Our material matters
We disclose matters that substantively affect our ability to create value over the short, medium, and long term. We identify these matters using a double materiality determination process to enable us to identify our impact materiality (the effect our business has on society, communities, and the environment) and our financial materiality (those matters that could meaningfully affect our ability to create and preserve financial value over time). Our approach reflects the combined guidance of the Integrated Reporting Framework and the JSE Sustainability Disclosure Guidance.
The process we follow includes:
IDENTIFY
Our external environment influences our ability to create value and achieve our strategy, along with our relationships with our stakeholders and the risks and opportunities derived from these contexts.
PRIORITISE
Material matters were reviewed to evaluate and prioritise a comprehensive set of issues relevant to our business and strategy.
INTEGRATE
We map our material matters to our strategy to ensure our strategic direction is responsive and progressive. Furthermore, by assigning internal owners of various material matters and the related KPIs, we integrate monitoring and management of these diverse issues into our everyday business.
IDENTIFY
Our external environment influences our ability to create value and achieve our strategy, along with our relationships with our stakeholders and the risks and opportunities derived from these contexts.
PRIORITISE
Material matters were reviewed to evaluate and prioritise a comprehensive set of issues relevant to our business and strategy.
INTEGRATE
We map our material matters to our strategy to ensure our strategic direction is responsive and progressive. Furthermore, by assigning internal owners of various material matters and the related KPIs, we integrate monitoring and management of these diverse issues into our everyday business.
OVERVIEW OF OUR MATERIAL MATTERS
1. Access to healthcare and medicine
What it entails
Covers initiatives aimed at expanding access to comprehensive, quality healthcare services. It includes initiatives that target cost reduction and increase access to medicine and treatments for more people.
How we are responding
- Implemented disruptive strategies to eliminate inefficiencies in the healthcare value chain
- Implemented value-based care initiatives to improve health outcomes while controlling costs
- Increased focus on providing primary healthcare, providing fundamental healthcare coverage at a feasible cost, with a particular emphasis on preventative care and early detection
- Partnered with government to drive the universal healthcare agenda through the CCMDD programme
- Adopted technology and other initiatives to curtail costs
- Collective bargaining and negotiations of tariffs aimed at cost reduction
- Alternative reimbursement models with risk-sharing agreements
- Management of supplier-induced demand
- FWA initiatives to reduce maladministration and fraudulent activities that impact healthcare costs
Diving deeper: ESG in focus
Customer responsibility
- Product innovation: While no costs were incurred for research and development (R&D) aimed at social or environmental enhancements, the Group invested in digital technology to improve client service efficiency
(Refer to ESG Reporting Index for our full ESG reporting index)
2. Business continuity and business model adaptation
What it entails
Includes plans, protocols and systems to ensure continuity of business operations during and after crises. It also entails strategies to enable business model adaptation in the face of actual or potential changes in the external environment.
How we are responding
- We continue to innovate to ensure we remain relevant within a rapidly changing healthcare system
- Business continuity planning within the Group is continuously updated and reviewed by the Audit and Risk Committee
- Continuity plans are in place to ensure the services we provide to our clients are not materially impacted
- Information Communication Technology (ICT) Committee reviewed all ICT policies, including the business continuity plan
- We are investing in grid-tied solar systems to reduce our reliance on diesel and enhance business resilience amidst energy challenges in South Africa
Diving deeper: ESG in focus
Customer responsibility
- High-risk products and services: AfroCentric’s services pose no specific risks to individuals, communities, or the environment. The pharmaceutical cluster’s medicines comply with South African Health Products Regulatory Authority (SAHPRA) requirements, with routine stock checks in place to remove short-dated stock.
- There were five products that were recalled by SAHPRA during the year. There was no significant impact for AfroCentric as there were two products that were recalled in stock.
- Product innovation: While no costs were incurred for R&D aimed at social or environmental enhancements, the Group invested in digital technology to improve client service efficiency
(Refer to ESG Reporting Index for our full ESG reporting index)
Strategic focus areas
- Client-facing strategy
- Collaboration with Sanlam
- Leadership, culture and values
- Primary health insurance
Related risks
- Cybersecurity vulnerabilities
- IT infrastructure
- Strategic execution risk
- System stability/availability
Impacted SDGs
Related capitals
3. Digital transformation and resilience
What it entails
Includes matters related to our cutting-edge technological platforms and transactional systems and services, such as hosting, switching, administration, health risk management and clinical applications.
