Sustainable Development atThe Clicks GroupSept 201 4 3 – Aug

201 5 4

PHOTO: HR Director – Bertina Engelbrecht

Executive Director responsible for Sustainability

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Bertina Engelbrecht – Group Human Resources Director.

The Clicks Group incorporated sustainable business practices as operational business imperatives and set sustainability targets to help ensure the long-term competitiveness of the Group’s operations.

Clicks is regarded as the leader in the South African health and beauty retail sector. Our expansive store footprint affords us the opportunity to further entrench the brand as the most trusted health and beauty brand to our customers. As customers become increasingly aware of the social obligations on the part of corporate South Africa, the Group has elevated sound social, environmental and governance practices across all levels of the organisation.

Due to the increased focus on sustainability, the Group was included in several researches done by independent companies. The company has accomplished a better score in the Carbon Disclosure Project results, moving from 954 to 995 for disclosure with a B performance band.

The Group made a decision to adopt the principles of the UN Global Compact and follows the guidance by the International Labour Organisation and the Organisation for Economic Co-operation and Development (OECD). These organisations promote policies in support of the economic and social well –being of people around the world.

The Click Group is proud to be ranked amongst theincluded in the Top 10 Employers in South Africa by the Top Employers Institute for 20165. Rated as the number 1 Employer in the Retail industry. Participating companies complete a stringent research process to measure their employment offering against the Top Employers Institute’s international HR Best Practices Survey in order to achieve certification as a Top Employer and is validated through an independent auditing and verification process.

The Clicks Group is crowned as the winner of the Top Women Awards: Top Gender Empowered Company in the retail sector at the 11th Annual Standard Bank Top Women Awards.

The latter is the key driver behind the Group’s annual healthcare conference which is aimed at motivating and supporting group pharmacists, as well as providing a platform for discussions on issues facing the South African healthcare industry. A pharmacy and merchandise academy was also introduced by the Group with the overall focus on retaining and developing skills within the business.

The increase in group turnover of 9.215.3%, as well as the 10.314.6% increase in operating profit underscores the overall economic sustainability of the Group. The group operating margin was at 6.34% as a result of the faster growth rate in the lower margin UPD business.

The Group’s annual sustainability report has been written in accordance with the GRI 3.1 standards for the financial year 20143/20154. The new GRI 4 standards will be implemented in the next reporting period as per the requirements.

The Group will continue to strive for better efficiency and innovation in the next financial year.

Group commitment

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Sustainability is an unequivocal part of our operations. As the global economy shifts to become more sustainable, we continue to seek measures that would ensure the long-term competitiveness of our business.

Our sustainability strategy recognises that the group cannot achieve business success without caring for the social and environmental systems upon which our operations depend. We apply this philosophy throughout our value chain – from suppliers to customers, from products to processes and from our buildings to our brands.

The underlying principle of the Group’s sustainability strategy is to generate long-term economic value by harnessing, efficiency, transformation, product-related opportunities and challenges as well as supply chain initiatives as part of an integrated sustainability programme. This strategy is carried through in our approach to performance-based management as well as in our communication with stakeholders.

The Click Group sustainability strategy is built on four distinct focus areas:

Building a trusted, accessible healthcare network Empowering motivated, passionate people Sourcing products that uphold the integrity of our brand, and Lightening our footprint

The Clicks Group recognizes the significant impact of the individual and corporate on a sustainable social and economic environment. We agree that success cannot be achieved in the absence of care for the social and environmental systems upon which all our operations depend.

Sustainable business practices within a culture of responsible environmental, social and governance stewardship consequently underscores the Group’s commitment for future generations.

We look forward to continue exploring this exciting journey along with our stakeholders.

Stakeholder engagement

The Clicks Group follows a well endorsed stakeholder engagement programme across the business. Eight primary stakeholder groups have been identified that are most likely to influence the group’s ability to create sustainable shareholder value.

Management acknowledges the role and importance of other stakeholder groups, such as trade unions, industry organisations, statutory bodies, property landlords, financial institutions, service providers, media and the communities in which the group operates. The group engages in open and transparent, mutually beneficial relationships. Qualitative and quantitative performance indicators have been developed for each primary stakeholder group to determine the outcome of the engagement, and these measures are refined on an ongoing basis. These metrics are used in the formal reporting process on stakeholder engagement at board meetings.

Stakeholder

Aim Approach Key Issues Our Response

Customer Achieve pre-eminence in health and beauty

Cash-back statement mailings

ClubCard Magazine ClubCard members

Drive customer loyalty

Expand the

Creating opportunities for engagement with our valued

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retailing and in healthcare supply management

Building a trusted, accessible healthcare network

news letter Customer Service

Centre Customer surveys In-store Radio Marketing/

Advertising SMS and email

communications Website and social

media response

brand’s retail footprint

Improve customer experience in pharmacies

Enhance front shop product offer

Increasing competition in retail and corporate pharmacy sectors

Loss of distribution clients in UPD

customers Ongoing

improvement in pricing, product offer innovation and customer service

Employees Empowering motivated, passionate people

Focus on a clear vision and growth strategy, provides our people with unlimited opportunities

Attract and retain pharmacy professionals

Invest in scarce and critical skills

Clique magazine Employee surveys In-store radio Internal email

communication Internal website Learning and

Development Pharmacy

Conference Results

announcement Roadshows Store visits Transformation

forum

Maintain a motivated and skilled workforce

Attracting and retaining scarce and skilled talent

Failure to achieve BBBEE targets

Improving Work-Life Integration

Performance and recognition

Development & Career Opportunities

Compensation Benefits Employee

Wellness Programme

Benchmarking salaries to retail industry

Transformation plan to align BBBEE codes of good practice with implementation

Suppliers and Service Providers

Sourcing products that uphold the integrity of our brand

Lightening our footprint

Drive operational excellence and cost reduction

Contractual agreements

Electronic communication

Enterprise Development

Meetings Service Level

Agreements Supplier

conferences Technical support Written

communications

Environmentally responsible businesses

Social, Ethics and transformation compliance

New business opportunities

Carbon Footprint reduction

Supplier Audits Screenings Certifications Approval as

preferred supplier

Continuous improvement with distribution network optimization

Increase research and implementation

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New store developments

of affordable water and energy efficiency initiatives

Improve products used in store development

Shareholders and investment community

Passionate to lead innovation within the unique mix of our Group

Grow pharmaceutical and distribution market share

Competitive returns for shareholders

Analyst presentations

Annual General meeting

Annual Integrated Report

CEO and CFO engagement with investors, analysts and fund managers

Company website Investor roadshows

Return on investment and dividends

Challenges of the economic environment

Risks and Mitigations

Sustainable business

Increasing the footprint of stores

Extend presence of pharmacies in stores

Grow private label product portfolio

Application of King III

Complying to Corporate Governance

Community Care about and contribute to the wellbeing of people, the environment and communities

Clicks Helping Hand Trust

Bursaries Chapel Street

Primary School Donations through

stores and the business

The Helping Hands Trust engagement

Active engagement

Skills shortages in the health industry

Access to affordable healthcare

Sustainable contribution to communities through product and finances

Development of the pharmacy and merchandise academy

Offer free clinic services to babies born in state hospitals

Assist the local school financially

Government and regulators

Support government and industry policies

Regulatory compliance and implementation

Comment on the development of new regulations and legislation

Industry meetings in food, health and beauty sectors

Meetings and electronic communication

Public Health

Regulatory changes to medicine pricing

Margin pressure from genericisation of medicines

Non-compliance with pharmacy

Development of company policies and procedures

Corporate representative of the South African Pharmacy Council

Representative

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Enhancement Fund SAPC, MCC and

DoH

and healthcare industry regulations

Non-compliance with current and emerging legislation

s on committees of new developments in the health, beauty and food sectors

Industry associations

Development of innovative business to sustain

Industry communication session through companies like NBI (National Business Initiative)

Retailers unite for employee wellness

Sustainability forums

Fast development of new industries and trends

Adopted and monitor progress against the 10 principles set out in the UN Global Compact

Development of new innovative products

Risks and Mitigations

1. Trading environment

Risk Opportunity

The current trading environment is characterized by constrained consumer spending, low selling price inflation and continuing cost increases.

Low inflation could negatively impact profitability as volume increases are required to maintain revenue growth. This also creates pressure to remain price competitive.

Cost growth ahead of inflation could place pressure on maintaining margins.

Further deterioration in the economic environment which will impact on consumer spending which is already under severe pressure.

Inability to trade as a result of power outages disrupting stores, information technology systems, distribution centres and third-party service providers.

Clicks will continue to pursue an aggressive promotions strategy to improve price competitiveness and grow sales volumes, and entrench Clicks as a value retailer.

Focus on differentiators including extensive and convenient store and pharmacy footprint, private label and exclusive ranges, and driving customer loyalty through Clicks ClubCard rewards and consistently high standards of customer care.

Clicks will continue to pursue an aggressive promotions strategy to maintain price competitiveness, grow sales volumes and entrench Clicks as a value retailer.

Focus on differentiators including extensive and convenient store and pharmacy footprint, private label and exclusive ranges, and ensure customer loyalty through Clicks ClubCard rewards and consistent high standards of customer care.

Alternate power solutions for stores, systems and distribution centers ensure disruptions to trading patterns will be minimised.

2. Competition

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Risk Opportunity

Expansion by corporate pharmacy and retail chains, new entrants into the local retail sector and increasing price competitiveness of retailers could negatively affect sales, profitability and market share growth in Clicks.impacting on market share growth in Clicks.

Increasing price competitiveness of retailers could negatively affect sales and profitability in Clicks.

Clicks has an extensive store network and plans to open 20 to 25 new stores each year, expanding to over 600 stores in the longer term. This includes stores outside South Africa, focused on the Southern African Development Community (SADC) region.

