Sentinel Retirement Fund at a glance

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1 Sentinel Retirement Fund at a glance Key highlights Total assets Rm 12-month investment return as at 3 June , ,7 2,7 2,3 1, Wealth builder Inflation protector Pension protector Pensioner Money market Pension increase vs inflation Total asset allocation 3 June , 5,5 8,6 6,6 6, 4,7 6,3 6,3 4,5 5,1 7, 3,5 2,81,7 1,3 1,7 5,4 33,9 2 17, ,4 Pension increase CPI increase 8 of CPI SA equity Foreign equity Africa equity SA money market Foreign property SA long-term inflation-linked bonds SA property Emerging market equity SA nominal bonds Foreign money market 4 Sentinel Retirement Fund Integrated Annual Report 217

2 Contributions R2 846 million annual contributions by members Our oldest pensioner turned 11 this year Pension payments R4 113 million annual pension payments to pensioners and beneficiaries Assets R82,5 billion total assets at 3 June 217 Pension increase 4,5 pensioner increase awarded Shareholder engagement activities Proxy voting resolutions voted on 3 companies engaged Sentinel Retirement Fund Integrated Annual Report 217 5

3 Sentinel Retirement Fund at a glance continued Who we are Through its responsible investment strategy, that incorporates economic, social and governance (ESG) factors, and the provision of excellent retirement funding benefits, the Fund makes a meaningful contribution to the communities and markets it operates in. Sentinel Retirement Fund has a proud heritage dating back to 1946 of providing retirement fund benefits. Originally founded as the Mine Officials Pension Fund, Sentinel has since grown into one of the largest self-administered, defined contribution, umbrella funds in South Africa actively managing assets of approximately R82 billion (as at 3 June 217). Sentinel is registered in terms of the Pension Funds Act (No 24 of 1956) and the Income Tax Act (No 58 of 1962) under registration number 12/8/1215 and SARS approval number 18/2/4/38. The Fund is structured as a type A umbrella pension fund that also provides in-house selfinsured risk benefits (death and disability) and monthly pensions. It is administered by its employees, who are accountable to its Board of Fund. Sentinel actively pursues growth through world-class investment management and the provision of modern flexible benefits underpinned by best of breed systems and specialist skills. Currently the Fund has 4 64 active and deferred members and 92 active participating employers. Monthly pensions are paid to former members and beneficiaries. Sentinel is managed from its head office in Parktown, Johannesburg, supported by comprehensive client services provided from five client service centres situated in Parktown, Welkom, Klerksdorp, Carletonville and Emalahleni, as well as a dedicated client contact centre. 6 Sentinel Retirement Fund Integrated Annual Report 217

4 The Sentinel Retirement Fund Ethics Charter Our vision To position and grow Sentinel to continually provide sustainable retirement solutions to all its members in a socially responsible manner. The way we do things We exist because of our members and participating employers. We are therefore first and foremost accountable to those who place their trust in us. Our integrity gives them peace of mind and security. We never underestimate the scope of this responsibility. We manage the assets entrusted to us with care, diligence and responsibility. In this we anticipate and manage risks that we could reasonably be expected to identify. We continuously engage with our stakeholders in a direct, honest and transparent manner. We listen to our stakeholders and respond to their legitimate needs. We make decisions regarding these expectations in a fair and consistent way. Our income, expenditure and investments are managed with great care and responsibility. We take care of those resources entrusted to us as if they were our own. We know that proper use of organisational time, money and property is non-negotiable. Any real or potential conflicts of interest of our Board, management, employees and service providers are identified, declared and managed in a responsible way. We recognise that it is through people that organisations attain trustworthiness. As Board members, management and employees of this organisation we view our responsibilities with the dedication it commands. We treat each other and those we interact with by exercising respect and compassion. It is our obligation to invest in our skills to enable us to continually instil confidence and trust in those whose lives we touch. We acknowledge that it is through teamwork that respect and trust are earned. We care about our employees. We acknowledge their contribution and sacrifices by compensating them in a fair and equitable manner. We have a right to hold our service providers and suppliers to the highest ethical standards. Our reputation is reliant on their reputation. We uphold the laws that apply to us. Our policies reflect accountability. Going beyond mere compliance, we do the right thing even when nobody is watching. Therein lies the trust others place in us. In all of this, we find meaning in what we do. We recognise that we make a difference in people s lives and we embrace this privilege with purpose and humility. Signed on behalf of the Board, management and staff of Sentinel Retirement Fund. AB la Grange Chairman FJ Visser CEO Sentinel Retirement Fund Integrated Annual Report 217 7

