CORPORATE CITIZENSHIP

Economic empowerment

The Company endeavours to involve historically disadvantaged South Africans as equity partners in Group businesses, or as preferred suppliers to Group companies, to the extent that they are the true beneficiaries of such initiatives, without undue disadvantage to shareholders of the Company

In 2006, a formal process to measure and verify the Group's status and performance in terms of a broad-based Black economic empowerment scorecard was undertaken for the first time. This showed that the Group was a non-compliant contributor, with a score below 30 per cent in terms of the Department of Trade and Industry's generic codes of good practice. In 2007, action was taken to improve this situation in terms of both the underlying empowerment position and of the speed and accurate recording of empowerment activities. The 2006 evaluation process will be repeated in 2008.

Economic empowerment equity transactions at Group level have been investigated in the past and it was concluded then that such transactions would not add value. With customers' knowledge and support, AECI nevertheless remains committed to following relevant guidelines issued by the Department of Trade and Industry.

A broad-based employee share ownership scheme is being researched, with a view to possible implementation before the end of 2008.