Continued expansion of the pharmacy network, with the long-term plan to open dispensaries in all stores (currently in 775% of South African stores).

Continued recruitment of new members to the Clicks ClubCard loyalty programme.

Ongoing improvement in pricing, product offer and customer service.

3. Regulation

Risk Opportunity

Healthcare markets are highly regulated across the world and South Africa is no exception.

Legislative and regulatory changes introduced by the Department of Health (DoH), SA Pharmacy Council (SAPC) and Medicines Control Council (MCC) could impact on Clicks and UPD.

These changes could reduce turnover, margins and profitability in Clicks and UPD.

Continued management engagement with the DoH on any proposed changes to legislation and regulation.

Formal written and oral submissions to DoH in response to draft legislation and regulations.

Ensure Clicks and UPD are operating efficiently to maintain margins and profitability.

As the market leaders in retail pharmacy and pharmaceutical wholesaling, position Clicks and UPD to benefit from market consolidation arising from changes in legislation and regulation.

Ensure Clicks and UPD are operating efficiently to maintain margins and profitability.

4. 5. Attracting and retaining pharmacy professionals People

Risk Opportunity

The shortage of healthcare professionals is an industry challenge.

The demand for professional staff has increased along with the expansion of corporate pharmacy and more competitive remuneration packages being paid by state health institutions.

The shortage of pharmacy professionals, as well as the increasing cost to attract and retain pharmacists, could limit the growth of Clicks, increase costs and impact on margins.

Pharmacy Ssalaries are externally benchmarked to ensure the groupClicks remains competitive in the employment market.

Group resourcing function established, including specialist pharmacy team. An employee share ownership scheme aims to attract and retain scarce skills, with a higher allocation of share to pharmacists.

Specialist pharmacy recruitment team

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Inability to recruit, attract and retain talent for core business needs, including pharmacy and management.

established. Group collaborates with pharmacy schools to

increase capacity. Extensive bursary and internship programme to

attract trainees. Dedicated in-house Pharmacy Healthcare

Academy. Bursary and internship programmes to attract

pharmacy graduates. Retail graduate programme to be launched. Accredited training programmes for store

management, key store roles and merchandise and planning being developed.

Senior leadership development programme to strengthen management talent.

[5.] Regulation

Risk Opportunity

Healthcare markets are highly regulated across the world and South Africa is no exception.

Legislative and regulatory changes introduced by the Department of Health (DoH) could impact on Clicks and UPD.

These changes could reduce turnover, margins and profitability in Clicks and UPD.

Continued management engagement with the DoH on any proposed changes to legislation and regulation.

Formal written and oral submissions to DoH in response to draft legislation and regulations.

Ensure Clicks and UPD are operating efficiently to maintain margins and profitability.

As the market leaders in retail pharmacy and pharmaceutical wholesaling, position Clicks and UPD to benefit from market consolidation arising from changes in legislation and regulation.

Corporate Governance Creating value through good governance

Corporate governance philosophy

The group’s robust governance and compliance framework is based on the principles of accountability, transparency, ethical management and fairness, and a philosophy of sound governance is entrenched across the business.

While the board is unwavering in its adherence with legislation, regulations and codes, our commitment to good governance goes beyond compliance. The directors recognise that good governance can benefit long-term equity performance and enhance shareholder value.

We believe that governance can contribute to value cration through enhanced accountability to shareholder, more effective risk management and mitigation, equitable performance management and reward structures, great transparency and disclosure, improved reporting to shareholders, effective leadershihp and decision-making, and avoiding sanction or penalties for non-compliance.

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Governance processes are regularly reviewed to align with legislative and regulatory changes and to reflect changes in the business to ensure processes remain relevant.

The annual evaluation for inclusion in the JSE Socially Responsible Investment Index provides an independent assessment of companies’ corporate governance, social and environmental practices. Clicks Group qualified for inclusion in the Index for the fifth time in the 2015 financial year, meeting all the required social and governance related core indicators, which is a pleasing external endorsement of our governance standards.

The group voluntarily applies the principles of theee King Code of Governance Principles 2009 (King III) and the board remains satisfied with the manner in which the group hasa applied the recommendations of the code. Principle 9.3 was not fully applied during 2015.

The governance landscape in South Africa will be further enhanced with the proposed introduction of the King IV Code of Corporate Principles in 2016, which is anticipated to be effective from 2017. There have been significant corporate governance and regulatory developments, both locally and internationally, since the introduction of King III in 2009 which will hopefully be incorporated into the new code. We welcome governance codes which facilitate value creation without adding burdensome compliance requirements on companies.

The Clicks Group strives to achieve high standards of corporate governance and adopts stringent compliance with legislation, regulation and voluntary codes to ensure the sustainability of the business.

Governance processes are regularly reviewed to align with legislative and regulatory changes and to reflect best practices.

The group has applied the principles of the King Code of Governance Principles 2009 (King III) throughout the financial year and elected to explain the principles that are not applied. The directors confirm that the group has in all material respects applied the recommendations of King lll and elected to explain Principle 9.3 which was not fully applied during 2014. Details of the group’s application of each King III principle is available on the website.

Board of directors

Independence of directors Board diversity and independence

Clicks Group has a diverse and independent board of nine directors, comprising three salaried executive directors and six non-executive directors.

The diversity of the directors in terms of gender, race and their professional backgrounds encourages constructive debate and ensures that the board considers the needs of a wide range of stakeholder interests.

All six non-executive directors are classified as being independent in terms of King III. This was confirmed in the 2015 internal evaluation of the performance and independence of the non-executive directors which included a rigorous assessment of chairman, David Nurek, who has served as a non-executive director for 18 years.

There are no shareholder interests represented on the board, further confirming the independence of the board.

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King lll requires the board to review the independence of long-serving non-executive directors. This applies to the chairman of the board, David Nurek, who has served as a non-executive director for 17 years.

The remuneration and nominations committee conducted an evaluation of the independence of the chairman and non-executive directors during the year. All relevant factors that could impact on their independence and performance were considered, in particular the factors outlined in King lll. Based on the feedback from this evaluation, the remuneration and nominations committee considers there are no factors that prevent the directors from exercising independent judgement or acting in an independent manner. All six non-executive directors, including the chairman, are therefore appropriately classified as being independent in terms of both the King Ill definition and the guidelines outlined in the JSE Listings Requirements.

Board charter Director election

The scope of authority, responsibility, composition and functioning of the board is contained in a formal charter that is regularly reviewed.

The directors retain overall responsibility and accountability for:

• ensuring the sustainability of the business• approving strategic plans• monitoring operational performance and management• ensuring effective risk management and internal controls• legislative, regulatory and governance compliance• approval of significant accounting policies and annual financial statements• selection, orientation and evaluation of directors• appropriate remuneration policies and practices• monitoring transformation and empowerment• balanced and transparent reporting to shareholders

The board charter will be aligned with the requirements of the Companies Act once the revised MOI has been approved by shareholders.Regular election of directors ensures that shareholders are able to exercise their right to appoint directors they beliefe will add value to the company. One-third of the non-executive directors are required to retire at the AGM each year. Executive directors retire on the third-year anniversary of their appointment or most recent re-election to the board. All retiring directors are eligible for re-election. Independent non-executive directors David Nurek and Fatima Jakoet, and executive director David Kneale, are standing for re-election at the forthcoming AGM.

The board elects the chairman after the AGM each year and all members of the audity and risk committee are elected annually by shareholders.

Board appointment Ongoing evaluation

The remuneration and nominations committee considers directors for appointment to the board and motivates these candidates to the board in a thorough and transparent process.

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Newly appointed directors undergo a formal induction programme which outlines their fiduciary duties and provides an in-depth understanding of the group and its operations. This includes meetings with business unit heads and visits to stores and distribution centres. Ongoing director development includes regular updates and information sessions on legislative and regulatory changes.

Directors do not have a fixed term of appointment. In accordance with the company’s memorandum of incorporation (MOI), one-third of the non-executive directors, must retire at the AGM each year. In addition, the executive directors retire on the third year anniversary of their appointment or re-election to the board. All retiring directors are eligible for re-election. Directors appointed during the year are required to have their appointments ratified at the following AGM.

The chief executive is subject to a 12-month notice period and the other executive directors to a six-month period.

Executive directors retire as employees at the age of 63. There is no prescribed retirement age for directors.

Directors are entitled to seek independent professional advice at the company’s expense after consultation with the chairman of the board. No directors exercised this right during the year. Directors also have unrestricted access to all company information. Good governance is maintainded through the annual evaluation undertaken by the directors of the performance of the board, the chairmang, the chief executive officer, individual directors and all board committees.

The evaluation indicated tha the board an dits committees have discharged their responsibilities adequately. The directors believe the board contributes to value creation in the company, is well balanced and has the relevant knowledge to make a meaningful contribution to the group’s affairs.

Group executive committee Board and executive relationship

The roles of the chairman and chief executive are separate and clearly defined, ensuring that no director has unrestricted decision making powers. The chairman, David Nurek, leads the board and the chief executive, David Kneale, is responsible for the executive management of the group.

The board and executive management team work closely in determining the strategic objectives of the group. Authority has been delegated by the board to the chief executive and the group executive committee for the implementation of the strategy and the ongoing management of the business.

Executive management and the board work closely in determining the strategic objectives of the group. Authority has been delegated by the board to the chief executive officer and the group executive committee for the implementation of the strategy and the ongoing management of the business.

The group executive committee comprises the four executive directors and the managing executive of UPD. The board is apprised of progress through reporting at board meetings and regulate communications with management.

