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INDEPENDENT NEWS & MEDIA SOUTH AFRICA. PRESENTATION TO PARLIAMENTARY PORTFOLIO COMMITTEE Diversity and Transformation of the Print Media. Presented by Tony Howard (CEO) Parliament – Cape Town November 15 2011. Independent Newspapers’ (“INL”) main business is that of a newspaper publisher
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INDEPENDENT NEWS & MEDIASOUTH AFRICA PRESENTATION TO PARLIAMENTARY PORTFOLIO COMMITTEE Diversity and Transformation of the Print Media Presented by Tony Howard (CEO) Parliament – Cape Town November 15 2011
Independent Newspapers’ (“INL”) main business is that of a newspaper publisher The company publishes 18 paid newspapers and a number of important specialist, free-standing publications (chief amongst these is BR and Personal Finance) – plus 15 community newspapers Each of the company’s titles cover the broad-base of the diversified SA market and cover; morning, afternoon and weekend markets with some providing for specific reader needs – such as Post in KZN which is produced specifically for the Indian community In addition to its long established core newspaper brands, INL has launched three new titles (Isolezwe) in IsiZulu directed at the special, diversified news needs of the majority people of Kwazulu Natal The Business of Independent Newspapers
Since 1994, the company’s established / mature brands have actively been repositioned to ensure that they address the news needs of the changing and broadening readership markets As a consequence; African readership of the company’s titles have increased; Gauteng by 18% to 62% in the past 16 years Cape by 5% to 14% (Coloured readers from 51% to 58%) KZN (excluding Isolezwe) by c11% to 30% (Indian readers steady at c45%) KZN including Isolezwe by c43% to 63% Business Report (launched in 1995) has c52% African readers The male and female readership too is reaching a 50/50 split Transformation and diversification – a longstanding business imperative within Independent
Changes in the appeal of the products has been driven by the steady re-alignment of the newsrooms of INL’s newspapers to better reflect the changing demographics of the markets served Just over 57.5%% of all editorial staff are Black Females represent just under 50% of the company’s editorial structure (a 55.6% black representation) This reflects a significant change from the position in 1994 Along with the newspaper industry as a whole, Independent Newspapers has adopted the DTI’s B-BEEE Codes of Good Practice as its transformation goal setting and measurement tool The company has regularly applied and worked towards the DTI Codes since 1998 Focus has been on the codes which apply to the broadest base of transformation Transformation and diversification – a longstanding business imperative within Independent
In November 1996, well in advance of the BEE Act of 2003 – the company originally embraced transformation as a social and business imperative– by implementing a detailed, union approved, AFFIRMATION ACTION plan; In 1998, this was expanded into a 5 year Employment Equity Policy and Plan in compliance with the EE Act In 1994, Independent sold a controlling shareholding in the Sowetan – and in 1996 total control of the paper – to Dr Motlana’s New Africa Investment Limited group (“NAIL”) Subsequently, brought NAIL in as a 33.3% shareholder into the distribution company Allied Publishing In 1997 Independent funded and was instrumental in the creation of radio station Kaya FM – together with a number of BEE partners Subsequently (in 2001) passed its shareholding in Kaya FM to Thebe Investments and Makana Media Between 1995 and 1998 set up a fully outsourced distribution / delivery operation setting up the existing employees in their own franchise businesses And others Embracing Transformation
Editors: Of the company’s 19 titles (including the community stable); 14 are edited by Black editors, of which 5 are female, and Business Report also has a Black Editor the balance (5 titles) have White editors, of which 1 is female Senior business management: Of the company’s 4 major separate business divisions; 3 of these are under the direct control of Black managers, of which 1 is female Pre-1994 all editors –except for the Post – were White Important transformation changes Nearly 75% - transformed 31.6% - female 75% - transformed 25% - female
Independent is foreign owned – by a multi-national media group But is fully managed by South Africans 10% of the shares are held onshore The investment in the company was made in 1994 – as one of the first foreign investments in the new democratic South Africa – a time during which not many were investing in SA The purchase was done for value and with general Government approval Importantly, shareholding has no influence in terms of editorial independence Editorial independence is guaranteed in the letters of appointment of editors Ownership
The company is currently a Level 5 BEE Contributor to broad based BEE with a score of 56.77 points Management Control: The company has achieved almost 60% of the points required Senior / Top management and editors reflect significant transformation (see earlier slide) The Board has been affected by resignations during the year Broad Based-BEE Special focus in action
Employment Equity: The company has achieved nearly 69% of the points required Black employees account for 69.5% of total staffing Black females 30% Number of Black employees within the junior, middle and senior management levels largely accountable for achieving the overall points Steady focus is being given to increasing the company’s employment of disabled persons – which is low Strict vacancy replacement policy in place to drive further transformation Broad Based-BEE
Skills Development and Capacity Building The company has achieved a rating at 40% of the required points Skills development plans are in place for all activities within the company with special emphasis on designated staff and women Separate budgets are in place to cover annual training The company has for the past 3 years run and fully funded an internal editorial training school providing graduates with practical and on the job training in newsroom situations for 12 months – with all interns being offered permanent employment at the end of their course Apprenticeship training is offered in the company’s printing factories In addition, the company offers; a study loan scheme to all staff tertiary loans to children of staff who intend to study post-matric an Independent fellowship – of 3 months on one of our international titles advertising learnerships to develop sales capacity executive development programs for middle and junior managers (80% designated staff) Broad Based-BEE
Preferential Procurement The company has achieved c74% of the points required based on a definitive procurement policy Systems have been set up to monitor the appointment of new suppliers – with emphasis being on seeking businesses at Level 5 and less Contributor status Broad Based-BEE
Enterprise development Maximum points have been achieved As was the case pre –1994, the company continues to seek and build outsource operators to support its main operations and identify and support “start-up” operations related to its core business activities Broad Based-BEE
Socio - Economic Development Maximum points have been achieved The company runs and supports a number of CSI projects directed at providing assistance and growth opportunities to under privileged persons – especially children (most notably the company’s Star Seaside Home in Durban) Broad Based-BEE
Ongoing Commitment to Transformation and Diversity • Independent Newspapers has been and remains committed to transformation and diversity within its businesses