LEADING TRANSFORMATION WITH THE FUTURE IN MIND
TRANSFORMATION REPORT 2012 CONTENTS
2 FOREWORD 4 INTRODUCTION 6 Anglo American’s presence in South Africa
01 Safeguarding people and environments with the future in mind 12 mAINTAININg the highest standards of safety, health and environmental stewardship
02 Investing in our people with the future in mind 24 ACHIEVING EQUITABLE REPRESENTATION IN OUR WORKFORCE 32 Investing in our skills base 40 Improving our employees’ housing and living conditions
03 Supporting communities with the future in mind 46 Collaborating to develop mine COMMUNITIES
04 Developing partnerships with the future in mind 54 Diversifying ownership to promote a more equitable society 58 pROmoting socio-economic development through local PROCUREMENT 64 Championing entrepreneurship through leading enterprise development initiatives 68 Facilitating beneficiation
72 Acronyms Living our values To achieve our ambition of becoming the leading global mining company, we have identified six values that guide how we behave and interact with others. Our approach to living these values is reflected throughout this report:
Safety This is always first on our agenda. We truly believe that all injuries are preventable and that by working together we can make safety a way of life, inside and outside the workplace.
Care and respect We always treat people with respect, dignity and common courtesy – regardless of their background, lifestyle or position.
Integrity This means taking an honest, fair, ethical and transparent approach in everything we do. It is not about being popular; it is about always doing the right thing.
Accountability We take ownership of our decisions, our actions and our results. We deliver on our promises and acknowledge our mistakes. Above all, we never pass blame.
Collaboration We are one company with a joint ambition – all working together to make decisions and get things done more effectively.
Innovation Challenging the way things have always been done is a key priority for us. We do this by actively developing new solutions, encouraging new ways of thinking and finding new ways of working.
Acknowledgement To all our colleagues who contributed to making this report possible, thank you.
Transformation Report 2012 | 1 No more “business as usual” The past year has highlighted the complexity of the socio-economic challenges still facing South Africa. Our platinum and iron ore businesses were hit hard by strike action and general unrest that took place during the second half of 2012. The tragic events in Marikana put the spotlight on the mining industry, and brought to the fore the challenges our industry still has to confront. These and other events of 2012 have shown us that we can no longer be in a “business as usual” mode of operation. Transformation is at the heart of this need for change. Despite all the good work we have done, the extent of which is evident in our Social and Labour Plans and Department of Mineral Resources reporting, something is clearly still missing. Our approach and solutions need to go beyond the normal business thinking. Achieving meaningful transformation with the future in mind As a business we know that we cannot grow successfully in isolation of our broader community, and that our licence to operate is dependent on the visible and tangible contribution we make towards the development of communities we operate in, as well as the relationships we establish right from the start of the mining lifecycle. We are reaching out more to stakeholders and exploring new and better avenues through which to communicate and reinforce our commitment and partner with stakeholders in all areas of our business.
2 | Transformation Report 2012 FOREWORD Khanyisile Kweyama
Successful partnerships depend on sharing responsibilities and a commitment to develop and implement mutually supportive solutions. Being a good partner – a partner of choice – is how we will help to ensure that South Africa’s mineral wealth continues to support the country’s economic transformation imperatives.
The mining industry is central to South education from Kumba’s Ulysses Gogi creation, education, infrastructure (such as Africa’s economy, providing 9,2% of Modise wellness clinic in Kathu, a partnership roads and schools), and community health its GDP, directly employing more than with the Northern Cape DoH. and welfare. 500,000 people and indirectly supporting Delivering value to our people More significant than the value of these a further 840,000 jobs. An exciting empowerment initiative across investments, however, are the results that We continue to make encouraging progress all parts of our South African business is our we share in this report. These include the in advancing transformation and constantly employee share ownership plans (ESOPs). 100% pass rate of Grade 12 learners evaluate our achievements, as well as our participating in the Protec School Excellence Our aim with these schemes is not only to challenges and opportunities. We believe programme supported by Thermal Coal, give employees a sense of ownership in an important measure of the impact of as well as the many examples of small and the business, but also to empower them by our transformation programme is to ask micro businesses that have been established building their financial management skills whether the beneficiaries of these efforts are in communities around our operations. to encourage responsible and wise use of benefiting in a way that adds meaning and These are made possible by the financial the funds. real value to their lives. and business support of Anglo American’s While we are meeting most of our enterprise development arm, Zimele as we Delivering value through partnerships employment equity targets, an ongoing continue to see the benefits of collaborating At the heart of transformation lies a common challenge is to increase the number of with various stakeholders. vision for a better, more equitable and African women across the organisation, participative society. This can only become I believe this 2012 transformation report especially at more senior levels. We are provides evidence of an organisation that is a reality through the joint efforts of multiple reviewing how we attract and prepare African stakeholders. committed to making a positive, long-lasting women for management roles, and how contribution to the communities and other Successful partnerships depend on sharing we can enhance our current training and stakeholder groups with which it interacts. responsibilities and a commitment to develop development initiatives to better support Importantly it also identifies areas of potential and implement mutually supportive solutions. their entry into higher levels of the business. We are, however, encouraged by strides we improvement and opportunities to increase They connect strategy with practice, and continue to make in improving the numbers the pace of change under some of the key people with ideas. Being a good partner – of women in technical roles. Our numbers are pillars of the Mining Charter. It is on these a partner of choice – is how we will help to up by 25,8% from 2011. areas that we must focus our attention if we ensure that South Africa’s mineral wealth are to take our transformation efforts and continues to support the country’s economic This year we increased our investment in performance to the next level. transformation imperatives. training and development of our employees, with an aggregate 6,3% of HDSA payroll As you read this report you will come across spent in 2012. We are focusing on ensuring examples of partnerships that are making that those skills developed are being used to a difference in the lives of hundreds of best effect within our business. Khanyisile Kweyama thousands of people. For instance, 1,9 million Executive director Delivering value to our communities people will have access to clean water Anglo American in South Africa Our approach to community development thanks to our Platinum business’s partnership is reflected throughout this report. In all with government on the Lebolelo Water our efforts we seek to ensure that our Scheme and Flag-Boshielo and De Hoop investments are used as intended, that they dams in Limpopo. The development of a benefit the maximum number of people, R26 million community health centre – a and that the stakeholders involved have partnership between Thermal Coal’s New the capacity to manage and maintain those Denmark colliery, the Lekwa Municipality investments in the long term. and the Mpumalanga Department of Health (DoH) – will significantly improve the quality In 2012, our operations across the country of healthcare for around 2,400 households. invested a total of R694 million in socio- A further example is the 35,000 community economic projects, primarily community members who have received HIV/Aids development initiatives to support job
Transformation Report 2012 | 3 Anglo American’s approach to promoting social and economic transformation in South Africa is founded on a fundamental understanding of the business imperative for transformation. Our approach is informed by the needs and expectation of all those affected by our business – our employees and their families, local communities we serve, government and trade unions. Transformation is a challenging process. It can require people to change what they are familiar with: their work environments, the way they do things, their attitudes and behaviours. As we look back on our journey so far, we acknowledge that it has not always been an easy path. We have had to deal with unexpected obstacles and sometimes redirect our course to more effectively address our mandate. Yet we have remained true to our destination, that of a transformed society. This year’s transformation report tells the story of a business that is making a real and positive difference in the lives it touches. The statistics provide evidence of our progress against the targets we have to reach, while the narrative reflects the positive impact of our initiatives. Within the context of transformation, “impact” can be explained in terms of the difference between providing a community with a school building, or working with the community to build a school where learning and teaching take place. The former we can do by ourselves as a company. The latter requires meaningful consultation with all associated stakeholders – from government and municipal authorities to educators, students and their parents – to ensure that jointly we deliver a facility that has sufficient capacity, is properly resourced, efficiently managed and well maintained long into the future.
4 | Transformation Report 2012 INTRODUCTION Lindiwe Zikhali
For as long as these challenges persist, we recognise that we need to apply our collective thinking to innovative and sustainable solutions.
We need to constantly interrogate whether what we are doing is in the best interests of the people affected, taking cognisance of their diverse social circumstances, needs and aspirations.
There are many examples in this report that genuinely believe that people – employees, underline the importance of collaboration. communities and stakeholders alike – make The introduction of a peer review process our business what it is and who support and on mine community development initiatives, guide our efforts. based on our internationally acclaimed Socio-economic Assessment Toolbox As we continue on our transformation journey, (SEAT), illustrates our proactive approach we learn from experiences along the way to assessing and enhancing our impact on and explore new avenues and new futures, local communities. Working with partners seeking opportunities to share the journey who share our vision, we will be able to pool with others. Working together, with a common resources, knowledge and skills to develop purpose and a shared commitment, I have no solutions and increase the value we add to doubt that we will reach our destination – that people’s lives and livelihoods. of a transformed society. The South Africa mining sector has come a long way in transforming itself over the last decade. Nevertheless, there remain some Lindiwe Zikhali underlying systemic challenges, many of Head of transformation and regulatory affairs which have been the root cause of labour Anglo American in South Africa disruptions, violence and the tragic loss of lives in recent months. These are issues that we must tackle as an industry, together with our stakeholders and the country as a whole. For as long as the challenges we confront persist, we recognise that we need to apply our collective thinking to find innovative and sustainable solutions. We need to constantly interrogate whether what we are doing is in the best interests of the people affected, taking cognisance of their diverse social circumstances, needs and aspirations. We aim to build on the solid foundation that we have laid through our transformation programme. We are fortunate to have a Group CEO and a leadership team who
Transformation Report 2012 | 5 report, which focus on what we are doing to safeguard our people and environments, Anglo American’s how we invest in our people and create equal opportunities, our commitment to developing invest extensively in promoting the socio- mine communities, and how we collaborate economic development in the workplace and presence in with partners as a collective to encourage the communities in which we operate. transformation and competitiveness. Our transformation journey is underpinned by This report covers our business units that our values and business principles. As a good South Africa operate in South Africa, namely Kumba Iron corporate citizen, we respect the dignity and Ore (Kumba), Anglo American Platinum Welcome to Anglo American in South Africa’s human rights of individuals and communities (Platinum) and Thermal Coal. De Beers, second annual transformation report. This everywhere we operate and endeavour to which had been an associate company, but report provides a review of the progress that make a lasting contribution to their well- became part of the Anglo American Group our South African businesses have made being. In partnership with our stakeholders, in August 2012, is partially reported on. during the 2012 calendar year towards we strive to move beyond compliance and De Beers will be fully integrated during 2013 achieving meaningful transformation. meet ambitious internal targets. and comprehensively reported on in next We employ over 97,000 people in South Our performance is measured primarily year’s report. The report also includes Anglo Africa, of which approximately 70,000 are against the key pillars of the Mining Charter, American’s Corporate Division (ACD) and full-time employees and 27,000 contractors. namely: sustainable development and Anglo American’s EMEA Shared Services in As one of the largest private sector employers growth, employment equity, human resource South Africa (AAESS). in the country, Anglo American is a proud development, housing and living conditions, The report is aimed at stakeholders who have leader in contributing to the transformation mine community development, ownership, an interest in our transformation journey, of the mining industry and the country procurement and enterprise development, including employees, local communities, as a whole. Beyond our direct economic beneficiation, and reporting. These issues non-governmental organisations (NGOs), contribution, outlined in the table below, we are covered in the four sections of the investors, suppliers and government. Anglo American’s contribution to South Africa
PERIOD 2011 2012 PRESENCE in South Africa % operating assets in South Africa 37 35 % revenue in South Africa 49 45 % operating profit in South Africa 55 54 Commitment to the South African people Number of people employed in South Africa 100,240 97,298 Full-time employees: 76,000 Full-time employees: 70,468 Contractors: 24,240 Contractors: 26,830 Number of business unit CEOs based in South Africa 4 4 Number of business units managed from South Africa 3 4 Investor in South Africa Amount invested in capex in South Africa since 1999 R173,4 billion R188,30 Contributor to South African fiscus Amount paid in direct and indirect taxes R18,1 billion R14,4 billion Contributor to South African foreign earnings Anglo American’s foreign shareholding (resultant capital inflow) 17% in 1999 to 57% R9,6 billion (R31,8 billion) Export revenues generated R102,5 billion R94,2 billion Contributor on the JSE (together with controlled companies) Market capitalisation on the JSE R761,1 billion R664,6 billion % of the value of all JSE companies 10,40 8 % South African shareholders of Anglo American 43 46 Key partner with South Africa’s state-owned enterprises Amount spent with Eskom R3,4 billion R3,5 billion Tonnes, cost of thermal coal delivered to Eskom 35 million tonnes, R5,2 billion 33,7 million tonnes, R5,8 billion Amount spent with Transnet R4,6 billion R6,7 billion
6 | Transformation Report 2012 ANGLO AMERICAN’S PRESENCE IN SOUTH AFRICA
Strategic assets in South Africa % owned
2011
79% 65% 100% 45% 40% 9,7%
Anglo American Kumba Thermal Coal De Beers Samancor Exxaro Platinum Iron Ore Manganese 2012
79,9% 69,7% 100% 62,9% 40% 9,7%
Anglo American Kumba Thermal Coal De Beers Samancor Exxaro Platinum Iron Ore Manganese
Key industrial companies Anglo American has divested from
SCAW Highveld Columbus Company name AECI LTA Metals Mondi Steel Stainless Hulamin
Date of acquisition 1924 1951 1964 1967 1969 1989 1996
Date of divestiture 2001 2000 2012 2012 2007 2005 2009
Transformation Report 2012 | 7 PLATINUM WESTERN LIMb EASTERN LIMb 1. Dishaba 13. Mogalakwena 2. Tumela 14. Bokoni 3. Union 15. Ga-Phasha (JV) 4. Bafokeng/Rasimone (JV) 16. Twickenham mine 5. Khuseleka 17. Modikwa 6. Thembelani 18. Mototolo (JV) 7. Bathopele 8. Khomanani 9. Siphumelele 10. Kroondal 11. Marikana 12. Pandora
THERMAL cOAL 1. Greenside 2. Goedehoop 3. Kleinkopje 1 2 4. Landau 5. Kriel 3 6. New Denmark 4 5 7. New Vaal 7 6 8. Mafube 8 9 11 9. Isibonelo 10 12 10. Zibulo
KUMbA IRON ORE 1. Sishen 2. Thabazimbi 3. Kolomela
DIAMONDS 1. Venetia 2. Kimberley 3. Voorspoed
8 | Transformation Report 2012 ANGLO AMERIcAN’S PRESENcE IN SOUTH AFRIcA
OPERATING FOOTPRINT IN SOUTH AFRIcA In 2012, Anglo American had over 30 operations and shared access to three ports in South Africa
1
Limpopo 13 2 14 15
16 Mpumalanga 17
1 North West 3 10 7 4 2 1 18 8 5 9 6 3
3
KwaZulu-Natal 2 Free State NorthernMAP capeTO cOME Richards Bay KwaZulu-Natal
Saldanha Bay Eastern cape Western Cape
Western cape
Port Elizabeth Eastern Cape
Transformation Report 2012 | 9 10 | Transformation Report 2012 01 01 Isibonelo is a large scale, complex 02 Boipuso Semenya taking a pH reading opencast mine operating some of the at a groundwater abstraction borehole world’s largest earthmoving equipment. near RBMR (Rustenburg Base Metals Everyone at the mine treats safety Refiners) in Rustenburg. as their first priority. Foreman Paul Mashinini, leading a team safety briefing on a working day at the mine.
02
01 Safeguarding people and environments WITH THE FUTURE IN MIND
Transformation Report 2012 | 11 Our capacity to have a transformative visited each operation along with key Maintaining impact in building socio-economic value is representatives from labour unions and the dependent on us maintaining a sustainable, Department of Mineral Resources (DMR) to the highest healthy business. Operating safely, reaffirm the commitment of all stakeholders sustainably and responsibly is fundamental to to the goal of zero harm. standards our licence to operate, and to protecting and enhancing the sustainability of the business. Our most significant safety risks relate to transportation, moving machinery and falls of of safety, Offering a safe and healthy workplace is a ground, and we have dedicated programmes core Anglo American value – we should not in place to address these. The behavioural health and accept any harm coming to those who work and engineering controls put in place in the for us. Mining is a high-risk industry and past five years have led to an 80% reduction our on-site employees work in challenging in fatal incidents resulting from falls of environmental conditions. Although our safety performance ground. However, we are constantly working has greatly improved in recent years, we to improve this by embedding a robust and stewardship recognise that there is still a lot of work systematic approach to risk management. to do to deliver on our vision of zero harm. Workplace safety, occupational health, In 2012, the Group’s lost-time injury and employee wellness (including the frequency rate (LTIFR) declined to 0,8, which management of diseases such as HIV/Aids represented an 8% improvement on and tuberculosis (TB) in our workforce 2011 and a 43% reduction since 2008. and communities) are investments in the Anglo American’s LTIFR definition includes future health of our people and therefore all injuries that result in lost-time or restricted our business. duties from the calendar day after the injury occurred. Platinum recorded the most Being a responsible miner also means significant improvement since 2008, reducing taking a serious approach to environmental from 1,74 to 1,15 (more than 30%), closely stewardship. It is our responsibility to followed by Kumba, with an encouraging 17% minimise and mitigate potential environmental improvement over the five-year period and risks that could affect our business or a 25% improvement since 2011. Materials stakeholders. In particular, water scarcity handling is still a major risk, and we are and climate change are two of the greatest applying additional engineering controls to concerns to our business. Our partnership address this challenge. approach enables our host communities and local authorities, together with NGOs, While Thermal Coal’s performance remained business and other stakeholders, to benefit stable between 2011 and 2012, the long- from our activities. term trend remains positive. The business unit has launched a re-energised safety In this chapter we review our safety, health improvement plan, based on inputs from and environmental performance and the management, employees and safety management systems and procedures we professionals across the business. have in place aimed at ensuring we continue to improve our performance. De Beers Consolidated mines (DBCM), recorded a total of 11 lost-time injuries (LTIs) Striving for zero harm in 2012, with a corresponding LTIFR of 0,22*. Our safety performance With deep regret we report that eight A number of individual operations continue to employees and three contractors lost their lead the way with excellent results. lives while working at our South African • The Kolomela project achieved a record operations in 2012. While this represents 29 million LTIs and fatality-free hours a 21% year-on-year reduction, any loss of between March 2010 and October 2012. life is unacceptable. Seven of these deaths • Three out of nine Thermal Coal collieries occurred at our Platinum business, where the recorded more than 200 days without Employees and majority of fatal incidents still occur, despite LTIs, and seven out of all 10 mines a significant 42% reduction in fatalities since achieved more than 1,000 fatality-free contractors tested 2011 and a 61% reduction over the past production shifts. five years. and counselled in The encouraging decline in injury frequency Two fatal incidents took place at Kumba and rates shows that our focus on leadership southern Africa two at Thermal Coal. At Thermal Coal, both and an increasingly robust application of incidents occurred in close succession at standards are having a positive impact. the start of the year, prompting management Since 2007 this has included a reinvigorated › 93,000 to halt production for a day. A senior team commitment to zero harm as an achievable
* (De Beers’ safety figures are not included in the Anglo American totals. Full integration of De Beers’ performance reporting will only begin in 2013.)
12 | 2012 01 Safeguarding people and environments
Anglo American’s safety strategy is founded on three key principles: a mindset of zero harm; the elimination of repeat incidents; and the consistent application of simple, non-negotiable standards.