The responsibilities of the group executive include:

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developing and implementing the group strategic plan; preparing budgets and monitoring expenditure; monitoring operational performance against agreed targets; adhering to financial and capital management policies; determining human resources policies and practices; monitoring and managing risk; and communicating with stakeholders.

Board evaluation

An annual questionnaire-based evaluation is undertaken by the directors which include an assessment of the performance of the board, the chairman, the chief executive officer, individual directors and all board committees. The key issues covered include the board’s role and agenda setting; the size, composition and independence of the board; director or orientation and development; and board meetings. The chairman of the board discusses the results of these reviews with the board, the chairpersons of the board committees and with each director. The chairman receives feedback on his performance from the remuneration and nominations committee.

The responses from the evaluation process indicate that the board is well balanced, the size of the board is adequate for the group and the board has the relevant knowledge relating to the group’s business. The directors believe board meetings are well organised, efficiently run and all relevant aspects of the group’s businesses are dealt with thoroughly by the board and its various committees which have all discharged their responsibilities adequately.

Board and committee structure oversight

The directors have delegated specific functions to committees to assist the board in meeting its oversight responsibilities. The committees all have documented terms of reference which are reviewed annually and the directors confirm that the committees have functioned in accordance with these written terms of reference during the financial year. All board committees are chaired by independent non-executive directors.Specialised governance functions are delegated to committees to assist the board in meeting its oversight responsibilities. All board committees are chaired by independent non-executive directors and the composition of the committees conforms to the requirements of King III.

These committees are as follows:

The audit and risk committee The remuneration and nominations committee; and The social and ethics committee

The role, functions and composition of these committees are contained in the extended Corporate Governance Report on the website.

Accountability and compliance Ethics and values

Details of the internal audit function and systems of internal control, as well as the external audit function, are contained in the Corporate Governance Report on the company website. The group strives to achieve the highest ethical standards of business practice. A set of values and a behavioural code of conduct require staff to display integrity, mutual respect and openness, and affords them the right and

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obligation to challenge other who are not adhering to these values. Policies have been implemented which require all employees to adhere to ethical business practices in their relationships with colleagues, suppliers, intermediaries, shareholder and investors. These policies also set stringent standards relating to the acceptance of gifts from third parties and declarations of potential conflicts of interests.

Information technology governance

Information technology (IT) governance is integrated into the group’s operations, and governance practices and frameworks are reviewed as part of the annual internal audit plan.

An IT steering committee reports to the chairman of the audit and risk committee. The steering committee meets quarterly to review governance issues as recommended by King III, including IT standards, governance frameworks, results of internal and external audit reviews and specific IT risks.

The governance framework includes alignment of IT to support business strategy and operations, deliver value and manage performance, information security, managing IT risk and compliance, and business continuity management.

Legislative and regulatory compliance

Legislative and regulatory compliance is monitored by the head: group legal counsel and the compliance officer.

An analysis of current and pending legislation and regulation is presented at each meeting of the board, the audit and risk committee, and the social and ethics committee. Further information is provided in the Corporate Governance Report on the website.

There were no cases of material legislative or regulatory non-compliance and no penalties or sanctions were imposed on the group or any of its directors or officers during the year. This includes social, environmental and governance non-compliance. No requests for information were withheld by the group in terms of the Promotion of Access to Information Act.

Ethics and values

The group subscribes to the highest ethical standards of business practice. A set of values and a behavioural code of conduct require employees to display integrity, mutual respect and openness, and affords them the right and obligation to challenge others who are not adhering to these values. The social and ethics committee is responsible for monitoring ethics practices and the report of the committee appears on pages 46 to 49 of the integrated report.

The group has implemented various documented policies which require all employees to adhere to ethical business practices in their relationships with one anothercolleagues, suppliers, intermediaries, shareholders and investors. These policies also set stringent standards relating to the acceptance of gifts from third parties and declarations of potential conflicts of interests.

All new employees sign the code of conduct of the group as part of the recruitment pack and an overview of the code of conduct is given in the on boarding presentation to

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new employees. The Code of Ethics and Gift Declaration Policy is also available to employees on the internal intranet of the company for review by employees.

A fraud prevention policy ensures that a firm stance is taken against fraud and the prosecution of offenders. This policy outlines the group’s response to fraud, theft and corruption committed by staff and external parties against the company. The internal audit department manages the legal processes relating to fraud cases to ensure the highest possible level of recovery for the group arising from any fraudulent behaviour.

Tip-offs Anonymous

Employees are encouraged to report suspected fraudulent or unethical behaviour via a toll-free telephone service managed by an external service provider. All reported incidents are investigated. Awareness of this facility is created through presentations, a quarterly newsletter and competitions, and by encouraging employees to report incidents before significant losses are incurred.

2015 2014 2013

Tip-Offs reported 136 142 187Direct reports received 175 162 116Resultant dismissals/resignations 140 171 165Employees counselled 80 106 97Other disciplinary action 14 12 11

Political party donations

While the group supports the democratic system in South Africa, it does not make donations to endorse individual political parties.

Anti-competitive conduct

Clicks Group does not engage in practices that could limit competition or that could adversely impact on customers.

The directors are committed to ensuring that all group executives and employees understand the requirements of competition law and regulations. Robust risk management and supervisory oversight processes are in place to ensure adherence to these laws and regulations. A Competition Act compliance process is undertaken every year.

The group occupies a market-leading position in healthcare retailing and supply in South Africa and guards the confidentiality of intellectual property, customer and supplier data, business processes and methodologies.

The group has not been sanctioned for anti-competitive practices or for non-compliance with the Competition Act during the year.

Trade Union

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Collective salary increases are negotiated with the representative trade union for the Clicks bargaining unit. The negotiation team is headed by the Clicks head of human resources that reports to the Chief Operating Officer of Clicks that is part of the executive committee of the group. Trade union membership comprises 3027.5% of the total group employees (20143: 3029%)

Attachments: Code of conduct, Gift declaration policy

Review of performance in 2014 Performance against objectives in 2015 and plans for 2016

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External Recognition

Clicks Group was crowned winner of the Top Women Awards: Top Gender Empowered Company in the retail sector at the 11th Annual Standard Bank Top Women Awards in 2014

Clicks Helping Hand Trust won Board of Healthcare Funders Titanium Award for Excellence in Corporate Social Investment 2015.

Clicks Group is rated as a South African Top Employer 20154 by the Top Employers Institute ranking in the top 10 of employers for 20165.

The Clicks Group won the Head Office category in the National Energy Barometer Survey in 2014 for the utility year of 2012.

Clicks Group is included in the Sunday Times Top 100 companies for 2015. Clicks was independently rated as South Africa’s top health and beauty retailer in

The Times/Sowetan Retail Awards for the seventh consecutive year. 4. Clicks Group was ranked third seventh in the Financial Mail Top Companies 20154

survey and the highest rated retailer.

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The Body Shop won a prestigious award in Woman & Home 2014 – Best in Beauty Award for best body oil – the Brazil Nut Beautifying oil.

The Body Shop won Best of Bloemfontein Readers’ Choice Award 2014 as the Best Pampering Products Award.

The Body Shop South Africa scored 3rd place in the Specialist Health, Beauty & Fragrance Outlets category of the Times Sowetan Retail Awards.

Clicks and Musica remain the coolest Specialist Health and Beauty store in the Coolest Music Retailer Awards in the 10th annual Sunday Times Generation Next Awards.

Clicks ClubCard was awarded 2nd place for Loyalty Programme in the Sunday Times Top Brands 20154 awards

Musica wins 1st place – best entertainment store in the Soweto Times Retail Survey for 2014

Sustainability Indicators2015 2014 2013

Financial HighlightsTurnoverComparable stores’ turnover growthGross profit marginOperating profit marginHeadline earningsMarket share*- Clicks: retail pharmacy

R’m%%%

R’m

%

22 0707.5

20.56.3

960

18.7

19 1506.3

21.56.4

838 362

18.3

17 5435.8

21.66.3

7565 947

17.6

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- UPD: private pharmaceutical market % 25.2 25.2 24.5Building a trusted, accessible healthcare networkNumber of storesNumber of pharmaciesIn-store clinics

Clicks ClubCard- Active members- Contribution to sales

m%

657361157

5.075.1

632339139

4.775.7

607331122

4.176.1

Empowering motivated, passionate peoplePermanent EmployeesEmployee turnoverPharmacist turnoverPercentage employee participation in share ownership schemeEmployees covered by medical aidEmployees covered by retirement benefitsEmployees covered by collective bargaining agreements

%%%

%%%

8 65818.821.992.3

23.198.835.6

8 62520.9

24.2099.08.9

21.18 89338.00

8 38521.5

27.68.098.7

19.08 351

37.827

Employment equity- Black employees as a % of total employees- Black senior and top management- Black directors- Women as a % of total employees- Women senior and top managementSkills development- Total expenditure- Skills development as a % of basic payroll- Number of employees trained

%

%%%%

R’m%

89.6

23.244.461.821.4

49.02.9

4 156

85.86.0

40.025.440.0

63.3030.022.0

52.53.3

4 483

85.0

27.335.044.0

63.1033.025.8

45.012.8

3 735

Transformation rating- Preferential procurement- Enterprise development spend- Corporate social investment spend

Level%

R’mR’m

380.393.411.1

355

46.09.5

358

55.713.8

Employee Wellness Program- Employee Utilisation number- Family Utilisation number- HIV/AIDS programme number

1 194103

52

16538247

Sourcing products that uphold the integrity of our brandClicks private label and exclusive products- Percentage of total sales- Percentage of front shop sales

%%

19.825.7

19.024.7

18.524.1

Lightening our footprintCarbon emissions (CO2)Water usage for Distribution Centres and Head officeElectricity UsageCarbon Disclosure Project- Disclosure Score- Performance BandJSE SRI

metric tonsKilolitresKilowatt

Hours

115 159

99B

Included

121 56051 198

108 496

95B

Included

127 52845 68691 645

94B

Excluded

BUILDING A TRUSTED, ACCESSIBLE HEALTHCARE NETWORK

The integrated healthcare retail and supply model provides a unique competitive positioning for the Clicks Group in South Africa. The group’s strategy is driven by the objective to achieve pre-eminence in two key areas: health and beauty retailing through Clicks, as well as in healthcare supply management through UPD.

