Sustainability Strategy

Our approach to sustainability

Sustainability is fundamental to our strategic thinking. As this report reflects, we understand that we have a significant role to play as a responsible corporate citizen and we take the cumulative effect of our activities on long-term sustainability very seriously.

As a growing organisation, we appreciate the importance of managing our carbon footprint. The first step is to measure our emissions and these are reported on in this document. We maintain three to five year strategic planning cycles and review the social, environmental and economic contexts of our operations during each cycle.

Determining our sustainability risks

In determining our sustainability risks, Safaricom engaged KPMG to undertake a sustainability risk materiality assessment for the business. KPMG interviewed eight Executive Committee (Ex-Co) members to identify the cross-functional risks to the business. The identified risks were then grouped together into eight risk categories, with associated sub-risks. Once categorised, Ex-Co members were asked to rank each risk category using Safaricom’s existing Enterprise Risk Management (ERM) criteria. The outcome of this process is presented in the risk heat map below.

The heat map plots each of the eight identified risks (R1 to R8) in terms of the possibility or ‘likelihood’ of the risk happening and the potential damage or ‘impact’ it will have on the business should it occur.

Our identified risks

• R1 — Dynamic regulatory environment
  Safaricom operates in a dynamic regulatory environment that requires it to ensure full compliance with licence conditions, regulations, bylaws and changes to governing legislation. Failure to meet prescribed compliance levels will expose Safaricom to penalties and other remedial sanctions from sector regulators.
• R2 — Energy security
  Energy security poses a significant challenge for Kenya and Safaricom, given the nation’s irregular energy supply and the company’s expanding infrastructure and energy requirements. The primary energy source used by Safaricom is electricity from the national grid. Grid electricity supply is unpredictable, with long outages often experienced and current downtimes of around an hour per day.
• R3 — Network stability
  A stable network — available, uncongested and performing optimally — is critical to the provision of our services and, therefore, our business as a whole. Although Safaricom boasts the widest network footprint in the country, there remain ‘hard to reach’ areas that are not yet covered. We also have to work continuously to counteract fibre cuts, vandalism and theft, which contribute to network failures and congestion and result in lost customers.
• R4 — Innovation
  Innovation is at the core of Safaricom. The mobile phone market in Kenya is becoming increasingly saturated and our ability to innovate remains a key differentiator between us and other network operators. We are also playing a key role in the country’s growth and transformation in line with Vision 2030, supporting both of the public and private sectors through innovations that liberate the economy and touch the lives of all Kenyans.
• R5 — Supplier ethics and performance
  Supplier ethics and performance is a key issue for Safaricom. Business partners engaging in unethical practices, or not performing as required, may reflect negatively on Safaricom’s reputation. Associated risks include bribery and corruption, child labour, compliance and fraud. Accordingly, we have developed a Business Partner Charter and Supplier Code of Conduct to guide our interactions. We have also carried out a supplier sustainability self-assessment exercise.
• R6 — Ethics and values
  At Safaricom, we are committed to the highest level of corporate governance, which we consider critical to business integrity and success. Consequently, we promote an organisational culture that values the highest ethical standards of personal and corporate integrity, and expect all of our directors, employees and suppliers to act with honesty, integrity and fairness. An Ethics Committee has been set up to establish our ethics vision and to provide guidance on ethics management, and a number of strategic actions have been recently implemented to fight fraud.
• R7 — Employee environment
  Employees are one of Safaricom’s most valuable assets and recognised as key to the sustainability of the company. Overall, Safaricom is committed to investing in its employees and creating a healthy, happy working environment. We have developed an Employee Charter that commits us to providing a great place to work — where both individual accomplishments and team effort will be rewarded — and a great place to grow — creating opportunities for personal empowerment and career growth in an atmosphere of trust, honesty and openness.
• R8 — Environmental performance
  Safaricom has embraced environmental performance as a key challenge, not just to fulfil our responsibilities as a corporate citizen, but because we believe it will push us to become more productive, more innovative, more efficient and more competitive as an organisation. We have developed an integrated green agenda: an eight point blueprint for transforming our company into an environmentally aware and sustainable organisation. We have also calculated our carbon footprint for the first time. We do not have targets or benchmarks for carbon emissions performance data yet, but these will be defined going forward. We are, nonetheless, already taking steps to manage our carbon emissions through initiatives aimed at improving generator usage and operational energy efficiency.