objective; the Group CEO’s ‘Call to Action’; developed communication material to guide of contractor safety inductions across the the introduction of our ‘safety journey our LFI processes, supported by training Group, and audits of contracting companies model’ and safety improvement plans for the sessions. Encouragingly, we are seeing an against our safety requirements (with businesses; and Group-level programmes increase in the use of LFI, particularly in associated improvement plans where there to address key risks such as falls of ground, the investigation and reporting of incidents, are gaps). transportation and fatigue. and in the development and maintenance of better controls. Certain products and services have specific Our strategy and management approach risks attached to them. In these cases Anglo American’s safety strategy is founded Risk and change management: During we have a particularly strong safety focus on three key principles: a mindset of zero 2011, our internal risk and assurance team embedded in our supplier relationship harm; the elimination of repeat incidents; led 46 independent site safety reviews management process. We collaborate and the consistent application of simple, across the Group to assess compliance with with suppliers to develop and introduce non-negotiable standards. fundamental aspects of safety management. safer products, for example, researching The outcomes were reported at board responsible mechanisation processes such We use the Anglo American safety journey and executive levels, and shared with as autonomous trucking and collision- model – which recognises the importance operations. Every operation has committed avoidance technology. of both people and systems in a mining to an action plan to address gaps. Progress Managing health effectively business – to measure our progress in will be reviewed regularly and is included delivering against our safety strategy. This in each business unit CEO’s performance Managing health effectively is about model and its supporting matrix help every targets. From 2013, this will also influence managing the most important contributor to operation to understand where they are the performance-based remuneration of all our business: our people. How we operate on the journey and how they can move to executives and managers. today is critical to ensure we have a healthy the next stage. We believe we are at the and productive workforce – and, in turn, a ‘compliant’ stage, with a growing number of Leadership: Group Safety Leadership healthy business – for decades to come. operations moving to ‘proactive’ and fewer Summits in 2011 and 2012 emphasised the We are committed to achieving zero harm by now being characterised as ‘reactive’. role of leaders and their accountability in creating and instilling a company and industry making safety part safe of all our decisions culture that protects people from harm and Our current suite of Group safety and actions. As part of the ongoing drive improves their health and well-being. Beyond programmes aims to improve our level towards visible felt leadership (VFL), the workplace, we aim to facilitate tangible of maturity, by focusing on the following: managers and directors regularly visit health improvements in local communities. operational risk management; learning operations and play a visible role in daily Our strategy and management approach from incidents (LFI); risk and change activities. Our leaders also strive to foster management; leadership; developing people; a culture where employees at all levels The crux of our occupational health strategy, leading indicators; corporate safety work feel empowered to engage freely on and our entire focus on occupational health streams; supply chain safety initiatives; safety matters. management, is around prevention. We strive integrating safety throughout the business; to proactively identify and manage the source and the 2012 Safety Leadership Summit. Leading indicators: By using global safety of potential health risks, and to eliminate All operations have safety improvement ‘leading’ performance indicators, which are exposure to hazards that can cause disease. plans that prioritise these elements based on now routinely reported to the board and the Our approach is governed through a series operational risk and help us to move further executive committee, we are becoming more of standards, guidelines and assurance along the journey model. The operational proactive in anticipating and pre-empting processes relating to two disciplines: risk management and LFI programmes in potential incidents. occupational hygiene and occupational particular have the potential to profoundly medicine. The former focuses on identifying impact on our long-term safety performance. Working in partnership: Since 2008, our occupational exposure (to hazards), profiling Tripartite Health and Safety Initiative has the associated risks, and controlling exposure Integrated risk management: An integrated developed into a highly rewarding and in the workplace environment. The latter approach to operational risk management is productive partnership with government and involves monitoring the health of employees. vital to improving both safety and operational labour. A core steering committee, supported Our principal occupational health risks relate performance. The Anglo American by task teams, works on developing solutions to noise, inhalable hazards (mainly dust) operational risk management process that are helping to transform our own and fatigue. (ORMP), which ensures we take a common safety performance, and more broadly in approach to operational risk management the South African mining sector. Through Building on these initiatives is our employee and the development of associated skills, this collaboration, government and union health and wellness programme, which is being incorporated into our Group representatives are invited to participate includes a strong emphasis on combating integrated risk management standard. in Anglo American safety training courses, HIV/Aids and TB within our workforce and We are building capacity at both business visit operations and interact with employees their families. We also believe that we must unit and operational levels by training risk to better understand health and safety help strengthen healthcare systems in under- management facilitators as part of our risk- challenges. serviced rural areas and build partnerships to management workstream. improve access to quality healthcare. Our suppliers also have an important role Learning from incidents: One of our key to play in helping us improve our safety safety principles is ‘no repeats’. It is only by performance. In 2012, 29 safety initiatives understanding what happened and why, and with suppliers were shared across our Supply by identifying and taking preventative action, Chain function. Some of these involved that we are able to avert similar incidents. the inclusion of minimum safety criteria in During 2012, we strengthened the way we tender adjudication processes, against which investigate and report incidents. We have also performance is tracked, the standardisation
Transformation Report 2012 | 13 Occupational health Health incident reporting Nevertheless, we recorded 62 new cases of Our approach to occupational health Health incidents are performance indicators noise-induced hearing loss (NIHL) in 2012 is governed by the Anglo American that allow us to monitor critical controls. (compared with 80 in 2011). The majority Occupational Health Way. This is underpinned They include employee complaints about of other new cases of occupational disease by three principles: all occupational illnesses the working environment; observed (or were from exposure to inhaled hazards, are preventable; we learn by assessing and measured) failures of control mechanisms; resulting in 16 cases of coal worker monitoring exposure and disease incidence in and signs of exposure and disease identified pneumoconiosis and seven cases of chronic order to prevent further harm; and we apply in the medical surveillance programme. obstructive airways disease. common, simple, non-negotiable standards The early detection, investigation and No new cases of silicosis have been reported throughout the Group. correction of control failures help us to at Platinum, Thermal Coal or Kumba for more prevent harm, as these occur well before Simple, non-negotiable standards than five years. any visible manifestations of occupational During the year, we educated managers illness. We continue to see encouraging Employee wellness on our noise and dust standards and the improvements in health incident reporting Employee health and well-being extends associated risk management programmes. across all BUs. beyond occupational health. Through These standards, published in 2011 as our wellness programmes we encourage part of the Group technical standards, Engagement and collaboration healthy lifestyle choices, such as proper are being rolled out to the business units The Tripartite Health and Safety Initiative nutrition regular exercise and activities to for implementation. Business units have ensures that risk management practices are reduce stress. We also facilitate access to completed self-assessments, with average adopted at all levels of the workforce. One appropriate healthcare facilities. In many compliance levels ranging between 60% and such practice is the stop, look, assess and of our operations and corporate offices 85% by the end of 2012. manage (SLAM) approach. we provide free health assessments for We are putting renewed emphasis on fatigue Anglo American’s inaugural Health Summit cholesterol, blood pressure, weight, smoking, management. On the health front, we are was held in October 2012, bringing together chronic diseases, HIV/Aids and TB. We also educating people on the importance of a hundred health and safety experts from provide an annual vaccination programme getting a good night’s sleep, eating correctly across the Group to share best practices for influenza. and reporting to work in a fit state. On the and lessons learned. We held a second Tackling TB and HIV safety side, we recognise the need to health conference in November to raise the Anglo American is a recognised leader in design jobs so they do not create fatigue, for standards of health and safety performance the field of HIV/Aids and TB workplace instance by ensuring sufficient breaks or by among our long-term contractors. Moreover, programmes, and has proven that investing adopting mechanical engineering measures we require that all long-term contractors in HIV prevention, treatment and care has a that will protect people if they are tired. provide a basic healthcare package for measurable and positive impact on business their employees. This will include diagnosis, performance. Treatment costs are just under In 2012, we also reinvigorated our approach counselling, care, support and treatment 5% of the cost of caring for someone with to fighting alcohol and substance abuse in for HIV infection and TB. Where necessary, AIDS, if HIV infection is left unmanaged. our workforce. Our focus is on prevention Anglo American will subsidise this healthcare and rehabilitation so that, as far as possible, package and deliver it through our network The continued high prevalence of HIV in problems are identified and dealt with of healthcare facilities. southern Africa contributes to a rising long before disciplinary measures become incidence of TB. A major step in 2012 was necessary. Improving our performance the signing of a declaration by the Southern All our businesses are required to report on Integrated risk management African Development Community (SADC) the estimated number of people potentially region heads of state and government to We have refreshed the risk management exposed to hazards that could result in tackle TB in the mining industry. We have an approach within the Occupational Health Way occupational illness. We measure this against active programme aimed at addressing the and Group technical standards for health, set occupational exposure limits. These are escalating epidemic, but need to dramatically to align with our new Group-wide approach legally prescribed limits, set per individual upscale our efforts to detect TB in the to integrated risk management. An example health risk, above which no employee can workforce and communities associated with of this is at Kumba’s Sishen mine, where, be exposed without the use of personal our operations. recognising that integrated risk management protective equipment (PPE). We count the is a business-critical issue, business number of employees working in conditions In 2012, the TB incidence rate at improvement teams are now responsible for that exceed those limits, even though they Anglo American’s South Africa operations fatigue management. are protected with PPE. We use this measure was 990 per 100,000 employees (compared Health information systems to identify opportunities to improve controls with 1,304 per 100,000 in the previous Capturing and managing each health and potentially eliminate the need for PPE. year). This rate is well below the national and industry average and is decreasing. Despite transaction online enables us to track and In line with the 2003 Mine Health and this, there were 676 new TB cases recorded analyse the health of all our employees. Safety Summit challenge to reduce exposure among our workforce and we deeply regret Building this capability within our business to noise, we have focused our efforts on the loss of 59 employees due to TB. People was a central activity in 2012 and will reducing equipment emitting noise levels enrolled in our HIV wellness programmes continue in 2013. Health information systems above 110dB(A). More than 98% of the are offered TB prevention therapy, which has ensure that we deliver a consistently high equipment identified at our Platinum reduced AIDS mortality by 50%. quality of service, and can measure our business, and 100% of that at Kumba performance. and Thermal Coal, have been reduced to acceptable levels over the past five years.
14 | 2012 01 Safeguarding people and environments
As a result, Thermal Coal is, to the best On a broader scale, once an entire The key to better of Anglo American’s knowledge, the only population is registered on such a platform, mining company in the world that can we could create an accurate benchmark healthcare provide accurate, real-time daily healthcare of the nation’s state of health. By building lies in knowing statistics, such as the HIV prevalence GPS technology into the data collection rate among employees, and how many process, we could also analyse disease the data convert from HIV negative to positive in patterns in each region, while monitoring a year. The current HIV statistics indicate basic health parameters such as body Increasingly, there is a move away a dramatic improvement on where the mass index (a good measure of nutrition in from a reactive healthcare response business was a few years ago, and this is a population), blood pressure, vaccination to a more sustainable approach – one a direct result of being able to proactively status, conditions such as diabetes and that involves strengthening developing manage the treatment and care of epilepsy, and similar. nations’ health systems in order to better employees based on the information that Nations need this depth and breadth serve their populations. In practice, this theHealthSource delivers. of health knowledge in order to fully means a country must have adequate What makes this technology so suited understand the burden of disease in health facilities, trained health workers, to third-world environments is that it a population. Once we have it, we can properly functioning drug procurement is mobile, easily available and cheap. manage the resources required to tackle it. and supply chain, and sound management, Data is stored in a secure, central online A sound, secure information platform such governance and monitoring. space and all that is needed to access it as theHealthSource creates exactly that Importantly, a robust information platform is the patient’s thumbprint, login details opportunity. is what holds all of these elements and an Internet connection. It can be run Many first world countries have together, and this is what many current using wireless connectivity and hand- sophisticated, but complicated information health systems lack. held battery-powered devices, which means that developing nations can easily systems that would be difficult, if not For the past six years a team at Anglo implement it in rural areas that have limited impossible, to implement in developing American’s Thermal Coal business, infrastructure. countries. The ease with which a single spearheaded by Dr Jan Pienaar, has been population-based information platform using an internally developed information For a country like South Africa, could be put in place, and the value it could system known as theHealthSource, which implementing this on a national scale deliver, is simply too big to be ignored. documents and tracks the healthcare would enable us to answer critical details of each employee. The system questions in the fight against HIV/Aids, uses fingerprint scanning to identify such as what proportion of the population patients and capture their information in is infected with HIV, how many people a single secure electronic health record. have started treatment and whether the treatment is effective.
01 Dr Jan Pienaar showing theHealthSource presentation in discussion with Thia Grobler and Julia Denton (Business Analysts) who developed the software for theHealthSource.
Transformation Report 2012 | 15 01 Taking surface water samples at Hex River in Rustenburg is Edward Masoba, senior environmental field technician.
Testing (through our wellness programmes) real-time healthcare statistics being captured and equipment; ensuring the availability is the entry point to our comprehensive through theHealthSource online system of a skilled health workforce; improving programme of HIV/Aids prevention, care, (see case study below) are proving to be very procurement and supply chain processes; support and treatment, and all employees helpful in managing the treatment and care sound financial management; information who test positive are invited to enrol. of employees. systems; good governance; and effective In 2012, we tested and counselled more monitoring and evaluation processes. Promoting healthcare in the broader than 93,000 employees and contractors in community southern Africa (up from 75,652 in 2011). In South Africa, we work with the provincial This equates to 82% of all employees in the Our comprehensive socio-economic health departments in Eastern Cape, region and is ensuring that we achieve early assessments in local communities include Mpumalanga, Northern Cape and North West diagnosis of HIV infection and timely access community health reviews. We also develop (all are either associated with our operations to care. social management plans in consultation or are labour-sending areas) in order to with key stakeholders, which factor in improve health services. In the Northern We documented 524 new HIV infections in health considerations. To support health in Cape, for example, Kumba financed nine 2012, but the prevalence of HIV infection developing countries more broadly, we remain mobile clinics to take critical health services in our workforce remains level with 2011 at one of the key private-sector supporters of to disadvantaged communities in the remote 17%, which means that almost 11,900 of our the Global Fund to Fight Aids, Tuberculosis John Taolo Gaetsewe district, which has employees are HIV-positive. In 2012, 70% and Malaria, and the Global Alliance for severely limited access to healthcare. of employees who are thought to be HIV- Vaccines and Immunisations (GAVI), a public/ Kumba will gradually hand this project to the positive enrolled in the programme, compared private partnership that is increasing access to DoH, thereby ensuring its long-term viability. with 60% in 2011. immunisation in the world’s poorest countries. Managing our impact on the environment At the end of 2012 we had more than We use the knowledge and experience While the extraction and processing of 5,000 employees on anti-retroviral therapy gained from our workplace health minerals and metals is fundamental to the (ART). A major challenge is ensuring people programmes to support community outreach global economy, its associated activities take the treatment correctly, which is why we programmes and strengthen community result in the unavoidable disturbance of emphasise support, counselling and diligent health systems. The latter is based on land, the consumption of resources, and the care at a primary care level. The accurate, seven building blocks: improving facilities generation of waste and pollutants. The way
16 | 2012 01 Safeguarding people and environments
Total greenhouse gas emissions for 8.31 million South African operations tonnes
we manage these issues is fundamental water for both production and processing, are prepared to delay project schedules until to the ability of our business to achieve its and our South African operations are located potential concerns or conflicts are resolved. strategic goals. In this section we review our in water-stressed basins where we expect We regularly engage with suppliers to see management approach and performance increasing competition for water resources, where they can help us deliver on water relating to water, climate change and energy, particularly in light of the potential effects of efficiency improvements. Platinum, for land stewardship and biodiversity, and waste climate change. management and air quality. instance, has a single supplier for all tailings The Anglo American water strategy and management, with which it has formed a In South Africa, the Mining Charter requires policy, approved in 2010 support our aim close relationship and realised significant that mining companies improve on industry- to demonstrate leadership within our water operational benefits. standard environmental management by: basin areas, while helping to position the Water use: The volume of water used in • implementing environmental management company as a leading water custodian within primary mining activities in our South African systems (EMS) that focus on continuous the communities and catchments in which operations in 2012 was 46 million m3 – improvement to review, prevent and we operate. a slight reduction on the previous year, mitigate adverse environmental impacts We are implementing this strategy through mainly as a result of production losses at • conducting continuous rehabilitation initiatives in three key areas, phased over Platinum during the period of industrial on land that is disturbed or occupied by 10 years: improving operational excellence, action. In addition to targeting overall water mining operations, in accordance with investing in technology, and partnering with reductions, we re-use and recycle as much appropriate regulatory commitments our stakeholders. water as possible, and in 2012, we met • providing for the safe storage and disposal 52% of our operational water requirements of residual waste and process residues Operational excellence: In terms of water in this way. Where possible, we also switch • designing and planning all operations so management, operational excellence is to lower water-quality grades to reduce our that adequate resources are available to largely about being smarter in how we use dependency on high-quality water. Currently, meet the closure requirements of these and manage water. In 2011, we implemented potable water accounts for only 17% of our operations. our water efficiency target tool (WETT), total water requirements. which forecasts the projected business-as- Environmental management usual water demand of individual operations Improving the quality of the water we use The Anglo American Environment Way and establishes a register of water-saving and recycle remains a priority, not only outlines our mandatory, Group-wide projects. These defined WETT targets are because poor-quality water is harmful to the environmental management system, and now included in our business unit CEOs’ environment, but also because it can also includes detailed performance standards performance contracts as well as in those be destructive to equipment and therefore for social and environmental impact of relevant operational personnel. detrimental to mining operations. assessments, water, air quality, mineral The volume and quality of water that residue, non-mineral waste, hazardous Operational water action plans have driven can be discharged by our operations are substances, biodiversity, rehabilitation, a positive shift in our approach to managing predetermined by regulatory processes. and mine closure. It supports our vision water at operations. We are looking beyond Any unplanned discharges or breaches for minimising harm through the design, the boundaries of our operations to become of legal requirements are reported as operation and eventual closing of operations even more engaged in our catchment areas. environmental incidents and addressed in an environmentally responsible manner. Engagement and partnerships: 2012 promptly. The Environment Way requires that all saw a more structured and purposeful We use a five-tiered scale to report the operations be certified to international approach to advocacy and stakeholder impact of an incident. Level 1 and 2 incidents environmental management standards within engagement. Through the Chamber of Mines are minor and, while remedial action is taken two years of commissioning or acquisition. we held discussions on important proposed developments such as the national water for every incident, they are not reported All our mines in South Africa have resources strategy, water pricing structures, externally. Relevant authorities are kept environmental management plans (EMPs) demand-side management targets for the informed about all incidents until they are that are approved by the Department of sector, and the development of a system resolved. During 2012, we confirmed seven Mineral Resources (DMR) and certified to to charge for waste contained in water level 3 environmental water incidents. These ISO 14001 environmental management discharges. These will have significant involved unplanned discharges and we took standards. In addition to legal compliance implications for our future performance and immediate remedial action to mitigate their audits, our mines conduct self-assessments in shaping industry developments. impact. None of the water bodies were and are subject to risk-based internal significantly affected by the incidents and environmental audits and peer reviews. When We also have long-standing partnerships various longer-term interventions are in activities are changed or added, the EMPs with international bodies, national industry progress to avoid repeat incidents. No level 4 are amended and resubmitted to the DMR associations, collaborative forums and NGOs, or 5 incidents occurred. for approval, along with annual performance such as the South Africa Water and Energy Anglo American’s exposure to acid rock assessments as required by the Mineral Forum and the Integrated Water Task Team drainage (ARD) in South Africa is limited and Petroleum Resources Development for South Africa (IWTTSA). to some of our Thermal Coal mines Act (MPRDA). At an operational level, we continue to in Mpumalanga, where the geology is Water engage with local communities to build trust predisposed to acidity. We have mitigated Security of water supply is a core business by effectively managing water expectations the risk of ARD impact by developing a water risk and a critical element of our social and and our impacts. We follow an ‘avoid, reclamation plant in eMalahleni and two legal licence to operate. Our operations minimise, mitigate’ management approach. mobile water treatment plants. The water require large volumes of the right quality of When necessary, we have shown that we reclamation plant, built in partnership with
Transformation Report 2012 | 17 BHP Billiton and the eMalahleni Municipal effective energy and carbon management. business-as-usual projections allows us to Council in 2007, currently treats around Climate change is now integrated into multi- account for variable operating conditions, 25-30 million litres (Mℓ) per day of acid disciplinary Group-wide risk management and acquisitions or disposals, although the mine water from four mines, which is then processes. absolute percentage reduction will remain supplied to surrounding communities, and constant up to the target date of 2015. can support up to 80,000 people. Around Our industry-leading energy and carbon management programme, ECO MAN, has Achieving our long-term milestones in 60%-70% of the treated water is pumped 2 to the municipality. enabled us to understand how energy energy management hinges on identifying management can be used to create additional and implementing innovative ‘step-change’ We are currently expanding the facility business value. It provides a structured technologies. We are researching many to double its capacity, with a planned approach to achieve our objectives and opportunities with stakeholders and we completion date of end-2013. In addition it helps our people to understand their have invested nearly R25 million to date to addressing ARD at its point of impact responsibilities and accountabilities. in low-carbon technologies around the by treating affected water, we also seek to world. Our technology vision is to run cost- prevent it from occurring in the first place, In 2012, we analysed our performance data efficient low-carbon (if not carbon-neutral) for example by designing our new mines to identify where energy is being used, mines by 2030. Our approach focuses on differently, rehabilitating opencast operations where opportunities exist to save it, and how three areas: reducing how much energy concurrently, and effectively rehabilitating to follow a standardised process to deliver we use; recovering and re-using some of waste facilities. savings. Each mine has a programme in place that energy; and using alternative energy to continually improve how it manages energy sources. In parallel, we continually investigate In terms of the National Water Act of 1998, usage, with targets to reduce consumption. opportunities for carbon offsetting. all our South African mines have approved Our approach to setting site targets against integrated water use licence agreements (IWULAs) in place, with the exception of Platinum’s Amandelbult mine. Amandelbult continues to engage with government and currently operates with a valid water permit under the old Water Act. Climate change and energy Climate change presents a significant global business challenge. The key risks we face are: increasing energy and compliance costs associated with new policy measures, including potentially significant costs from carbon pricing; changing demand for our products; and increased risks associated with the physical impacts of climate change on our operations and neighbouring communities. We recognise the need to take meaningful action towards addressing the causes of climate change, and to help protect our employees, assets, as well as the communities and environments linked to our operations, against its potential impacts. We are in the second year of our 10-year climate change strategy, which strives to yield the following business benefits: • reduced exposure to emerging carbon policies and increases in energy costs • improved ability to influence the development of effective government policy • increased access to opportunities in our markets • improved resilience to the physical impacts of regional climate change. Our implementation last year of a new Group- wide performance standard and guideline on how to manage energy and climate change, has resulted in a significant shift. For the 01 The sable and buffalo breeding project at Thermal Coal’s Waterberg Estate is delivering on its goal to promote biodiversity first time, across the business, we have a and conservation in South Africa’s Northern Limpopo region – ‘Bulklip’, a sandstone feature on the site which is of high detailed understanding of what is required for biodiversity value.