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Clicks was again independently rated by customers as South Africa’s leading health and beauty retailer. The pharmacy network was extended to 36139 and the number of clinics was increased to 15739. Two important trends in pharmacy continued to influence trading patterns. The first is the increasing use of generic medicines, which now account for 45.43% of pharmacy sales in Clicks, with sales growing by 19.08.9% in the past year. The second is the increasing shift to self-medication.

Clicks is actively switching patients to lower-cost generic medication and promoting over-the-counter medicines. Clicks also experienced good growth in front shop medicines, vitamins and supplements. This confirms the move to increased self-medication, as customers become more health and lifestyle conscious, opting for preventative rather than curative medicine.

The Clicks Store footprint expanded to 464 486 as it moved towards its medium-term target of 500 outlets.

In healthcare supply management, UPD consolidated its leadership position in wholesale distribution and grew market share to 25.2%.

ClubCard

Launched in 1996, the Clicks ClubCard programme is one of the first and fastest growing loyalty programmes in South-Africa. By the end of the previous financial year, Clicks ClubCard had 5.04.7 million active members registered on the programme. During 20154, over R29440 million was paid out in cash-back to members. The group continues to explore new ways to add value to the ClubCard member base.

The ClubCard points, double points and savings and cash-back offerings at Clicks and Clicks Pharmacies continues to attract cost sensitive consumers through its value for money offering within a convenient, trusted and pleasurable shopping environment.

http://www.clicks.co.za/ClubCard.aspx

Clicks Pharmacy

Clicks Pharmacies offer healthcare advice, low medicine prices and a front shop with a wide range of beauty and healthcare products. More details on savings, convenience and Clinic services are available at http://www.clicks.co.za/ClicksPharmacy.aspx

Clicks BabyClub

BabyClub offers extra benefits to Clicks customers who are planning on having a baby, to those who are expecting, and to customers with toddlers up to the age of three. This programme provides you with access to exclusive BabyClub competitions, vouchers and other special benefits.

http://www.clicks.co.za/baby/index.html

Senior ClubCard

If you are 60 years or older and a ClubCard member, you can opt for our ClubCard Seniors programme and earn Double Points on the 2nd Wednesday of the month on our exclusive Double Points Days. On these days, you get one additional ClubCard Point for every Point you earn which means double the discount on everything you buy.

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http://www.clicks.co.za/SixtySomething.aspx

Corporate Responsibility

Clicks Helping HandsClicks Helping Hands Trust has opened all Clicks clinic doors for HIV testing and have 75 HHT clinics for Moms and Babies services, with over 350, 000 baby consultations and family planning consultations performed to date. All clinics also now offer free services on a campaign basis, and have delivered a further 45 000 free consultations during, Heart Health, Diabetes and HIV Awareness campaigns. On average, over 250 HIV tests each Thursday since launching at the start of September 2014.

Helping Hand Trust funds the full cost of HIV tests and counselling. Currently, it cost over R43500 to vaccinate a child for the first 18 months of their lives. Free baby vaccinations and family planning medication are now available at all Clicks Clinics in the Western Cape, as a result of a partnership between the Western Cape Government Health Department and Clicks. Similar partnerhsips in 3 other provences are currently being finalised. The Trust is able to continue the work it does through financial support and donations from Clicks, its’ employees, suppliers and other organisation with aligned goals.

HIV/AIDS programme

All our clinics as Helping Hands Clinics will open on a Thursday for free HIV Voluntary Counselling and Testing (VCT) services. We offer this service to people who do not have medical aid. This service will share the 1 – 4.30 pm time slot currently used for Mom’s and babies. Our hope is that we will be able to touch more live in the greater South African through this new programme.

The primary objective of TB screening at Clicks Helping Hand Clinics is to ensure that active TB is detected early and to help reduce TB transmission. TB screening is not intended to be diagnostic. People with positive results on a screening test should undergo diagnostic evaluation.

This will allow us to extend our commitment to achieving Millennium Development Goals and include Goal 6: Combat HIV and AIDS, malaria and other diseases as a focus area. Through providing FREE Voluntary counselling and Testing the Helping Hand Trust will be actively contributing to the state’s goal of ensuring that all South African’s “know their status” and begin taking a more proactive approach to their health and well-being.

This project focuses on key health services:

Comprehensive and professional pre-counselling HIV Anti-body test through skin prick blood-test Post-test counselling

Helping Hand Trust endeavours to gain government support in all provinces for this service through the provision of HIV tests. This will afford us the opportunity for far greater reach and to begin the conversation about healthy lifestyle with all South Africans.

Moms and Babies programme

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The Click Helping Hand Trust Moms and Babies programme offers free clinic services every Thursday afternoon at selected clinics. These services are available to mothers whose babies were born in state hospitals, and who don’t have access to medical aid. The trust was launched in 2011 in response to the need to reduce infant and maternal mortality in South Africa. The free services offered include baby immunisation (where state stock is available), growth measurement and baby weighing, feeding and nutritional advice, as well as family planning advice and medication (where state stock is available). For more information go to Clicks Helping Hands.

Health Campaigns

Clicks Helping Hand Trust Moms extends it hand further with other focused health campaigns through the year, aligned with the National Health Calendat. We are focused on working with the National government to improve the health of all South Africans, by helping every South African to know their health status. These campaigns include, Heart Health with free blood pressure and cholesterol testing, Diabetes Awareness with free glucose and blood pressure testing and HIV Awareness with free HIV testing. These free services are available in all clinics during campaigns.

Clicks and Western Cape Government Health Partnership (Fikelela)

Free baby vaccinations and family planning medication are now available at all Clicks Clinics in the Western Cape, as a result of a partnership between the Western Cape Government Health Department and Clicks. A small convenience fee will be charged for babies born at state hospitals and with no access to a medical aid (with the exception of Thursday afternoons when Helping Hand Trust pays for the consultation at Clinics in the Western Cape), baby vaccinations and family planning medication will be provided for free.

“Vaccination medication for babies in their first 18 months can cost more than R3,500. The benefit of this partnership is that the arrangement will enable our primary health care facilities to channel patients toward Clicks clinics and shorten the queues at primary health care facilities,” said Western Cape Minister of Health, Theuns Botha.

“Increasing access to baby vaccinations and family planning services is crucial in preventing illness and reducing our country’s child mortality rate. We are excited to partner with the Western Cape Government to extend these vital primary healthcare services to all the citizens of the province,” added David Kneale, CEO of the Clicks Group.

The partnership aims to make vaccines and contraceptives more accessible across the Western Cape. The stock will be provided by government to Clicks Clinics. The benefit of this partnership is that it will enable Western Cape Government Health to channel patients towards Clicks Clinics and therefore reducing the queues at primary health care facilities and enabling health employees to attend to other health needs.

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For more information please visit www.westerncape.gov.za or www.clicks.co.za. To make an appointment please call 0860-254-257.

Attachment: Clicks Helping Hand Trust Annual Report 20143

Other beneficiaries of the group’s social investment include organisations such as:

Carel du Toit Centre

The approach followed at The Carel du Toit Centre is based on the early identification of the hearing loss and the fitting of hearing-aids or a cochlear implant.

We believe that with early identification, providing there are no further complications, a large percentage of deaf children are able to acquire sufficient speech and language abilities in order to be able to adapt intellectually, socially and emotionally in a society of hearing people.

The Topsy Foundation

The Topsy Foundation, a fully-registered and internationally-respected South African Non-Profit Organisation, provides relief services to some of South Africa’s most under-resourced rural communities through a multi-faceted approach to the consequences of HIV and AIDS and extreme poverty.

Topsy’s interventions are characterised by the provision of medical and social services (with a strong emphasis on wellness) to people and families who do not otherwise have ready access to such services. Typical interventions include the provision of professional medical treatment (including antiretroviral therapy) to people living with HIV and AIDS (PLWHAs) and the treatment of other illnesses; the holistic care of orphaned and vulnerable children; the provision of food and nutritional supplementation to households threatened by malnutrition; and job creation to help alleviate poverty.

Since the disease has an impact in every area of life, the work of the Topsy Foundation seeks to intervene commensurately. It has a vision of flourishing rural communities where people have the tools for change and where young people, in particular, are productive members of society, in spite of the impact of HIV and AIDS and poverty.

The Topsy Foundation partners with communities in and around the crossroads of the Mpumalanga, Free State and Gauteng provinces. Activities take place from a central project site at Grootvlei, in Mpumalanga Province, called the Topsy Sanctuary.

The organisation was conceptualised and founded in 2000 by Duke Kaufman, Silja Elena and Doug Maritz. The mission of the Topsy Foundation is fulfilled using inter-related programmes which operate together to help prevent HIV and AIDS and alleviate its consequences.

These programmes operate a number of inter-related projects. Frequently, the activities carried out in one project fulfil the mandates of more than one programme. It is precisely this web of intervention that is helping to bring social, economic and physical change within the communities Topsy serves.

