues or can confidentially contact our whistle-blowing line.
AFEX have formed an Employee Council in all their operations, where the employees appoint their own representatives. The Employee are encouraged to raise any issues they have through the Council. The management also uses this tool to communicate with the employees.
Lonrho is committed to a culture of transparency where all stakeholders are encouraged to speak up about any concerns they may have through our grievance channels. Internal and external channels for raising concerns have been established and are detailed in the Employee Handbook / Code of Business Conduct – which is kept under review. Our suppliers and their employees are also encouraged to contact us should they encounter any breach of Code.
Our employees are provided with mandatory training of our Code of Business Conduct during induction. Compliance to the Code is mandatory for directors, employees, contractors and individuals who work or act on behalf of Lonrho. From early 2016, the role of Compliance Officer has been created across our business to deal with compliance issues relating to our business and our suppliers.
As well as focussing on primary safety, Lonrho companies have addressed the wider well-being of our work force by promoting awareness of nutrition, personal hygiene and HIV/AIDS to avoid onward infection and encourage testing, counselling and treatment. Luba Freeport operates an on-site clinic which is available to all employees for first response treatments.
AFEX is committed to offer nutritious and well-prepared food to staff and customers who are more health conscious than previous generations. AFEX presents food along with nutritional indicators that act as a guide to customer when making their selection, this is referred to as ‘Traffic Light System’. For example, foods and drinks that are classified as Green are the healthiest choices. Foods and drinks classified as Amber are mainly processed foods. Foods and drinks classified as Red are energy dense and nutrient poor foods and drinks that are high in saturated fat, sugar and/or salt.
AFEX also invests in staff health and well-being, and providing a safe workplace by providing wellness sessions and access to fitness activities within the camps.
Lonrho is committed in building a high-performance culture that encourages all employees to work towards their full potential. To achieve this the company is committed to help employee build up skills necessary to perform better. The company believes in identifying key competencies for each job position, each of these competencies are assessed on annual basis through the performance reviews, the outcome of these dictates the type of training required for each staff. The identified training needs are logged into the training matrix.
Lonrho believes in having a multi-skilled work force. AFEX achieves this through the Customer Service Assistant model which is aimed at ensuring that staff are equipped with more than one skill set. The model is a win-win solution for the management and the staff, creating skills upgrade, career advancement, salary progression and productivity improvement. The key objective is to help staff earn better wages through skills upgrading and productivity improvements, help staff at all levels of the wage to upgrade and progress to the next level, and create better opportunities for the staff should they leave our business.
AFEX recently held Customer Services training for their employees. This training will go long way in creating a positive impact to the clients and to those working within the organisation. 142 employees received the training and were issued with the certificates.
AFEX recognises and rewards employees for their efforts to improve profitability,
reputation and service. The Company has established award schemes to award employees who perform well. The two schemes are classified as Outstanding Contribution Award (OCA) and Exceptional Service Award (ESA).
The OCA recognizes and rewards employees for their efforts to improve profitability, reputation and service of the business. The rewards are categorized into bronze ($50), Silver ($100) and Gold (unlimited and at the discretion of management).
The ESA on the other hand recognizes and reward employees’ contribution that improves profitability, enhances the reputation of the business that results in a better service to the business guests. This scheme allows managers / supervisors to instantly reward employees who have gone an extra mile, who have worked and achieved over and above their day to day responsibilities and who act as role models to all other camp employees. The reward is an instant cash prize of Kshs. 2,000.00/- an equivalent of US$200.
AFEX have put up a career progression plan for local staff whereby they are trained to ensure they are able to take up jobs currently held by other nationals in the future. A good example is one Assistant Storeman who was trained and has now taken up the full role of a Storeman. A local employee is also being trained as a Receptionist. The current Housekeeping Team Leader is undertaking training that will enable her take up the role of a Housekeeping Supervisor.
At AFEX employees have also formed a Savings and Cooperative Society that allows employees to contribute shares on monthly basis and later take up loans and repay at lower interest. This has contributed to improving the livelihoods of the employees and their families.
