Stakeholder engagement

Datatec aims to create value for all stakeholders in the short, medium and long term. Understanding the needs and expectations of our stakeholders is fundamental to achieving this objective.

Datatec has identified seven key stakeholder groups who may impact or be impacted by its business strategy, activities and policies. We rely on these stakeholder groups to create value. Below, we have disclosed the key issues raised by each and our response in addressing these issues. The strategic objectives linked to the key outcomes are illustrated by our strategic objectives icons.

Our ability to create value is interdependent on the quality of our relationships with our key stakeholders, all of which are regarded as strong.

1. Shareholders

Key issues raised

Remuneration policy
Share-based payment schemes
Value realisation
Sustainable returns
Governance
Risk management

Our response

Consulted extensively with shareholders on governance matters, remuneration and share-based payment schemes
Implemented numerous initiatives to improve operational efficiencies, cut costs and enhance profitability
Investor roadshows and one-on-one meetings with analysts

Key outcomes

Refined remuneration policy
Refined share-based payment schemes
EBITDA US$118.6 million (adjusted EBITDA US$141.0 million)
13.6 US cents uEPS
Strong balance sheet
Stringent focus on application of good governance principles
Risk management focus in ARCC
Commitment to develop and execute a revised global Responsible Business strategy

2. Financial institutions and providers of financing

Key issues raised

Financial health
Liquidity
Ratios
Cash generation
Risk management
Growth prospects
Compliance
Covenant adherence

Our response

Two new significant refinancing arrangements in Westcon International
New banking facilities in Logicalis

Key outcomes

Reduced net debt
Improved liquidity position
US$28 million in interest to providers of financing
Improved interest cover (includes IFRS 16 interest)
Improved operating cash flows
Two strategic acquisitions made

3. Employees

Key issues raised

Ongoing training and personal development
Non-discriminatory work environment
Nature, variety and breadth of work
Performance management
Incentives and rewards

Our response

Decentralised engagement programmes - operation specific
Education, training and development programmes - operation specific
Employee performance assessments
Group and regional tracking of employee turnover rate and drivers
Refreshed share incentive schemes

Key outcomes

US$636 million in staff salaries and benefits
US$2.7 million cash paid for
share-based payments
Commitment to diversity and inclusion
Ongoing employee development
Long-term and short-term employee incentives

4. Customers

Key issues raised

Effectiveness of processing and transacting systems
Value for money and quality of service
Premium (best-in-class) vendors
Vendor profile (broad offering)
High degree of technical competence
Diverse product and service offering across the Group
Innovation and early adaptation to emerging trends

Our response

Implemented digital enablement technology tools to improve customer experience and speed to market
Customer engagement programmes to ensure customer needs and expectations are met
Strong partnership approach to deliver best results
Customer satisfaction surveys
Vendor incubation accelerates access to emerging technologies

Key outcomes

Positive feedback from satisfaction surveys
Strong vendor offerings
Improving services and product mix - services revenue is now over 18% of total revenue after restatement of revenue

5. Vendors

Key issues raised

Alignment with vendor "approach to market" messaging
Meeting vendor financial targets
Accreditations (training)
Quality of training programmes
Maintaining technical edge in light of ongoing market evolution
Scope for alignment and scale of operations
Geographic reach
Financial health
Innovation and early adaptation to emerging trends

Our response

Differentiated global relationship management strengthens partnerships
Active participation at global vendor conferences
Partner enablement programmes to drive global expansion, channel development and scale
Global services capabilities
Vendor satisfaction surveys
Vendor audits and assessments

Key outcomes

Positive feedback from satisfaction
surveys
Strong vendor relationships
Numerous partnership awards won
Extended partner reach
Vendor incubation provides competitive advantage
Contract renewals

6. Governments and regulators

Key issues raised

Investment
Employment
Taxation
Governance
Compliance
Impact on energy usage (IT centres)
Import and customs controls
Diversity
Empowerment and transformation
Data privacy

Our response

Maintain sound governance policies and processes
Regulatory returns/submissions made on time
Complied with JSE Listings Requirements
Tax compliance policy (UK)
BBBEE certification for SA operations and maintained BBBEE ownership credentials
Board policy on diversity
Adhere to strict data protection policies and processes

Key outcomes

Westcon SA BBBEE status - Level 1
Logicalis SA BBBEE status - Level 2
US$29 million directly distributed to governments
Increased energy savings initiatives
Environmental certification
Diversity policies in place

7. Foundation beneficiaries

Key issues raised

Development of education (specifically mathematics, science and IT) in previously disadvantaged communities
Charitable and compassionate aid

Our response

Partnerships with various organisations committed to improving education in under- resourced schools and communities
Partnerships with non-profit organisations that provide professional development to teachers
Partnerships with organisations that provide secondary school-level intervention programmes focused on improving results in mathematics, science and English

Key outcomes

Donated R8.7 million
Provided close to 3 000 individuals with access to computer technology
Close to 300 learners directly benefiting from school-level intervention in mathematics and science
Over 500 individuals benefiting from ICT skills training