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UPD

UPD consolidated its leadership position in wholesale distribution and with grew market share from 24.5% toof 25.2%. Besides its leadership in wholesale distribution the business has become an increasingly significant player in the bulk distribution market and now has 2219 distribution agency clients. Growth in notional turnover of the bulk distribution business was limited by capacity constraints and consequently only showed marginal growth to R3.9 billion in 2014. Total managed turnover, combining wholesale turnover with the turnover managed on behalf of distribution agency clients, increased by R2.7 billion to R15.2 billion. Total managed turnover has grown strongly in recent years, delivering a four-year compound annual growth of 25.1%

UPD Distribution provides its clients with the perfect platform to maximise supply chain cost efficiencies through its owner driver fleet. 

For further information, visit http://www.upd.co.za/home/index

A new specialised service, Clicks Direct Medicines, was established to assist with the delivery of prescription drugs directly to patients, with a specific focus on assisting oncology patients.

Healthcare Conference

In line with our recent strategy to provide a sharper focus on not only Pharmacy, but Healthcare as a whole, we’ve expanded our annual Healthcare conference to include all the employees and suppliers who help us deliver the patient-centred Clicks healthcare experience. The 98th Annual Clicks Healthcare Conference marks the continuation of this new chapter in our history and we’re inviting you to join us on this exciting journey.

Hundreds of delegates from all over the country – including pharmacists, nursing practitioners, pharmacy assistants, interns, Clicks operational employees and suppliers – attend the Healthcare Conference every year to increase their knowledge, learn from each other and connect with key suppliers. This helps the group to explore new ways to take healthcare further. Speakers from both public and private sectors address the gathering to share knowledge and engage with the group.

http://healthcareconference.clicks.co.za

EMPOWERING MOTIVATED, PASSIONATE PEOPLE

The Group’s Employer Value Proposition focuses on people, passion and opportunities. To this end, a new total rewards strategy was developed for every permanent employee across the business in a bid to encourage better work/life balance for employees.

The five focus points for the business is Compensation, Benefits, Work/Life Integration, Performance & Recognition and Development & Career Opportunities. More thanEmployees covered by retirement benefits is 8893 98.8% of employees belong to a retirement fund and 21.123.1% of employees belong to a medical aid scheme.

The group maintained its level 3 BBBEE rating and achieved 80.5484.23 overall points.

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Clicks started a relationship with The Clothing bank by donating R1.1 million in surplus stock and 30 computers to support and empower previously disadvantaged women.

A total of R11.1 million was invested in social development through financial and products donations to non-profit organisations and initiaitves aligned to the group’s focus on health and wellbeing.

Employee Value Proposition

Our Company’s talent strategy is to employ customer obsessed people with a confident, ‘can do’ attitude, who are proud and professional. This strategy is underpinned by our employees and our Company values:

We are truly passionate about our customers We believe in integrity, honesty and openness We cultivate understanding through respect and dialogue We are disciplined in our approach We deliver on our goals

Underpinning the company values, the Employee Value Proposition of the company focus on People, Passion and Opportunities.

Group retention scheme

The group retention scheme is aimed at retaining talented employees by providing them with a long-term financial incentive linked to the growth in the group’s earnings. One-quarter of the retention value is allocated on joining the scheme, with the balance payable at the end of the three-year retention period. The objective of the scheme has been achieved as reflected in the retention rate of the scheme’s participants.

The scheme targets high-potential employees, black employees and employees with scarce and critical skills. There are currently 5145 employees participating in the scheme, of which 2931% are black and 454% are women. The candidates recommended for inclusion in the retention scheme are reviewed and approved by the remuneration and nominations committee, which also approves all payments made under the scheme. During the financial year R5.59 million (20143: R5.92.7 million) was paid out to participants in the retention scheme.

Empowerment and Transformation

Clicks Group is committed to the spirit of the Broad-based Black Economic Empowerment (BBBEE) Act. The group’s transformation strategy is aligned to the Department of Trade and Industry (DTI) codes of good practice.

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Transformation is managed within a governance framework that includes the board’s social and ethics committee, the internal transformation committee, which is chaired by the chief executive and co-ordinated by the group human resources director, and the business unit transformation forums, which are responsible for implementation.

The group maintained its level 3 BBBEE rating on the dti generic scorecard in the 20154 financial year and achieved an improved score of 840.2354 overall points (2013: 77.99) on the DTI generic scorecard.compared to 80.54 in the previous year.

BBBEE Element Maximum points 20154 20154 Target 20143

Ownership 20 15.8715.64 12 15.6412.58

Management and control 10 9.188.83 7.97 8.838.88

Employment equity 15 10.6810.46 10 10.4610.38

Skills Development 15 12.1511.43 15 11.4310.74

Preferential procurement 20 16.3514.19 14 14.1915.41

Enterprise development 15 15.0015.00 15 15.0015

Socio-economic development 5 5.005 5 55

Total 100 84.2380.54 78.97 80.5477.99

BBBEE level 33 3 33

Ownership

The group achieved 15.8764 (20143: 12.5815.64) points on the ownership element of the scorecard which is attributed to the employee share ownership programme (ESOP) launched in 2011, and an independent analysis conducted on the group’s shareholding to determine the level of beneficial black ownership.

At the end of the reporting period, 8 5367 993 employees were participants in the ESOP scheme, shareholders with black employees accounting for 876% and women 643%. A dividend of R4.93 million (20143:R4.33.1 million) was paid to scheme participants this year. Since the inception of the ESOP in 2011, total dividends of R15.7 million have been paid out to employees.

The ESOP is governed by a board of trustees which consists of a majority of black employee representatives and is chaired by an independent non-executive director, Professor Fatima Abrahams.

Management control

The management control element of the scorecard is a reflections of the composition of the board of directors, group executive committee and senior management who are members of the business unit operating boards. The board comprises 440% black directors with females making up 330%. The group executive committee has 540% black representation and 250% female. The group achieved 9.18 (2014:8.83) out of 10 points on this element.

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Employment equity

The Clicks Group is committed to creating a diverse workforce and is committed to shaping an organisational environment which supports the recruitment, development and retention of all employees regardless of race, gender, disability, religion, sexual orientation and political persuasion. The group’s workforce comprises 90% (2014: 86%) black employees and 62% (2014:63%) female. 70% of employees are below the age of 35 with 27% between 36 and 55 years.

The group supports the national agenda aimed at the employment of youth in sustainable positions. During the financial year, the group employed 3 649 employees under the age of 35 into permanent positions.

The group continues to aling its employment equity targets and the national economically active population statistics, in line with the Department of Labour Director General’s review process since 2012.

The staff turnover of 18.8% (2014: 20.9%) is in line with the targeted range of 18% - 20%.

The group achieved overall 10.46 points for employment equity and 1.78 for employees with disabilities.

Black employees account for 86% (2013: 85%) of total employees. Female employees comprise 63% (2013: 63%) of the total permanent workforce.

Employee Profile

Occupational LevelFemale Male Total

African Coloured

Indian White African

Coloured

Indian White

Top management 0 0 2 1 0 1 0 0 5Senior management 3 1 3 29 1 0 2 6 51Middle management 66 64 51 192 72 61 54 181 752Junior management 316 146 42 120 381 385 126 429 1967Semi-skilled 2 811 663 71 93 3828 1736 151 171 9546Unskilled 2 0 0 0 5 1 0 0 8Total permanent employees

3 198 874 169 435 4287 2184 333 787 12329

Temporary 71 13 4 33 108 41 14 35 323Grand Total 3269 887 173 468 4395 2225 347 822 12652

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39%

34%

18%

10%

AGE GROUPING

Under 30 years30-39 years40-49 yearsOver 50 years

37%

63%

GENDER

MaleFemale

54%27%

5%

14%

Ethnic Distribution

AfricanColouredIndianWhite

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53%

28%

13%

7%

Age Grouping

under 3030 - 39 years40 - 49 yearsover 50

38%

62%

Gender

MalesFemales

61%25%

4%10%

Ethnic Distribution

AfricanColouredIndianWhite

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The group supports the national agenda aimed at the employment of youth in sustainable positions. This has resulted in the group benefiting through the youth employment tax incentive to the value of R1.2 million.

The group has been included in the Department of Labour Director General’s review process since 2012. The group has continued with the work required to achieve alignment between people development and the group’s employment equity targets across different geographic locations based on the national economically active population statistics.

The employee turnover of 20.9% (2013: 21.5%) exceeded the targeted range for employee turnover of 18% - 20%. This is partially due to the decrease in the labour turnover for pharmacists. Clicks Group was ranked first in the retail sector and in the top ten employers nationally by the Top Employers Institute. The group was also rated as the top gender empowered company in the retail sector in the annual Standard Bank Top Women Awards.

No strikes or industrial actions took place in this financial year.

Preferential procurement

The group’s procurement practices are focused on sourcing merchandise and services from locally-based and empowered suppliers. In the past year, 525% (20143: 558%)of procurement was from level 4 and higher-rated BBBEE suppliers, 65% (20143: 510%)from qualifying small and exempt enterprises and 267% (20143: 74%) directed atfrom black-owned enterprises.

Enterprise development

The group invested over R9346 million (20143: R10155.7 million) in enterprise development initiatives and again achieved the maximum 15 points on the DTI scorecard.

A total of R33 million (2014: R38 million) was paid to Tthe UPD independent owner-driver scheme, which has been operating sincewas established in 2003, and an additional R1 million (2014: R1 million) to contracts close to 50 small enterprise owner-drivers to deliver products from UPD to Clicks, independent pharmacies, hospitals and clinics. UPD paid R38 million (2013: R32 million) to owner-drivers, with an additional R1 million (2013:0.8 million) to the management company supporting the owner-drivers. The owner-drive scheme contracts 43 small enterprise owner-drivers to deliver products from UPD to Clicks, independent pharmacies, hospitals and clinics.

Clicks spent R503 million (2014: R53 million) with Bakers Transport (2013:R52 million), a 100% black-owned independent transport and logistics services providercompany and provided an interest-free loan to Triton, a 50% black-owned manufacturing enterprise.