18 | 2012 01 Safeguarding people and environments
Engagement and partnerships: We continue We focus on two core components of land Our biodiversity partner NGO, Fauna & Flora to work with governments, our business management: rehabilitation (a key regulatory International (FFI), has also helped us peers and other stakeholders to help and financial risk for Anglo American), and to develop a consistent methodology for shape equitable and effective climate the conservation of biodiversity (the variety conducting high-level biodiversity risk change policies. We are especially active of plant and animal life that provides a assessments, which articulate the business in discussions around a carbon pricing range of vital benefits, collectively known case for biodiversity management. policy, and have welcomed the opportunity as ecosystem services). To help us maximise to participate in the debate and the the value of land holdings and minimise In 2012, our South African operations development of a solid fact base to influence impacts, we are developing new land had 205,898 hectares of land under an effective carbon policy that is aligned management and biodiversity strategies that our management control of which with the country’s development objectives. take an ecosystem services-based approach 44,346 hectares have been disturbed We also continually engage with the to risk management. by our mining, processing and mineral- government regarding the national utility’s waste disposal operations and supporting intended price increases, which will see Our Environment Way rehabilitation infrastructure. So far, 6,271 hectares of energy costs rise significantly over the next performance standard follows the “avoid, that have been rehabilitated. This compares few years. minimise and mitigate” approach, and with 246,913 hectares in 2011, of which advocates early and thorough rehabilitation 41,673 hectares were disturbed and Reducing our footprint: Our South African planning. The earlier we start, the better the 4,244 hectares rehabilitated. operations’ total greenhouse gas (GHG) result. Rehabilitation that takes place while emissions in 2012 were 8,31 million tonnes the mine is operational reduces operational Every business unit contributes to controlled funds to meet the cost of (Mt) of CO2e, down from 9,48Mt in 2011. environmental risks (such as soil erosion and Our 2012 emissions data no longer includes water pollution), improves the outcomes of our decommissioning, restoration and spontaneous combustion in process our rehabilitation efforts, and is less costly in environmental rehabilitation liabilities in emissions (which is partially responsible for the long run. South Africa. At the end of 2012, the total this reduction) since it is not industry practice value of those funds was R48,9 billion. We develop rehabilitation outcomes with to do so, and there is no agreed scientific Waste management and air quality stakeholders during the environmental methodology. However, we continue to We manage our waste and air quality risks estimate and report this internally. impact assessment (EIA) process, and commitments are made to return land to a and activities in line with the Anglo American During 2012 we consumed 37,74 million specified land capability potential and post- Environment Way and according to its gigajoules (GJ) of energy (down from mining use. While stakeholders may agree standards on mineral residue, non-mineral 38,04 million GJ last year). This is partly to an alternative land use during the course waste, hazardous substances, rehabilitation, due to disrupted production at operations, of the life of a mine, it is imperative that and water and air quality. We follow the along with a large number of energy-saving such decisions do not alter the rehabilitation “avoid, reduce, re-use and recycle” waste projects that have been implemented. commitments in respect of land capability to management approach to ensure the least keep post-mining land use opportunities as possible impact on human health and the Adaptation: In recent years, we have focused broad as possible. environment. on assessing the potential physical impacts of climate change in a number of potentially Given the potential of mining activities to We focus on the responsible management high-risk operational regions and sites, disturb habitats through land disturbance of mineral waste storage facilities, and including our Thermal Coal and Platinum and land-use change and pollution, basic carefully monitor structural stability operations in the Olifants River catchment. biodiversity management is a requirement through regular inspections and monitoring. Building on this, in the first half of 2012 we within all our operational ISO 14001 Key environmental risks include surface and worked with the UK Met Office to prioritise management systems. Where our EIAs identify groundwater contamination, dust generation all projects across the Group in terms of significant biodiversity risks or opportunities, and spontaneous combustion associated with when climate change ‘time of emergence’ operations develop standalone biodiversity coal mining residues. Ground and surface signals will arise. We are now piloting a study action plans that balance ecological water contamination risks are reduced to capture issues around climate and weather considerations and community needs. through clean and dirty water separation, model data into project design. as well as dirty water collection, treatment We have proactively sought to gain an even and re-use. In some operations we have Land stewardship and biodiversity better understanding of our biodiversity risks introduced fines dewatering technology to Our approach to land stewardship is governed and opportunities, so that they are managed improve water recovery and reduce the risk by various mandatory Anglo American in the same integrated and rigorous manner of seepage from storage facilities. ‘Wetting’ Environment Way performance requirements as other business risks. The requirements of tailings dams, soil or rock cladding, and related to rehabilitation and the management of our new Group-wide integrated risk planting vegetation on waste facilities help of water, biodiversity, mineral waste and management standard have now been to mitigate risks posed by dust. Wherever hazardous substances. These standards are integrated into our current biodiversity possible, we start rehabilitating waste underpinned by rigorous predevelopment performance requirements. The updated facilities during the operational life of social and environmental impact assessments standard was piloted at our Los Bronces the mine. to ensure that we proactively consider social mine in Chile during 2012, and helped the and environmental matters in our planning. mine more clearly relate biodiversity issues Regular internal and third-party risk Our mine closure performance requirements to its day-to-day operations, identifying some assessments and audits take place at our and toolbox offer specific guidance on mine new risks. facilities as part of our drive for continuous closure planning. improvement. In addition, all facilities are audited by our internal Technical
Transformation Report 2012 | 19 Solutions consulting function. The board’s Thermal Coal is involved in the development We work hard to ensure that our air quality safety and sustainable development of a power plant that will convert low-quality remains within legal limits, and are proud to subcommittee annually reviews the outcomes discard coal from three of its collieries into report that we have not had any significant of these audits. electricity, some of which will be supplied incidents of non-compliance. Our most back to our mines via the national grid. material Group-wide air quality issue relates The management of hazardous substances The 450MW plant will use a relatively new to SO2 emissions around our platinum is subject to stringent legal requirements technology to generate power from waste smelters. These amounted to 20,076 tonnes and is carefully managed and audited, coal that would otherwise have been dumped. of SO2 in 2012 (up from 18,774 tonnes in both at the operations and at the receiving The three participating mines together dump 2011). We have started collecting Group- waste facilities. up to 4,5Mt of coal a year. The power plant wide data on SOx and NOx emissions All our operations have dust monitoring and will not only reduce the environmental impact associated with the combustion of diesel control programmes in place. Our air quality of this discard, but it will also create jobs and explosives. performance requirements are based on and provide inward foreign investment of European Union Standards and World Health around R112 billion to contribute to regional Organization (WHO) guidelines, and apply development (refer to page 68). throughout the lifecycle of projects and Another innovative example of waste operations. Where air quality management recovery can be found at one of our Platinum is a material issue, we have air emission mines, where the Vukuzenzele waste recovery inventories in place to identify and better project was implemented to minimise unsafe manage significant emission sources. and illegal scavenging taking place at the Once waste-reduction opportunities are operation’s landfill site. Mine employees exhausted, we actively explore the re-use of engaged with the community to understand by-products. In some instances, this involves their needs and waste reclaimers can now re-mining waste facilities, while in others, we carry out their searches safely and with the research and test novel applications and uses opportunity to earn a legitimate income. for by-products.
01 Work on the Northam waste water treatment works.
20 | 2012 01 Safeguarding people and environments
Sample analysis Most of our samples are analysed at facilities SO2 emissions based in South Africa. At Kumba, we had 100% of samples analysed locally compared to 87% in 2011. Thermal Coal* had 99% of 20,076 samples undertaken locally (2011: 96%). Platinum had 95% of their samples analysed tonnes in South Africa and 5% in Australia. This around our Platinum facility is regarded as the only one that provides qualitative Nickel Sulphide (NiS) smelters in 2012 analysis at the volumes that were required, at a reasonable cost.
Report on analysis of samples for the year 2012
Platinum 159,424 151,178 95% Thermal Coal* 10,322 10,234 99% Kumba 289,207 289,207 100% De Beers 4,157 4,157 100% AASA 463,110 454,776 98% 1. Number of all samples across the 2. Number of samples analysed at 3. Percentage of samples analysed at South value chain analysed per annum (A) South African based research facilities and African based organisations (B as % of A) laboratories – internally or externally (B)
* Including Mafube colliery
Mineralogical research unit acquires best practice sample analysis facility
Anglo American has made a major stride towards ensuring that our samples are analysed locally with the acquisition of a state-of-the-art three-dimensional sample analysis facility. Our mineral research unit, together with Platinum, sponsored the purchase of the leading class 3D X-ray microscopy (XRM) unit. This will primarily be used for small sample analyses at high resolution focusing on platinum group minerals, and the characterisation of rock fragments at lower resolution for base metal research. Absorbency of coal and iron ore, and cross method comparisons, are additional potential applications. Our mineralogical research at Crown Mines campus in Johannesburg is the largest mineralogical research facility of its kind and provides valuable Group-wide input on various processes. The department has played a key role in the development of techniques for examining and analysing ore samples and process products to identify the minerals and phases present. This is essential to understanding the intricacy of these minerals and how they behave during processing.
01 Geologists checking core samples at Zibulo colliery.
Transformation Report 2012 | 21 01 Inside the Sishen Iron ore 02 Zibulo colliery – 01 Jig plant between a fine Diesel and surface crew and medium ore size screen From front: Jaco, Thandeka, are Dedre van Wyk (plant Xolani, Khetiwe and Jeffrey. operator), Collins Griqua (senior process controller) and Charles Shepherd (process controller).
02
02 Investing in our people WITH THE FUTURE IN MIND
22 | Transformation Report 2012 Transformation Report 2012 | 23 Establishing a workforce that is Initiatives including the “Knowing Me, Achieving demographically representative of our nation Knowing You” diversity drive, the anti- is a strategic business imperative. As one of discrimination Personal Change Programme, equitable the largest private sector employers in South and the Values and Culture Journey, all Africa, investing in the development and support Anglo American’s overarching representation transformation of our skills base is a focus as human resources development plan, the we strive to be an employer of choice and the People Development Way – a global world’s leading global mining company. capability framework detailing the behaviours, in our knowledge, skills and experience required to Treating all employees equitably is a achieve our strategic objectives. workforce fundamental tenet of our employment practices. In our recruitment practices The Mining Charter 2012 targets for HDSA and training, development and leadership representation in mining companies are programmes, we strive to uphold the highest calculated according to two criteria: standards of employment equity (EE). • A minimum representation of 30% HDSAs EE legislation in South Africa promotes equal at the top and senior management levels, opportunity and universal fair treatment by and in core functions. eliminating discrimination and implementing • The population profile of economically affirmative action measures. In this way, active people in the country. through a unified approach, we seek to redress the imbalances of the past. When based on 30% HDSA representation, the targets became 13,1% (African men), As part of the country’s process of 1,9% (coloured men), 0,6% (Indian men), transformation, we must meet the Mining 10,9% (African women), 1,6% (coloured Charter’s requirement that by 2014 women), 0,4% (Indian women) and 1,6% HDSA employees make up 40% of each (white women). management level (junior, middle, senior and top management) as well as in the core and critical skills category. We set ambitious internal targets, over and above those set by legislation, including targets to increase female representation, especially at management level. We continue to make valuable progress in promoting equitable representation across most levels of management and are well positioned relative to our competitors. We achieved all the Mining Charter’s 2012 EE targets. At the end of 2012, 60% of our management were HDSAs (an aggregate of employees from Thermal Coal, Platinum, Kumba, De Beers South Africa, AAESS and ACD), compared to 58% recorded at the end of 2011. Overall, HDSA employees represent 81% of our workforce in South Africa. Women now make up 15% of our employees in South Africa. Women hold 25% of management positions, with 7,042 women in core mining jobs. The recruitment and retention of highly sought-after skilled HDSAs, particularly women, nonetheless remains a challenge, as the widespread lack of skills in South Africa has resulted in extreme competition for suitable candidates. In seeking to meet and go beyond the An aggregate of expectations of the Mining Charter, our EE strategy and EE plans focus on integrating transformation and EE considerations 60% with our talent management and people processes, and accelerating the recruitment, 01 Bonolo Hamese is a mining engineer at De Beers’ of our management development and promotion of designated Venetia mine. She is pictured here with colleague, groups into occupational levels that are pit superintendant, Charles Moyana at the Southern were HDSAs under-represented. viewpoint above the pit.
24 | Transformation Report 2012 02 Investing in our people
Anglo American’s comparative performance: 2012 Mining Charter Target EAP distribution of 30%
TOP SENIOR CORE 2012 MANAGEMENT MANAGEMENT Management target
African FEMALE 9,1 10,9 6,7 10,9
Coloured FEMALE 4,5 2,6 0,4 1,6
Indian FEMALE 0,0 4,1 0,4 0,4
White FEMALE 9,1 27,9 5,3 1,6
Foreign Female 0,0 0,6 0,4 –
TOP SENIOR CORE 2012 MANAGEMENT MANAGEMENT Management target
African MALE 4,5 12,6 33,0 13,1
Coloured MALE 13,6 6,5 4,1 1,9
Indian MALE 4,5 13,2 1,4 0,6
White MALE 45,5 58,4 35,2 –
Foreign male 9,1 4,9 3,0 –
EAP distribution of 40%
MIDDLE JUNIOR 2012 MIDDLE JUNIOR 2012 MANAGEMENT MANAGEMENT target MANAGEMENT MANAGEMENT target
African FEMALE 10,2 12,1 14,5 African MALE 25,9 36,9 17,4
Coloured FEMALE 1,0 1,3 2,1 Coloured MALE 2,9 4,3 2,5
Indian FEMALE 1,5 0,8 0,5 Indian MALE 2,3 0,7 0,8
White FEMALE 12,3 11,1 2,1 White MALE 40,9 31,0 –
Foreign Female 0,6 0,2 – Foreign male 2,4 1,5 –
2012 | 25 EAP vs aggregate management representation
MANAGEMENT EAP MANAGEMENT EAP % %
African FEMALE 10,5 34,0 African MALE 29,7 40,7
Coloured FEMALE 1,1 5,0 Coloured MALE 3,6 5,8
Indian FEMALE 1,1 1,1 Indian MALE 1,8 1,9
White FEMALE 11,5 5,1 White MALE 38,1 6,4
Foreign FEMALE 0,4 – Foreign MALE 2,2 –
THERMAL COAL An active and robust cultural and gender diversity programme is helping to increase Thermal Coal has a consolidated EE plan in the intake of women. The programme strives place to ensure meaningful transformation to ensure equal opportunity, eliminating while also addressing the human resource all elements of discrimination and barriers requirements of its business. The plan to the advancement of female employees. addresses succession and experience This is complemented by initiatives such planning, performance management, as the Women in Mining forums aimed at standardised work environment and facilities, facilitating successful transformation. Visible cross operational promotions, recruitment felt leadership (VFL) is important in attaining procedures, training and development, buy-in from both genders in these initiatives. improved analysis of employment opportunities for people with disabilities, and Thermal Coal has made significant capacity and capability building of individuals investments in upgrading existing facilities and the organisation. for female mine workers so that female employees have access to safe and This plan is monitored and reported at comfortable amenities. operational level to ensure that each part of the business reflects the target demographics Through robust workforce planning and is representative of Thermal Coal’s overall and recruitment, the business strives to transformation strategy. develop its pool of female talent and build a stronger pipeline to achieve greater Thermal Coal continues to make steady female representation in core functions. progress across target areas. In 2012, A well-established bursary scheme aims to HDSA representation reached 35% at develop suitable students who are then given senior management level (30% in 2011), professional career opportunities within the 53% in middle management (50% in 2011) organisation. In 2012, 127 students, including and 64% in junior management (62% in 61 women, received bursaries. 2011). This equated to an aggregate of 57% of HDSA participation in Thermal Coal’s Thermal Coal has introduced an initiative to management structures (55% in 2011). fast-track the development of high-potential As Thermal Coal is a division of Anglo women across the business. Training and Operations (Pty) Limited (AOPL) and is not a development interventions across various separately listed entity, the top-management disciplines are in place, to help identify level does not apply. suitable high-potential candidates. Currently, 27 women have been identified as fast-track Women within Thermal Coal candidates and allocated a senior executive In 2012, women made up 18% of Thermal mentor. A further nine women have been Coal’s workforce (17% in 2011), occupying appointed into senior management roles 14% of core functions (13% in 2011) and in 2011 and 2012, and receive continuous 20% of management. support and coaching to enable their success. 01 Keitumetse Hynes is a female haul truck operator on the Komatsu 960E trucks. She has been trained to use the Collision Avoidance system on the vehicles.
26 | Transformation Report 2012 02 Investing in our people
In her opening address, the Minister of Cornelia Holtzhausen, general manager at ACTION FOR WOMEN, Mineral Resources, Susan Shabangu, raised Kumba’s Thabazimbi mine, presented on BY WOMEN concerns about the safety and well-being of diversity and culture and shared Kumba’s women miners, given the uncharacteristic approach to women in mining and how they Kumba partnered with the DMR to host number of reported incidents of women are working to change mindsets in their the first annual Women in Mining Lekgotla miners experiencing harassment and operations. in 2012. inhumane treatment by fellow workers. She The outcomes of the first Lekgotla were specifically cited an incident that occurred to establish a programme of actions The conference, was attended by women at one of Platinum’s mines in 2012. working in mining or supplying services to to be taken and to identify champions mines. The conference theme was “Safety, The challenges for women in the mining who will drive the resolutions that were security and comfort for women in mining: industry relate predominantly to a lack of adopted. These included the need to towards a programme of action for women, support, and discrimination, based solely intensify awareness of sexual harassment; by women”. Core women mine workers, on gender. The Lekgotla was the first step for women to play a role in policy mine managers, operational managers and in acknowledging these issues and will, development; and to conduct research executives came together to discuss and in future, provide the platform to plan and and development around the ergonomics map a guideline for the DMR as it seeks to implement ideas and specific interventions of operating underground plants and address issues of safety and transformation to empower and develop women in this machinery. in the South African mining industry. industry.
01 Cornelia Holtzhausen, general manager at Thabazimbi mine, at the Women in Mining Lekgotla 2012.
KUMBA IROn ore approximately 87%. Overall, by the end focused discussions to determine the of 2012, around 80% of employees were interest, potential, suitability and readiness In 2012, HDSA representation at Kumba was sourced from communities and labour- of potential HDSA successors. Career an aggregate 53% at management level, sending areas in and around operations. exhibitions, focused on careers for women with 37% in senior management (37% also Human resource development is central in in mining, were held at a number of targeted in 2011), 56% in middle management (53% efforts to achieve a more equitable workforce. schools in our operational regions. in 2011); and 55% in junior management At Kumba this includes mentorship plans, (53% in 2011). Kumba has proudly achieved succession planning, individual development Talent pipelines are yielding promising an overall 81% HDSAs in the workforce. planning, and constructive retention models. results. The Kumba bursar pool for the At the end of 2012, women made up 17% of Through these initiatives, we seek to address graduate programme has 69 bursars, of employees (17% in 2011), with 13% in core the ongoing challenge of a lack of skills in the which 80% are HDSA and 64% are Africans. mining positions (12% in 2011) and 19% in local mining industry. The graduate programme comprises management. Improving the current status 50 graduates, of which 72% are HDSA and The business is committed to employing at To increase succession pipelines for HDSAs, 62% African, mainly in technical disciplines least 75% of its workforce from the Northern Kumba has implemented several internal that ultimately feed into junior and middle Cape, where the majority of operations career development initiatives, including management levels, once graduates have are based, and has currently achieved regular career development panels with completed their formal training programme.
2012 | 27 The business has also developed and rolled • communicating targets clearly and openly, Promoting gender diversity at Sishen mine out a diversity management programme. as well as the consequences of targets not Sishen has recruited young female artisans being achieved and operators employed at the mine to Throughout its operations, Kumba is • monitoring and communicating progress participate in road shows to schools and strengthening its transformation efforts by: each month. colleges, with the aim of encouraging • being responsible for achieving social and young women to pursue a career in mining. labour plans as well as transformation This has helped to successfully instil a culture Sishen’s recruitment team has also partnered objectives in which compliance and internal stretch with government and local colleges to • ensuring that EE plans are presented and targets are being considered in all employee establish a bursary scheme and bridging discussed at consultative forums, and movements and appointments, as well as in programme, to assist women who apply to that commitments are honoured by all training and development decisions. enrol in engineering/artisan learnerships in stakeholders meeting minimum educational requirements. In addition, line management are now involved in the early stages of the recruitment process to secure their buy-in and support. • working conditions Platinum • an attractive brand Sishen’s Women in Mining committee is certified as one • employing the best people in the helping to ensure that potential barriers to business women are identified and managed. The team has also introduced a rehabilitation functional of South Africa’s • staff members who are warm, polite and assessment (RFA) to the selection process, respectful. best employers to reduce the high percentage of new female Then interim CEO (and current CFO), recruits who are not physically fit for the In 2012 Platinum achieved the coveted Bongani Nqwababa said: “Platinum is demanding work in a mining environment. CRF Institute’s “Best Employer” honoured to have received this seal These combined efforts have seen the overall certification, which indicates that the of approval from the CRF, and to be proportion of female technical learners at business has met stringent requirements recognised as a leading organisation Kumba’s Sishen mine increase from 6% to and international standards, thereby in providing professional careers. 20% in the past two years. qualifying as a frontrunner in human We welcome the certification as a reward resources management excellence. for our consistent efforts to ensure Training centres throughout Kumba are The certification is based on research into equitable policies and practices, as well as leading the way by growing and appointing all critical areas of HR management and ample career development opportunities gender-diverse training officers, one example showed that Platinum has outstanding for all our employees.” being the engineering training centre, which employee offerings in terms of: has a fast-track programme for female artisans to become technical training officers. The results are encouraging: from 2007 to 2012, the overall number of women at Kumba’s technical training centres more than doubled, from 567 to 1,139, while the number of women in technical support has more than quadrupled, from 156 to 727. PLATINUM Platinum’s HDSA representation in 2012, using Mining Charter measures, was 50% in top management (51% in 2011), 40% in senior management (41% in 2011), 57% in middle management (56% in 2011) and 65% in junior management (63% in 2011). The total aggregate of HDSAs in management was 59% by the end of 2012 (58% in 2011). Platinum has focused intently in recent years on achieving increased involvement of women in mining. The number of women in core skills has steadily escalated from 405 in 2005 to 4,686 in 2012, with 893 appointed in 2012. Progress has been accelerated by introducing fast-tracking programmes for women in both engineering and mining occupations, as well as targeted 02 Then interim CEO (and current CFO) of Platinum, Bongani Nqwababa, accepting the award from CRF Institute recruitment and improvements in the working CEO, David Plink, at a prestigious event in Kyalami on 29 August 2012. environment, such as more suitable change-
28 | Transformation Report 2012 02 Investing in our people
shortage of qualified African women, largely a previously male-dominated environment. due to their late entry into the mining sector, Platinum wins top It is also important to acknowledge our and because many women fail to meet the gender award male colleagues who continue to work inherent fitness requirements of the jobs. tirelessly to transform our organisation.” To address this shortage, Platinum has Platinum was recognised as South put women-specific quotas in place for Platinum was recognised for: Africa’s Top Gender Empowered participation in all training, learnerships, Company in the Resources category • the recruitment of women from the bursaries and fast-tracking programmes. at the ninth annual Top Women Awards surrounding communities A cadet programme is in place to address in 2012. • extending opportunities for women entry-level appointments. across the Group Accepting the award, Khanyisile • changing the corporate culture by Progress is slow, but steady. In 2011 a Kweyama, Platinum’s then executive implementing the Personal Change woman was appointed as a group safety head of human resources (now executive Programme and Leadership Academy manager and Platinum anticipates the director: Anglo American South Africa Frontline Supervisor Programme that qualification of two African women as mine Limited (AASA Ltd)), said: “I would like to instil corporate values that bring about managers; both are close to completing their dedicate this award to the women in our sustained cultural change. certificates. organisation who are making their mark in Platinum’s values and culture journey In February 2012, the results of the 2011 Values and Culture Survey were shared with employees. The survey aimed to measure the extents to which Platinum values were being “lived”; to determine the impact of the leadership academy and other programmes in support of the values; and to strengthen employees’ engagement with the values and culture initiative. The results indicated that employees at all levels were very aware of the values and there had been an improvement in living these values, notably in terms of safety. The results also showed an increase in valuing and caring for one another and a move towards teamwork. Platinum subsequently adopted a five-phase programme focusing on organisational development through monitored implementation of action plans to address weak areas associated with the values. Personal change programme Platinum’s personal change programme, launched in 2009 as part of Anglo American’s broader culture change programme, was discontinued in the second quarter of 2012 due to budget constraints. At its closure, the programme had covered 40% of all employees (30% in 2011). Driving gender diversity: Techno Girl 03 Khanyisile Kweyama, Platinum’s then executive head of human resources (now executive director: AASA Ltd), programme accepts the Top Gender Empowered Company award on 8 August 2012. Platinum has annually contributed R50,000 towards the Techno Girl programme since houses, appropriate PPE and women’s However, the employment of African its inception in 2009 by The Gauteng forums at all operations. women remains a challenge. Between 2011 Department of Education (DoE) and and 2012 there were no changes in the UNICEF. The scheme targets young Women across the four management levels number of African women in senior or junior girls from poor families who are studying represented 20%, while 12,7% of women management, while middle management science and mathematics at high school, make up the total workforce. The percentage increased slightly from 9,5% to 10,5%. with the aim of growing skills in disciplines of women employed in management positions like engineering, finance, technology and at the end of 2012 was: 12% in senior When taking into consideration the mining. The programme provides shadowing management; 22% in middle management; economically active population (EAP), opportunities to Grade 9 girls (three grades and 20% in junior management. There were Platinum has not yet achieved adequate before university) during school vacations, no women executive directors on the board. numbers of African females. There is a for three years.
