Implementation report

It is the view of the Remuneration Committee that the remuneration policy achieved its stated objective.

2021 guaranteed pay – base pay increase (%)
2021 guaranteed pay – base pay increase (%)
* Middle management was awarded a 3.3% increase; senior managers 3%, and general management was awarded a 2.5% increase.
Total remuneration outcomes
Single figure remuneration (R'000)
  Guaranteed pay Variable pay  
  Base pay Benefits and
allowances
STI LTI Total
remuneration
  2021 2020 2021 2020 2021 2020 2021 2020 2021 2020
Executive directors
A Banderker 4 948 450 4 781 364 452 817 435 788 4 000 000 3 242 207 1 750 000 9 401 267 10 209 360
W Britz 4 142 382 3 975 310 380 481 394 235 Waived fee 4 522 862 4 369 545
H Boonzaaier 3 404 936 3 061 646 314 452 276 436 2 083 405 1 755 613 1 460 000 1 750 000 7 262 792 6 843 695
S Mmakau 3 464 020 3 347 678 337 507 323 939 1 449 711 1 479 066 1 095 000 875 000 6 346 239 6 025 683
TOTAL 15 959 788 15 165 998 1 485 257 1 430 398 7 533 116 6 476 886 2 555 000 5 025 000 27 533 160 27 448 283
STI performance outcomes

Financial performance indicators are measured against audited annual financial results and are net of STI accruals. Non-financial performance KPIs are based on a formal performance evaluation conducted by the Group CEO for executives and by the Remuneration Committee and Board Chairperson for the Group CEO.

Performance below the threshold attracts no STI payments, where the threshold for financial targets is 100% of the target.

Non-financial individual performance is assessed against suitable KPIs and is rated on a sliding scale – where a score of 2.75 represents threshold performance, 3 on-target performance, 4 excellent performance and 5 stretch performance.

R59.9 million was paid out on the management performance bonus scheme aligned with individual performance scores.

Management strategic incentive scheme
Business multiplier Outcome Comments
Weighting – 40% Finance (EBIT) 3 out of 5 Target met EBIT of R794 million achieved, relative to the target of R806 million (on-target)
Weighting – 10% Governance 3.8 out of 5 Target partially exceeded The risk management processes continue to evolve, with more relevant aspects being monitored earlier in the process. The internal audit findings have been reduced significantly
Weighting – 10% Transformation 4 out of 5 Target partially exceeded ACT maintained its level 1 B-BBEE rating. Pharmacy Direct maintained its Level 1 B-BBEE rating, and other subsidiary entities improved ratings from the prior year
Weighting – 5% Culture 3 out of 5 Target met We have achieved more than 50% of our culture goals and the business culture assessment score has remained largely the same as the previous assessment score
Weighting – 35% Strategic impact
  • Enhancing our operating model specifically in the administration and managed care business
  • Stabilising IT systems and enhancing the infrastructure
  • Launching and implementing primary care products to create a unique value proposition for the Group
  • Delivering a successful medicine capitation model with full value chain optimisation
3 out of 5 Target met While the Group achieved its targets of enhanced leadership culture, value chain optimisation and lowering the cost of healthcare, targets set in respect of strategic projects were partially met
LTI performance outcomes

The Remuneration Committee reviewed participation in the scheme to ensure alignment with the strategic objectives of the Group and consideration was given to individual long-term performance (measured over three years), scarce and critical skills required, the strategic importance of the role and the individual's talent measured in a nine-box matrix.

The vesting share scheme was implemented in 2017, and the first 4 410 000 shares were awarded to participants in terms of the registered rules. The vesting period is three years, with the second third of shares awarded in 2017 vesting in 2021.

        Vesting criteria
  Date awarded
Number of
shares
awarded
Grant
value
(R)
Tranche 1
33.33%
Tranche 2
33.33%
Tranche 3
33.33%
Hannes Boonzaaier November 2018 200 000 1 000 000 335 333 335 333 335 333
November 2019 500 000 1 750 000 583 333 583 333 583 333
November 2020 400 000 1 460 000 486 666 486 666 486 666
Ahmed Banderker April 2019 500 000 2 400 000 800 000 800 000 800 000
November 2019 500 000 1 750 000 583 333 583 333 583 333
Sello Mmakau November 2019 250 000 875 000 291 666 291 666 291 666
November 2020 300 000 1 095 000 365 000 365 000 365 000
Individual remuneration outcomes
Ahmed Banderker (Group CEO)
  2021 
(R)
2020 
(R)
Salary 4 948 450  4 781 364 
Medical aid 47 852  44 968 
Retirement benefits 325 093  314 260 
Other employee benefits 79 872  76 560 
Total guaranteed pay 5 401 267  5 217 153 
Increase in guaranteed pay 3.5%  4.3% 
STI 4 000 000  3 242 207 
Number of shares awarded –  500 000 
Value of awarded shares –  1 750 000 
Total variable pay 4 000 000  4 992 207 
TOTAL REMUNERATION 9 401 267  10 209 360 
Total Remuneration
Total Remuneration: Ahmed Banderker (Group CEO)
Hannes Boonzaaier (Group CFO)
  2021 
(R)
2020 
(R)
Salary 3 404 936  3 061 646 
Medical aid 52 872  49 444 
Retirement benefits 209 988  182 492 
Other employee benefits 51 592  44 500 
Total guaranteed pay 3 719 388  3 338 082 
Increase in guaranteed pay 11.4%  4.31% 
STI 2 083 405  1 755 613 
Number of shares awarded 400 000  500 000 
Value of awarded shares 1 460 000  1 750 000 
Total variable pay 3 543 405  3 505 613 
TOTAL REMUNERATION 7 262 792  6 843 695 
Total Remuneration
Total Remuneration: Hannes Boonzaaier (Group CFO)
Willem Britz (prescribed officer)
  2021 
(R)
2020 
(R)
Salary 4 142 382  3 975 310 
Medical aid 104 892  128 272 
Retirement benefits 221 234  213 862 
Other employee benefits 54 355  52 101 
Total guaranteed pay 4 522 862  4 369 525 
Increase in guaranteed pay 3.5%  4.3% 
STI* –  – 
Total variable pay –  – 
TOTAL REMUNERATION 4 522 862  4 369 525 
* STI waived due to shareholding. No LT plan allocation.
Total Remuneration
Total Remuneration: Willem Britz (prescribed officer)
Sello Mmakau (prescribed officer)
  2021 
(R)
2020 
(R)
Salary 3 464 020  3 347 678 
Medical aid 59 540  55 680 
Retirement benefits 223 143  215 708 
Other employee benefits 54 824  52 551 
Total guaranteed pay 3 801 527  3 671 617 
Increase in guaranteed pay 3.5%  4.3% 
STI 1 449 711  1 479 066 
Number of shares awarded 300 000  250 000 
Value of awarded shares 1 095 000  875 000 
Total variable pay 2 544 711   2 354 066 
TOTAL REMUNERATION 6 346 239  6 025 683 
Total Remuneration
Total Remuneration: Sello Mmakau (prescribed officer)
Non-executive Directors' 2021 remuneration