Socio-economic development

The group continues to demonstrate its commitment to making a sustainable contribution to the communities within which it operates by investing 1% of profit after tax in social development programmes. A total of R11.19.5 million (20143: R9.513.8 million) was invested in social development through financial and product donations to

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non-profit organisations and initiatives aligned to the group’s focus on health and wellbeing.

Clicks Group has made a three-year financial commitmentThe group has donated R3.5 million to the Public Health Enhancement Fund over the past three years. , with 2.2 million donated to date. The fund aims to address skills shortages and, improve quality of public healthcare and improve access to affordable healthcareadvance research.

The Clicks Helping Hands Trust continues to offer free clinic services to mothers whose babies were born in state hospitals and who do not belong to a medical aid. The trust was established in response to the need to reduce infant and maternal mortality in South Africa. Through the trust, Clicks clinics have undertaken over 34 000 baby consultations, 13 000 family planning interventionas and 14 000 HIV counselling and testing sessions. The services offered include baby immunisation, growth measurement and baby weighing, feeding and nutritional advice, as well as family planning advice and medication.

Clicks donated R2.91.1 million (2014: R1.1 million) in surplus stock and 30 computers to the Clothing Bank to support and empower previously disadvantages women.

Other beneficiaries of the group’s social investment included organisations such as Carel du Toit Trust for hearing impaired children, Heal the Hood South African Medical Education Foundation, and Topsy Foundation, Villa of Hope, and Samaritan Feet.

Employees are encouraged to support social development projects, schools and charities in local areas. In 2014 employees contributed financial and non-financial donations to a number of beneficiaries including Chapel Street Primary School, Saartjie Baartman Centre and the Woodstock Trauma Centre. Employees also supported the Blow the Whistle campaign aAs part of the 16 days of activism for no violence against women and children, abuseemployees supported the Woodstock Trauma Centre which is located near the group’s head office. Employees of the group are also encouraged to subscribe to the payroll giving scheme through the Helping Hand Trust.

Attachments: Constitution of the Transformation Forum, Employment Equity policy, CSI Policy

Learning and Development

Skills Development

The group remains committed to investing in the development of the skills, knowledge and capability of its employees. to achieve sustainable business growth and to enable employees to realise their potential. The most senior person in the business responsible for learning and development is the Group HR Director. A total of R49.052.5 million (20143:R45 R52.5 million) was invested in learning and skills development, which equates to 2.93.3.% of basic payroll (20143: 3.32.8%). A total of 4 156483 employees (20143: 3 7354 483) participated in learning and development interventions which

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included on-the-job training, skills programmes, learnership programmes, short courses and academic qualifications. Black employees accounted for 832% of the total number of employees trained, and females 612%.

Learning and skills development interventions focused on enabling performance, enhancing management and leadership competencies, developing scarce and critical skills, and facilitating organisational transformation. 845% of employees completed their individual development plans which formed the basis for participation in the learning and development interventions.

Learning and development statistics 20154 20143

Learning and development spend as a % of payroll 2.93.3 3.32.8

Learning and development spend (R’million) 49.0R52.5m 52.5R45m

Number of employees trained 4 1564 483 4 4833 735

Black employees as a % of all employees trained 8382% 8281%

Female employees as a % of all employees trained 6261% 6150%

Delegates on the leadership development programme 3638 3820

Delegates on management development programmes 221252 252223

Delegates on retail learnership and skills programmes 115106 106173

Delegates on pharmacy learnership and skills

programmes

Delegates on health and safety training

332277

121234

277

234397

-

Interns or graduates on workplace experience

programmes

6948 4843

Pharmacy bursary spend (R’million) 4.0R3.8m 3.8R5.1m

As a leader in the South African healthcare market, Clicks is the largest employer of pharmacists in the private sector. We recognise the scarcity of pharmacists and healthcare professionals and are committed to invest in the attraction, learning and development, and retention of employees. This is the reason we are partnering with pharmacy school, external learning providers and other stakeholders to reason we are partnering with pharmacy schools, external learning providers and other stakeholders to ensure the delivery of a pipeline of talented, motivated healthcare professionals who choose to work for us.

The group follows a comprehensive pharmacy development strategy that focuses on: continued investment in stakeholder engagement with pharmacy schools across

the country investing in learning laboratories at university pharmacy schools managing a pharmacy bursary scheme

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providing workplace experience through the pharmacy internship programme development of pharmacist’s assistants and trainees through learnership

programmes and the continuous professional development of pharmacists and nursing

practitioners

The group invested R4.03.8 million (20143: R3.85.1 million) in bursaries to 8298 students completing the Bachelor of Pharmacy degree at registered South African universities. 3551%of bursary recipients were black and 2547% female. The group further provided opportunities to 498 students to complete internship programmes.

The group’s Pharmacy Healthcare Academy is registered with the SA Pharmacy Council and continues to be instrumental in developing pharmacists’ assistants. Currently 332277 learners are registered on learnership programmes.

Employee Wellness Programme

Our comprehensive Employee Wellness Programme (EWP) had its origins in an HIV Project that was set up as a group initiative in August 2005. The intention was to define and implement a group-wide HIV Strategy instead of having separate business unit initiatives per brand.

Before we started the HIV Project, we spent time evaluating our current and past approaches to determine what worked and did not work in our previous initiatives. We also looked externally at what companies were doing and what they have learned; what other retailers had put in place; what international research recommended; and finally what various Service Providers offered.

Key points that we learned were: HIV/AIDS is not the only issue our employees are struggling with. There are a

whole range of sociological issues that impact on the day-to-day lives of our employees and their families, such as substance abuse, domestic violence, tuberculosis etc.

Leadership buy-in is vital (for the sustainability of any programme) Behaviour change through communication is vital to the success of the

programme

We decided it was necessary to commission an actuarial study. The intent of the study was to allow us to estimate the demographic and financial impact of HIV/AIDS in the workplace and weigh it against the benefits and estimate costs of an HIV Disease Management Programme. We also wanted to know how this could affect our bottom line. We commissioned Metropolitan to do the Risk Impact Assessment.

The Employee Wellness Programme (EWP) was developed and is a work-based advisory, counselling and support programme which provides life, health, performance and wellness management services to employees and their immediate household free of charge, 24/7 and in the official SA languages.

EWP is aimed at informing, educating and supporting employees to: enable employees to take responsibility of their physical, mental and emotional

wellbeing ensure that employees remain fully engaged and motivated enable a productive organisational culture in which employees are fully present

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The Clicks group Employee Wellness Programme (EWP) provides independent, confidential, professional counselling and advisory services to permanent employees and their direct household dependants. The programme continues to be highly valued by employees and line managers as evidenced by the high rate achieved during the 2014 employee satisfaction survey. The programme utilisation rate of 21% remains highest compared to the consumer services sector.

In 2014 over 1 400 employees completed wellness screenings which included blood pressure, glucose, cholesterol, body mass index and HIV tests during the wellness days which are held nationally across head office, distribution centres and stores.

Employee wellness programme 2015 2014 2013

Employee utilization 1 940 1 194 1 653

Family utilization 77 103 82

Total utilisation rate 22.2% 19.3% 19.7%

Manager referrals 56 49 56

High-risk cases 46 38 24

HIV/Aids Management Programme 53 52 47

The HIV/Aids management programme is focused on prevention through information and education, treatment and support. Employees are encouraged to know their HIV status through the voluntary counselling and testing campaign delivered across head office, distribution centres, regional offices and in-stores on an annual basis.

The programme is delivered through an independent services provider, Metropolitan Health, and offers the following:

free ARVs and certain HIV related medication five free HIV-related doctor consultations and blood tests per year patient counseling and support counsel on prevention of mother to child transmission Post Exposure Prophylaxis (PEP) assistance

Attachment: HIV/AIDS policy

Career opportunities

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Group resourcing

Following the review of the quality of the group’s talent pipeline, a target has been set to improve the ratio of 60% internal to 40% external hires over a 3 year period. At the end of August 20154 the internal hires in non-pharmacy were 45% and to 55% external hires. For pharmacy the internal hires were 403% and 6057% for external hires.

A key enabler in the improvement of our talent pipeline has been the standardisation of our resourcing framework under a centralised resourcing team, supported by an in-house assessment bureau.

In addition aA dedicated pharmacy recruitment team operates within the Clicks brand that focuses on the recruitment of pharmacists, pharmacy graduate interns, pharmacist assistants at the basic; post basic and qualified post basic level. Both of these centralised recruitment teams operate under an agreed service level agreement with business partners which tracks the average time to fill a vacancy, cost savings and compliance to the group resourcing framework. In order to support the success rate of the centralised resourcing teams an employee referral scheme was launched which resulted in 12.85% of all placements from employee referrals. The success of our e-recruitment strategy resulted in 58.6723% of non-pharmacy from the group’s careers website.

Total Rewards Framework

Our Total Rewards Framework provides flexibility to meet differing employee needs.

Clicks Group has endorsed a total rewards strategy to ensure that our employees are appropriately and fairly rewarded.

We offer outstanding career development opportunities across the Group and we provide our employees with excellent benefits through the Clicks Group total rewards framework:

1. CompensationRefers to how we compensate employees for the services they have provided in line with their job objectives.

Permanent employees are appointed on the basis of an Annual Guaranteed Pay (AGP), which consists of their total annual package including the company benefits such as medical and retirement funds.

Compensation is reviewed annually and is based on the Hay grading system which works on the premise that each job is rated (via a point system) on the actual work/tasks and the complexity thereof.

2. BenefitsWe offer a number of benefits including membership of retirement and medical aid funds, employee discounts across our brands, employee share ownership opportunities and Group life and disability cover. This also includes Annual, family responsibility, maternity, paternity, sick and study leave.