2012 | 29 At the launch of the 2012 programme, the The business has made good progress At the end of 2012, 57% of the individuals Minister of Women, Children and People in achieving and exceeding the Mining on De Beers’ engineering and mining with Disabilities commended Platinum for Charter diversity targets for 2012: HDSA learnerships, and 64% (124) of community its work on the programme to date. This representation reached 35% at senior leaders who received education grants, includes successfully tutoring four girls who management, 53% in middle management were women. The objective of these grants have chosen to follow engineering careers. and 74% in junior management levels. is to support community learners towards If they pass their subjects they will be placed This equates to an overall 61% HDSA achieving a higher education qualification at Platinum’s Engineering Skills Training participation in De Beers’ management and, in so doing, establish a community Centre (ESTC). structures. talent pool. The DoE has since asked Platinum to Gender diversity and the employment In association with the Ponahalo Disabled become involved in the selection process of people with disabilities are important Persons’ Trust, De Beers has developed for Techno Girl, particularly in choosing focus areas for De Beers. In 2012, 28% a toolkit to promote the empowerment of candidates for the subjects needed in of its workforce was female, with 25% of people with disabilities through advocacy science and mining careers. In 2012, management roles and 21% of all core roles and employment opportunities. The toolkit 21 young women were selected to take being occupied by women. Several structures fosters awareness and understanding with part in the Techno Girl programme. and processes have been established to regard to the employment and integration accelerate the integration of women into the of people with disabilities. Voorspoed mine DE BEERS workplace. Through these structures the in the Free State was used as a pilot site company continues to address the challenges for the toolkit and has already achieved De Beers has longstanding transformation and barriers that women face, targeting 2% representation of people with disabilities. plans and programmes in place at all of recruitment, talent planning and focused its South African operations. Progress is development initiatives. Together, these aim monitored and reviewed in consultation with to increase the attraction, retention and organised labour and as part of De Beers’ promotion of women in the mining industry. performance metrics.
01 Doreen Botha Leepo and Magdeline Kagelelo Schalk preparing drill holes prior to blasting of Sishen mine at Kumba.
30 | Transformation Report 2012 02 Investing in our people
Anglo American Emea By giving employees work targets to achieve within well-defined parameters, as opposed Shared Services (AAESS) to just ‘filling time’, AAESS hopes to make employees more productive and motivated to Transformation within AAESS remains a complete their work quickly and accurately. strategic focus and every effort is being made to recruit HDSA candidates with the relevant skills and experience. The unit has Anglo american’s visibly improved gender diversity in middle Corporate Division (ACD) management and senior management levels. Initiatives including talent reviews, succession ACD’s employment equity performance plans, focused recruitment and structured has surpassed 2012 targets. As ACD is a development plans, have been implemented division of AOPL and does not have a board to continuously upskill HDSA talent and of directors, the top management level does equip individuals to take on bigger roles in not apply. Senior management has 32% the organisation. HDSA representation; middle management is at 61%; and junior management at 82%. AAESS has also rolled out a diversity Women make up 37% of the total workforce, programme to encourage employees with 24% in core functions and 36% in to embrace their unique diversity and management positions. that of their colleagues. In 2012, HDSA representation reached 73% in senior The mining and technical disciplines of ACD management, 66% in middle management have long-term initiatives in place to ensure and 96% in junior management levels. they attract and retain HDSAs by: Total HDSAs in management positions • exploring opportunities to accelerate equates to an impressive 92%. the development of employees at middle management levels; in 2012 the mining By the end of 2012, 71% of women in and technical talent meeting identified AAESS occupied senior management seven HDSA candidates as emerging positions, 59% in middle management and talent 77% in junior management levels. In 2012, • accelerating each individual’s development 75% of AAESS employees were women and with training and coaching 74% occupied management positions. • using employer and employee networks Establishing a conducive work to attract HDSA candidates, as well as environment investigating the use of platforms such as Focus groups to discuss work-life balance LinkedIn, and reviewing the incentives for with employees provided valuable insight into employees in this space what would create the best work environment • exploring ways of attracting talent from for employees. various Anglo American operations into the mining and technical disciplines, either as AAESS currently employs a high number of permanent placements or on secondment; women in its transactional centres, many of for example, in 2012 the geosciences whom have young children. There are times team appointed an HDSA candidate on a when childcare is problematic and they have three-year secondment from Thermal Coal no option but to bring their children into work. at senior management level Being able to provide support and a safe environment in these instances is important • giving even more HDSA-bias to bursar and for the individual and the company. Where graduate recruitment necessary, AAESS also offers a day’s holiday • ensuring that current HDSAs are given the or a day’s unpaid leave to allow mothers to right development programmes, and that stay at home until they can make alternative their pay is properly benchmarked. arrangements. Offering more flexibility in working hours is a unique selling proposition that is not offered by other employers in the locations where AAESS operates. This division plans to introduce a more flexible working day that allows employees to choose the times that they start and end their working day to better suit their children’s school times and travel arrangements. This may also include giving employees the option of working on Saturday as an alternative to one weekday.
2012 | 31 Our employees are as vital to our success as The Mining Charter requires that mining Investing our mining assets, as it is ultimately they who companies invest a percentage of annual realise our ambitions and deliver our strategy. HDSA payroll (excluding the mandatory in our We therefore need to have processes in place skills development levy) in essential to attract and retain the best talent, provide skills development activities reflective of skills base opportunities for personal development, the demographics. Our operations have recognise and reward excellence, encourage consistently exceeded the charter’s minimum diversity and protect employee rights. requirements. In 2012, the target was 4%. Thermal Coal invested 9,1% of payroll in Human resource development (HRD) is a its HDSA skills base, Kumba 6%, Platinum vital strategic tool to achieve our employment 5,7% and De Beers 4,6%. Only ACD fell equity targets and is an integral part of social short of the target, spending 2,1% of payroll. transformation in the workplace. The combined investment of our South African operations totalled R1,07 billion, representing 6,3% of the HDSA payroll.
Total HRD expenditure on HDSAs (2012 Mining Charter target: 4%) 2,1% 4,9% 9,1% R11,9 million R6,5 million R241,3 million ACD AAESS Thermal Coal 6,0% 5,7% R200,3 million R578 million KUMBA iron ore PLATINUM
HRD expenditure 4,6% 6,3% in 2012* R1,07 billion HRD expenditure R37,2 million as a percentage of AASA De Beers HDSA payroll
* Excludes the mandatory skills levy. Figures include only the licensed operations
We have made significant progress over the Anglo American’s approach to HRD at all years in providing basic literacy and numeracy business units includes employee training, to our employees and community members specific career development interventions, through ABET programmes. Related performance management and development, initiatives include bursaries, scholarships, coaching, mentoring, succession planning, learnerships, support for tertiary education and high-potential employee identification and other programmes that vary across the and fast-tracking. We constantly evaluate business units. All programmes are supported whether we are matching the right people by campaigns to encourage employees to to the right development programmes, to participate, along with mentoring and career ensure that training investment is effective. path initiatives. Measures of success include reduced levels of staff turnover, enhanced employee retention, promotions and permanent employment of graduates.
32 | Transformation Report 2012 02 Investing in our people
Training initiatives are aligned to the Anglo Learnerships, bursaries and PITs The professionals in training (PIT) initiative American People Development Way, a Learnerships enable employees to improve is a structured programme that exposes global capability framework that defines the their skills through theoretical and practical graduates to the world of work. The 24 to competencies required for the development training, and can lead to qualifications 36-month programme remains an innovative of its business leaders. recognised by the Sector Education Training way to address the training of technical Authority (SETA) and the Department of graduates, technicians, technologists Adult basic education and training (ABET) Labour (DoL). and non-technical graduates alike. It also Promoting literacy is essential in building includes other skills such as report writing, empowered employees and communities. In 2012, a total of 1,230 learners participated personal development, Excel for engineers, The ABET programme is run by our in learnership programmes. Of these, 74% aptitude profiling, safety and management businesses and the corporate centre office in (916) were HDSAs, and 18% (226) of the skills. In 2012, we had a total PIT intake of South Africa, and provides general education total learners were women. To date, 46% 474 individuals across our South African to adults who have not all had access to formal (569) have completed the programme. businesses. schooling. A total of 789 learners enrolled for ABET programmes in 2012 across our Bursaries are awarded to high-performing South African operations. Of these, 507 were individuals who potentially create a pool employees, 280 were community members of competent future employees for Anglo and two were contractors. American. A total of 552 bursaries across a variety of fields were awarded in 2012.
HRD performance
Thermal Coal Platinum De Beers Kumba ACD AASA
2012 intake
Learnerships 278 427 75 450 – 1,230 Total ABET training 166 489 41 93 – 789 Employees 34 360 41 72 – 507 Community members 132 127 – 21 – 280 Contractors – 2 – – – 2 Bursaries and scholarships 127 315 21 69 20 552 Professionals in training/ 137 259 24 48 6 474 graduates (PITs)
Completed in 2012
Learnerships 89 257 48 175 – 569 ABET training – 182 – 104 17 303 Bursaries and scholarships 40 55 17 11 7 130 PITs 13 25 10 4 2 54
HDSAs
Learnerships 236 232 55 393 – 916 Bursaries and scholarships 106 263 13 55 7 444 PITs 117 209 21 35 2 384
Women
Learnerships 61 44 20 101 – 226 Bursaries and scholarships 61 17 17 34 2 131 PITs 48 78 11 17 1 155
2012 | 33 Tertiary education A collective industry plan to address this led Members of METF contribute a set The shortage of basic and specialised skills to the formation of the Minerals Education amount per graduate employed in the within the mining industry is linked to low Trust Fund (METF) in 1999, which provides a three disciplines of mining, metallurgy numbers of learners entering technical study means to: and geosciences. Collectively, members fields, where mathematics and science is • pool industry resources to support tertiary contributed more than R30 million to the required. This results in lower throughput education in the South African minerals fund in 2012, to support departments at nine and quality of graduates in the fields of industry universities across the country. mining, metallurgy and geosciences. These • jointly seek solutions to tertiary education Global leadership training graduates are essential for companies in challenges Anglo American’s leadership development the mining sector to maintain the necessary • achieve a cohesive approach to providing programmes include the Programme for pipeline of talent and sought-after skills. industry support. Management Excellence (PME), which seeks to enhance the leadership skills of global A further challenge is to retain well-qualified The METF aims to supplement lecturers’ managers to meet the changing needs of the and experienced lecturers in mining, salaries to enable institutions to retain critical organisation, and The Achiever Programme metallurgy/chemical engineering and staff in these departments and thus provide (TAP), which aims to develop the leadership geology. Comparable positions in the industry a high quality of lecturing. Since its inception, potential of emerging talent through a series are more attractively remunerated. there has been a steady improvement in staff of stimulating challenges delivered in three retention as well as in the ability to attract one-week study blocks. new employees into those departments in the targeted institutions.
Anglo American’s contribution to METF in 2012
Metallurgy/ MINING GEOLOGY chemical engineering
Number of graduates Number of graduates Number of graduates 450 490 323
Contribution of Contribution of Contribution of R5m R5,5m R3,7m
IN 2012, THERE WAS A TOTAL CONTRIBUTION OF R14,2m
34 | Transformation Report 2012 02 Investing in our people
Anglo American in South Africa: Global leadership training in 2012
PME TAP
34 5 23 45 31 15 8 3 1 11
ACD AAESS Kumba Platinum Thermal ACD AAESS Kumba Platinum Thermal Coal Coal
Total: 138 Total: 38
THERMAL COAL aims primarily to attract bursars from the in the previous year, as the target population areas around its operations and has launched has increased to include PITs and additional Thermal Coal spent R241,3 million on HRD various drives to improve mathematics and first-line management positions. training for HSDAs in 2012, representing 9,1% science tuition at local high schools. During 2012, 31 employees attended PME of HDSA payroll and a significant increase on and 11 employees graduated from TAP. the R191,1 million invested in 2011. Many of the bursars who complete their degrees go on to become part of the PIT ABET initiative, a structured programme that KUMBA iron ore Thermal Coal has provided ABET to exposes graduates to the world of work. Kumba spent R200,3 million on HRD training employees for more than two decades and Thermal Coal had 32 PITs in 2012. PITs are for HSDAs in 2012, representing 6,0% of anticipates that all members of its workforce inducted through a series of presentations HDSA payroll and twice the expenditure will be functionally literate within the next relevant to their future roles within the i n 2 011. seven years. In 2012, 34 employees and company, covering topics such as Anglo 132 community members enrolled for American’s values and approach to business Informed by Mining Charter guidelines as well ABET courses. integrity, the importance of a healthy lifestyle, as its own needs for development, Kumba manages a wide variety of training initiatives. While mine-based ABET centres are the People Development Way and the revised These include formal training programmes, extensively used by employees’ dependants performance management system. mentorship, career progression plans, study and members of host communities, many Safety training assistance and training in portable skills who could benefit from developing their During 2012, Thermal Coal employees for employees who are nearing normal or literacy skills, are reluctant to participate. attended Anglo American’s Safety, Health medical retirement so that they are more Reasons include believing they are too old and Environmental Risk Management employable once they leave the organisation. to learn, or will not learn as fast as younger Process (SHE RMP) training, which equips ABET participants, or the pressures of shift work. employees with the knowledge and practical Around 95% of Kumba’s workforce is Thermal Coal continues to explore ways skills to perform job safety analysis risk functionally literate. To increase this to address these concerns. assessments, and to evaluate such analyses percentage and to extend the opportunity performed by those they report to directly Learnerships to the broader community, ABET is available where applicable. A1 level training, for all In 2012, 278 people enrolled in learnerships throughout Kumba operations on a part- at Thermal Coal, of whom 89 have employees, and A2 level, which targets junior time voluntary basis. In 2012, 72 employees successfully completed their learnerships management employees, is continuous, and participated. and trade tests. has now moved into the refresher phase. Learnerships, bridging school, bursaries Bursaries and PITs Leadership training and scholarships Through its well-established bursary scheme Thermal Coal requires its managers to In 2012, Kumba registered the following Thermal Coal continues to develop high- participate in the Safety Leadership learnerships: 128 mechanical engineering, potential students and provide access to Programme to ensure they have the 95 electrical engineering, 38 civil professional career opportunities within knowledge and critical skills that leaders engineering and 189 mining metallurgy. the organisation. In 2012, bursaries were need to contribute to the achievement of zero All 450 participants were acknowledged awarded to 139 students, of which 85% were harm. In 2012, 61% of managers attended as being proficient in the skills acquired and HDSAs and 57% were women. Thermal Coal this programme. This was down from 75% a total of 138 artisans were trained.
2012 | 35 In an effort to improve the maths and science Recruitment training with the company. After completing performance of students wanting to enter In 2012, around 48% of all candidates their electrical or mechanical engineering tertiary institutions, Kumba sponsored recruited externally for scarce and critical studies at tertiary institutions, those who 12 local learners to participate in a bridging positions in middle management and above show potential for further development are programme in 2012. The business invested were HDSAs, of which 5% were women. entered into fast-tracking programmes. R9,4 million in supporting 69 employees Talent development initiatives such as the Currently, five engineering development fast- and learners from host communities and graduate development programme (GDP) and tracking programmes are in place: labour-sending areas to study in core mining other training and development interventions disciplines. contributed to the improvement in these • Foreman development programme numbers. • Measurement control and instrumentation PITs • Planned maintenance officer programme In 2012, there were 48 PIT participants at Additionally: • Training toward the Government Certificate Kumba, of whom 35 were HDSAs. • 25 graduates from the advanced GDP of Competence (GCC) were appointed as metallurgists Management development • Project manager training. More than R3,7 million was spent in 2012 • 70% of the mine overseer appointments, on formal studies and management and 52% of safety officers and all section Of the 59 employees who participated manager appointments were internal leadership development programmes in these programmes in 2012, 31% were promotions for 51 employees, of whom 25 were HDSAs. women; and of the eight employees placed In total 23 employees attended PME, four • 82% of the shaft rock engineer in substantive positions within the company, attended the Anglo Management Programme appointments were Platinum’s own strata 50% were women. (AMP), three graduated from TAP and one controllers, who have successfully obtained their Chamber of Mines’ certificates Platinum also runs a series of mining employee completed the Leaders in Anglo fast-tracking programmes that are yielding • 62% of all promotions were internal. (LiA) programme. promising results. In 2012, 192 employees Career development Integrated HRD participated in shift supervisor courses, Career development panels (CDPs) further Platinum’s integrated and holistic HRD 39 in a mine overseer course, and 13 in support leadership development by assisting strategy is aimed at identifying individual section manager courses. Six participants managers to understand the career potential at all levels, giving employees the obtained the mine overseer Certificate of aspirations of employees as well as areas opportunity to obtain skills and competencies Competency, while four obtained the mine that require further development. Kumba to advance along a predetermined career manager Certificate of Competency. Of held 79 CDPs in 2012 to facilitate employee path. During 2012, 3,856 employees the three women who participated in the development. were assessed and 2,326 new individual section manager Certificate Course, one was development charters were developed. promoted to a safety manager’s position. PLATINUM To date, 13,010 employees have a charter in place based on agreed development Of the two participants in the Mineral Our Platinum business spent R578 million plans, while a further 1,976 employees Resources Management (MRM) programme, on HRD training for HSDAs in 2012, were promoted as part of Platinum’s talent one was appointed as an MRM manager. representing 5,7% of HDSA payroll and development plan. Safety training a 3,2% decrease on expenditure in 2011 Platinum’s strong focus on safety training (R597 million). Young professional development The Young Professionals Scheme feeds the continued in 2012 with 38 safety trainees, Platinum’s investment in HRD is aimed at pipeline of future leaders for the Platinum including 11 women, completing the training. developing potential and current employees, business and helps to meet EE objectives by Three trainees were subsequently appointed with a strong focus on women and HDSAs. providing bursaries and graduate in-training as safety officers. The safety on-boarding programmes. Around 83% of bursars on the programme was launched in October 2012 ABET scheme in 2012 were HDSAs. and 13 new employees successfully completed Platinum continues to invest significantly the programme in the first two months. in ABET, providing access to recognition Fast-tracking programmes Furthermore, 5,175 employees completed of prior learning (RPL) so that every Effective implementation of fast-tracking Safety Risk Management Process (SRMP) and learner writes a placement assessment programmes can help address the shortage “Commitment to zero harm” training. before enrolling. In 2012, 489 people of business critical skills, while helping (360 employees, 127 community members businesses to comply with legislative Platinum’s Group Standards Committee and two contractors) registered for full- requirements. was established in 2012, with HRD being time ABET, with 182 of those completing acknowledged as an important stakeholder. a level of training. A further 1,987 shift A national scarcity of female engineers The committee adopted the learning from workers registered for voluntary own-time has prompted a drive at Platinum for higher incidents (LFI) tracker tool, which will be programmes, with 418 completing their female intake. Women are recruited from a standing item from 2013 onwards. This respective levels. the National Skills Accord Programme, a tool was developed in order to record all partnership between the government and learnings from fatal accidents, how these Platinum aimed at addressing the shortage relate to HRD, the agreed action plans, the of critical and scarce skills. These students implementation progress, as well as the spend six to 12 months of their practical close-out status.
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Anglo American’s approach to HRD at all business units includes employee training, specific career development interventions, performance management and development, coaching, mentoring, succession planning, and high-potential employee identification and fast-tracking.
Critical skills development in engineering Course development and new mining delivery system – 70% of learning should By the end of 2012, 427 learners were in technology take place on the job, 20% from peers and engineering training, with 84 having qualified, Learning and course development: 10% from formal learning. including 68 HDSAs. Close to 40% of this The newly developed learning material for Management leadership training group were existing employees. Overall, the 14 critical skills as well as various other In 2012, 47 of Platinum’s first-line managers 97 women (21%) were spread across trades. non-critical skills was updated to incorporate attended the Junior Management Programme learning from incidents and newly defined Platinum recruited 81 learners from the process requirements. Hazards, energies, (JMP) and 60 senior managers graduated communities in which it operates. They are causes and controls were also added. from the PME. Over the course of the all registered on learnerships in different year, 502 managers attended mentoring engineering disciplines and will qualify Seven ‘fast forward’ modules were designed workshops. as artisans in 2013. The Medium Voltage and developed as well as three new courses Talent management Scheme training drive for artisans continued for the miner, shift supervisor and mine Effective employee engagement includes in 2012, with 594 employees participating. overseer. These courses were developed ensuring that employees understand and The company has also implemented the to efficiently address shortcomings in daily appreciate the company’s objectives and their engineering foreman, senior foreman and work delivery, and will be supported through respective roles in achieving them. In 2012, specialist schemes. To date, 159 certificates a Platinum Leadership Academy framework. Platinum focused on having one-on-one have been issued for mining and 77 for New mining and HRD technology conversations with high-potential employees processing. Common standards and procedures were to understand their aspirations, goals, desired Four winding-engine drivers and 10 onsetter reviewed and where necessary converted development and what can be done to ensure learners successfully completed their into an electronic format for easy access that they stay with the company. qualifications following the alignment of through computer-based programmes and this training to the new national Mining the intranet. Computer-based training was DE BEERS Qualifications Authority (MQA) requirements. implemented at the School of Mines as well as the other operational training centres. The De Beers spent R37,2 million on HRD Critical skills development – mining- newly designed, technology-driven learning programmes for HDSAs in 2012, related training material will be piloted at the School of Mines representing 4,6% of HDSA payroll. Platinum’s Operational Skills Development and Bathopele Mechanised Training Centre. A spectrum of training initiatives includes: (OSD) department provided additional health and safety and technical training; training to 109 replacement miners during Three new 3D Virtual Reality programmes diamond sorting and supervisory the miners’ strike. were designed: hazard identification training learnerships; bursaries and study assistance; system programme for Mogalakwena; stope as well as leadership development The development of learning material for face marking; and interactive geology. programmes. Development initiatives are 14 critical skills was completed using a new Platinum also designed and developed a new geared towards supporting transformation approach and methodology. The initiative conventional advanced strike gully and breast objectives and include training for community also saw the introduction of “Safe Profitable face prototype, a nine-hole burn cut ‘hole learners, thereby enhancing skills levels Platinum” into all new material. director’ and laser technology for marking within local communities. mechanised nine-metre board to enhance An internal quality assurance audit was drilling accuracy and speed. Educational levels and functional literacy conducted on the training delivery system All of the De Beers Group Services (DBGS) at the Anglo American Platinum School Mining Training Centre (MTC) east project permanent employees are functionally of Mines services and across Platinum’s The MTC east project made encouraging literate, the lowest level of education being operations. The OSD team, in conjunction progress in 2012, despite enduring budget NQF level 1 (equivalent of ABET 4 or with staff at the School of Mines, constraints. The mining excavation of the Grade 9 in secondary school). Around 90% implemented a continuous improvement plan lecture room and model area was completed. have an NQF level 4 (Grade 12 equivalent) to address all non-conformance areas by the Temporary lecture rooms were established qualification or higher. first quarter of 2013. and training equipment has been delivered. The South African mining operations Bathopele mine’s Mechanised Training Services – human resources and finance (De Beers Consolidated Mines (Pty) Limited Centre maintained Mining Qualifications Overall, 3,856 psychometric assessments or DBCM) have a minimum entry requirement Authority (MQA) accredited provider status were conducted to identify learning potential of Grade 12. Less than 3% of employees do during 2012. The centre also achieved in these areas, and 2,326 function-specific not possess a Grade 12 certificate and they 391,108 fatality-free shifts on 25 November individual development charters were have been offered opportunities to achieve 2012 and 1,282 incident and injury-free drawn up. this level of education through self-study, days despite conducting all practical training Platinum’s new Finance Leadership Academy computer-based and classroom-based in the underground environment where the programme produced its first 30 graduates learning. With the establishment of the blasting cycle was maintained. By the end and their positive feedback has ensured that Quality Council for Trades and Occupations of 2012, a total of 2,687 learners obtained the course will continue in 2013. (QCTO) and the focus on attaining the certification and/or qualifications. In addition, Foundational Learning Certificate (FLC), 13 learner miners attended the “Rock In 2012 we continued embedding the human a number of employees have the opportunity Breaker Learnership” specifically developed resources People Development Way which, to complete the FLC certificate full-time over for mechanised mining. among other things, explains the 70:20:10 a five-month period. principle of the Anglo American learning
2012 | 37 01 Diamond sorters at the DTC HOH (Harry Oppenheimer House) in Kimberley.
