Transnet Online Integrated Report 2017
Market Demand Strategy (MDS) themes
  • Financial sustainability
  • Capacity creation and maintenance
  • Market segment competitiveness
  • Operational excellence
  • Human capital
  • Organisational readiness
  • Sound governance and ethics
  • Constructive stakeholder relations
  • Sustainable developmental outcomes
Sustainable Developmental Outcomes (SDOs)
  • Employment
  • Skills development
  • Industrial capability building
  • Investment leveraged
  • Regional integration
  • Transformation
  • Health and safety
  • Community development
  • Environmental stewardship
The Capitals
  • Financial Capital
  • Manufactured Capital
  • Intellectual Capital
  • Human Capital
  • Social and Relationship Capital

2017 Multi-Stakeholder Perception Survey

During the year, we engaged our stakeholders in a Multi-Stakeholder Perception Survey. The survey was performed telephonically with 150 participants. The sample was collected across six stakeholder clusters: influencers, governing bodies and regulators, investors, organised labour, suppliers and enterprise development. Overall the quality of our stakeholder engagement has improved, with respondents scoring our quality of engagement at 60% (out of 100%), with our ability to meet stakeholder needs at 83%, and our responsiveness to stakeholder concerns at 79%.

Overall strengths identified by participants included:

  • Good communication;
  • Responsive (address key issues and concerns);
  • Consistency (deliver promises despite being late);
  • Strong brand;
  • Use diverse tools to engage, e.g. social media;
  • Eagerness to improve;
  • Ethical values (honesty, transparency and openness);
  • Strong leadership; and
  • Efficiency and productivity.

Main areas for improvement included:

  • More balanced and evenly distributed information to stakeholders;
  • Improve involvement of staff in crucial decision-making;
  • Improve transparency – particularly with regard to long-term planning; and
  • Improve ‘out of the box’ thinking.

Going forward, we will perform additional studies to validate the above engagement perceptions and to gauge further improvements and weaknesses. The survey process provides a meaningful perspective of the quality of Transnet’s relationships with its material stakeholders.

Our 2017 engagement with stakeholders across diverse functional disciplines revealed several material issues common to multiple stakeholders. The importance and relevance of material issues varied between stakeholder groups.