Lonrho also takes into consideration the welfare of people with disabilities. For example, MES (Mauritius) have designed their office in a way that accommodates people with physical disabilities. Our new London Headquarter offices (from February 2017) are also fully accessible for staff and visitors.
Lonrho invests in our employees’ professional development, from their first day and at all levels of the company. For example, at MES financial support is offered in maintaining professional qualifications e.g. ACA, access on various online language courses to assist with improving business wide communication, and training in all relevant John Deere programs and methods. MES Management are investing in the knowledge and skills of its workforce: semi-skilled staff are enrolled in formal online training, which is followed through and paired with travel overseas to attend face-to-face training. The aim is to move all apprentice mechanics to the level of Senior Technician.
MES have created the Employee of the Quarter Award, and Employee of the Year Award. Every quarter, each dealership has the right to nominate any employee of their choice, regardless of the grades and skills, this employee receives a branded gift and a certificate, as well as a local acknowledgement. The aim is to recognise the good performance and diligence of the star employees who thrive at proving their best performance to enrich our dealership performance. A diverse panel votes and elects the Employee of the Quarter for the entire division, who is awarded a voucher for an outing, and is part of the newsletter. Once a year, the best of the Elected performers of the Year are re-evaluated, and the employee of the quarter is voted and rewarded with a customised prize that meets their needs.
Lonrho also recognises the value for staff of activities to mark personal milestones such as birthdays and weddings, as well as collective celebrations such as Christmas parties and celebrating achievements.
At Lonrho, we take action on human rights, fair compensation, improving employee development, and health and safety, to ensure the well-being of all who work with us.
At MES headquarters, equal opportunity policy has been designed, the Management and new recruits has been coached on creating a healthy culture where all employees have the same treatment, fair workload and rewards. The dealerships across Africa are integrating this ideology and adapting it to their culture. AFEX and other Lonrho businesses take a similar approach across their operations.
Central to Lonrho Limited’s core values is to behave as a responsible neighbour, respecting and supporting local communities and the people impacted by our business. At both local and national level, we seek to address community issues, through consultation and dialogue with key stakeholders including the local communities themselves, civil society, Governments, international organisations and industry partners.
Across the Lonrho Group, community-specific investments add value and address local needs. That ranges from donations to local charitable causes including homes for the elderly and sport, to addressing water and waste management to contribute to improved standards of living.
For example: AFEX has previously donated assets (mattresses, beds, trunks etc.) to its staff during the demobilization phase of Ngamia 1 and Ekales camps.
Luba Freeport’s emergency fire-fighting and community waste disposal services are available to support the adjoining town as well. Luba Freeport participate in an annual community-support programme manged by the Ministry of Mines, recently helping restore a local school building and basketball court to use. In the education sector, Luba Freeport have continued their successful partnership with the Ministry of Education in providing sponsorship (through paying rent, maintaining the building and paying the salaries of three teachers) at the local pre-school.
AFEX plans are in place to partner with Africa Oil through the Lundin Foundation to facilitate a local polytechnic (Lodwar Youth Polytechnic in the Northern Part of Kenya) with the necessary kitchen equipment and facilitators.
AFEX has also budgeted to initiate a greenhouse project in Kapese that will benefit the local community schools. The schools will be required to hold agriculture lessons at the greenhouse; this will ensure that the students learn valuable and sustainable skills and the help in the day to day running of the greenhouse. The school will then sell the produce to Akiberan (a local women’s group) who will sell to AFEX and other local suppliers. The main objective is that the students will transfer their farming and business skills to their parents back at home thereby enhancing training skills and develop employment opportunities in the future. The school must demonstrate a method of income accountability and how the school will benefit in the long run.
AFEX are committed to an apprenticeship scholarship program. Plans are in place that will involve engaging local candidates and taking them through a course for a period of two years to ensure they have the skills required to do the job.