5 Sentinel Retirement Fund at a glance continued Organisational structure GOVERNANCE Chief Executive Officer Board of Fund Principal Officer Claims Business Development and Review Investment Audit and Risk Human Resources and Remuneration EXECUTIVE Investments Finance and support services Legal, risk and compliance IT support services Operations Advisory services SERVICE PROVIDERS Investment managers Investment consultant Custodians Legal advisers IT support services HR consultant Actuary External audit Internal audit 8 Sentinel Retirement Fund Integrated Annual Report 217

6 Membership highlights Contributory members per participating employer Average age of contributory members 26, 16,4 12, 23,3 8,1 14,6 31,2 9,9 11,1 13,9 33,5 AngloGold Ashanti Sibanye Gold Harmony Anglo American/ Anglo Coal Lonmin Platinum Other Gold Fields Under to to and older Retirement savings contributions received Rm Average monthly member pension paid Rand Membership benefits What happens to my savings in the event of? Dismissal/resignation/retrenchment Deferred membership option Fund credit paid out Fund credit transferred to approved fund. Death Fund credit plus cover amount (if applicable) paid as follows: 5 to provide spouse pension 5 paid as lump sum in terms of section 37C of the Pension Funds Act (No 24 of 1956) to dependants and/or nominees. Disability Fund credit plus cover amount (if applicable) paid as a retirement benefit. Retirement Maximum one-third lump sum Monthly with profit pension payable for life (member and spouse): Spouse pension payable at 75 or 1 in event of death of retiree Term certain guarantee period of 5, 1, 15, 2 or 25 years An option of a living annuity pension, after a minimum R15 annual pension from the above. Sentinel Retirement Fund Integrated Annual Report 217 9

7 Sentinel Retirement Fund at a glance Investment spread continued Sentinel actively pursues growth through world-class investment management and the provision of modern flexible benefits underpinned by best of breed systems and specialist skills. roup 2 1, Naspers Limited 4,5 lc lp ua ut M kg Ban dard Stan 1,1 ted Limi d Ol RS A link I238 ed bon inflatio n d1,4 - TOP 1 RSA R22 inflationlinked bond 2,8 ed 1,4 Sasol Limit S on ati infl 5 2,6 I2 ond A b RS ed k lin ntio a infl 6 1,7 4 I2 ond A b S R ed k n li EST MENT British Amer ican Tobac co plc 1,8 I NV 1 Sentinel Retirement Fund Integrated Annual Report 217

8 So,2 st Ea dle Mid,8,6 8 si a 3, a ala eric ia str As Au h Am ut So uth A frica 6 2,1 Afric a 7,9 I ONAL POSURES Euro pe 1 5,3 United States dollar 19,3 T EX URREN EX er Oth C Great Britain poun d sterling 1,4 Hong K ong doll ar,8 South African rand 7 1,2 POSURES Sentinel Retirement Fund Integrated Annual Report 217 4,1 Euro 3,2 Y C OP,3 rica 9 me rth A No REG 11

9 Integrated Annual Report 212 Sentinel Retirement Fund at a glance continued Key milestones 216 Awarded THE EUROPEAN: Pension Fund of the Year Africa Members: Pensioners: Assets: R79,9 billion Renamed to Sentinel Retirement Fund and the Mine Employees Pension Fund merged into Sentinel Positioned for growth First integrated annual report Pension income choice implemented Converted to a pure defined contribution (DC) fund and MOPF renamed Sentinel Mining Industry Retirement Fund Members: Pensioners: 4 5 Assets: R152,3 million Member Investment choice implemented Celebrating 5 years Created as Mine Officials Pension Fund (MOPF) 12 Sentinel Retirement Fund Integrated Annual Report 217