OUR PERFORMANCE
OUTLOOK
We have presented our integrated report to provide all our stakeholders with balanced and transparent information, which can assist them in making more informed assessments of the organisation’s prospects (including its viability/ sustainability) and value creation ability into the future.
The information in this Outlook is essential when reporting to stakeholders as it completes the value creation story of the Fund as told in our report, which will also continue to evolve over coming years.
The information below covers the Fund’s strategic path ahead – the Leadership's view of the material uncertainties, disruptive factors, challenges that may affect the achievement of the strategic objectives and the potential implications, as well as the opportunities that have been identified. We present the information under each of the six capitals.
The information in this Outlook is essential when reporting to stakeholders as it completes the value creation story of the Fund as told in our report, which will also continue to evolve over coming years.
The information below covers the Fund’s strategic path ahead – the Leadership's view of the material uncertainties, disruptive factors, challenges that may affect the achievement of the strategic objectives and the potential implications, as well as the opportunities that have been identified. We present the information under each of the six capitals.
Increasing
Reducing
Stable
LEGEND: OUTLOOK FOR THE YEAR AHEAD
Financial Capital
Strategic Priorities
Increase contributions
Increase income earned
Improve cost efficiency
Challenges, uncertainties, and disruptive factors
Key challenge:
The Fund has reached maturity and requires new sources of growth going into the next strategy cycle. The period was also characterised by our equity portfolio suffering from increased market volatility.
KPI:
Minimum return of 10-year inflation +2%
Committee oversight
Investments and Project Monitoring Committee (IPMC)
Mitigating factors/opportunities
Measures undertaken to address the challenge:
The Fund continues to explore opportunities in alternative investments such as major oil and gas sectors, and investment in the major infrastructure projects within Uganda. This will provide the opportunity to diversify our investment portfolio and curtail some of the investment risks in our current exposure.
Trend during the reporting period:
Our annual collections during the year (UGX 1.72Tn) were 6.2% above target. The reason for the above-target collections is due to an increase in employer compliance levels.The positive outcomes can be attributed to the advantages derived from partnerships and ongoing compliance campaigns. These campaigns are aimed at educating and informing employers about their obligations and providing them with the necessary support and guidance to meet those obligations.
The Fund’s actual growth was UGX 0.56Tn below target as at the end of June 2023 mainly because of the high benefits pay out (UGX 1.199Bn) and unrealised foreign exchange losses (UGX 1.151Bn) mainly due to the appreciation of Ugandan shilling against the Kenyan shilling. However, the members fund, at UGX 18.15Tn, is adequately covered by the Asset and the Fund is solvent.
Outlook:
In the forthcoming year, the Fund's asset allocation strategy will be meticulously designed to provide steadfastness in the returns yielded for our members. We shall continue to evaluate our strategic asset allocation, with a specific emphasis on integrating additional "alternative assets" into our portfolio. This strategic approach aims to mitigate risks and amplify returns for our investors. Our paramount objective is to guarantee the delivery of an interest on member savings that surpasses long-term inflation rates by a margin of at least 2%.
Manufactured Capital
Strategic Priorities
Improve data quality
Improve governance, compliance, and risk management
Implement hyper-automation of all core business processes
Challenges, uncertainties, and disruptive factors
Key challenge:
Delays in payment of member benefits.
KPI:
Our strategic target is to pay member benefits in 1 day. Over the coming 12 months we plan to move this to under 7 days.
Committee oversight
Finance Committee
Mitigating factors/opportunities
Measures undertaken to address the challenge:
The Fund onboarded OctoPAS, a next generation Pension Administration System. Its implementation has been advancing consistently and we are on track for the final migration and Go-Live.
Trend during the reporting period:
During the financial year, the Fund's primary focus was to enhance capacity within the IT Project Team. Efforts were made to identify additional opportunities to customise OctoPAS, thereby expanding the range of products and services offered in the short and medium term.
The benefits payout turnaround times remained largely unchanged at 11.9 days, only a slight improvement from 12.3 days in the previous financial year, primarily due to system limitations. Substantial resources and dedication are now being directed towards business process re-engineering and system customisation to expand and enrich the range of products and services available to our clients. There is confidence that eventually, the system will enable us to increase the number of beneficiaries claiming while reducing the TAT to 1 day and resolve process challenges, especially at the verification stage, as well as cashflow issues during the peak period when interest is declared.
Outlook:
In the upcoming year, our primary focus will revolve around re-engineering and optimising the benefits process to align with our strategic goal of processing benefits within a single day. Key initiatives entail streamlining and improving customer experience by integrating benefits applications, contributions, registration, and member updates through external channels for enhanced convenience. We aim to develop specialised group channels for specific client segments, utilising real-time feedback to facilitate rapid customer communication and employing automation to refine back-office processes related to contributions and contract management.
Human Capital
Strategic Priorities
Fully operationalise the new organisation structure
Enhance talent management
Promote Diversity, Equity, and Inclusion
Challenges, uncertainties, and disruptive factors
Key challenge:
Maintaining an agile, portable, and engaged workforce given the new operating environment. Effectively implementing the new Fund structure while minimising any negative impact on our operations.
KPI:
Staff satisfaction rating of 95%
Committee oversight
Staff Administration and Corporate Affairs Committee (SACA)
Mitigating factors/opportunities
Measures undertaken to address the challenge:
During the year, to meet the needs of its members and enhance the customer experience, the Fund continued to realign its operating model. This process included the creation of new roles and the dissolution of positions that were no longer relevant. The Fund also implemented several staff re-skilling programmes to equip staff with the required skills to succeed in the new operating environment.
Trend during the reporting period:
Staff members remain at the core of ensuring a robust and enduring Fund. Throughout the year, the Fund attained a staff engagement score of 83%. It maintains a hybrid work approach, enabling employees to choose between remote work and office presence, thus contributing to its continued strength and adaptability.