01 Diamond Trading Company The Diamond Trading Company South Africa (DTC) division has a fully accredited Diamond Academy, which focuses on developing technical diamond skills, both within the company as well as for external stakeholders, increasing the overall diamond knowledge and capability of the diamond industry. The DTC also runs learnerships, through which employees can improve their theoretical and practical skills in supervisory management and diamond sorting, potentially leading to qualifications recognised by SETA and the DoL. DTC spent R1,1 million on learnerships in 2012, in three fields: • Diamond design and evaluation (NQF level 4) – six trainees • Supervisory learnership aimed at team leaders – nine trainees • Instrumentation mechanical – one trainee. These learnerships were specifically identified to close scarce skills gaps and to develop leadership capabilities. Of the 16 trainees, all are HDSAs and three are women. Technical training programmes With the establishment of the ISO accredited Kganya Human Resource Development Centre at De Beers’ Voorspoed mine in 2012, each of the DBCM mining operations now has its own accredited training facility. In 2012, training initiatives included: • technical learnerships in general trades such as electrical, fitting and boiler making engineering • women in mining programmes at operations that focus on technical Graduate and professional development • DBCM offers practical training to students learnerships in engineering and mining programmes and initiatives and bursars in the form of vacation work • 80 weeks of experiential training in One of the vehicles used to improve and experiential training. Two female electrical, mechanical, fitting and turning De Beers’ technical capacity is through interns were employed in 2012, and the engineering trades, provided at DBCM its various graduate and professional company currently has five female bursary operations and in partnership with the development programmes. These include, holders in the engineering, mining and Department of Public Works among others: metallurgy disciplines. This will increase • learnerships focusing on supervisory skills. • A company-approved study assistance to 12 in 2013. The De Beers Technical Training Campus scheme that provides 100% financial • The De Beers Professional Management (TTC) in Kimberley completed a total of assistance towards attaining a recognised Development Programme (PMDP) assists 31,353 training days in 2012. This represents qualification with an accredited tertiary employees in management positions or a 1% increase compared to the same educational institution. In 2012, with management potential to enhance period in 2011. The current training split is 43 employees participated, of which their knowledge and skills, enabling them 20% DBCM employees and 80% external 25 (58%) were women. to deliver in their current positions, while learners. • In 2012, 23 graduates were entered preparing them for future roles. After into the De Beers postgraduate training completing the PMDP, participants receive Safety training programme, a structured two- to three-year a BSc (Honours) degree in Industrial A total of 5,677 DBCM employees and development plan that exposes graduates Technology and Management. The PMDP contractors have been trained in SRMP to the world of work and assists them to also empowers participants to grow between May 2010 and December 2012, learn and develop within the organisation. personally and professionally by providing representing 97% of individuals working On completion, the candidate is usually theoretical and practical skills to become on DBCM sites. Emphasis is now placed promoted to the professionally qualified competent senior managers. Twenty on ensuring the continued application of occupational level. In 2012, 10 (44%) of employees participated in the programme knowledge attained through this programme. the graduates were women. during 2012, of whom 15 were HDSAs.
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• A well-established Supervisory The Global Shared Services (GSS) ABET Development Programme aims to equip People Way All 17 learners who participated in the ABET first-line managers with the knowledge programme in 2012 completed it by the end and skills to develop, lead and inspire high- During 2012, AAESS launched the GSS of the year. performance teams. In 2012, 21 women People Way, which outlines the experience, completed this programme. knowledge and skills required for success Bursaries and scholarships in AAESS. This information describes seven During 2012, ACD provided full bursaries AAESS subdisciplines – service leadership, service to 20 students (all HDSAs) at recognised management, service quality and business universities throughout South Africa, to study AAESS invests in a number of learning improvement, and service delivery – as well in disciplines that are aligned to its business and development initiatives to support the as a generic role profile for each. It also requirements. More than 40 employees made continuous development of employees, and includes the 10 technical competencies use of a part-time in-house bursary scheme to support Anglo American’s ambition to required within AAESS, guidelines for each of to further their education. become the leading global mining company. these and examples of possible career paths. ACD is building a pipeline of emerging talent During 2012, HRD expenditure on HDSAs The GSS People Way is specifically designed through Building Leaders and Shaping Talent in AAESS totalled R6,7 million (up from to help employees identify the competencies (BLAST). This programme attracts bright R6,3 million in 2011), which equates to they need to develop and the roles to which young talent exiting universities and provides 4,79% of HDSA payroll. they aspire. them with broad exposure to the business by Safety Study assistance moving them across three different positions AAESS remains committed to ensuring that AAESS encourages employees to improve on at least two continents over a five-year employees are safe, both at work and outside their academic qualifications and in period. This programme has been in place for of the workplace, and continued to build 2012 provided financial assistance to nine years and currently has 48 candidates on the safety and development initiatives 39 employees to support their part-time and alumni working throughout the introduced in the previous year. During 2012, studies. These included courses in business organisation. 50 employees who are regular road travellers management, finance, human resources Leadership development were trained in defensive driving tactics, and payroll, to develop skills required to The ACD offers a range of programmes with the aim of improving driver awareness, deliver quality service in a shared services to develop leadership talent within the reactions and safety while driving. A parallel environment. organisation. In 2012, two groups of initiative, to reduce business mileage (for delegates (76 in total) graduated from TAP example, by conducting business meetings ACD in 2012 and 176 employees participated via teleconference or video conference in PME. whenever possible) resulted in a 40% ACD spent R11,9 million on HRD training for reduction in kilometres driven by employees HDSAs in 2012, representing 2,1% of HDSA for business. payroll. Training initiatives are aligned to the People Development Way global human Practical management training resources programme. AAESS introduced a second iteration of the Practical Management Training (PMT) programme aimed at providing managers and supervisors with the basic skills required to manage and lead more effectively. The PMT consists of seven modules customised to suit the AAESS operating environment, namely: emotional intelligence; managing people for results; leading through change; performance coaching; relationship intelligence; thinking and problem-solving; and customer experience management. In 2012, a total of 57 managers attended the PMT programme. Leadership forums Good people management is critical to ensuring effective employee engagement, high performance in teams and quality service delivery. In support of this, AAESS introduced a quarterly leadership forum in 2012, attended by 104 managers. Each forum aimed to help managers develop their people management skills, covering topics such as the importance of management style, change management and holding difficult 01 Receiving operator training on a Bucyrus SKL drill rig are trainee operators, Florencia Bekend and Nattie Groenewald with the conversations. senior instructor, Enos Dladla.
2012 | 39 We want our employees to enjoy quality We engage with the Chamber of Mines and Improving our housing and living conditions. We believe with organised labour to address issues that an environment that fosters respect and explore options for home ownership. employees’ for human dignity, privacy and family life, is One innovative approach is our work with essential to achieving real transformation in NGO partners to develop and implement a housing South Africa. Decent living conditions are low-income housing model using enterprise part of the foundation for developing long- development, with houses being built with a term stable and empowered communities that room that can be rented out, as a means to and living will prosper long after our mines have closed. pay for part of the loan provided. conditions Anglo American has made great strides in Our employees can participate in home moving from the classic mining hostels of the ownership schemes through housing past to converted bachelor-flat and family allowances, which are complemented units. We invest in improving the housing and by programmes to educate them on living conditions of employees and making the responsibilities of buying, owning it possible for them to buy their own homes and managing their own homes. We are in suitable areas near our mining operations. experiencing an encouraging increase in Our vision is that all of our employees who the number of employees seeking home would like family accommodation have that ownership. option in the mining communities. Our business units offer various We seek to provide a range of housing accommodation choices, including a living- options that cater for the diverse out allowance, to suit employee needs. circumstances and preferences of our For instance, some of our employees have employees. As such, our housing initiatives families based in other regions and do not also take into consideration the financial, wish to invest their money in a fixed property developmental and personal elements of away from home. Other employees cannot each individual, thus contributing to making afford to purchase homes straight away and Anglo American an employer of choice. We may prefer a rent-to-buy option. This allows believe that offering quality accommodation employees to pay a monthly rental for a and attractive housing initiatives is a key house until they are able to secure funding factor in attracting and retaining vital skills. from the banks to buy the property. Our housing-related efforts are in line with Housing options include providing bulk the Mining Charter, which requires that by services and offering building packages, 2014, mining companies must have converted for which employees can apply for or upgraded hostels into family units/single housing bonds. occupancy per room, and facilitated home- ownership options for all mine employees Anglo American’s housing initiatives in consultation with organised labour. take into consideration each employee’s We continue to make encouraging progress financial awareness and circumstances. towards meeting all the Mining Charter’s We have a service provider to assist with housing and living condition requirements. credit administration, facilitate and support employee applications with financial PROMOTING institutions. OPPORTUNITIES OUR PERFORMANCE In South Africa, there remains a significant Hostel conversions shortage of affordable housing and Anglo American has invested extensively long waiting lists for units being built. over many years in upgrading its residences In partnership with local and provincial across South Africa into converted units, government, we are helping to alleviate flatlets and family houses. We continue to this situation. steadily decrease the level of occupancy in our converted hostels. At the end of 2012, Our Platinum, Kumba, Thermal Coal just over 2,163 employees, (8,065 in 2011), businesses and De Beers proactively mainly in our Platinum business, were sharing engage in developing properly serviced land a room with one other person (maximum to facilitate housing development in areas occupancy of two per room). We are working where services are inadequate or do not hard to meet the Mining Charter’s target exist. The business units collaborate with occupancy of one person per room by 2014. reputable developers to encourage and R1,4bn promote affordable home ownership among Thermal Coal: The business completed all employees at all levels. Where possible, land necessary hostel conversions before 2010, spent on housing is donated to the municipality to facilitate and is now concentrating its efforts on the rehousing of communities residing in consulting with organised labour to facilitate initiatives informal settlements. home-ownership options for mine employees.
40 | Transformation Report 2012 02 Investing in our people
We invest in improving the housing and living conditions of employees and making it possible for them to buy their own homes in suitable areas near our mining operations.
Kumba: All 18 hostel blocks at Sishen mine Kumba: At Sishen, about 1,970 employees COMPANY-BUILT HOUSES have been converted into 684 bachelor are living in company-provided flat units, each comprising a bath, toilet, accommodation. Preparations are under We invest in creating opportunities for our shower, kitchenette and bedroom. Employees way to build an additional 476 company- employees to rent or buy company-owned who could not be accommodated in the owned units to house employees who housing stock and newly built homes. converted units are now living in company- cannot be accommodated in the converted Thermal Coal: By end 2012, 203 houses had owned two-bedroom detached family units. company flats. been built for sale to employees: Arrangements to provide women-only accommodation are under way. Additionally, Platinum: About 6,000 employees are • 77 units at Aloe Ridge, for officials and the Thabazimbi mine has converted all its living in company-owned and company- management hostels into family units. leased houses. Home-ownership and • 60 units at Hlalamnandi, for skilled own-accommodation options are being employees Platinum: All hostels have been converted encouraged through projects such as the • 66 units at KwaMthunzi Vilakazi, for all into single-person accommodation villages, East End project for the Rustenburg mines, employees. and the business is now focused on and the Thabazimbi project for the Tumela developing family units within communities and Dishaba mines. Duvha Park, a new development under way close to the operations. The Rustenburg in eMalahleni, aims to provide 3,733 houses mines have met the 2012 target of 50% De Beers: De Beers provides company to the broader community. The bulk services of employees not sharing rooms; the housing to skilled employees at certain levels, are expected to be completed in 2013, and Amandelbult mines (Tumela and Dishaba) and pays housing allowances, as well as the majority of the houses completed and have slightly surpassed the target and are water and electricity subsidies, to semi-skilled occupied by early 2014. In return for investing currently recording 51%; with Union mines employees at Venetia mine. R16 million in the development of bulk lagging slightly at 46%. infrastructure for the project, Thermal Coal Housing expenditure has secured 272 units that will be available De Beers: There are no hostels at any of (Rbn) for 2012 for sale to employees. So far, 113 employees De Beers’ three South African operations. have been granted bonds to purchase these houses. Company-provided accommodation Across South Africa, 11,990 Anglo American Thermal Coal is also developing the employees stayed in company-provided KwaMthunzi Vilakazi project, west of accommodation in 2012. We actively promote eMalahleni. Ultimately this project will home ownership in order to encourage deliver more than 370 houses (as building the acquisition of a meaningful asset and packages) over the next two to three years, to lessen employee dependency on the subject to demand and bank home loan company to provide accommodation. approvals. Developers vetted by Thermal 1,414 Coal will build the houses. The building of Thermal Coal: At the end of 2012, 33% new roads (including rehabilitation of existing of employees live in company-provided roads), the storm-water drainage system and accommodation. There are 560 company- infrastructure for bulk services are complete, owned houses: 405 in eMalahleni; 30 in with the capacity to service 500 existing Komati; 57 in Middelburg; 40 in Thuthukani; privately owned stands and about 500 new and 28 in KwaMthunzi Vilakazi. stands. The bulk services, provided by Thermal Coal, include the supply of water, Thermal Coal intends to retain ownership sewer, electricity and transportation networks of a large share of the houses in 110 Platinum for the community. the eMalahleni/Middelburg area as 386 Thermal Coal Kumba: In 2012, Sishen mine built accommodation for employees who do 918 Kumba not qualify for housing schemes, such 895 houses to accommodate employees, 0.24 De Beers as foreign nationals working at Thermal bringing the total number of homes Coal operations. In 2012, the business 1,414 Total constructed since 2007, to 2,475. More than unit made 125 units available for sale to half of these have already been sold, with the employees, of which 36 have been bought balance being rented or available for sale. to date. The sale of a further 100 units in Following pay-outs from the Envision eMalahleni to employees is being considered. employee share-ownership scheme in An additional 661 Eskom-owned houses 2011, Thabazimbi mine offered 75 of the accommodate Anglo American employees at 126 Ipelegeng houses for sale in order to the collieries serving Eskom power stations, promote home ownership. In 2012, 23 houses of which 448 are available for sale to these were purchased by employees. employees. Kolomela mine has built 579 houses, Thermal Coal has established a new market- including 336 in 2012. These homes will related rental scheme, in consultation with initially be leased to employees, and made organised labour. Skilled employees qualify available for sale after five years. for a full housing allowance, which they can use either for rental units or for mine accommodation. Plans are in place to extend the scheme to other employees.
2012 | 41 Sishen plans to build an additional Another project – Mokopane Extension 14, Platinum is finalising a rent-to-buy housing 1,720 houses in Kathu in the Northern for 500 houses – is at the conceptual stage. option, which will allow employees to move Cape to meet current and future housing into their houses while their credit rating needs, while Kolomela plans to build a total These initiatives are part of a broader is being improved through the MBFP. of 718 houses in three different areas at commitment by Platinum to develop up to Around 600 employees have signed up for Postmasburg, with completion of the final 20,000 homes for low-income employees, the programme and are awaiting internal 139 units expected in 2013. by 2017. approval before their houses can be built. The 500 houses allocated for this rent-to-buy Platinum: The business unit has built Many employees who would like to invest in Platinum’s housing projects are regrettably option will form part of the 924 houses being 465 houses, of which 263 were completed constructed in Seraleng, near Rustenburg. in 2012. The following housing projects are unable to access financing due to poor credit at the construction phase: records. To address this obstacle, Platinum De Beers: Currently, De Beers does implemented a debt-rehabilitation programme • Seraleng project in Rustenburg – not provide company accommodation to (DRP) to assist employees in proper 1,000 units semi-skilled employees, as employees are financial planning and debt management. recruited from the local communities around • Thabazimbi Extensions 18 and 22 – To date, about 1,000 employees have been 89 units the mines. The company is, however, in talks through the DRP. The business hopes to with labour unions on how to facilitate home • East End housing project in Rustenburg – attract 100 employees to register for the ownership. Plans include rent-to-buy options, 208 units “My budget fitness” programme (MBFP), access to government subsidies and financial • Northam Extensions 6 and 17 in Northam, which aims to amend employees’ impaired institutions and building around 700 houses as well as the Northam 310 project for the credit records and increase their credit rating across its three operations in South Africa. Union and Amandelbult mines – 680 and so that they can secure housing bonds. 310 units, respectively Several employees have already succeeded in clearing their poor credit records after completing this programme.
01 Platinum’s Seraleng Housing Project in Rustenburg where 1 000 houses were completed.
42 | Transformation Report 2012 02 Investing in our people
Employee allowances per business unit
Platinum Amount per employee
Home-ownership allowance R2,725 – R5,178 (6,635 employees)
Living-out allowance R1,737 (27,562 employees) Thermal Coal Amount per employee
Housing allowance R5,242 – R7,532 (for the 67% of the workforce who live in their own accommodation) R5,242 less monthly rental charge of R2,600 (for skilled employees who are provided with accommodation) Kumba Amount per employee
Housing allowance R1,250 – R2,830 (5,373 employees qualified)
Subsidy for first-time homeowners Formula-based for the first five years of home (184 employees qualified) ownership De Beers Amount per employee Water and electricity allowance R800 – R1,200
Worth its weight in platinum A Govan Mbeki Housing Award is sought-after recognition of a company’s contribution to accelerating housing delivery in South Africa. In 2012, the Platinum business won two of these prestigious awards. Presented by the Department of Human Settlements in April 2012, the first award recognised Platinum’s dedication to the provision of housing in the Northam area. The second, presented in June, recognised the business’s commitment to South Africa’s housing needs at a national level. The national award was presented to the executive management of Platinum. Platinum, in partnership with the Department of Human Settlements, plans to build 20,000 homes within 10 years. A 310-unit housing project is in progress in the Northam area, while a number of other housing developments are at various stages. The building of 1,000 units in Seraleng, Rustenburg was the first Platinum housing project to be commissioned; by 2012, 200 families had already moved into
their new homes. 01 At the presentation of the national Govan Mbeki Housing Award are, then-Platinum’s executive head of human resources (currently executive director: Anglo American in South Africa, Khanyisile Kweyama) with Platinum’s senior HR manager for housing, Papillon Motswenyane.
2012 | 43 44 | Transformation Report 2012 01 01 Kgololosego Leteketwa, an 02 Impilo Health Programme – which educator at Kloof View Primary is supported by Anglo American School in Rustenburg. Chairman’s fund, delivers a professional and holistic healthcare service to the homeless and destitute community within the inner city of Johannesburg – Female nurse Gabisile Dubazana, with child patient.
02
03 Supporting communities WITH THE FUTURE IN MIND
Transformation Report 2012 | 45 Mine communities form an integral part of transparency and accountability. Engagement Collaborating mining development. The sustainability of our with local stakeholders is central to the mining activities depends on our ability to process. Operations must undertake a to develop mine contribute to the well-being and prosperity of SEAT assessment every three years to host communities. It is through their goodwill ensure that any significant changes in the communities that we are able to gain and maintain our operation and community are reflected, and social licence to operate. The failure to that management measures set out in the secure or retain support from our host previous SEAT report have been implemented communities as a result of changing societal and evaluated. expectations, or through inappropriately managed social, health, human rights or In 2012 our business units spent a combined environmental impacts at our operations, total of R694 million (vs. R423 million in could have a material impact on our business. 2011) on socio-economic development initiatives. (The table on page 51 provides In South Africa, the need for sustainable a breakdown of investment in focus areas community development is recognised as by each business unit). These initiatives a commercial and social imperative. Many contribute directly to progressing our social of our South African operations are in rural and labour plan (SLP) commitments at all our areas characterised by low levels of formal operations, which are aligned to municipal economic activity and inadequate provision integrated development plans (IDPs). Every of infrastructure and services. We seek to operation has an SLP, which is developed help alleviate poverty and unemployment through a consultative process with local and develop host communities, by building municipalities as well as through regular local capacity, providing infrastructure interaction with host communities. for healthcare, education, housing and sanitation, investing in education, enterprise FOCUS AREAS and skills development, and promoting local procurement and supplier development. Community healthcare Many of these programmes are undertaken We use the knowledge and experience gained in partnership with NGOs, communities, from our workplace health programmes to and local governments. support community outreach programmes and strengthen community health systems. There For many years we have worked to improve are seven building blocks to strengthening the way we operate so that we can respond healthcare systems: improving facilities to our stakeholders’ needs. We have led the and equipment; ensuring the availability way in such areas as small and medium-sized of a skilled health workforce; improving business creation, community engagement procurement and supply chain processes; and development using our industry-leading sound financial management; information Socio-Economic Assessment Toolbox systems; good governance; and effective (SEAT), and healthcare through our leading monitoring and evaluation processes. workplace health and wellness programmes to combat HIV/Aids and TB. In South Africa, we are working with the provincial health departments in Eastern Mine community development is considered Cape, Mpumalanga, Northern Cape and at all stages of the life of a project, from the North West, which are all associated with our pre-feasibility stage through operation to operations and labour-sending areas, in order closure. Our business units have embarked to improve health services. on extensive initiatives to develop mine communities and labour-sending areas, in line Education and capacity building with the Mining Charter requirements. Investing in education is vital in promoting a more equitable society in South Africa. All operations follow social and community Business units invest in a range of community improvement plans, developed in 2009, which education and youth projects, including provide roadmaps aimed at ensuring full primary school education, maths and science compliance with the 24 requirements of the focused programmes, teacher development, Anglo American Social Way – the standard literacy, higher education and infrastructure We spent a total of for managing our social performance. development. SEAT is the primary means by which we We offer employees, contractors and enhance the development outcomes and community members ABET programmes on R694 million capacities of host communities. We use SEAT literacy and numeracy, as well as training on socio-economic to improve our operations’ understanding of in skills outside the mining sector, such as their socio-economic impacts (both positive electrical services, plumbing and carpentry. development initiatives and negative), enhance stakeholder dialogue This investment is aimed at making people and the management of socio-economic more employable after mine closure. issues, build our ability to support local socio- economic development, and foster greater
46 | 2012 03 Supporting communities
We seek to alleviate poverty and unemployment and develop host communities, by building local capacity, providing infrastructure for healthcare, education, housing and sanitation, investing in education, enterprise and skills development, and promoting local procurement and supplier development.