How we are responding
- Enhanced our actuarial and analytics capability to understand our scheme lives and develop products and services to delight and assist members
- Focused on providing innovative digital solutions to meet member needs and enhance efficiencies
- Provided easy access to digital self-service on clients’ websites and members’ smartphones
- Enabled faster detection and response to rapidly evolving cyber threats
- Migration and integration of AfroCentric Data Centre with Sanlam Group Technologies to improve client servicing capacity
- Launched our HCP portal, a web-based digital tool designed to help healthcare practices and their staff simplify and expedite administrative tasks
Diving deeper: ESG in focus
Customer responsibility
- Product innovation: While no costs were incurred for research and development (R&D) aimed at social or environmental enhancements, the Group invested in digital technology to improve client service efficiency
(Refer to ESG Reporting Index for our full ESG reporting index)
4. Legal, regulatory and compliance management
What it entails
Compliance with relevant laws, policies and regulations. It covers several processes for recognising and proactively addressing litigation or regulatory action risks and seeking to prevent disputes from arising or escalating.
How we are responding
- The Board serves as the custodian of corporate governance and ensures that best-practice corporate governance principles are observed and entrenched while meeting all compliance requirements
- Adapted our strategies to align our business model to the government’s health policy direction and have successfully demonstrated our abilities in these strategies
- Maintaining a legal compliance framework to guide and support the Group in complying with legislation and regulation
- Keeping abreast of legislative and regulatory changes and their impact on Group operations
- Engaging with industry regulators
- We are proactively expanding our participation across the healthcare sector, a move that strategically situates the Group to collaborate with the government on the unfolding implementation of the NHI processes (for more information, refer to our Chairmans’s review)
Diving deeper: ESG in focus
Customer responsibility
- High-risk products and services: AfroCentric’s services pose no specific risks to individuals, communities, or the environment. Pharma Cluster medicines comply with SAHPRA requirements, with routine stock checks in place to remove short-dated stock.
- There were five products that were recalled by SAHPRA during the year. There was no significant impact for AfroCentric as there were two products that were recalled in stock.
- Consumer data security and privacy: An Information Officer oversees compliance with the Protection of Personal Information Act (POPIA). Data breach complaints are reported to the Information Officer and escalated to the Executive Enterprise Risk Committee (EERCO). This year, three complaints were escalated, with one reported to the Information Regulator and the affected medical scheme
Compliance and risk management
- There were no significant environmental, social and/or governance related incidents in 2024, including incidents of legal non-compliance
- There were no fines, settlements, penalties, and other monetary loss suffered in relation to ESG incidents or breaches in 2024, including individual and total cost of the fines, settlements and penalties paid in relation to ESG incidents or breaches
(Refer to ESG Reporting Index for our full ESG reporting index)
Strategic focus areas
- Client-facing strategy
- Collaboration with Sanlam
- Leadership, culture and values
- Primary health insurance
Related risks
- NHI
Impacted SDGs
Related capitals
5. Economic, transformation, political and societal risk
What it entails
Encompasses economic, transformation, political and societal issues that may pose risks to the Group.
How we are responding
- Our business model is geared towards transforming healthcare, making it more affordable and widely accessible (see material matter: 1. Access to healthcare and medicine and 4. Legal, regulatory and compliance management)
- Developed and promoted primary health insurance solutions to support individuals facing economic hardships while awaiting the Council for Medical Schemes’ (CMS) pronouncement on low-cost benefit options
- As the most transformed health-related business listed in South Africa, we are committed to corporate citizenship and driving transformation to support a more resilient economy
- Increased partnerships within the Group to achieve B-BBEE priority objectives, emphasising skills development, enterprise and supplier development and ownership
- The Group Scorecard highlights a significant transformation goal – to ensure that 70% of senior management appointments are African, Indian, and Coloured individuals
- ESG framework to enhance focus on delivering integrated, sustainable value to our stakeholders
Diving deeper: ESG in focus
Human rights and community development
Supply chain (social)
- Supply chain – The Group aims to proactively identify and mitigate significant risks of child labour, forced or compulsory labour, and other potential negative social impacts within our value chain, ensuring ethical and sustainable practices in the communities and regions where we operate
Board composition
- Board diversity and competence
- Board independence
- Remuneration practices (refer to section 7 of the remuneration report)
(Refer to ESG Reporting Index for our full ESG reporting index)
Strategic focus areas
- Client-facing strategy
- Collaboration with Sanlam
- Leadership, culture and values
- Primary healthinsurance
Related risks
- NHI
Impacted SDGs
Related capitals
6. Employee wellbeing, acquisition, talent management and retention
What it entails
Includes how we recruit, manage, and retain employees to build a skilled and capable workforce that supports sustainable growth.