Key issues/concerns impacting stakeholders during the 2017 reporting period
Sharing of Transnet long-term plans with material stakeholders
Transnet’s response
  • Producing an annual Integrated Report, online Sustainability Report and Annual Financial Statements to a) report on performance, and b) to share information on the Company’s strategy and goals.
  • Publishing Transnet’s Long-term Planning Framework online for public consumption and documenting (in detail) how Transnet plans for future growth opportunities and accompanying risks.
  • Aligning Transnet’s plans and MDS with Local and Provincial Government plans and sharing these in a timely manner with Local, Provincial and National Government representatives.
  • Engaging with relevant stakeholders to enable projects to move forward as planned.
  • Ensuring that our quarterly reports are prepared and signed off in time – as stipulated by the Shareholder – demonstrating our progress on and alignment with programmes and plans.
Reduce safety incidents and improve Disaster Management Strategies
Transnet’s response
  • Ensuring that the Company embeds sustainability criteria into all material decision-making, to set sustainability targets and to measure and report on performance against these targets.
  • Our Safety League Models have been revised with a new proposed safety-culture operating model. The model drives long-term sustainability; ensures maturity of the existing safety league programme and operating model; promotes the ‘safest site’ vision; and integrates our safety efforts with the Group Risk Strategy.
  • Partnering with various stakeholders (e.g. Anglo American) to ensure that a safety mindset is embedded.
  • Conducting safety awareness campaigns for the public at level-crossing areas.
  • Conducting door-to-door campaigns at identified hotspots where safety and crime pamphlets are issued.
  • Facilitating presentations to Regulators through the Environmental Monitoring Committee and the Environmental Liaison Committee.
  • Facilitating interventions in areas that are polluted in the ports to curb further pollution.
  • Work done by academics in ports have assisted us to better understand issues identified by external research (e.g. plastics that enter marine water, including ports, pose a threat to marine life).
  • RCB working group made up of DAFF1, KZN Ezemvelo, provincial environmental affairs, and KZN Water Affairs to discuss. biodiversity in the port of Richards Bay, development requirements and potential solutions to balance the two.
Improve operational efficiencies through regular updates on overall performance, new projects and service improvement initiatives
Transnet’s response
  • Transnet’s Operating Divisions continue to collaborate to increase port efficiencies, including improvements from newly acquired capital investments.
  • Engaging in round-table discussions to address customers’ complaints and concerns around service delivery and efficiencies.
  • Implementing integrated Service Level Agreements (SLAs) management and embarking on TVCC initiatives to improve service offerings, including on-time delivery.
  • Implementing Terminal Operation Performance Standards (TOPS), and Integrated Port Management System (IPMS) for tracking and tracing operation.
  • Conducting detailed schedule workshops and interactions in the drafting of feeder line agreements.
  • Ensuring the uniform implementation of policies and guidelines, as well as processes and standard operating procedures to improve operational efficiencies.
Improve compliance with regulatory requirements
Transnet’s response
  • Embed risk management and compliance principles that are aligned with legislative, regulatory and statutory requirements.
  • Ongoing engagement with Regulators to facilitate common understanding of pricing risks and market requirements.
  • Requesting Shareholder intervention on National Ports Act section 56 and 79 provisions, and requesting clarity on National Ports Authority and Pipelines corporatisation.
  • Keeping the Regulators informed as to construction progress of the New Multi-Product Pipline (NMPP) through the six-monthly construction progress report.
  • Submitting all outstanding regulatory compliance requirements and completing requisite tariff applications.
  • Conducting joint presentations with Pipelines as per the licence conditions.
Improve contractual management and timeous payments
Transnet’s response
  • The Contract Management office provides practical guidance on the implementation of contract management frameworks for effective contract management activities during the lifecycle of contracts.
  • Contract Management aims to ensure that we operate within the ambit of the agreed terms set out in the signed agreement. Our Contract Management Policy and frameworks collectively form an integral part of business for effective and efficient management of contracts within Transnet.
  • The Contract Management and Security Governance offices ensure that all active contracts are valid and contractual spend and revenue management is within the parameters, terms and conditions of the contracts.
  • Contract lifecycle management systems are being embedded in the business to facilitate streamlined contract management.
  • The key elements of Transnet’s Contract Management function include:
    • Risk – The early identification of risks, together with managing the mitigating actions throughout the contract lifecycle ensures that the risk realisation is minimised;
    • Planning – Contract deliverables are identified and plans are designed to manage the contract throughout the contract;
    • Delivery Management – Ensuring active delivery against contract milestones in terms of the agreement;
    • Relationship Management – Every major contract must be managed in line with a relationship management plan for the effective achievement of Supplier Development and Enterprise Development;
    • Contract Administration – The centralised location of all contracts on one electronic platform; and
    • Contract review and close-out activities – Contracts must be closed out prior to the expiry of the contract. The overall management of the contract is reviewed holistically to ensure that Transnet learns from mistakes and builds on successes.
Improve engagements/consultations on the disposal of non-core properties
Transnet’s response
  • According to Transnet’s Significance and Materiality Framework (as determined by the Shareholder), the Shareholder is presented with detailed notifications for all acquisitions and disposals of assets above R2 billion.
  • Transnet Property continues to engage National, Provincial and Local Government on any new property transactions.
Improve environmental compliance and processes
Transnet’s response
  • Transnet continues to engage the Department of Water and Sanitation (DWS) and the Department of Environmental Affairs (DEA) with the aim of ensuring alignment of our plans with those of regulators and to streamline processes.
  • Issues of environmental non-compliance are also discussed at bi-monthly meetings with the key governmental departments (DEA and DWS).
  • During the 2017 financial year, Transnet, together with DWS, held a workshop to further unpack and understand the requirements of water-use authorisations and compliance monitoring.
  • Workshops were held with the DEA throughout the country to further unpack the requirements of Part 8 of the Waste Act.
Improve the arrangement of short-term funding, mostly with banks
Transnet’s response
  • Transnet has raised sufficient funding up to 31 March 2017 and hence there are no concerns in terms of our short-term funding.
  • Transnet consistently meets with rating agencies and shares Company plans relating to capex optimisation to respond to the weak economic environment and to share all other cost-saving initiatives that are being implemented. Rating agencies are comfortable with Transnet’s plans to optimise capex, in response to the weak economic environment and all other cost-saving initiatives that are being implemented.
  • Transnet has facilities from various sources for bridging finance and to meet short-term maturing obligations, while long-term funding is being concluded.

1 Department of Agriculture, Forestry and Fisheries.