In South Africa, poor capacity in The Goedehoop programme in Mpumalanga, launched in 2011, delivered impressive municipalities potentially jeopardises our improvements in four schools around the Middelburg/Hendrina area, as reflected in the below ability to deliver on SLP commitments and comparative analysis of Grade 12 results. promote broader social stability. We have Grade 12 pass rate supported initiatives aimed at building the capacity of our host municipalities since we 2010 2011 2012 signed a Memorandum of Understanding with School % % % the Development Bank of Southern Africa (DBSA) in 2010. KwaZamokuhle 25 57 91 Infrastructure development Tsiki 52 51 64 Working with partners to provide Bankfontein 17 25 80 infrastructure is an important way in which we create sustainable value for our host Polzee 53 68 77 communities. Our mines are often situated in areas that are underdeveloped and remote, where we can share infrastructure associated Thermal Coal completed the feasibility study healthcare services and a pharmacy. with our mines – roads, health facilities and for an R18 million state-of-the-art schooling The construction contract was awarded to water – with local communities. Where our facility at Kriel that will cater for around a 100% black-owned company, and will planned or existing infrastructure does not 1,500 children of the Ga-Nala community. generate an expected 100 to 150 jobs meet an important need, we go beyond Construction has begun and the contract for local residents during the construction leveraging our core business activities, to has been awarded to a local company, with phase alone. meet requirements through social investment. priority given to local employment and subcontracting. A particular focus is addressing South Africa’s acute shortage of affordable Environment formal housing. The country’s history of • A private-public partnership between discrimination has left large segments of Thermal Coal’s Zibulo colliery, the population living in informal settlements, eMalahleni Local Municipality and Phola and current municipal resources to provide environmental groups, has resulted in a the infrastructure essential for residential waste-management programme that is development are limited. generating significant benefits for the 30,000 residents of the Phola, Wilge Thermal Coal and Ogies communities in Mpumalanga. The initiative, which focuses on waste Our Thermal Coal business performed collection, clearing of illegal dumps and well against its 2012 social performance greening community areas, has promoted targets. Total socio-economic development a cleaner environment and a healthier expenditure for the year amounted to community. R105 million. Thermal Coal’s SLP five-year commitment period came to an end in 2012 Infrastructure and a new SLP was developed in consultation • Thermal Coal’s New Vaal colliery in the with stakeholders to ensure bigger impact, Free State is constructing a multi-purpose based on the lessons of the previous SLP’s centre in the Metsimaholo Municipality. programmes. The centre aims to make government services, including a post office, social Flagship initiatives in 2012 security centre and sports facilities, more Education accessible to the residents of Harry Gwala Thermal Coal’s maths and science township in Zamdela. The R23 million improvement programmes at targeted project is being undertaken by a 100% schools supported a significant increase in black-owned local company and has the 2012 matric pass rate. The Protec School already created 120 local jobs. Excellence programme achieved a 100% pass rate from 48 Grade 12 learners across Health nine schools in eMalahleni, Phola and Kriel; • New Denmark colliery, in partnership 66,7% attained admission to undertake a with Lekwa Municipality and the Bachelor’s degree, 29,2% gained a national Mpumalanga Department of Health, is diploma, and 4% obtained a higher education funding the construction of a R26 million certificate. community health centre for people living in Rooikoppen, a township south west of Standerton, Mpumalanga. The newly established area is home to around 2,400 households that have limited access to essential services, including adequate medical care. The 24-hour facility will include a full range of primary 01 Mebile Moji, a male nurse with a child at the Impilo Health Programme.
Transformation Report 2012 | 47 Tshikululu Social Investments, which The operations are acting on the findings Collaborating manages investment funding in South of the reviews, and best-practice learning Africa through the Anglo American’s is shared across the Group in order to improve Chairman’s Fund. to maximise benefits. The project will our approach deliver four peer reviews for 2013. The Platinum, Thermal Coal and Kumba were learnings from the process will also be to community among the six business units reviewed incorporated in other training offerings globally in 2011/2012. Through the peer- such as our socio-economic assessment review process, 10 critical themes were toolbox (SEAT). development identified for further interrogation and As part of efforts to find better ways to management: Most opportunities to boost benefits deliver community development, Anglo • Conflict and tension experienced by to local communities rely on using core American has developed an innovative the operations owing to labour strikes business activities, such as procurement peer-review process aimed at identifying and community unrest and recruitment, rather than more what the company is doing well and • Lack of partnerships with traditional social investment approaches. where it can improve. governments, NGOs, community and The project will be evaluated by traditional structures The in-house community development monitoring the number, quality and peer-review process was successfully • A need for meaningful indicators impact of the changes that host sites piloted in 2011 at a selection of beyond input and output can implement, as well as those that Anglo American operations around • Sustainability versus dependency peers take back to their own operations. the world, and rolled out in 2012. The • Poor record-keeping and information The Centre for Social Responsibility in reviews draw on internal expertise, as systems Mining at the University of Queensland, well as external partners such as the • Weak local government structures Australia, is preparing a paper documenting and reviewing the project. leading development charity CARE • Weak internal capacity and capability International, to assess current activities • Community trusts and community and identify opportunities to ensure benefit-sharing schemes that our investments in community development are as effective as possible. • Expanding areas of influence The reviews are actively supported by • Risk-based approach to development.
Kumba iron ore • R2,4 million was provided to support: the Health and welfare Manyeding sustainable agriculture, the • Kumba has invested R6 million in Sishen Kumba’s total socio-economic development Dibeng organic beekeeping and honey mine’s Ulysses Gogi Modise (UGM) expenditure in 2012 was R276 million, farming, the ART (alternative recycling wellness clinic, at Kathu township in the compared to R182 million in 2011. technologies) tyre recycling, and the Northern Cape, which provides much- Kathu Vision public safety projects in the needed healthcare services to the As part of its long-term community Northern Cape community, employees and many local development strategy for the next 25 years, contractors. In 2012, 8,856 community the business unit plans to increase its • Kumba signed an agreement with Food members visited the clinic enterprise development (ED) spend from and Trees for Africa and Renewable 5% to 20%, in recognition of the high value Energy Solutions to establish a bamboo • Also in the Northern Cape, R5,6 million has that this focus area can generate in enabling plantation in Thabazimbi, in Limpopo. been invested in nine mobile clinics to take empowerment and sustainable development The local community will benefit from the critical health services to disadvantaged in Sishen mine’s areas of operation. manufacture of bamboo products once communities in the remote John Taolo the plantation becomes commercially Gaetsewe district, which faces serious Sishen mine embarked on a new SLP for the sustainable. A vegetable farm is also health challenges and severely limited period 2012 to 2016, having met or exceeded planned with a total investment of around access to healthcare. Since its inception in all its SLP commitments for the previous R20 million. September 2011, this project has benefited five-year plan. an estimated 26,000 people. Kumba will Education and skills development gradually hand over the project to the Flagship initiatives in 2012 • Approximately R15,6 million was spent in Department of Health, thereby ensuring Poverty alleviation and enterprise communities around Sishen mine in 2012 the long-term viability of the initiative. development to support the delivery of quality education • In Kuruman, in the Northern Cape, around from early childhood development through R4,1 million was spent on mentoring small, to Grade R, primary and secondary school, medium and micro-sized enterprises as well as colleges of further education (SMMEs) and emerging enterprises and training and tertiary institutions. in 2012. This incorporated SMME An increase of 12% in the matric pass Development in Kathu, with a total of rate was achieved in the district where 306 beneficiaries for 2012 Sishen operates.
48 | 2012 03 Supporting communities
Infrastructure engaging with contractors about the Group’s construct a 600km water supply pipeline • Together with the local municipality at requirements regarding the management in Limpopo which will give up to 1,9 million the Thabazimbi mining town in Limpopo, of environmental and socio-economic people access to a reliable source of potable Kumba is addressing the town’s insufficient issues. The business continues to focus on water for the first time. and unreliable water supply through integrating the Social Way requirements into Investing equity in communities: Steady a R24 million project that will benefit Platinum projects, as well as closing the gaps progress was made in laying the foundations 14,000 households (approximately on any outstanding requirements. of Platinum’s pioneering community share 84,000 people). Flagship projects in 2012 ownership scheme, Project Alchemy, through • About R25 million was invested in 2012 in Entrepreneurship: Platinum has nine thriving the Lefa La Rona Trust. This R3,5 billion various projects to improve service delivery small-business support hubs, established transaction aims to ensure the long-term in the Northern Cape, with an emphasis as part of Anglo American’s enterprise socio-economic development of communities on roads and storm-water services in the development initiative, Zimele, which have that do not benefit from Platinum’s existing Gamagara Local Municipality, which has advanced R131 million in loans to around BBBEE initiatives. These include a number population of more than 41,000 people. 400 emerging businesses. Together, these of communities around the Mogalakwena, have created and maintained more than Rustenburg, Twickenham and Amandelbult Platinum 5,300 jobs since 2008. mines, and also communities in the key labour-sending areas. Platinum invested R276 million (R187 million Education and training: Our Platinum in 2011) in socio-economic development business built and handed over the Tlhabane Further information on the initiative is initiatives during 2012. Community West Primary School in Rustenburg to the provided on page 55. development efforts focus on four main local education authority. It is currently labour-sending areas: Taung in the North building two more schools in labour-sending Health: Platinum has built nine community West, Bizana and Mqanduli in the Eastern areas in the Eastern Cape and North West. health clinics which it continues to fund Cape, and Mohaleshoek in Lesotho. In line More than 350 employees, community and oversee. Mobile clinics, funded by with regulatory requirements, Platinum members and contractors took part in ABET Platinum and delivered in partnership with currently follows an inclusive zone (radius) programmes in 2012. Platinum launched a the Department of Health (DoH), have approach of 50km from its operations R40 million bursary fund for people living delivered primary healthcare to more than to identify beneficiaries of community around the Twickenham mine, and more than 32,000 people. Lifeline, funded by Platinum development. This is now under review 2,000 learners benefited from extra maths and the DoH, has run mobile clinics, testing to ensure activities are more focused and science lessons organised during school 282,500 community members for HIV/ and beneficial to those directly related to holidays in the North West and Limpopo. Aids, since 2010. Platinum’s investment our operations. Altogether 100 community youth members in healthcare facilities in 2012 included are benefiting from the artisan training the completion of the Jalamba Clinic for In compliance with regulatory guidelines and remote communities in the Eastern Cape, Anglo American governance frameworks, the offered at Platinum’s Engineering Skills Training Centre. in partnership with the Anglo American’s business developed a plan to integrate social Chairman’s Fund, and the R14,5 million performance requirements into contractor Environment: To address water shortages upgrade of primary healthcare facilities in management. This is yet to be implemented for Platinum operations and the communities communities around its mines in Limpopo. at operational level. Platinum also participated around its mines, the business is in a in Anglo American’s Contractor Summit, partnership programme with government to
Firmly rooted Already a number of courses have been their own crops based on sound successfully implemented. agricultural principles. In the longer term, sustainable the trainees will acquire skills that will Fully sponsored by the mine, the well- development enable them to boost micro-economic equipped training centre is located on development in the area. Many of Platinum’s mines are located Mogalakwena’s Waterberg Biosphere among rural communities, where Reserve. Converted from a disused Courses currently offered at the centre long-term economic sustainability and stable, it provides accommodation for include: well-being may be under threat owing to around 24 learners and five trainers in a • Food preservation the high level of dependence on mining comfortable environment, with workspace • Permaculture – individual, family and activities and related businesses. areas to suit different training styles and community gardens of up to 1 hectare needs. A separate industrial-style kitchen (100 trainees in 2012, with scope to Community members often lack is available for women from the local the essential skills needed to earn cater for 300 permaculture students community who have been trained to per year) an alternative living and become cater for large groups, to prepare meals • Sustainable development through self-sufficient. To address these for up to 30 people. challenges, in 2012 Platinum opened mining an environmental training centre The training courses are aimed at • Linkages to the Eco-Schools South near its Mogalakwena mine, 30km empowering local community members Africa programme from Mokopane in the Limpopo. to provide for their families by cultivating • Carpentry/woodwork for adults.
Transformation Report 2012 | 49 01 Children walking on a new road built by Twickenham mine at the Makgopa Village.
50 | 2012 03 Supporting communities
De Beers Flagship initiatives in 2012 • Venetia mine spent R27,586 on a borehole Education project for the Maseka Drop in Centre, De Beers’ community development • Venetia mine donated R3 million towards which looks after 243 children from programmes seek to meet commitments Messina Primary School, Musina High child-headed families in the Juniorsloop identified through SLPs and by the De Beers School and the Eric Louw High School community Fund and the De Beers Zimele Small in Musina, to support staff costs and • Venetia mine donated R13,198 to the Business Development Hubs. Activities focus scholarships for learners Musina Lutendo Community Home Care on the communities in which the business • R600,000 was invested in Grades 10 to 12 in the Nancefield township in Musina, for unit operates and through the De Beers Fund education at the Khula Weekend School equipment for administration purposes. on national programmes. (KWS), which operates at University of The organisation provides after-school Johannesburg (UJ), Soweto Campus care to orphaned and vulnerable children Target beneficiary and the Vaal University of Technology, (OVC) and looks after the elderly in the Mine communities Vanderbijlpark Campus. More than community. 1,600 learners have benefited from the Venetia Musina and Blouberg areas Infrastructure development programme since its inception in 1997 mine in Limpopo • De Beers invested R881,000 in • Voorspoed mine donated five computers Voorspoed Moqhaka, Ngwathe and the Hondeklip Bay Early Childhood to the Mmabatho Intermediate School in mine Jagersfontein areas in Development Centre, in Namaqualand Parys, in Free State, for use in the school’s Free State • At Buffelsrivier, the business invested resource centre. Kimberley Galeshewe and Kimberley R670,000 in the construction of an mines areas in Northern Cape Welfare administration building at the local primary • Grants amounting to R99,000 were school. The De Beers Fund focuses on projects in distributed to community-based Youth development the labour-sending areas of the De Beers organisations in De Beers’ labour-sending • De Beers co-sponsored the annual mines and also on strategic programmes areas around Musina, Blouberg, Kimberley, KwaMahlobo Games soccer tournament nationally. Kroonstad, Parys and Namaqualand, in the in Soweto during the Christmas holidays, fields of welfare, education, art and culture with R80,000. The event is attended by and environment approximately 25,000 people.
Socio-economic development spend for 2012
Thermal Coal Kumba Platinum De Beers AASA
Education R19,926,685 18,9%* R42,100,000 15,2% R27,090,000 9,8% R59,081 0,2% R89,175,766 12,8%
Health R14,918,958 14,2% R34,700,000 12,5% R2,880,000 1,0% R6,897,833 18,7% R59,396,791 8,5%
General community development (including infrastructure) R8,061,898 7,7% R151,600,000 54,8% R138,120,000 50,0% R8,399,023 22,7% R306,180,921 44,1% Arts, culture and heritage R24,894,229 23,7% – – – – R94,658 0,3% R24,988,887 3,6%
Environment R16,573,589 15,8% R25,000,000 9% R980,000 0,4% R7,347 – R42,560,936 6,1%
Other R19,494,638 18,5% R5,200,000 1,9% R92,040,000 33,3% R169,933 0,5% R116,904,571 16,8%
Chairman’s Fund/ De Beers’ Fund R1,358,687 1,3% R18,000,000 6,5% R15,000,000 5,4% R21,321,336 57,7% R55,680,023 8,0% Total R105,228,684 R276,600,000 R276,110,000 R36,949,211 R694,887,895
Net profit after tax (NPAT) R1,807,005,337 R32,000,000,000 R67,200,000 R988,812,107 R34,728,617,444
Expenditure as a percentage of NPAT 5,8% 0,86% – 3,74% 2,0%
* Percentage of total socio-economic development spend.
Transformation Report 2012 | 51 01
01 The Jig plant at Kumba Iron Ore’s Sishen 02 Dr Lorna Maphuthuma with Rose Kgoete mine in the Northern Cape, South Africa, (Zimele Hub Manager, Burgersfort). Lorna is the largest of its kind in the world is a medical practitioner who runs a large practice in Burgersfort. The business was provided with seed capital from Zimele. 02
04 Developing partnerships WITH THE FUTURE IN MIND
52 | Transformation Report 2012 Transformation Report 2012 | 53 Anglo American has a long and well- employees. We provide financial planning Diversifying established track record of being an active advice to facilitate responsible investment partner in black economic empowerment and spending, and to assist employees ownership (BEE) mining projects. Since 1994, we in managing this benefit in the most have concluded BEE transactions with effective way. an estimated value of around R67 billion. to promote a We believe that investing employees and Most of our business units have already communities in our performance promotes achieved the Mining Charter’s 2014 minimum stability at our operations. more equitable target of 26% BEE ownership to enable meaningful economic participation of HDSA ESOPs currently in place at Anglo American’s society in the mining industry. South African operations include: Our effective and mutually beneficial BEE • Thermal Coal: Siyaphambili partnerships have led to the creation of • Kumba: Envision flagship black-owned mining companies • Platinum: Kotula including Exxaro Resources, African Rainbow • De Beers: The De Beers Equal Allocation Minerals, Mvelaphanda/Afripalm and Trust (shares issued to all SA employees Shanduka. in 2006). In 2012, we reviewed a number of current THERMAL COAL and previous empowerment deals in order to identify opportunities to boost transformation Thermal Coal’s assets for empowerment in areas other than ownership. We support purposes are divided into two categories, our BEE partners through procurement assets held by AOPL and assets held by and enterprise development initiatives, and Anglo American Inyosi Coal (Pty) Limited in some instances provide technical and (AAIC). BEE ownership is calculated refinancing support. differently for each category: Community and employee participation are • AOPL is empowered on the basis that central to our efforts to make a meaningful it has transferred 26% of attributable contribution to the sustainable, long-term production to HDSA-owned and -controlled entities socio-economic upliftment of communities affected by our mining operations. We are • AAIC is empowered on the basis that ambitiously moving beyond regulatory it has transferred 27% equity to HDSA compliance, pursuing innovative opportunities shareholders. to extend and distribute the benefits Thermal Coal’s 26% ownership by HDSA of ownership to employees and host entities was achieved through the sale of communities. assets to BEE companies and consortia. ESOPs and community trust initiatives The stake is made up of attributable tonnes Our ESOPs and community trust initiatives derived from the following transactions: are pivotal vehicles for achieving broad- • The transfer of Arnot and New Clydesdale based transformation. Structured to support collieries as well as Thermal Coal’s our aspiration to be both an employer and 50% shareholding in Matla colliery to partner of choice, the schemes offer a Eyesizwe Coal workable model for ensuring that workers • The formation of the Mafube colliery 50:50 and communities participate in and enjoy joint venture with Eyesizwe Coal the benefits that accrue from our mining • The sale of various reserves and resources activities. which led to the creation of Umcebo Mining, Leeuw Mining, Umsimbithi Mining A leading example is at our Kumba business, and World Wide Coal. These entities are where a combination of favourable conditions currently in production including a strong financial performance • The sale of Panfontein and South Rand enabled the business to distribute among assets in the Vaal Basin near Vereeniging its employees, through the Envision share to two emerging HDSA controlled ownership scheme, the largest collective companies. Panfontein has resources of social dividend ever paid out by a company to HDSAs. 281 million tonnes and South Rand has 143 million tonnes, which could be used Anglo American awarded its first ESOPs to supply coal to the domestic thermal in 2008, and has progressively expanded coal market its offering over the years, across all South • Term sheets have been concluded for African business units. Since 2012, all our Rietvlei, a 42 million tonnes resource in the South African employees are members Witbank area. This project is 40% owned of an ESOP. Our structured schemes are by investors from the local community. carefully implemented and managed, with the aim of delivering meaningful benefit for
54 | Transformation Report 2012 04 Developing partnerships
Our Employee Share Ownership Plans (ESOPs) and community trust initiatives are pivotal vehicles for achieving broad-based transformation. Structured to support our aspiration to be both an employer and partner of choice, the schemes offer a workable model for ensuring that workers and communities participate in and enjoy the benefits that accrue from our mining activities.
AAIC is a BBBEE mining company in which of the company, while the SIOC Community a number of disposal transactions and joint Thermal Coal holds a 73% stake. The Development Trust (CDT) and the Sishen ventures. Platinum established the Kotula company has a resource base in excess of ESOP (Envision), which were developed ESOP in 2008, and has various community 1,5 billion tonnes and owns Kriel colliery, specially to empower communities and trusts. The cumulative BEE ownership is in the new Zibulo multi-product mine and employees, hold 3,1% and 3% respectively. excess of 26%. greenfield projects of Elders, New Largo and Platinum is implementing a landmark Heidelberg. The AAIC’s 27% equity to HDSA When phase one of the Envision scheme community trust scheme that will benefit the shareholders comprises the following parties: matured in December 2011, each scheme communities around four of its operations The Inyosi Consortium, led by Pamodzi Coal member who had been employed by and in key labour-sending areas, in an and the Lithemba Consortium, which each the company since its market listing in enduring partnership. In 2011, the R3,5 billion hold 33%; the Women’s Development Bank 2006 received a pre-tax cash payout. Lefa La Rona (meaning “our inheritance”) investment holds 19%; the remaining 15% The amount was determined according Trust was established to hold a 2,33% is held by the community trust, which carries to each employee’s length of service. ownership interest in the business unit, from out our socio-economic project in and around Envision scheme members also receive which beneficiary communities will benefit. the communities in which the mines operate. dividends twice a year, in March and August. In 2012, the biannual dividend payouts were The Lefa La Rona Trust will act as a conduit Pamodzi and Lithemba work closely with R106 million and R100 million. between Platinum and four independent Thermal Coal in relation to AAIC’s strategy development trusts that are currently being and ongoing transformation activities in the Total dividends paid to Envision participants set up to serve the host communities around communities around AAIC’s operations. since the scheme began amount to the Mogalakwena, Dishaba/Tumela (formerly approximately R93,800 per person, Amandelbult), Twickenham and Rustenburg Thermal Coal employees participate in the before tax. Phase two of Envision began mines. A not-for-profit company (NPC) has Siyaphambili ESOP scheme. Employees in November 2011, and will mature in been established to extend the benefits to receive seven shares each year over a November 2016. labour-sending areas. The South African period of 10 years, with shares awarded Revenue Service has given regulatory to employees in 2013, 2016 and 2019.
