Conscious Capitalism
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Conscious Capitalism

Serious Social Investing Conference 2016. April 2016. Who we are. Established in 1985 by Archbishop Desmond Tutu, the late Dr Beyers . Naude. ´, Archbishop Emeritus Desmond Tutu . and other clergy from the South African Council of .

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Conscious Capitalism




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Presentation on theme: "Conscious Capitalism"— Presentation transcript:

Slide1

Conscious Capitalism

Serious Social Investing Conference 2016

April 2016

Slide2

Who we are

Established in 1985 by Archbishop Desmond Tutu, the late Dr Beyers

Naude

´, Archbishop Emeritus Desmond Tutu

and other clergy from the South African Council of

Churches

Registered Section 21

company

Established to channel funds into the fight against apartheid and empower communities deprived by the

system

Oldest and most respected black-led development facilitation agency in South

Africa

KT has managed and disbursed over R1 billion to a variety (over 5000) of grassroots community development projects across the country. Projects included:

Bursaries to over 20,000 tertiary students

Soul City

Johannesburg Housing Company

Slide3

Growth Path

3

2004

KT launches Beyers Naudé Schools Development Programme (BNSDP) and

Beyers Naudé Memorial Lecture Series are launched

Slide4

R200 million

invested in BNSDP &

430

schools,

100,000

learners

benefitted

Over 250,000 beneficiaries since inception

Over R50million invested in businesses since 2002

3,100 jobs created

Over R16.3 million invested in EMSP

CLOSE TO R2billion

spent to date on development

Slide5

KT’s focus: Transformation built on own assets

Beyers Naude Schools Development ProgrammeDeveloped in response to challenges facing schooling in South Africa, particularly in rural areasThe idea is to transform schools into centres of learning and excellence by creating a conducive learning and teaching environmentEric Molobi Scholarship ProgrammeOffers full bursaries to deserving youth from BNSDP schoolsHas an annual intake of 15 scholarsEducation ConversationsA space for on-going debate on challenges facing our education systemSeeks to identify solutions to the challenges facing education

Transformation – Community Development and Empowerment Programmes

Education

Aimed at systematically changing the face of education in South Africa

Kagiso Enterprises Rural Private Equity FundFunds sustainable high growth enterprisesFacilitates economic participation of previously disadvantaged individuals in rural areasKagiso Trust ConsultancySupports sustainable development in South African through social impact projectsGenerates sustainable funding for Kagiso Trust’s social investment programmes

Social Impact

S

ource

of income for the Trust through

dividend income

Slide6

KT’s Focus: Transformation built on own assets

6

Investment Asset Creation

Mainstream Investments

Main source of income for the Trust through high dividend income and selling opportunities

Kagiso Tiso Holdings

Formed in 2011 as a result of a merger between Kagiso Trust Investments and the TISO Group

Kagiso Trust currently has a 38% shareholding in KTH

FirstRand Investment

Kagiso Trust took advantage of a BEE deal with FirstRand in 2005

Share capital was allocated to FirstRand Empowerment Trust (FRET) set up for the benefit of BBBEE groups which included Kagiso Trust

Kagiso Capital

- Set up to house and manage KT’s investments and ensure it’s financial sustainability

Slide7

Slide8

Conscious Capitalism as defined by Jeff Klein

Conscious

Capitalism is the emerging

combination of awareness

and

capitalism

Consciousness means

to be aware, awake, mindful, recognizing what we do, how we do it and the effects of our

actions

Capitalism is a socio-economic system based on the principles of property rights, rule of law, voluntary exchange, wealth creation,

entrepreneurial initiative

and social organizations (called businesses) reflecting and embodying these

principles

Conscious Capitalism is based on 4 key principles; Purpose, Stakeholder Orientation, Conscious Leadership, Conscious Culture

Slide9

Conscious Capitalism

Principles of Conscious Capitalism as articulated by Conscious Capitalism, Inc.   Purpose: - Driven by a “Higher Purpose’ in order to deliver value not only to the business, but others Stakeholder Orientation: Traditional view of business is to maximise return on investment for shareholdersConscious business focuses on the whole business ecosystem: creating and enhancing value for all stakeholdersUnderstands that strong and engaged stakeholders lead to a healthy, sustainable and resilient business Conscious Leadership: Foster transformation and bring out the best in those around themUnderstand that their role is to serve the purpose of the organisation, support the people within the organisation and create value for all stakeholders Conscious CultureThis is the ethos – the values, principles, practices – underlying the social fabric of a business, which permeates the atmosphere of a businessConnects stakeholders to each other, structure and processes of the company

Slide10

8 Pearls of Wisdom

On Conscious Capitalism

Slide11

#1 Build on your legacy and learn from your past

Formed in 1985 to channel funds from the European Union, for anti apartheid initiatives

In last years of apartheid funds also received from Japan and Scandinavia

Up until 1994 over R1billion was invested in

Kagiso

Trust

Then came our biggest challenge:

Post 1994 international funding was diverted

We had to change our funding model to survive from international to domestic sources

Eric

Molobi

conceived a sustainable funding model for the Trust

Kagiso Trust Investments was set up to provide income to support the Trust’s core programmes (later this merged into Kagiso

Tiso

Holdings)

KT does not make investments in sectors that are harmful to humans and the environment

Slide12

1.3%

0.8%

0.7%

26%

9.7%

38%

100%

Total Asset Value

R7,5 Billion

#2 Develop diverse sustainable funding streams

Slide13

3

# Establish and define your investment philosophy

Kagiso

Trust’s philosophy:

Slide14

#4 Establish a strong, moral leadership base

14

“The history of the institution of Kagiso Trust is fundamentally tied to the individuals that were part of its establishment and sustainability”Our leaders have always:aimed to servefocused on developing the capacity of othersdemonstrated a strong responsibility for doing what is right according to societal needsLeadership from our Board of TrusteesMoral leadership is a true compass for the development agenda

Slide15

#5 Cultivate a values based culture

15

Conscious Capitalism requires leaders and employees that live, work and lead aligned to a set of values Connect the organization's values to stakeholders’ values Our values:IntegrityAccountabilityPassion for DevelopmentA hands on, bottom up approachWe are presently engaging with staff to define the behaviours associated with these valuesWe have strongly defined our vision and mission Collateral benefit to stakeholders is a non tolerance for corruption. As a consequence, we deliver solutions to beneficiaries at a fraction of government spend

Slide16

#6 Adopt a bottom up approach to development

We have a participatory approach to developmentThis allows our stakeholders to actively respond and impact their transformationWe listen to themWe design the development agenda togetherWe regularly engage with all our stakeholders We place an emphasis on our stakeholders, rather than shareholders

Slide17

#7 Actively partner and encourage replication

Our funding models are available for others to replicateIncrease scale = greater impactWe understand that transformation will only occur through sustainable developmentWe actively seek out collaboration with likeminded partnersOur partners are amongst our greatest assetsCyril Ramaphosa FoundationFree State Department of Education Kagiso Africa Investments

Slide18

#8 Be real about the challenges

It’s not all pretty pictures!There is a constant contradiction when we allocate investments:Capitalist point of view : Do we grow the investments?Conscious point of view: Do we deploy it into the development space?It’s never an easy decision!

Slide19

THANK YOU!

Any Questions?

www.kagiso.co.za