Every year in October AFEX sponsors four local staff from Kapese to participate in the nationwide marathon events. These events provide a chance for the local staff to meet others including colleagues from Head Office, Juba and other areas where the company has operations.
AFEX is committed in enriching and empowering the local community by raising money through raffle draws during global sporting and similar events. Cash raised will be donated to local schools or other community groups.
In June 2017, AFEX achieved 1000 days of no LTI (Lost Time Injury). To celebrate this achievement AFEX decided to give back to the local community of Kapese, choosing Lokichar Girls’ Primary School as a beneficiary. The School is situated several kilometres from Kapese Camp, and hosts 300-day students, together with 700 boarding students. AFEX donated 100 beds together with mattresses and bedding, which the school strongly needed.
MES works with others to build thriving communities and improve people’s lives and support the long-term success of our business. Examples are: partnering with the charity “Christmas Box” to provide gift boxes to two children and grocery boxes to two families from disadvantaged backgrounds; possible future partnership with the British High Commission and British Council to sponsor leadership programmes in local Mauritian schools; associated contribution from our staff in terms of volunteer hour; large contract sale to government agency supporting an effort to boost local agricultural economy; annual touch rugby tournament for staff and current/future clients with participation from local teams; demo vehicle granted to a customer (Unitrans) in an effort to improve perception and demand for mechanised farming in Tanzania; partnering with John Deere South Africa and local banks to provide financing and leasing options to new small buyers in an effort to boost the local agricultural economy in Tanzania; training provided to two university students on aspects of technical mechanisation.
At MES Dealerships, hands-on training and demos has been greatly appreciated by local farmers, and has become very popular. LonAgro dealerships are copying the training model and local farmers are receiving this customised training in Mozambique, Rwanda, Malawi & Angola (as well as previously in South Sudan).
Our business contributes to the economic well-being of many communities, through employment, training and our value chain. Lonrho is committed in forming partnerships with local entities in provision of goods and services to our business, many of whom are women. We are committed in training the local groups in raising standards hence empowering the local businesses and providing them with skills to make their businesses grow.
Lonrho is committed in advancing opportunities for women. A good example is a local women’s group - Akeriban - in the north-west Kenya which has been awarded a tender by AFEX to provide fresh fruits and vegetables and dry goods to Kapese Park camp. The women share the proceeds and this has ensured that over 300 families are able to put food on their table.
Our companies are committed to local sourcing of goods and services wherever possible. Luba Freeport operate local contracts for their two largest services, in security and tug supply. AFEX are committed to form partnerships with local entities in provision of goods and services to Tullow Oil plc.
AFEX currently have 100% of all fresh fruits & vegetables being supplied by the locally based suppliers within the Turkana region. Their forecast is to have 50-70% supply of dry goods by the local suppliers. They give priority to the members of the local communities when it comes to sourcing for local suppliers and we are committed to promoting the local content to grow the local ability of the local people as we consider the benefits which our business can bring to the local communities by investing in training and development of the local based women group suppliers. AFEX are also committed to training local groups in raising standards empowering the local businesses and providing them with skills to make their businesses grow.
Lonrho Logistics have completed an initial round of internships, with participants gaining the award of the National Certificate in Transport and Logistics. Luba Freeport have begun a knowledge transfer scheme, whereby suitable local employees are selected for dedicated skills improvement courses, managed both internally via on the job training and externally via third party training courses.
To maximise local employment opportunities at Luba Freeport, the Ministry of Labour systematically post all vacancies on local TV and radio. To further demonstrate Lonrho’s commitment to technology transfer and training our local workforces, two Equatorial Guinean nationals at Luba Freeport have completed a six-month course (in-house) on crane operations. Following practical and written examination by Bureau Veritas in 2016, one was certified to operate cranes up to 50t capacity, the other was certified to 90t capacity. Luba Freeport’s current national crane operator, who was certified to 50t, has now been certified to 90t. This has allowed Luba Freeport to replace two expatriate crane operators with in-country nationals.