Envision spending pattern in 2012 indicated by percentage
Age group Settled debt Buying a house Bought a car Bought shares Children’s education Other
18 – 24 41,46 20,33 0 0,81 1,63 0
25 – 30 46,42 0 0 0,5 2,83 0
31 – 35 43,46 0 0 0 0 0
36 – 39 39,67 0 0 0 0 8,85
40 – 45 0 34,06 0 0 0 9,75
46 – 59 0 34,88 0 0 0 0
60+ 0 37,5 17,86 0 0 0
At the end of 2012, Siyaphambili had Kumba provides ongoing ‘financial fitness’ approval for the NPC and four trusts, which 9,249 beneficiaries, including 8,071 Thermal programmes to help employees to wisely are due to be registered during 2013. Coal employees. The balance includes manage their finances. The training focuses The fund will be provided for a 10-year employees of ACD, AEESS and our on clarifying the tax implications of the period at a fixed notional interest rate. Vergelegen wine estate. Envision payouts, advising on how to settle During this period, 40% of the dividend personal debt, and the value of long-term declared by Platinum will be paid out to planning and smart investments, notably Kumba iron ore the Lefa La Rona Trust, to fund community through home ownership. In 2006, Kumba became a fully empowered developmental activities, while the remaining company in terms of the 2014 equity The project generated widespread media 60% will be used to settle the notional ownership requirements set out in the Mining publicity and set an inspiring example for vendor finance. The transaction provides Charter, with a BEE ownership transaction other mining companies. a guaranteed R20 million to the trust to at a company level resulting in 26% HDSA finance development projects, should the ownership. PLATINUM aggregate dividend payable be less than R20 million per year. Furthermore, the trusts Sishen Iron Ore Company (SIOC), which Anglo American’s Platinum business achieved will be able to motivate for additional funding operates Sishen mine, is 26,1% black the transfer of about 23% of forecast for social development projects through a empowered. Exxaro Resources holds 20% attributable production to HDSAs, through R30 million corporate social investment fund,
2012 | 55 and will receive incentives for achievements of the Mining Charter. It led to the creation Ponahalo Women’s Trust holds 17,5%; against community-relevant health and of Ponahalo, a new-generation BBBEE Ponahalo Community Trust holds 17,5%; and safety indicators. company that acquired a 26% equity interest Ponahalo Disabled Persons’ Trust holds 10%. in De Beers Holdings, which in turn owns The transaction will be facilitated through a 100% of De Beers Consolidated Mines The directors of Ponahalo are actively comprehensive engagement and education Proprietary Limited (DBCM). involved in the management and strategic process with the various stakeholders direction of DBCM, assuming the roles of involved. The overarching aim is to assist Ponahalo Investment Holdings is owned executive chairman, deputy chairman and the beneficiary communities in developing 50% by De Beers’ South African employees one female member on the DBCM board. into self-sustaining communities that are not and pensioners, and 50% by the business Ponahalo directors also hold other key solely dependent on mining. consortium Ponahalo Capital. This broad- DBCM board committee positions, including based consortium has three trusts, chairman of the Governance and Assurance DE BEERS representing disadvantaged women, people Committee. with disabilities and mining communities, De Beers concluded a pioneering near De Beers’ operations. Collectively, these empowerment transaction in 2006, which trusts own a 45% interest in the consortium: was structured to meet the spirit and intent
Empowerment transactions completed by Anglo American in South Africa
Business unit Ownership transferred Empowerment partner
Thermal Coal 26% of current and future production Inyosi, owned: 33% Pamodzi consortium, 33% Lithemba consortium, 19% WDB, 15% Community trust
Kumba 26% of equity of Sishen Iron Ore Company Exxaro, communities, ESOP (Envision)
Platinum More than 26% of production from disposals and joint Mvelaphanda Holdings, ARM, ventures Royal Bafokeng Nation (RBN), Atlatsa Resources, Around 3% direct equity is held by the community and Bakgatla, employees (Kotula), communities employees
De Beers De Beers South Africa sold a 26% interest in De Beers Ponahalo owned: Consolidated Mines (DBCM) to a BEE-controlled entity 50% Ponahalo capital, 15% key employee trust, 35% equal allocation trust
Meaningful economic participation (%)
Thermal Kumba Coal Iron Ore Platinum De Beers % % % % Percentage HDSA credits earned through transfer of shares or issue of new shares to following beneficiaries:
BEE entrepreneurs 26,00 20,00 – 7,15
Employees (eg ESOPs) – 3,10 1,40 13,00
Community interests – 3,00 2,33 5,85
Percentage HDSA credits earned through sale of assets to the following beneficiaries:
BEE company or consortium – – 16,00 –
Employees (eg ESOPs) – – –
Community interests – – 7,00 –
Percentage HDSA credits earned by other means – provide short description – – Percentage total HDSA ownership credits 26,00 26,1 26,73 26,00
56 | Transformation Report 2012 04 Developing partnerships
Our local procurement framework, policy, our key principles and our local procurement strategies, are designed to optimise opportunities to integrate local businesses into our global supply chain.
01 The expansion project at the eMalahleni Water Treatment plant will effectively double the capacity of the plant, drawing waste water from underground workings as far as Landau colliery.
2012 | 57 Anglo American’s approach and activities to suppliers and working with several partners, Promoting promote local procurement and enterprise including our larger suppliers, government development are focused on exceeding agencies, commercial associations, local socio-economic compliance and collaborating for sustainable, businesses, mayoral offices and local meaningful change. communities, to provide business training development to local suppliers. We are also developing Our local procurement framework, “supplier parks”. Situated close to our through local policy, our key principles and our local operations, these clusters will house localised procurement procurement strategies, are designed to suppliers, as well as joint ventures between optimise opportunities to integrate local large suppliers to Anglo American and local businesses into our global supply chain. entrepreneurs. Tenants will enjoy access In doing so, we believe we can make a to training, mentoring and finance through significant socio-economic contribution to Leveraging our core business activities our supplier and enterprise development our host communities, as well as improving to support HDSA businesses through programmes, as well as access to local efficiencies in our supply chain by lowering preferential procurement is an important shared services. logistics costs and securing access to critical part of our contribution to promoting goods and services. The innovative Entrepreneur Internship transformation. Local procurement can Programme, which commenced in March have a positive impact by contributing Our management approach 2012, supports accelerated growth of to skills development, creating jobs, and A commitment to optimising local high potential entrepreneurs. The five investing in local infrastructure. procurement is integrated throughout Anglo entrepreneurial interns are now all trading American’s supply chain decision-making. in their newly established businesses, Our leading Group-wide local procurement with two providing mining related services policy, launched in 2010, recognises the to Anglo American business units and a importance of promoting social development third working on geological modelling with in our host communities. This policy is now us. A total of 35 additional people have embedded in all our operations. been employed by their new businesses. For further information on our enterprise Our local procurement strategy seeks development activities, please refer to the to benefit everyone: our communities relevant chapter in this report. receive jobs, skills and investment in local infrastructure, while our business gains from Our performance having suppliers closer to our sites with the Thermal Coal, Kumba, Platinum and De Beers resultant cost-efficiencies. During the year, spent a combined total of R28 billion in 2012 all operations made encouraging progress (59% of total spend) with HDSA businesses in developing their local procurement (excluding goods and services procured from strategies and are now measuring and the state-owned entities). This represents reporting against targets. a 30% increase on the R21,5 billion spent in 2011. In 2012, we produced guidance on building local procurement capability within Anglo In line with the South African Mining Charter, American. We also prepared a local by 2014 companies are required to source procurement toolkit to provide practical a percentage of capital goods (40%), guidance to procurement managers. consumables (50%) and services (70%) from companies owned by HDSA. Many opportunities for local procurement exist in partnership with large suppliers. In 2012, each of our South African business For instance, partnerships between our units met or exceeded the procurement construction partners are improving requirements of the Mining Charter for 2012. development in the Northern Cape. Good progress was made in the areas of We continue to seek opportunities to capital goods and consumables, although the partner with suppliers to create an enabling target for services remains a challenge that environment for local procurement. is being addressed. Thermal Coal, Kumba Procurement spend The practice of increasing levels of and Platinum are focusing on suppliers that local procurement can be challenging. provide services, and specific actions and in SA For instance, local suppliers are often at timelines have been set to guide us towards a disadvantage competing against larger meeting the services targets. suppliers who can benefit from economies The business units engage with suppliers to of scale. We are developing practical ways 51% CAPITAL goods raise levels of awareness of the importance to overcome these barriers. In particular, our of BEE compliance in the procurement tender process includes a weighting system contract process. favouring local HDSA companies. 61% SERVICES We contribute to the development of local suppliers by simplifying our terms and 65% CONSUMABLES conditions and payment policies for our
58 | Transformation Report 2012 04 Developing partnerships
OUR 10-STEP LOCAL PROCUREMENT FRAMEWORK Our 10-step local procurement framework is designed to help build capability for local procurement within Anglo American, to achieve our vision of sustainable, responsible local procurement that positively contributes to a resilient supply chain and the economic and social development of the communities in which we operate. LEARN 2 DETERMINING DEMAND OPPORTUNITIES FOR LOCAL PROCUREMENT 1 ESTABLISHING PLAN THE BUSINESS CASE 3 ASSESSING MEASURE LOCAL SUPPLY CAPACITY 4 DEVELOPING LOCAL PROCUREMENT STRATEGY 10 MONITORING PROGRESS AND IMPACT 10 STEPS 5 BUILDING CAPACITY FOR ANGLO AMERICAN 9 SUPPORTING 8 COMMUNITY 6 BUILDING ENTREPRENEURS ENSURING SUPPLIER 7 ACCESSIBILITY CAPABILITY INTEGRATING AND VISIBILITY LOCAL AND LARGE SUPPLIERS DO
2012 | 59 HDSA spend per business unit: 2012
2012 MINING CHARTER TARGETS 20% 50% 25%
Capital Aggregate Actual BEE total Business Unit goods Services Consumables HDSA spend spend (Rbn)
Thermal Coal 34% 50% 60% 49% 5,673
Kumba 62% 61% 57% 60% 9,026
Platinum 52% 53% 55% 53% 10,975
De Beers 57% 81% 85% 74% 2,345
Anglo American South Africa 51% 61% 65% 59% 28,020
THERMAL COAL Kumba iron ore Letters signed by Kumba’s chief executive, Norman Mbazima, were sent to all senior Thermal Coal has completed a demand- Kumba has completed the process of employees and Kumba’s top 100 suppliers to side analysis and has started drafting matching suppliers to demand, and has request support in ensuring that contracts are its local procurement strategy. New awarded to BEE suppliers, and to highlight procurement policies addressing BEE and identified opportunities to encourage greater the importance of BEE compliance in the local procurement were implemented and all participation of HDSAs in the supply chain. supply chain staff received training, which will This includes restructuring contracts into procurement contract process. be extended to other stakeholders in 2013. smaller, more accessible packages, and A BEE procurement campaign was launched A Group local procurement workshop was reserving certain packages or contracts in June 2012 to raise greater awareness of held in April 2012 to introduce and test the exclusively for procurement from localised and support for BEE procurement targets new procurement toolkit. In the last quarter suppliers. among all stakeholders. This ongoing of 2012, the team focused on implementing campaign has a three-pronged approach: the supplier development programme (SDP) Sishen operation embarked on an extensive a focus on Mining Charter targets; what with five supplier days being held in host process of analysing all routine low-risk the supply chain department is doing in this communities. contracts, and targeting them for local regard; and how stakeholders can help to achieve these targets. Workshops were held with Thermal Coal suppliers. Through a specially formed cross- stakeholders to explain the SDP, and to functional forum, the supply chain team Kumba introduced a new supply chain model. identify categories of commodities or identified opportunities, while the sustainable Known as the Local Forum Engagement services that will be assigned to local small, development team identified potential Guidelines, this model specifies two medium and micro enterprises (SMMEs). approaches that potential suppliers can SMMEs that have completed Sishen’s These workshops attracted 1,418 SMME use to be considered for future business applicants and 876 potential candidates mentoring programme. It facilitated loan opportunities. This includes registering on in mining-related services or commodities. funding through Anglo American’s enterprise sourcing databases, and/or registering A total of 43 SMMEs were shortlisted and development arm, Zimele. at one of Kumba’s local enterprise the 30 finalists will be developed during the development hubs. course of 2013. Kumba awarded various contracts to local The team also conducted a feasibility black-empowered suppliers to supply The supply chain and sustainable study to establish a supplier cluster or park consumables such as stationery, toilet paper, development teams joined forces to offer business opportunities to entrepreneurs in Mpumalanga, which will house local beverages and fire extinguishers, as well as suppliers as well as joint ventures between in the communities surrounding Kumba’s to transport mail between Sishen mine, the large suppliers and local entrepreneurs. operations. A total of 15 new suppliers are Participants will enjoy access to shared airport and post office. now contracted to the company. services, training, mentoring and finance Kumba’s supply chain department embarked through Thermal Coal’s enterprise PLATINUM development programmes. We envisage on an initiative to engage individually with Platinum has prepared a local procurement this will create employment and business top non-BEE service providers and suppliers, strategy for Mogalakwena mine, and is opportunities in host communities and which resulted in a number of suppliers labour-sending areas. drafting a strategy for Modikwa. It has also achieving BEE-compliant status. Several appointed a partner to assist with supplier In the past year, Thermal Coal has worked others are reviewing their BEE status with development at its other operations. hard to ensure that suppliers are BEE- a view to becoming compliant in order to The second annual Transport Safety compliant, with the top six companies (in secure major contracts: for example the terms of expenditure) achieving this status. and Sustainable Development (S&SD) In part, this contributed to Thermal Coal’s supply and maintenance of mobile toilets Conference, held in Johannesburg in own BEE performance improving by 3% to and air-conditioners, and the supply and September 2012, was attended by more an overall 49%. installation of glass. than 100 people and provided an ideal
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opportunity to reinforce the business’ S&SD DE BEERS supporting development through value-adding vision and principles; to position S&SD as downstream diamond-related activities, a collaborative effort between Platinum As part of Anglo American’s integration such as diamond processing and jewellery and its suppliers; and to provide feedback process, De Beers will participate in the manufacture, through partnerships with on S&SD audits, transport standards and Group’s strategic sourcing initiatives, supply government and industry partners in a process other initiatives. chain processes and associated governance called beneficiation. Beneficiation helps practices. broaden and maximise the value of diamonds Platinum’s supply chain department for local economies. For further information, implemented several initiatives to contribute De Beers’ preferential procurement please see the chapter on beneficiation. to the Group vision of zero harm, and to programmes seek to stimulate growth in other ensure that suppliers and contractors adhere sectors and help offset historical economic to Anglo American safety principles and inequalities. The business has well-established standards at all times. initiatives in place in South Africa aimed at Scorecards and key performance indicators (KPIs) are aligned with Platinum’s operational safety standards, and managers discuss team progress on adhering to these standards every month. In addition, Platinum conducted Collaborating to achieve sustainable 38 sustainable development assessment supply chain excellence audits of on-site suppliers in 2012. Platinum’s commitment to a shared vision, strategic partnerships and collaboration The supply chain team hosted a safety with all stakeholders was rewarded with a prestigious Gold accolade at the 24th workshop aimed at small contractors and a annual Logistics Achiever Awards in 2012. safety summit attended by 42 Rustenburg- based BEE and community companies Platinum and Barloworld Logistics shared the award in recognition of excellence who currently supply products and services and outstanding performance in sustainable supply chain solutions in South Africa. to Platinum. The summit focused on risk The accomplishment is especially pleasing in view of the dramatic turnaround assessment, contractors’ safety packs, risk- Platinum achieved after its transport service provider went insolvent in 2010, identification tools, and corporate governance. putting the entire supply chain and platinum production at risk. Working By supporting BEE vendors situated close with Barloworld Logistics, the company has subsequently moved more than to its operations, Platinum has continually 80,000 tonnes of concentrate per month, at service levels exceeding 98%. It has demonstrated its intention to develop local also optimised costs and aligned itself with operational requirements, reducing black-owned businesses through preferential annual operating costs by 15%. procurement. In the eight years since the business began tracking procurement Furthermore, Platinum up-skilled and empowered 90 employees from communities spend, it has spent R60,9 billion (37% of close to the mines, implemented world-class risk-management and safety total spend) with BEE-compliant vendors. processes, and formed strategic relationships with key service providers. Of this, R16,7 billion (12%) was in the regions Platinum’s feat may win further acclaim, as the solution achieved with Barloworld where the procuring operations are located. Logistics is scalable and replicable in other similar operations. Localised BEE spend (less than 50km from a procuring mining operation) amounted to R11,8 billion (9%).
Our Journey with Motse Civils Motse Civils, an HDSA-owned civil construction company based in the Free State, began its association with Voorspoed mine in Kroonstad when the mine was laying its foundations. The business was successful in its bid to clear and level the ground around the mine’s construction areas. After the successful execution of this contract, Motse Civils won the tender for the topsoil stripping at the tailings and slimes dam areas. Five years later and Motse Civils has grown as a company having become a valued service provider for Voorspoed mine. The business secured further opportunities at the mine, which enabled it to grow its service offering and capabilities from standard civil earthworks to include mining activities while employing and empowering people from the local community.
2012 | 61 Helping local suppliers to help Mahlako Transport and Projects cc themselves started supplying services to Platinum, Makinta Mahlako Transport and it has also invested in assets such as Projects cc is a business wholly owned vehicles, an overhead crane and welding by Makinta Masenya, who lives in machines. Ga-Molekane village, less than a kilometre from Mogalakwena platinum mine. The company was registered in 2008 and started operating in 2011, with welding and building as its core activities. It currently undertakes plant maintenance at the mine. Makinta approached Anglo American’s Zimele Communities Fund in January 2012, regarding an order for the manufacture and installation of guard rails. The fund financed an initial loan of R236,500, which was repaid within three months. Zimele then financed a light-delivery vehicle, repayable over three years, and the building of a parking bay. Having started to work for our Platinum business for an order valued at R17,000, Makinta Mahlako Transport and Projects cc steadily accumulated company orders totalling about R3 million by the end of 2012. The business, which began operating from Mankita’s home with three employees, has grown to employ 22 people and rents two workshops in the industrial area of Mokopane. All its employees are recruited from the local mining communities. Most of the staff are under 35 years old, and three are women. In the short space of time since Makinta 01 Makinta Masinya, owner of Makinta Mahlako Transport and Projects cc.
Sustainable support After a stringent adjudication process, buses plus an additional 14 mini buses in presentations by shortlisted bidders the past six years. for entrepreneurs – and submission of safety plans, a Since the inception of this contract, Ponelopele local Kroonstad-based taxi operator, Mr Jordache Koetjie, was awarded the the mine undertakes regular safety Passenger Transport contract. The service required buses inspections to ensure the transport is with a 22-seat capacity. Mr Koetjie safe and roadworthy. Ponelopele has Voorspoed mine is far from the nearest established Ponelopele Passenger maintained an excellent safety record. main town, Kroonstad. The need for safe Transport with financing for the vehicles Through its dedication to support local daily transportation of our employees provided through the South African Taxi and BEE enterprises, Voorspoed has presented an opportunity to involve the Association and a financial institution, enabled a taxi operator from the local local community in transport services arranged by Voorspoed mine. With an community to successfully render a safe between Kroonstad and Voorspoed. initial fleet of five passenger buses, the and sustainable transport service to our mine. In addition, this contract has A tender for transportation services was business has grown its transportation created employment for 14 drivers from issued to local HDSA entrepreneurs. capacity to more than eight passenger the local community.
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01 Lebo Mogotswi and Anna Maredi are both sales staff employed at the Butterfield Bakery in Kuruman, a Zimele funded small business.
01
2012 | 63 Enterprise development (ED) is one of the concluded 500 transactions, supporting Championing most effective means for ensuring sustainable 318 companies that employed 6,713 people. benefits for our host communities. We seek to entrepreneurship enable entrepreneurs in our host communities We collaborate with a number of strategic through leading to identify business opportunities, develop and stakeholders to achieve our ED objectives. become independent, vibrant contributors to Zimele is in negotiations with the enterprise the economy. Development Bank of Southern Africa to partner with the government in establishing development Since the launch of our flagship Zimele a new fund, Sebenza, which will create ED programme in 1989, we have been a 8,000 new jobs over a three-year period. This initiatives catalyst in the development of emerging arrangement will be finalised during 2013. black business, helping to build sustainable, commercially viable enterprises, and We have worked hard to make Zimele’s empowering entrepreneurs to operate in the enterprise development services more visible mainstream economy through a combination and accessible by establishing a national of financial support and mentorship. In so footprint of more than 30 small business doing, Zimele has been a strong contributor hubs by the end of 2012. Experts are to sustainable job creation and socio- available at these sites to offer professional economic development in predominantly advice and share business experience, to peri-urban mining communities. promote the long-term sustainability of the Zimele is widely recognised as a global SMMEs we support. best-practice model for companies seeking In 2012, the Zimele funds made good to integrate local SMMEs into their supply progress: chains. Both the International Finance Corporation and the United Nations Supply Chain Fund Development Programme have adopted The Supply Chain Fund supports HDSA the Zimele formula. The model hinges on enterprises through the provision of equity enhancing capability and opportunities by and loan finance, as well as hands-on linking ED programmes to our core business. support, business guidance and skills About a third of the businesses currently transfer. In 2012, the fund concluded five new funded and supported by Zimele are directly transactions, disbursed R6,7 million in loans linked to our supply chain. Enterprise and R4,6 million in equity, collected R6 million development dovetails with our efforts in loan repayments, and exited from three to procure from enterprises close to our investments which are now independent operations whenever possible, as discussed of Zimele. in the earlier chapter on local procurement. Anglo American Khula Mining Fund We strive to reinforce our leading role in The Anglo American Khula Mining Fund, a promoting sustainable entrepreneurship by increasing the depth and scope of our ED joint initiative with government-owned SEFA, activities, to deliver greater economic and provides equity and loan finance to emerging social impact. We share the Zimele model black-owned mining companies, as well as with corporates, government and interested technical support during the exploration parties, to raise the profile of ED and and pre-feasibility phases. In 2012 the fund encourage discussion and involvement in concluded transactions with JSE-listed small business development. Sentula Mining and Thebe Investments. Achieving our objectives Community Fund Zimele consists of four separate funds – the The Community Fund provides seed Supply Chain Fund, the Anglo American and working capital for entrepreneurs Khula Mining Fund, the Community Fund, and emerging businesses in our host and the Zimele Green Fund. While these communities and in labour-sending areas. funds operate on a commercial basis, they It is funded and staffed by our Thermal are guided by the social purpose of creating Coal, Platinum and Kumba, and De Beers economically viable SMMEs through the businesses in South Africa, as well as the provision of equity/loans, mentoring and corporate centre. In 2012, the fund concluded access to value-enhancing opportunities. 491 transactions, disbursing R138 million in Between 2008 and 2012, the Zimele funds loans, created or sustained 6,230 direct jobs Zimele spent provided a combined R708 million in funding, through funding, achieved a loan recovery supported 1,393 companies, and completed rate of 75%, signed a memorandum of 1,972 loan transactions. Funded businesses understanding for ED with the Sishen Iron R1,9 million have employed 25,364 people – surpassing Ore Company’s Community Development on training the internal target of creating 25,000 jobs by Trust and Sishen Iron Ore Company, and 2015 – and have achieved a collective annual launched three new business hubs in and mentoring turnover of R3,5 billion. In 2012, the funds Voorspoed, Venetia and Phola.