How we are responding
- Recruited a significant number of clinical staff to strengthen our workforce and meet the growing demands of our healthcare services
- Continued initiatives to address mental health and employee wellbeing
- Offered comprehensive learning opportunities and other upliftment initiatives
- Remained focused on building an external pipeline of critical talent and an internal pipeline of successors for critical roles
- Undertook numerous training and development initiatives
- Reviewed short-term and long-term incentives
- Achieved Top Employers certification
- Listening strategy
Diving deeper: ESG in focus
Health and Safety
Human rights and community development
Labour standards
- Diversity and inclusion
- The Group is still in the process of determining the Pay equality, Wage level and Living wage and will report on these for the period ending 31 December 2025
- Freedom of association and collective bargaining
- Temporary workers
(Refer to ESG Reporting Index for our full ESG reporting index)
Strategic focus areas
- Collaboration with Sanlam
- Leadership, culture and values
Related risks
- Critical skills retention
Impacted SDGs
Related capitals
7. Member satisfaction for clients
What it entails
Encompasses strategies and processes seeking to meet or surpass member expectations to create a positive experience and build member loyalty for our clients.
How we are responding
- Focused on providing innovative digital solutions to meet member needs and enhance efficiencies
- Implemented value-based care initiatives to improve health outcomes while controlling costs
- Designed innovative scheme products and interventions to address declining affordability
- Enhanced our actuarial and analytics capability to understand our scheme lives and develop products and services to delight and assist members
- Partnered with various institutions, including Sanlam, to develop value-added products to address financial constraints for members
- Focused on improving call centre productivity
- Created specific teams to address retention for members, either directly or as service consultants for brokers
Diving deeper: ESG in focus
Customer responsibility
- High-risk products and services: AfroCentric’s services pose no specific risks to individuals, communities, or the environment. Pharma Cluster medicines comply with SAHPRA requirements, with routine stock checks in place to remove short-dated stock
- There were five products that were recalled by SAHPRA during the year. There was no significant impact for AfroCentric as there were two products that were recalled in stock
- Product innovation: While no costs were incurred for R&D aimed at social or environmental enhancements, the Group invested in digital technology to improve client service efficiency
- Consumer data security and privacy: An Information Officer oversees compliance with the POPIA. Data breach complaints are reported to the Information Officer and escalated to the EERCO. This year, three complaints were escalated, with one reported to the Information Regulator and the affected medical scheme
(Refer to ESG Reporting Index for our full ESG reporting index)
8. Cybersecurity and information security
What it entails
Securing critical information systems and networks from security breaches, which might disrupt core operations or lead to illegal access, destruction, alteration, or disclosure of protected data.
How we are responding
- Implemented several risk mitigation strategies for cybersecurity threats, primarily from increasing power disruptions. These risk mitigation strategies form part of AfroCentric’s business continuity plan
- Extensive cyber awareness training rolled out across the Group
- Applied a proactive approach with improved evaluation and analysis of cybercrime and data security risks
- Enabled faster detection and response to rapidly evolving cyber threats
- Ensured continued use of Privileged Account Manager, which is a supervisory tool to track activities and changes by privileged users
- Advanced threat analytics technology strengthens the security of our systems
- Ensured continuous updating of systems, including web application firewalls
Diving deeper: ESG in focus
Customer responsibility
- Consumer data security and privacy: An Information Officer oversees compliance with the POPIA. Data breach complaints are reported to the Information Officer and escalated to the EERCO. This year, three complaints were escalated, with one reported to the Information Regulator and the affected medical scheme
(Refer to ESG Reporting Index for our full ESG reporting index)
Strategic focus areas
- Client-facing strategy
- Collaboration with Sanlam
- Leadership, culture and values
- Primary health insurance
Related risks
- Cybersecurity vulnerabilities
Impacted SDG
Related capitals
9. Climate change
What it entails
The impending climate and biodiversity challenge in combination with the ratification of the Paris Agreement, which will likely increase environmental regulation. Includes the impacts of climate change on health and wellbeing.
How we are responding
- Our ESG framework expands the measuring and monitoring of KPIs related to environmental factors, including climate change
- Enhanced our external reporting on our environmental impacts
Diving deeper: ESG in focus
Strategic focus areas
- Leadership, culture and values
- Primary health insurance
Related risks
- Climate change*
* Currently falls outside top 10 risks.
Impacted SDGs
Related capitals
