‘We believe that shared value is not a feel-good strategy, but it is simply and fundamentally who we are’
The challenges that South Africans have had to face and overcome since the outbreak of the COVID-19 pandemic reflect the lightning pace at which the world has changed. The pandemic and associated regulatory responses created a volatile and rapidly evolving operating environment for businesses.
In the midst of the COVID-19 pandemic, AVBOB stood firm as a business, backed by its strength and trust earned over a century. AVBOB has remained true to its roots of building trust and connectedness – its current aim still reflects the integrity that comes with caring for one’s community and providing help where it’s needed most.
Beyond its core purpose as a provider of funerals and funeral insurance, AVBOB became a mutual assurance society in 1951. As a mutual, AVBOB has no external shareholders who receive dividends, but rather shares its surplus profits directly with policyholders. Today, AVBOB is the largest Mutual Assurance Society in Africa and provides a complete, one-stop funeral insurance and funeral service solution. AVBOB has 367 branches nationwide, of which 212 are funeral arrangement offices and funeral agencies.
As a business operating on the frontlines of the pandemic, the AVBOB Group experienced first-hand the bereavement of families and communities. The Group placed increased focus on the wellness of its employees and on supporting clients through its digital transformation journey. AVBOB provided financial support to employees who were unable to sell policies by investing in the development of digital platforms to enable intermediaries to sell policies with limited human contact.
AVBOB CEO, Mr Carl van der Riet, says that during the hard lockdown, the Group provided its members with nearly R500 million’s worth of FREE funeral benefits. This includes the execution and arrangement of the funeral, the cost of a coffin, and free transportation of the deceased. AVBOB’s free Personal Protective Equipment (PPE) campaign, which sought to relieve the financial strain on grieving families, provided free PPE to the value of R18 million for use at all funerals.
Van der Riet, who has been at the helm of AVBOB Mutual Assurance Society since November 2019, says that the organisation’s commitment to community relief and socio-economic support is at the heart of AVBOB. What distinguishes its corporate social investment initiatives is that the Group does not merely commit money and resources, but instead partners with communities to ensure tangible benefits over the long term.
The Group donated R7 million for immediate assistance to communities of KwaZulu-Natal which have been severely affected by the floods in the province. The support included the provision of free funerals to a maximum of R20 000 per deceased, to assist families to bury their loved ones lost through the devastation. Furthermore, AVBOB also supported its staff members in the province who were directly impacted by the disaster.
Recognising the wide disparity of income and wealth distribution in South Africa and the responsibility of the organisation to all citizens, AVBOB is invested in connectedness through caring and sharing. As a mutual society, the Group is committed to managing the relationship between business, society and the environment, which is vital for a sustainable future.
AVBOB sees its role as being more than just transactional. The Group believes that its combined offering of insurance and funeral services, makes the purchase of a policy merely the first step in its relationship with a customer. “We have a different approach … in that we will stand by our customers after the financial transactions of purchasing the policy and the claim’s pay-out to take them through the funeral and grieving process. This comes back to our shared-value approach and our emphasis on trust and family values.”
AVBOB’s performance in the 2020/2021 financial year was marked by the unprecedented spread of the COVID-19 pandemic. Despite this, the Group delivered exceptional results, setting multiple records in all three operating units – insurance, funeral service and manufacturing.
According to Van der Riet, the AVBOB Group generated a profit before transfer to policyholder liabilities of R4 billion, of which R3,7 billion was set aside for the future enhancement of member benefits. “Our shared value model is the cornerstone of our unique value proposition, which creates tangible economic wealth and benefits for our members. We believe that shared value is not a feel-good strategy, but it is simply and fundamentally who we are,” Van der Riet explains.
As a leader in the funeral insurance and funeral service industry, AVBOB continues to build business strategies that cater for the current and future needs of customers. A fully automated new business sales application now enables AVBOB intermediaries to meet rising consumer needs, with policy documents and schedules issued immediately, regardless of an agent’s location. The application removes the tediousness of hard-copy application forms and allows the approval of applications in real-time.
To remain a leader in the funeral industry, The Group continues to invest in expanding its national office footprint. Its key differentiator of being able to offer an integrated funeral insurance product and funeral service sets it apart from competitors.
Although the business was not immune to the shake-ups and test of resilience that companies experienced due to the impact of the pandemic, it has proudly maintained its status as a Top Employer for the fifth consecutive year. The Group regards the acknowledgement of being certified as one of the best companies to work for in 2022 as a tremendous vote of confidence in its more than 7 500 dedicated employees. DM
Mr Carl van der Riet, AVBOB CEO
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