3. Performance and RecognitionWe are a performance-driven company and employees have bi-annual performance reviews (in February and July) to assess their performance in line with the performance objectives set out in their performance contracts.

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Discretionary performance bonuses are paid in line with Company and individual performance.

4. Talent and DevelopmentWe develop employees who perform with passion, and we provide our employees with growth opportunities, and internal transfers and promotions are made available and supported by Senior Management in line with the relevant Company policy.

Talent and Development encompasses our DRIVE (Delivery, Resilience, Integrity, Vision, Enterprising) Leadership Model which outlines the competencies we have identified as essential for our leadership team.

The Group recognises the Importance of Investing in our employees and we are committed to ensuring that all employees are enabled to realise their potential and to meet their career aspirations, as well as developing scarce and critical skills.

5. Work Life IntegrationWe understand the challenges of sourcing and retaining scarce skills, coupled with the long retail trading hours and therefore we have introduced Flexible Working Arrangements, to ensure a full employee complement during peak trading periods and to provide work opportunities to candidates whose family/life circumstances only allow them to take up part-time permanent employment.

We also recognize that for employees to reach their potential, they need to be effective in all spheres of their life. Including their wellness, relationships and personal circumstances.

The Clicks Group Employee Wellness Programme (EWP) provides Independent, confidential, professional counseling and advisory services to permanent employees and their direct household members; aimed at enabling employees to make healthy lifestyle choices.

http://careers.clicksgroup.co.za/

Business Continuity

A comprehensive Business Continuity policy has been developed and implemented across the business. This is presented and evaluated by the Audit and Risk committee for continuous improvement. The policy and procedures are reviewed on an annual basis.

Employee Health and Safety

The continuous health and safety of employees, suppliers and customers is an important aspect of our business and as such, health and safety committees have been established across the group. Committee members as well as all other employees received on-going training. A health and safety policy covers employees, contractors and customers.

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The group use an online platform where all stores can submit necessary reports and have access to Health and Safety information.

An independent company conducts a detailed audit with a gap analysis of the programmes and procedures that is in place for the group Health and Safety programme on an annual basis.

The Group HR Director reports to the Social and Ethics committee where the continuous progress of the Health and Safety program for the group are discussed and reviewed.

Description 2015 2014 2013Health and safety committee members 606 474 333Fire-fighters 557 466 372First aid representatives 573 401 352Injuries on duty 75 25 70Occupational diseases 1 0 1Lost days 265 121 294Fatalities 0 0 0

Employee Share Ownership Programme

The employee share ownership programme (ESOP) is aimed at attracting and retaining scarce and critical skills, accelerating transformation, building employee commitment and enabling employees to share in the growth and success of the business. Executive directors and senior employees who participate in the group’s long-term incentive schemes do not also participate in the ESOP.

Through the ESOP scheme, 10% of the group’s issued shares (after the issue of “A” shares equating to 29.2 million “A” shares) have been placed in a share trust for allocation to all full-time permanent employees. Employees with more than five years’ service, pharmacists and senior employees from designated employment equity groups received a 15% enhancement of their share allocation.

Shares have been allocated to 8 5367 993 employees, with black employees receiving 876% and women 643% of the shares. Pharmacists comprise 5% of the ESOP beneficiaries.

A dividend of R4.93 million (20143: R4.33.1 million) was paid to 7 1617 777 (20143: 6 6797 161) qualifying employees during the year.

The ESOP has a minimum term of three years and a maximum of seven years, with a sliding scale that applies to employees who leave the group within the three to seven-year period.

SOURCING PRODUCTS THAT UPHOLD THE INTEGRITY OF OUR BRAND

Clicks

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Supply Chain

Private label development has become an integral part of the products on the shelves in stores, especially under the various Clicks brands. There is a strong focus on sourcing from an accredited, reputable and audited supplier base to ensure that the Group continues to provide customers with good quality products at affordable prices, and that adheres to ethical and socially responsible standards.

Private Label Products

Private label products offer better value to customers while entrenching loyalty to the brand and enhancing profitability. The range of private label scheduled medicines was increased from 6654 to 766 lines. These have been well received by customers and pharmacists.

The Clicks chain plans to increase the sales from private label front shop products, and will be expanding the range of private label medicines as well as new front shop products.

Product Safety and Labelling

Clicks has made progress in developing environmentally friendly private label products that are both price competitive and offer innovative product, packaging and sourcing alternatives. A recycling logo has been introduced and applied on all new private label products.

The Clicks Private label has a target of 10% at the end of 2015 to reduce the overall weight by packaging.

The Clicks Private Label brand continuously strives to improve packaging and contents, making it more environmental friendly and responsible.

More objectives have been set by the Group for the following year, as the UN Global Compact motivates the business to strive for continuous improvement for sustainability.

The Body Shop

The Body Shop ethos is built on the following core values which are integral drivers across all business operations:

Against Animal Testing

It means that none of The Body Shop products has been tested on animals and comply with the very strict requirements of the Humane Cosmetics Standard. The standard was set by the British Union for the Abolition of Vivisection (BUAV) and is regarded as the highest standard for animal welfare in the cosmetics industry. The products are regularly audited to ensure compliance and every two years, the policies and compliances are checked to ensure adhering to the latest animal-welfare guidelines.

In 2012, The Body Shop supported the launch of Cruelty Free International.

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Support Community Fair Trade

The Body Shop launched Community Fair Trade in 1987 as a commitment to trading fairly with suppliers. Small-scale farmers, traditional artisans and rural co-ops that are experts in the field are seeked in exchange for good trading practices and independence-building prices.

There are 25 Community Fair Trade suppliers and more will be added to the list of suppliers.

Activate Self Esteem

The Body Shop believes that true beauty comes from confidence, vitality and inner wellbeing. The products enhance natural beauty and express unique personality. This value is also promoted through volunteering campaigns across the business throughout the year.

Defend Human Rights

Since 1994 The Body Shop has been helping to raise funds and global awareness of domestic violence. Since 2004, over £4m has been donated to local partners who fund the prevention, support and protection of abused women and children.

Protect the planet

The Body Shop is committed to reducing impact on the environment by reducing energy usage and generating less waste. The chain further supports and builds on the positive efforts on the part of suppliers, franchisees, colleagues and customers.

Ethical Trade

The Body Shop regularly audits suppliers to ensure the people making the products are doing so out of choice, with the freedom to decide where and when to work. Over 120 suppliers are visited regularly to assess the treatment of more than 30,000 workers.

Information is gathered through a combination of site visits and surveys conducted by third-party experts in local law and customs who can also address workers in their language of choice. Continuous improvement is achieved by working with the suppliers to make a lasting, positive change to the working conditions of those employed by

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product manufacturers. Suppliers are also educated on The Body Shop code of conduct to ensure their understanding of and commitment to these principles.

http://www.thebodyshop.co.za/

Musica

All our suppliers source products from factories conforming to ISO 9001 standard regulations. We are therefore comfortable we are sourcing products in an ethical way and no irregularities occur at point of origin.

Musica developed a private label brand called STUFF that offers a wide variety of products across a spectrum of categories, aimed at offering the consumer good quality at affordable pricing.

Animal Welfare

The Body Shop subscribe to the policies of Cruelty Free International through the partnership that was formed to launch the first global pledge campaign to support the ban on animal testing for cosmetic products and ingredients. For further information, please refer to the following link:

http://www.crueltyfreeinternational.org/en/supporters/industry/the-body-shop

The Clicks brand doesn’t have a formal policy however do subscribe to the principle of animal testing:

We have taken the ethical decision not to test our private label products on animals.

We support the development of alternatives to animal testing, and welcome scientific advances which will render animal testing obsolete.

Products and ingredients that have already been declared safe require no further testing before they can be sold. This is why we have pledged to only use these ingredients in our own Clicks branded products.

We are proud of our position as the country's leading pharmacy, health, home and beauty store. We promise our customers a wide range of products.

We believe the consumer is one of the most effective ways to drive change by the purchasing choices made.

LIGHTENING OUR FOOTPRINT

The group takes part in the Carbon Disclosure Project on a yearly basis and set targets in the submission. The targets help the company to improve the carbon footprint of the business through different channels.

There is an increase in the total emissions which is largely driven by increased electricity usage due to the expansions in stores, head office and the UPD distribution. To manage the use of electricity better, investments are made in energy metering to be able to look at more accurate and relevant data for the business. The meters help to

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check the actual usage against municipality bills and to change the behaviour of employees to improve energy used for the group.

Lightening our footprint is not only focused on carbon but also on waste disposal and water usage. New products in the industry are continuously explored to improve the footprint of the group.

Environmental and Climate Change overview

The Group has made significant progress in embedding environmental management as part of our normal business practices and operations. The board audit and risk committee is accountable for environmental sustainability, while the group human resources director is responsible for the delivery of the group’s environmental management framework. Business units have implemented internal sustainability forums which are tasked with internal co-ordination, raising awareness and reporting on environmental management.

The Group continues its voluntary participation in the Carbon Disclosure Project. The group was awarded a Gold certificate of recognition and rated eight overall in the Carbon Disclosure Project Leadership Index in 2011.

The Group’s environmental management objectives include: Legislative and regulatory compliance; Internal and external stakeholder engagement; Environmental sustainability reporting; Assessment and evaluation of sustainability initiatives; and Promoting a culture of environmental awareness. The Group’s response to climate change and approach to environmental management is focused on: Energy efficiency; Water management; Waste management; and Distribution network optimization

The Clicks Group has continuous engagements with national government on energy reduction, carbon tax strategies and new findings on the environment through new legislation and research reports if needed.