During the financial year, the Fund undertook a comprehensive evaluation and reorganisation of its business procedures and personnel framework. The objective was to nurture a workforce that is agile and well-equipped to accommodate evolving business demands. In addition, the Fund introduced two transformative initiatives: the Pathfinder Mentoring Programme, aimed at cultivating ongoing professional growth for all employees through collective knowledge; and the Pathfinder Catalyst Academy, designed to empower female staff by providing skills and confidence to advance their careers and contribute to gender equality.
Outlook:
Our key focus is on elevating staff innovation and productivity, which will be achieved by implementing agile methodologies to create a flexible and dynamic work environment. Additionally, we plan to introduce motivational initiatives aimed at continuously engaging and empowering our staff for optimal performance. Over the course of the coming year, the Fund will continue to enhance its Mentorship Programmes to drive the agenda of diversity, equity, and inclusion.
Intellectual Capital
Strategic Priorities
Enhance brand image
Support business growth
Enhance product development
Challenges, uncertainties, and disruptive factors
Key challenge:
The reputation of the Fund suffered considerable damage due to adverse media coverage stemming from investigations by the Parliamentary probe, Auditor General, and Inspector General of Government (IGG).
KPI:
Customer satisfaction rating 95%
Committee oversight
Finance Committee
Mitigating factors/opportunities
Measures undertaken to address the challenge:
The Fund took steps to address the concerns highlighted by Parliament and the IGG. We not only devised a transparent stakeholder engagement strategy but also took concrete measures to address the identified issues. In addition, the findings from the investigations are being smoothly integrated into the Fund's policies and procedures, ensuring a forward-looking approach that aims to prevent the recurrence of similar issues in the future.
Trend during the reporting period:
The overall Customer Satisfaction Index (CSI) score has experienced a notable improvement, reaching 85% (FY2022: 82%). This can be largely attributed to the heightened satisfaction levels among users regarding the Fund's products, as observed in the broader CSI evaluation. However, there has been a minor decline in the Brand's image compared to the preceding year. This shift in perception is particularly evident in the brand equity index, which decreased to 71% from 74% in the previous year. This reduction in brand equity stems from a decrease in brand engagement and members' sentiments.
Outlook:
Over the coming year, the Fund is looking to thoroughly execute the recommendations from investigations, ensuring that they are fully embraced and implemented by all relevant stakeholders and responsible parties.
Social and Relationship Capital
Strategic Priorities
Enhance strategic partnering
Improve customer engagement and satisfaction
Challenges, uncertainties, and disruptive factors
Key challenge:
The Fund faces a significant challenge due to its limited product range, which currently does not adequately address the short-term and medium-term needs of its members.
KPI:
Customer satisfaction index of 95%
Committee oversight
Finance Committee
Mitigating factors/opportunities
Measures undertaken to address the challenge:
After the NSSF Act was amended and officially enacted, the Fund received a new mandate to encompass all categories of workers. The revised law also empowered the Fund to extend its services, offering a broader spectrum of benefits and addressing a wider array of risks encountered by its members. Currently, the Fund is in the concluding phases of securing approval for additional products, particularly within the voluntary sector.
Trend during the reporting period:
During the year, we were able to develop a target savings product known as Smart Life which includes key features such as registration/enrolment, contributions through multiple channels (mobile money, banks, and Visa payments), interest calculation, payment of benefits, and financial reporting through ERP. The final deployment and Go-Live of Smart Life will occur after obtaining the necessary regulatory approvals and gazetting of associated regulations.
Outlook:
Members have consistently requested the Fund to provide a wider and deeper range of benefits. The Fund will roll out several products in the short and medium term, which will address the current challenge of a limited product range. We believe that with improved staff capabilities and efficient processes the Fund will meet customer expectations.
Natural Capital
Strategic Priorities
Reduction in paper consumption
Improving energy and water management
Challenges, uncertainties, and disruptive factors
Key challenge:
Combating climate change; taking a sustainable approach to waste management; and minimising usage of water resources and energy.
KPI:
Annual saving of 15% on water and energy bills
Committee oversight
Staff Administration and Corporate Affairs Committee (SACA)
Mitigating factors/opportunities
Measures undertaken to address the challenge:
In pursuit of operational efficiency and energy management, the Fund implemented several strategies. We prioritised preventing energy wastage and complying with energy regulations. Electricity powers our buildings through a UMEME distribution feeder and backup diesel generator. Our energy-efficient initiatives included maximizing daylight, promoting LED lighting, installing smart lighting controls, using occupancy sensors, and optimising elevator use. These efforts demonstrated our commitment to energy efficiency and regulatory adherence, reinforcing positive changes in our facilities.
In addition, the Fund managed water and waste in alignment with regulations outlined in Section 4.2 of Global Environmental Health and Safety (GEHS) guidelines, focusing on water monitoring and management. To conserve water, the following actions were taken during the year water reservoir installation, push tap installation, shutdown of water in unused areas, and closed-circuit cooling systems.
Total savings:
Outlook:
In the upcoming year, the Fund will collaborate with Ecoplastile Limited through its Hi-Innovator programme to further contribute to reducing the global carbon footprint. This initiative involves recycling plastic and glass waste into quality blocks and tiles, aiming to decrease pollution and promote a green economy in the long term. We aim to explore the possibility of harvesting rainwater in FY 2023/2024 to achieve more savings on water usage.
Given our outlook, robustness of our risk management, governance, engagement and partnering with our stakeholders, refinement of our processes to achieve exceptional turnaround times, and implementation of the PAS etc, the Fund is strongly positioned to deliver value across the capitals in the short, medium and longer term.