Key material issues

The issues set out on the following pages are those that we believe underpin our strategic risks and opportunities and have the highest potential impact―positive and negative―on stakeholder value.

In this section of the report, related information on risks and targets is cross referenced. Where available, we provide links to these sources.

See more information about related risks in Annual Integrated Report.

See Targets in this report.

Governance

16 Peace, justice and strong institutions | Icon

Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels.

17 Partnership's for the Goals | Icon

Strengthen the means of global partnership for sustainable development.

 

The Global Goals for Sustainable Development

 

Material issue

Ethical behaviour and corruption

Background

In South Africa, in particular, various incidents in state- owned enterprises and private and public entities have led to outrage and criticism at the lack of governance and ethical leadership at all levels of our society.

Our response

Code of Ethics

Sappi’s high premium on adherence to ethical behaviour is entrenched in the Code of Ethics (Code). In addition to training all new employees during induction, we conduct ongoing awareness training. In the past year this included online or in-person awareness training on various topics covered in the Code. These ranged from dawn raid awareness to the protection of personal information. In addition, all relevant new employees in all regions were trained on anti-fraud and corruption and Competition Law.

Regretfully, notwithstanding these training initiatives, there have been breaches of the Code. We have investigated these incidents with the assistance of our Internal Audit Department and/or external advisors, addressed the issues and where required, took steps to seriously sanction the underlying relationships―an indication of the seriousness with which we view these transgressions.

Sappi continues to provide avenues to stakeholders to communicate breaches or apparent breaches of the Code either through hotlines or via e-mail (ethics@sappi.com). All complaints are registered and investigated by Sappi’s Internal Audit Department and then reported into the Audit and Risk Committee on a quarterly basis (see Annual Integrated Report).

During March 2019, we will once again be rolling out the Employee Engagement Survey, part of which tests values and ethical leadership as perceived by employees. The results in this area will be a useful guide to understanding the culture of ethical behaviour and conduct in Sappi and where improvements can be made.

We are also in the process of rolling out a Group Supplier Code of Conduct which calls on suppliers to commit to ethical behaviour, human rights, health and safety, diversity and equal opportunity and environmental awareness.

KPMG

In 2017, we reported that our auditors, KPMG South Africa, had been implicated in allegations related to patronage and corruption at other clients which caused us to reassess their provision of services to Sappi. We have engaged with KPMG International in this regard and are satisfied that more stringent checks and balances have been established which will prevent a reoccurrence of incidents of a similar nature.

Value impact

  • Greater understanding of the ‘One Sappi’ approach to ethics and human rights.
  • More stable and sustainable business.