At MES, the local dealerships have been opening training and internships for students from technical schools. These can last for up to six months depending on the curriculum needs of the trainee. Angola and Rwanda have offered permanent jobs to these trainees following a successful and constructive job shadowing.
AFEX encourages inclusiveness in its business – employment opportunities are offered to the local community which improves the livelihoods of many families. Over 70% of the workforce currently is from the local community.
3. Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;
4. The elimination of all forms of forced and compulsory labour;
5. The effective abolition of child labour; and
6. The elimination of discrimination in respect of employment and occupation.
Lonrho commits to adhere to the Labour practices as per the Constitution in the country of operations, follow the entire stated SOPs that regards recruitment, selection of staff, and procurement of goods and services, uphold labour standards across the business operations. This includes employment that is productive and delivers a fair income, one that ensures workplace security, social protection, better prospects for personal development and social integrations.
Lonrho focuses on non-discrimination, equal opportunities and treatment (including for men and women and freedom to express concerns. Lonrho respects the rights of women and girls by putting in place non-discrimination and sexual harassment policies and recognizes the importance of women as leaders, consumers, entrepreneurs, workers and caretakers.
Lonrho supports good relationships with employers, contractors and the labour unions that represent them and are vital in attracting the labour resources that the Group needs to maintain operational efficiency and licence to operate.
Lonrho recognises workers’ rights to union membership and collective bargaining, and takes a proactive approach to dialogue with workers and their representatives. This is included in the Standard Operating Procedures at Luba Freeport; AFEX have an active Staff Association.
Lonrho remains committed to and proud of our diversity, currently employing 18 nationalities across our Africa network. With a policy of employing local nationals wherever possible, we offer challenging career opportunities regardless of age, ethnicity, religion or gender. This is reinforced by appropriate policies within each business.
Employees across the Group are kept up to date on business and corporate matters through face to face meetings, newsletters (including messages by email from individual Board members), and through the facility since 2015 of a Group intranet.
Lonrho prohibits employment of a child in any activity by refusing to employ children under the recommended age in the respective countries and prohibits forced labour. The Board agreed and published its initial statement in September 2016 under the UK’s Modern Slavery Act 2015, as well as our existing UNGC commitments and the priority attached to SDG 8.
7. Business should support a precautionary approach to environmental challenges;
8. Undertake initiatives to promote greater environmental responsibility; and
9. Encourage the development and diffusion of environmentally friendly technologies
Lonrho’s approach to protecting the environment is to foster a culture of stewardship, where individual employees and Lonrho Group companies understand the impact of their operations so as to prevent and reduce the negative effects, use resources efficiently and utilise responsible technology.
Through the implementation of a robust Integrated Safety Management System to ISO International Standards Lonrho ensures appropriate policies, procedures and staff training can be put in place and quickly implemented. In order to communicate these international standards to new staff, Lonrho implements a well communicated and progressive training program to guide, instruct and ultimately ensure staff are well trained in the tasks that they perform. The training is introduced at an appropriate level and level pace to ensure the Lonrho’s QHSE message that “Safety and the environment are our number one priorities” is understood by all.
Lonrho Head Office in London has retained ISO ISO9001 and 14001 accreditation following periodic external review in June 2017.
AFEX Kenya maintains the following certifications in 2017: OHSAS 18001 (Occupational Health & Safety), ISO 22000 (Food Safety Management), ISO 9001 (Quality Management) and ISO 14001 (Environment).
In order to identify, reduce and mitigate business risks, AFEX Kenya have developed an Integrated Safety Management System to ensure appropriate policies, procedures, operational planning, inspections, audit checks, corrective actions and management reviews, are driving a positive safety and environmental culture of continual improvement.
As a company committed to the future growth of Africa, Lonrho Limited is deeply aware of the economic and social challenges of climate change across the continent. We are committed to work with other businesses and individuals to maximise sustainable resource use and minimise negative impacts, in line with the outcomes of subsequent UN Climate Conferences. We also look to provide local practical help where we can: eg. following major flooding last year, Luba Freeport completed the cutting of a new rainwater ditch in the neighbouring village, prior to the start of the rainy season.