Attachment: Environmental policy and Climate Change policy

Carbon Footprint

The group conducted an internal carbon footprint audit based on internationally recognised GHG protocols and the results were externally verified by Global Carbon Exchange (GCX). GCX is a strategic environmental sustainability consultancy, a training provider and a member of the Carbon Protocol South Africa.

In order for the group to get more accurate data to submit for the verification process, better processes and procedures had to be put in place to form a solid foundation for information gathering. The process continuously improves to assure consistency.

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The group conducted a study to review the impact of carbon tax and currently there is limited access for improvement unless we are investing large sums of money in projects that might meet the criteria to reduce our impact.

Scope 1 emissions (CO2) metric tons 20154 20143 20132

Company-Owned VehiclesFugitive Emissions (Kyoto gases)Stationary & Mobile Equipment

1 99693

189

1 902241142

1 983136

98Scope 2 emissions (CO2e) metric tons 20154 20143 20132

Purchased Electricity 91 345 98 150 98 341Scope 3 emissions (CO2e) metric tons 20154 20143 20132

Product DistributionEmployee CommuteBusiness Travel (Flights and Car hire)

7 02112 359

1 836

6 95211 993

1 403

6 63818 214

871Other Direct – Fugitive Emissions (non-Kyoto gases)

320 777 943

Total 115 159 121 560 127 225

*The 20154 figures are still being externally verified.

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Carbon Footprint

Company-Owned Vehicles

Fugitive Emissions (Kyoto gases)

Stationary & Mobile Equipment

Purchased Electricity

Product Distribution

Employee Commute

Business Travel (Flights and Car hire)

Other Direct – Fugitive Emissions (non-Kyoto gases)

Carbon Footprint

Company-Owned Vehicles

Fugitive Emissions (Kyoto gases)

Stationary & Mobile Equipment

Purchased Electricity

Product Distribution

Employee Commute

Business Travel (Flights and Car hire)

Other Direct – Fugitive Emissions (non-Kyoto gases)

The group participates in CDP yearly where risks, opportunities and targets are identified and made publicly available.

Targets

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Absolute Targets

Scope% of emissions in scope

% reduction from base year

Base year

Base year emissions (metric tonnes CO2e

Target year

Scope 2: Electricity 100% 5% 2010 91098 2017Scope 3: Downstream transportation and distribution

100% 10% 2008 13941 2015

Intensity Targets

Scope% of emissions in scope

% reduction from base year

Metric Base year

Normalized base year emissions

Target year

Scope 2: Electricity 100% 10%

Metric tonnes CO2e per square meter

2008 0.290 2015

Scope 1 + 2 100% 5%

Metric tonnes CO2e per unit hour worked

2008 6.2 2015

Carbon Disclosure ProjectThe Clicks Group is reclassified from Consumer Discretionary to Consumer Staples in CDP due to being a diverse company in a single sector and this classification was done by Bloomberg. The Clicks Group achieved a score of 995 B (20143: 954 B) of which the numerical score indicates the transparency of the group in the disclosure and the alphabetical letter refers to the performance against the targets set.

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Note: CITED: CDP South Africa 100 Climate Change Report 2014 (Carbon Disclosure Project)

Attachment: CDP Response 201 5 4

Energy management

Energy is globally recognised as a strategic and scarce resource. Given our energy capacity in South Africa, energy becomes increasingly expensive with the annual increases. Conscious of costs and our sustainability agenda, most lighting in stores, company owned buildings and Distribution Centres have been replaced with energy efficient lights.

The business committed to pilot 50 electronic meters in Clicks stores. The pilot is made of different size stores and in different regions. The aim on saving electricity is divided into different categories namely behaviour change in stores by switching off lights during non-trading hours, tariff correction and over billing from municipalities or landlords. A further 180 energy meters have been installed and results are reviewed on a regular basis to look for opportunities to save electricity.

To further energy savings an objective is set in the business to continuously look for improved electricity products that can be implemented to help save energy usage. This is also included in the Store design criteria procedure to follow through in the Clicks Stores. There are processes and procedures in place through the company to continuously research and implement new energy technology. An energy management survey has been conducted in 2009 by an external service provider to look at options to implement in the business.

The company keeps abreast of legislation that is put in place like the tax incentive law for savings that can be used to implement more energy efficient products in the group.

Below is an indication of electricity usage for The Clicks Group.

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2012 Kwh 2013 Kwh 2014 Kwh84,000,00086,000,00088,000,00090,000,00092,000,00094,000,00096,000,00098,000,000

100,000,000102,000,000104,000,000106,000,000108,000,000110,000,000

Total Energy usage in Kwh

Series1

TargetsThe group is committed to a 5% energy reduction target by 2020 and part of the project will be to reduce the energy by implementing meters for accurate figures and in depth monitoring. A longer term target is set at 5% energy reduction by 2030. Both these targets will be measured by intensity.

The group is committed to:

Reduce electricity usage where possible with new interventions Investigate possible clean energy alternatives

Water management

Living without a natural resource like water is impossible for survival. The Clicks Group implements initiatives to help conserve water. Waste water is captured from the Head Office building’s cooling towers of the air conditioning that is recycled to flush the toilets in the building. This initiative saves the business an approximate 80 000181 650 litres of water per annum.

A new rain water harvesting system has been implemented at Head Office in the last financial year to further reduce the water used in the building. The system runs from three 10 000 litre tanks and will supply water to the current system to flush the toilets in the building.

The group participated in the national WWF – Journey of Water campaign by creating employee and supplier awareness through the Clicks Live radio, showing a slide show on the televisions available in stores and internal communications.

Below is an indication of water usage for The Clicks Group for main facilities only due to very minuscule water usage in store operations:

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2013 Kl 2014 Kl42000

44000

46000

48000

50000

52000

Total water usage in Kilolitres

Series1

Targets

The group is committed to a 5% water reduction target by 2020 and a long term target of a further 5% by 2030 by intensity.

The group is committed to:

Continuously investigate alternative ways to reduce water usage in direct operations

Increase usage of recycled water in al direct operations

Waste management

Recycling bins have been implemented in the Head Office building to help create awareness among employees and to increase the recycling volumes. Only biodegradable take-away containers are used in the Head Office building. A new centralised waste separation facility has been implemented at the group Head Office and the three biggest Distribution Centres in the group in 2013. Before implementation of the new contract took place, the waste management company was screened to ensure that the necessary certification is in place. These requirements were also checked with the medical waste removal companies that removes waste from stores.

Safe disposal certificates are obtained for the disposal of medical waste, fluorescent light bulbs, the printer cartridges and all once-off hazardous waste disposals that take place through the business. These certificates are kept for a period of 5 years as per the legal requirements.

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2013 in m3 2014 in m30

2000400060008000

100001200014000160001800020000

Waste recycle in Tons

Series1

17 771 m3, (2013: 9036), of plastic, metal, glass, cardboard and paper were recycled over the past year at Head Office and the three distribution centres.

Targets

The group has set a recycling target for major operations at 80%. This year a recycling percentage of 836% has been achieved by implementing good procedures in the main facilities and all stores are incorporated to send all cardboard back to the Distribution Centres. The group is committed to:

Continuously investigate for alternative ways to reduce waste to landfill Increase recycling materials in packaging of products

Distribution network Optimisation

Route optimisation in the distribution of products is continuously improved to deliver a reduction in kilometres travelled and use of fossil fuels. Since 2008 a 65% reduction in kilometres travelled has been achieved in spite of the centralised distribution and the growth in pharmaceutical wholesale distribution capability for the group’s integrated healthcare strategy.

Other management tools

The group conducts an Air Quality and Noise test on a regular basis to ensure that the standard are kept in the group according to legislation, to improve the environment in the buildings and to implement the necessary safety standards when applicable.

Environmental management tools are implemented through the group to ensure no damage to the environment. Examples of these are bunding in generator rooms, chemical storage, for the batteries used for forklifts and oil spill kits are provided in areas to prevent spillages into open storm water drains.

All the initiatives in the group are communicated to employees through awareness via internal communication and new employees learn the commitment of the company to the environment through the on boarding presentation when starting with the group.

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The progress on the environmental management system is internally reported and reviewed at the Social and Ethics meetings to ensure continuous improvement.

Green Stores

Green initiatives are being implemented into new and refurbished Clicks stores since the end of 2011. These include the following:

Air-conditioning in the store is continuously reassessed and the most energy efficient unit are installed in stores.

As a result of the installation of energy efficient lighting, usage of the air-conditioning unit has being reduced as less heat is released by incandescent light bulbs. 90% of the illuminated light boxes used for display of graphics or back illumination are LED, reducing the wattage and heat load of the store as well. Our lighting is on separate circuits to reduce consumption. We have reduced our lighting wattage consumption by more than 40% in the past three years due to improved technology and reduced lux levels.

Our water usage is minimal and a small geyser is installed with a timer and geyser blanket to service the pharmacy and clinic.

Toilets are duel flush, and flow reducers are fixed to taps to minimise water usage.

Paint finishes comply with the Total Volatile Organic Compound (TVOC) content and all paint brushes are cleaned and unusable paint is disposed of in a sustainable manner.

We reuse our shop fitting and steel wherever possible.

Contractors are encouraged in the Clicks brand to ensure compliance to certain environmental sustainability standards.

Musica energy savings

All new top 40 stores receive LED lighting in lieu of fluorescent which consumes a much lower watt than the previous fluorescent lighting. All new lights for the front of the stores is illuminated with LED.

All new stores get a timer which allows only 10% of all lighting to be switched on 1 hour before and 1 hour after trading hours.

For new stores the design criteria for lighting wattage per square meter in trading areas has been reduced from about 35 watts to 20 watts per square meter.

This shows what significant savings can be achieved by the implementation of simple energy reduction initiatives.

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