Based on the PwC 2021 non-executive director remuneration report, AfroCentric concluded that the fees for the Chairperson of the Audit Committee, the lead independent and director fees are significantly below the median for companies of similar size. As a result and after careful consideration, the Remuneration Committee considered it prudent to steadily adjust the fees for the 2022 financial year. Accordingly, the directors' fees for 2022 were increased by bigger percentages than previous years to bring the fees closer to aligning with the median for similar size companies as reported in the PwC 2021 non-executive director remuneration report.

The following table sets out the fees for the period 1 January 2021 to 31 December 2021 approved by means of majority vote during the AGM:

  Current 
2021 
(R)
Proposed 
2022 
(R)
Recommended 
increase 
(%)
Main Board (annualised retainer fee)      
Chairman* 1 445 849  1 445 849 
Deputy Chairman* 1 317 844  1 317 844 
Lead Independent Director 515 802  667 627  29.43 
Member 256 875  305 955  19.11 
Audit and Risk Committee (per meeting)      
Chairperson 155 745  255 903  64.31 
Member 114 645  131 662  14.84 
Remuneration Committee (per meeting)      
Chairperson 93 448  132 997  42.32 
Member 68 788  72 370  5.21 
Nomination Committee (per meeting)      
Chairperson 70 086  132 997  89.76 
Member 51 591   72 370  40.28 
Social and Ethics Committee (per meeting)      
Chairperson 93 448  123 372  32.02 
Member 71 668  71 668  0.00 
Investment Committee (per meeting)      
Chairperson 140 172  192 277  37.17% 
Member 103 182  105 769  2.51 
ICT Steering Committee (per meeting)
      
Member** 51 591  70 513  36.68 
* The Chairman and the Deputy Chairman remuneration is all inclusive.
** The Chairperson is currently an Executive Director and does not receive fees.
Payments made to Non-executive Directors

The following fees were paid in respect of the AfroCentric Board:

Name of director Directors’ fees Social and Ethics Committee Medschseme Board ADS Board PD/Curasana Board Remuneration Committee
Dr Anna Mokgokong 1 555 377
Joe Madungandaba 1 167 449 25 958 38 215 78 782 98 558
Bruno Fernandes 252 526 22 572
Gary Allen 290 411 19 777
Jurie Strydom 192 775
Prof Shirley Zinn 361 765 96 875 103 965
Dr Nkateko Munisi 250 360 91 078
Alice Le Roux 302 022
Mmaboshadi Chauke 252 526
  4 625 211 210 525 25 958 38 215 78 782 222 300
Ronald Mundalamo 67 042
Total 4 625 211 210 525 25 958 38 215 78 782 289 342
Name of director Nomination Committee Internal Control Review Panel Pharma Audit and Risk Committee Audit and Risk Committee Investment Committee Total Fees
Dr Anna Mokgokong 52 824 1 608 201
Joe Madungandaba 38 884 105 648 1 553 494
Bruno Fernandes 22 929 46 724 182 682 67 624 595 057
Gary Allen 26 368 19 777 356 333
Jurie Strydom 192 775
Prof Shirley Zinn 25 477 588 082
Dr Nkateko Munisi 67 042 408 480
Alice Le Roux 154 645 456 667
Mmaboshadi Chauke 134 474 387 000
  91 708 22 929 46 724 523 646 260 091 6 146 089
Ronald Mundalamo 67 042
Total 91 708 22 929 46 724 523 646 260 091 6 213 131
Termination of office payments

No termination of payments were made for ACT directors during the year under review.

Statement regarding compliance with the remuneration policy

The committee satisfied itself that the remuneration policy, as detailed in the report, was complied with, and there were no substantial deviations from the policy during the year.

Advisory vote on the implementation report

The implementation report, as it appears above, is subject to an advisory vote by shareholders at the 2021 AGM. Accordingly, shareholders are requested to cast an advisory vote on the remuneration policy's implementation for 2021.

Approval of the remuneration report by the Board

The Board approved the remuneration report on 13 September 2021.