Since mid-2015, MES Mauritius as a company has generated zero waste: everything used is either reused, recycled or composted using the Mission Verte Network. That organisation collects and sorts the waste and then delivers it to local Mauritian companies who recycle the waste accordingly. Waste collected and recycled include paper, cardboard and cartons, plastic, E-waste, cartridges, glass bottles and batteries.
MES also commits to employee participation in green initiatives by training in waste reduction and recycling as part of starter induction, employees using cars to drive to work participate in a rota to transport recyclable waste to collection depots using their cars.
MES commits to energy efficiency. For examples the offices are equipped with energy-efficient LED lights and all lights, modems, computers and air conditioners are switched off in the evenings and at weekends.
MES has also adopted a Paper-free policy. An 80/20 approach is being utilised in to design a paper-free office environment. Local staff are trained on limiting the printing of hard copies, rather using server and software to keep records and manage their files.
AFEX manages waste by ensuring that waste is stored, handled and disposed of in accordance with relevant legislation, waste streams are regularly removed from waste bins on-site so that bins are not overly full and regularly removed from camp to ensure that waste remains within the capacity of the on-site waste storage facilities.
Data continues to be captured by other Lonrho companies to monitor water, consumables and energy consumption and to look for savings in usage, waste and cost. Generator use is constantly monitored at Luba Freeport to maximise efficiency.
Lonrho commits to Pest Control Management at all its business operations and has a Pest Control Management Plan whose purpose is to establish a sustainable approach to managing pests by combining physical and chemical tools in a way that minimizes economic, health and environmental risks. The plan outlines procedures to be followed to protect the health and safety of staff and clients from pest and pesticide hazards. Objectives of this pest management plan includes: elimination of significant threats caused by pests to the health and safety of staff and clients; prevention of loss or damage to products, structures or property by pests; and protection of environmental quality at relevant sites.
Lonrho commits to hazardous materials & chemical safety. The relevant QHSE officer will monitor the use of hazardous materials and chemical safety on site and ensure that chemicals are transported, stored, handled and used safely on site during construction and operations. This will be carried out in accordance with in-country legislation.
Where needed, the QHSE team will be responsible for maintaining a COSHH assessment register
(Control of Substances Hazardous to Health) - a risk based assessment for the use, handling, storage and PPE required for specific chemicals and substances. Material Safety Data Sheets (MSDS) will be made available for all chemicals introduced to site and appropriate training and Personal Protective Equipment (PPE) provided.
The QHSE team will carry out monthly checks of chemical products and associated MSDS and COSHH assessments to ensure the appropriate storage, handling and use of all hazardous chemicals on site.
10. Businesses should work against corruption in all its forms, including extortion and bribery.
This UNGC principle is embodied in Lonrho’s core value of ‘Conducting business with integrity’. Behaving ethically in accordance with our Group values is essential to maintain trust, licence to operate and a positive reputation. At Lonrho, we consider it everyone’s responsibility to uphold our corporate values and conduct themselves with the utmost integrity.
Since the 2013 acquisition, consistent ethical standards have been established and applied across the Group. Lonrho has a zero-tolerance approach to bribery and corruption and we are committed to acting professionally, fairly and with integrity in all our business dealings and relationships wherever we operate.
Several far-reaching measures have been adopted to ensure that these standards are being applied throughout the Group, which include training all staff members (nearly 300 completed so far) on the anti-corruption and bribery policy and whistleblowing policy, and through continual assessment of contract and procurement procedures. Compliance Managers have been appointed across the Lonrho businesses. In addition, Lonrho has enlisted the services of an independent auditor to identify and correct any weaknesses in the various divisions.
Lonrho welcomes opportunities to join discussions on these issues with other businesses working in Africa, with the UN and multi-lateral organisations, and with Governments in the UK, Africa and elsewhere. We strongly believe in helping to promote the value of transparent and business-friendly environments in fostering jobs and sustainable growth through trade and investment across the continent.