Human capital investment and development

Highlights

R2,525 million net operating income per employee

R2,474 million distributable income per employee

209 permanent employees

Our people are a critical driver of our business performance and sustainability, and a key competitive strength. The high calibre of current management at head office and senior operational level is instrumental in creating stakeholder value and long-term sustainability.

A main focus is to align all human capital investment with the core strategy and values of the company.

Our core staff values are to implement and nurture each employee’s highest potential, to reward performance and address non- performance and take responsibility for our actions and outcomes.

Workplace profile by occupation level

We are committed to creating and maintaining an environment which provides equal opportunities for all employees, with special consideration of previously disadvantaged groups. The formal company employment equity policy codifies this commitment and stipulates the promotion of equal opportunity, the elimination of unfair discrimination and the implementation of positive measures to redress disadvantages previously experienced by designated groups. Hyprop's 5 year equity plan was submitted to the Department of Labour in January 2013. A consolidated equity report is set out below:

Staff earnings ratio

Hyprop’s performance per employee in terms of net operating income and distributable income as a measure of productivity is benchmarked annually against peers.

Allocation of employees in the group

Staff retention

The high level of retention of staff, especially at senior level, reflects our people’s commitment to the group and the amicable working environment. In addition, the low turnover of staff ensures continuity and aligns the performance of the group with our long-term strategic objectives.

During 2012, a system of performance benchmarking, training and leadership development was introduced. The system is continously reviewed. During the period, the methodology related to performance assessments was enhanced.

Skills development and training

Hyprop's training and development takes into account Hyprop's skills requirements, skills shortages in the property industry at large and transformation requirements. Managers and staff are consulted on training requirements and the skills base is objectively assessed. From this, the focal areas requiring training are identified for the year ahead. Training and skills development is the responsibility of the group's National Human Resources Executive, Karin Eichhorn.

Objectives of our training strategy include:

A primary objective is to up skill our junior management to middle management to ensure a solid pipeline of skills eligible for succession (see Graduate programme).

The 2013 training plan was based on the outcome of performance reviews in the last quarter of 2012. There were 219 training sessions held during the six months to June 2013, and 72% of employees participated. The assessment process determined the focal areas requiring training during the year and 94% of the training planned was completed. The process will continue in 2013.

During the period, a combination of internal and outsourced training sessions were conducted covering, among others, the following areas:

Graduate programme

Hyprop introduced a graduate programme in 2010 aimed at developing staff into middle and senior management roles, and ultimately board positions where viable. The programme is intended to develop and incentivise candidates while addressing the group's succession planning. The number of participants has increased from five to nine, three of which are black, one is coloured, three are indian and two are white. Five are males and four are females. Employees applying for the programme are required to meet certain criteria to be considered. Length of service, performance and financial situation are taken into account. Successful applicants receive assistance with tuition and related costs.

Our first graduate, Tumi Sebone will complete her studies by December and has already been promoted within the company.

Value of training investments

2013 training

Performance management

Performance reviews in terms of individual competency are performed annually while performance reviews related to the deliverables set out below are conducted bi-annually.

Key performance indicators (KPI's):

For the six months ended June 2013 the company outperformed in terms of the above KPIs, achieving an overall score of 111%.

Performance against the above KPI's carries a 90% weighting towards executive directors and senior management's final performance score. The individual's performance carries a 10% weighting and individuals are assessed annually. Bonuses are approved by the remuneration and nomination committee and are payable in December. More detail on our remuneration policy is available on page 47 of this report.