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Since the launch of our flagship Zimele ED programme in 1989, we have been a catalyst in the development of emerging black business, helping to build sustainable, commercially viable enterprises, and empowering entrepreneurs to operate in the mainstream economy through a combination of financial support and mentorship.
Green Fund Kumba’s small business hubs, both based in De Beers Our newest fund, the Zimele Green Fund, Kuruman, continued to play a fundamental targets investment opportunities that role in boosting employment and stimulating As “diamonds are forever”, so their mitigate greenhouse gas emissions, reduce the economy in the region. The centre community legacy should be too – which is energy and water consumption, and improve facilitates the mentoring of small business why De Beers works closely with Zimele’s waste and emissions management. In 2012 owners, and employs 12 youths with the Community Fund to help create sustainable the fund explored a wide range of projects aim of transferring skills in the fast-growing livelihoods (for more South Africans). aimed at improving the environmental entrepreneurship environment. De Beers aims to be the funder of choice welfare of local communities, including tyre for its host communities by deepening its As with all development initiatives, there are and waste disposal. understanding of the needs of the people ongoing challenges: some SMME owners with whom it works, by providing access to Thermal Coal fail to submit their monthly income and funding and an application process that is expenditure statements, and others do not simple, fast and reliable, and by ensuring that Thermal Coal’s ED footprint continued to pay their loan instalments regularly. New ongoing support is available to help develop expand in 2012. Through Zimele’s Community strategies to address these challenges will be entrepreneurs’ skills and business expertise. Fund, hubs have been established in developed and implemented during 2013. eMalahleni, Middelburg, Phola, Dennilton, De Beers has established five Zimele Bushbuckridge, Secunda and the Vaal Platinum business development hubs in areas Triangle. Since the programme began in linked to its business: namely, Kimberley, Our Platinum business had a very active year 2008, these hubs have facilitated 535 loan Kleinzee, Venetia, Voorspoed and Springs. of ED initiatives. Through the five Zimele transactions to the value of R122 million In 2012, through these hubs, Zimele funded business hubs that are located near its to 360 businesses, creating 4,966 jobs. In 51 SMMEs, of which 34 are women-owned to operations, it processed 129 transactions 2012 alone, the hubs collectively concluded the value of almost R17 million. This helped for 63 companies, generating a turnover 127 transactions with 80 companies, to create and sustain close to 700 jobs of R81 million and creating and sustaining facilitating loans of R41 million. This created and achieved a loan repayment rate of 1,341 jobs. Of the entrepreneurs supported, or sustained work for 1,750 people, with 44% nearly 70%. The team has also established 44% were women. being women and 37% youths. coaching and mentoring partnerships with These hubs and Platinum’s supply chain various like-minded organisations. Kumba iron ore department remain key vehicles for Highlights in 2012: stimulating ED in the area and for providing Enterprise development is the thrust • The Voorspoed business hub partnered support to emerging entrepreneurs. of Kumba’s efforts to build sustainable with the Free State Department of In 2012, the Platinum team focused on communities, especially in Sishen mine’s areas Roads, Police and Traffic to fund road raising awareness of this, through a formal of operation. As part of the business unit’s maintenance businesses presentation to the community, delivered in sustainable community development strategy conjunction with the Community Engagement • The same hub won the Anglo American for the next 25 years, it plans to increase its Forum. (Reference case study on Makinta Zimele 2012 Hub Manager’s Award for expenditure in ED from 5% to 20%. Transport in procurement chapter.) outstanding performance Throughout 2012, the Kathu business • The Kimberley business hub entered into development support centre and one of a mentorship partnership with the Small Enterprise Development Agency
2012 Zimele statistics: • Zimele participated in the local SMME Approximately procurement and supplier development • R1,9 million was spent on training and study tour between South Africa and mentoring Zimele fund recipients Western Australia • Businesses were created and given • The Saudi Aramco Entrepreneurship 33% continued support in especially Centre from Saudi Arabia visited the of businesses impoverished environments, including: Zimele team to learn about the latter’s Atok, Burgersfort, Bushbuckridge, best-practice ED model currently funded and Phola, Dennilton, Kleinzee, Philippi, • BBC TV visited Zimele’s Philippi hub supported are directly Mthatha, King Williams Town, Piet in Cape Town as one of the poverty linked to our supply chain. Retief, Kathu and Kuruman node areas where Anglo American • Zimele was awarded the prestigious was contributing Mail & Guardian and Southern Africa • The Zimele team presented its ED Trust’s “Drivers of Change 2012” model at the International Small business award Business Council as well as at the • Anglo American hosted a successful Transformation Indaba. ED Conference in partnership with the Department of Trade and Industry (see case study below)
2012 | 65 ANGLO AMERIcAN The then Minister of Human Settlements, transform the economy. Zikode praised Tokyo Sexwale, contextualised small Anglo American for leading the way and PARTNERS WITH THE and medium enterprise development said other multinationals should follow DEPARTMENT OF TRADE within the current state of the local the example. and global economies as well as South AND INDUSTRy TO Africa’s national development plan. Dr Mamphela Ramphele former Anglo American plc board member and FOSTER bEST PRAcTIcE He acknowledged existing obstacles, including “tender-preneur” and fronting former World Bank Managing Director IN ED challenges and urged business to take discussed how around the world ED has a unified stand against such corruptive emerged as the most important trend in Anglo American partnered with the practices. facilitating long-term skills development Department of Trade and Industry and job creation – particularly for the (the dti) to stage the third annual Sipho Zikode, deputy-director general youth. She urged South Africa’s youth Enterprise Development Conference. of the dti, called for the development of to aim high with confidence to start up Around 350 stakeholders from the a vibrant small enterprise sector that will businesses. enterprise development sector attended not be burdened by red tape or inefficient the two-day conference held in Midrand, service delivery. He added that the broad- Acting Zimele head, Lia Vangelatos, Gauteng, in November 2012. based black economic empowerment concluded the conference with a call Scorecard will give increasing weight to to action from Anglo American to other Executive director of Anglo American in supplier development, which will help organisations, urging them to partner South Africa, Khanyisile Kweyama, gave with companies in this space. the opening address, acknowledging the value of the conference as a platform to share best practices and explore how to collectively maximise the resources at our disposal to increase enterprise capacity and foster skills development. The speakers at the conference, including ED pioneers and leading authorities on transformation, brought a wealth of knowledge, foresight and experience. They provided insight into complexities in SUPPORTED BY ANGLO AMERICAN the sector, as well as real-life examples of ED achieving sustainable job creation at the grassroots of the economy.
bUILDING ON GREAT Today they are the proud owners of a Timbercity franchise in Kuruman, FOUNDATIONS – employing 15 people and operating from AND HELPING OTHERS TO premises with retail space and a large workshop. They supply most of the mines LAy DOWN THEIR OWN around Kuruman with timber and other carpentry products. The company also Ausleo Construction started out as a helps to develop smaller contractors and small carpentry business in the garage of transfer skills by offering them carpentry a local car dealer in Kuruman, employing projects that Ausleo oversees. eight people. The company is owned and managed by a hard-working husband and wife team. Two years into their 01 Following the rapid growth of Ausleo Construction, venture, they identified a gap in the local Zimele awarded Greg Austin an additional loan to timber supply market and approached purchase a Timbercity franchise. Timbercity head office to apply for a From left: Andre de Jager, Greg Austin, Lenie franchise, with financial support from the Awotin a director of Ausleo Construction, John Zimele’s Community Fund. Seretsi and Percie Oliver.
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Tuck-shop Transport enterprise flourishes with a woman enterprise entrepreneur at the helm diversifies with Being a woman entrepreneur in a male dominated industry has not curbed Gizella van Sishen’s support Wyk’s determination to succeed. As the owner of Gibel cc, a transport company based in Okiep, Springbok, she recently won the Woman in Transport Entrepreneur 2012 award With support from Zimele’s Community from the Department of Transport, Safety and Liaison in the Northern Cape. Fund, Viret Trading opened its doors as a small tuck-shop in an impoverished Thanks to a R550,800 loan from the De Beers Zimele Kleinzee Business Hub, Gizella was area in Wrenchville, just outside able to buy a brand new 22-seater bus and a trailer in March 2012. Besides being able to Kuruman. Serving mainly pensioners transport educational groups, the new vehicle and trailer allows her to run chartered trips and other people living on grants, the to destinations outside the Northern Cape. It has also enabled Gizella to sustain eight jobs business had a very low turnover, but and create two more. was diligently managed with passion and care by owner Brian Viret. Gibel cc’s fleet (most of which Gizella bought with her own savings and by investing profits back into the business) now consists of various small buses and trailers. She also owns the When the chance came to tender depot from which her business operates. for the supply of tea, milk and sugar to Sishen mine, Brian seized the opportunity. He won the contract in February 2012, thanks to the efforts of Sishen’s supply chain and sustainable development departments, and recommendations of his services. Brian delivers orders on a monthly basis to the mine, which is now one of his biggest clients, and plans to offer a similar service to other mines in the area.
Local farmer excels using personal initiative and De Beers’ financing When Mercy Rambuda paid her final loan instalment to the De Beers Zimele 02 Gizella van Wyk, owner of Gibel Transport cc. Venetia Business Hub, ahead of schedule, she had just been named the ‘2012 Female Farmer of the Year’ by the local Musina Municipality. Co-operative spins its De Beers is one of IsiYalu’s loyal clients, as Mercy’s R110,000 business loan a regular buyer of conference shirts and enabled her to buy fertilisers and success into a second bags (the latter being made from 100% pesticides, and provide four months decade recycled plastic). of working capital at a critical time for IsiYalu Manufacturing and Retailing her business. This helped to sustain Margaret Thokozile Dlongolo, known as currently employs 12 people and intends five jobs, which otherwise would have Maggie, has a strong entrepreneurial spirit. to continue expanding. been lost, and created an additional Despite being left permanently disabled by five permanent positions as well as a bus accident in 2006, she has forged a 10 temporary positions during the burgeoning co-operative business. In 2012 harvest season. she won second place at the National Small Today, Mercy’s Sithagu Farm in Nwanedi Business Chamber (NSBC) awards in village in Limpopo is recognised for recognition of her outstanding contribution harvesting the best produce in the to business in South Africa. Musina Municipality. Maggie founded IsiYalu Manufacturing “I am living proof that being illiterate and Retailing Primary Co-operative does not stop you from achieving your in 2003 with two colleagues. goals,” she says, speaking in XiVenda. The co-operative started by offering “I cannot read or write and I cannot cut, make and trim services to aspiring speak English and yet I have been designers and has since grown to include empowered by the De Beers Zimele textiles, business suits for women, Venetia Business Hub to change my life, curtains, corporate clothing and general 03 From left to right: and to make a difference in the lives of fashion items. Maggie Dlongolo, William Dlongolo and Warwick my family and my community.” Mostert, biodiversity coordinator at De Beers.
2012 | 67 The beneficiation strategy that was approved Strategic beneficiation initiatives in the Facilitating as government policy by the Cabinet in pipeline beneficiation June 2011 defines beneficiation as follows: • Thermal Coal is at the prefeasibility stage “Beneficiation entails the transformation of of the planned development of the Elders a mineral (or a combination of minerals) to project in Mpumalanga, a multi-product a higher value product, which can either be underground mine that will produce both consumed locally or exported. The term is export and domestic beneficiated coal used interchangeably with ‘value-addition’.” products. The project is expected to create The South African government’s 300 jobs when it reaches full production beneficiation strategy seeks to leverage in 2019 the country’s mineral resource endowment • Prefeasibility and conceptual studies are to achieve higher levels of economic under way for the development of new growth, employment and socio-economic mines in the Limpopo and Waterberg development. While the specifics of the basins, where Thermal Coal holds government’s policy approach have not been prospecting rights. This development could finalised, it is acknowledged that mining plays potentially create 1,500 primary jobs a key enabling role. • Feasibility studies are under way for the development of a long-life mega-mine Anglo American has been involved in various at New Largo, which will supply up to beneficiation-related initiatives, including 17 million tonnes of beneficiated coal research and development, in respect of each annually to Eskom’s new Kusile power of its commodities in South Africa. These station, and employ up to 850 people for initiatives were, among other reasons, for the two generations purpose of developing new markets for its • Life of mine (LoM) extension projects commodities and to enhance the value of its are planned at a number of mines that products to meet customer requirements. currently supply Eskom power stations, to In this chapter, we also refer to our initiatives address an increasing demand for power. in the waste-beneficiation area, where waste This will provide prolonged job security for or by-products emanating from our mining current employees, as well as additional job operations are used to create new products creation opportunities during construction of value to our organisation, employees and stages. The mines include: New Denmark, other stakeholders, including neighbouring to be extended by 16 years to supply communities. Tutuka power station; Kriel, to be extended by 20 years to supply Kriel power station; THERMAL COAL New Vaal, to be extended by 13 years to supply Lethabo power station; Landau Our Thermal Coal and Platinum businesses (to be extended by eight years, producing have developed innovative ways of turning export quality coal; and Mafube, to be mining and industrial process by-products into extended by 15 years to supply to existing commercially viable resources, with positive export and domestic customers. environmental, social and economic impacts. Research and development focused Thermal Coal focuses on beneficiation projects activities that result in the cleaner and more • We are investigating commercially efficient use of coal, and on initiatives to exploitable discard coal for power- reduce greenhouse gas (GHG) emissions generation purposes. A prime example is through the use of technologies for low- the Khanyisa Project, the development of emission coal fired production, carbon a 450MW independent power producer capture and storage, and clean-coal generation project. A combustion technologies. technology recently introduced to South Most of the coal mined by Thermal Coal Africa will be employed to generate power undergoes a beneficiation “washing and while reducing coal waste (also refer to crushing” process to ensure that it meets chapter 8 on environmental management) the quality specifications required by our • Thermal Coal is a leader in developing customers. The washing process at our coal-bed methane (CBM) technology in Zibulo, Mafube and Umlalazi washing South Africa, for potential power generation. plants provides a continuous supply of Following a successful pilot project to ‘middlings’ (by-products of the coal washing/ explore the beneficiation of CBM by- beneficiation process), which are used products, we have partnered with Platinum for power generation by Eskom and local to pilot a stationary fuel cell at a CBM markets, as well as by cement and industrial exploration site near Lephalale in Limpopo. plants and brick manufacturing units. The electricity generated will support a disadvantaged community project
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In this chapter, we also refer to our initiatives in the waste-beneficiation area, where waste or by- products emanating from our mining operations are used to create new products of value to our organisation, employees and other stakeholders, including neighbouring communities.
• We explore opportunities to derive Pioneering technology is used to separate PGM value chain and across the market- economic value from using by-products. iron-bearing material from waste material, development scope. Our activities range A successful venture has been the enabling production of an additional from laboratory-scale research and transformation of gypsum produced at 13 million tonnes of iron ore per annum. product development, to early stage the eMalahleni water treatment plant, into commercialisation of products capable of Beneficiation project pursuits in gypsum-based building products suitable driving PGM demand in the longer term. progress for constructing quality houses. To date, 62 houses in KwaMthunzi Vilakazi were • Kumba is developing the Limpopo One such example is Platinum’s partnership built using a percentage of gypsum in domestic hub for the local market so with Limpopo to support a study into the the manufacturing of the bricks for those that it will generate approximately 6Mtpa feasibility of a platinum special economic houses and boundary walls in additional iron ore supplies, to meet zone in the province. The fuel cell industry could prove to be the anchor for the • Thermal Coal participates in the South domestic demand in the inland market. zone, depending on the outcome of the African Coal Roadmap (SACRM) • In 2012, Kumba partnered with Exxaro study. This could attract manufacturing and supports the Coaltech research to commercialise the latter’s ultra-high industry, peripheral services and investors. association. These collaborative initiatives dense-medium-separation (UHDMS) The company is also focused on fuel focus on exploring strategies, technologies technology, and to establish a 50 tonne cell development in South Africa (see and approaches for the development of the per hour (tph) modular beneficiation plant point 3 below). local coal industry and how to maximise for Sishen mine. The plant will be used to the economic opportunities for coal demonstrate the commercial feasibility of In promoting beneficiation we support • Thermal Coal is a founding member and separating iron ore at different operating industry and government’s efforts to ensure active participant in the South African densities using the new technology. that the current PGM industries in South Centre for Carbon Capture and Storage Ultimately, UHDMS facilitates a more Africa (the auto-catalytic converter and (SACCCS). Parliament endorsed the CCS efficient and cost-effective extraction jewellery industries, as well as a fledgling roadmap in May 2012. Demonstration process that will enable the business to fuel cell industry) are maintained and set on and commercialisation of this technology obtain more value from an orebody a growth path, with appropriate incentives in South Africa will enable the country to • Kumba is a 50:50 commercial partner in and market conditions. We also assist in meet its dual goals of economic growth the development of the Zandrivierspoort developing new manufacturing and job and reducing carbon emissions. mine project to beneficiate iron ore of opportunities in the PGM sector. between 35% and 67% iron content Kumba iron ore through the application of new proprietary Developing the jewellery market technology. Developing Zandrivierspoort • Our Platinum business stimulates Kumba has a beneficiation strategy and and the associated Phoenix project global demand for large growth markets engages with relevant stakeholders (a commercial mine to come on stream through its work with the Platinum Guild regarding beneficiation. The business invests after 2016), is expected to create between International (PGI). We also give the substantially in downstream value creation. 1,700 and 2,600 new full-time jobs in one industry access to the PGI’s research and of the poorest regions in South Africa materials regarding markets and trends Kumba operates three iron ore mines and in jewellery mineral beneficiation plants at its operations • In partnership with state organisations, • In South Africa, Platinum supports local at Sishen (Northern Cape) and Thabazimbi Kumba is investigating the feasibility of jewellery design and manufacturing (Limpopo). Approximately 80% of its ore concentrating Sishen C-grade material to a and encourages opportunities for is beneficiated. More than 10% of its iron required iron ore or pellet grade in order to domestic jewellers to compete in local ore production is supplied to the domestic feed a portion to a proposed Coega pellet/ and international markets. The company market, equating to a local steel production steel plant in the Eastern Cape provides training and marketing initiatives capacity of approximately three million tonnes • Kumba has facilitated co-operation that address technical and design capacity per annum. between the Industrial Development Corporation (IDC) and Tata Steel to and support, supports five training The business continues to explore novel investigate various business models and institutes, and sponsors the annual beneficiation methods to increase the iron iron ore sources, as well as setting up a PlatAfrica Design Competition, which content of iron ore and improve recoveries, second steel producer in South Africa showcases local design talent and high- and is at an advanced stage of investigating • Kumba and the IDC play an active role in quality workmanship. technologies that will add further value to investigating suitable technology to convert Collaborative research and development iron ore. We are looking at pyrometallurgical fine iron ore fines and concentrated into • Platinum engages with various government processes to produce products that can be products suitable for the steel industry. departments, including the Department utilised by steel makers. of Science and Technology (DST), the Kumba’s Sishen mine is currently the only PLATINUM Department of Trade and Industry (the dti), the Department of Mineral Resources haematite ore producer in the world to fully Our Platinum business has been (DMR) and the Department of Energy beneficiate its products by treating the entire implementing a market development (DoE), to explore collaborations on the run of mine into saleable products. This is and beneficiation strategy since 2009. development of PGM technologies in achieved through dense medium separation The approach focuses on identifying new South Africa (DMS) and JIG technology. sustainable applications for our metals, Kumba’s innovative JIG technology plant and relies on collaboration and alignment at Sishen mine is a leading example in with diverse stakeholders. Opportunities maximising value from current resources. for beneficiation exist along the entire
2012 | 69 Platinum powers Platinum launched the first fuel cell of diesel units, as well as environmental locomotive prototype at Khomanani cleanliness that is superior to battery forward mine in Rustenburg in April 2012. This vehicles. Furthermore, their application initiative was lauded by Minister for would be cost-competitive owing to Platinum has identified opportunities Mineral Resources Susan Shabangu. lower recurring costs, reduced ventilation to use fuel cells in its own operations, “We welcome the launch of the fuel cell costs (compared to diesel), and higher including underground mining locomotives. locomotive as a sign of commitment from vehicle productivity. The fuel cell locomotive will replace the industry to proactively transform and current lead-acid battery power pack contribute to national strategic objectives. Surface testing of the locomotive with a hybrid technology solution, which This particular case touches upon several continued into early 2013 to determine includes a hydrogen-powered fuel cell and key strategic priorities – development of efficiencies, reliability and effectiveness lithium iron phosphate battery with a metal the mineral sector, beneficiation, industrial of the new technology in comparison to hydride hydrogen storage facility. The development, an environmentally friendly the current method of working. While hybrid power pack can be retrofitted to economy, development of a knowledge underground testing is critical, it is also existing locomotives. economy and job creation.” imperative to address the behavioural changes required for employees to ensure Working in partnership with Trident Fuel cell-powered vehicles have the the safe introduction of new equipment South Africa, Battery Electric and fuel mobility, power and safety characteristics into the operating environment. cell developers Vehicle Projects Inc.,
01 Platinum unveiled a platinum-based fuel cell powered mine Locomotive prototype at Khomanani mine.
70 | Transformation Report 2012 04 Developing partnerships
• Platinum supports various PGM research during the early-stage development and Kimberley International Diamond and programmes at South African universities commercialisation of PGM technology Jewellery Academy and at the Council for Scientific and • Together with the Department of Science In partnership with the Northern Cape Industrial Research (CSIR), with the aim and Technology and USA-based Altergy government, De Beers launched the of accelerating local product development Systems, the key investment to date Kimberley International Diamond and and creating new applications for PGMs. is in Clean Energy Investments (Pty) Jewellery Academy (KIDJA) in 2011 to Certain programmes are conducted in Limited. Clean Energy provides fuel promote skills development in the local collaboration with international companies, cell-based back-up power solutions to jewellery industry. To date, over R5 million allowing the transfer of skills and access the telecommunications industry in South has been invested in the scheme and to new methodologies and equipment Africa. Currently, installation, maintenance 182 candidates have been trained. • Platinum has an equity stake in a Johnson and fuelling is provided by South African In addition, De Beers, in partnership with its Matthey Fuel Cells company to keep companies, but it is anticipated that the clients, has established a R2 million bursary abreast of developments and consider fuel cell units will also be assembled and scheme for the academy. future opportunities in the field, particularly manufactured in South Africa once critical The Shining Light Awards: This competition in promoting the ongoing use of PGMs. volumes have been reached. supports, encourages and develops Fuel cell product development DE BEERS new entrants into the local downstream • A key development area for platinum diamond industry. The initiative promotes is the use of fuel cells to provide As with all Anglo American business units, the development of skills and provides five power. Fuel cells are efficient, versatile beneficiation is a core part of De Beers’ jewellery design schools with education and scalable, and offer users several business model, and fundamental to its grants worth R10,000 per competition. advantages. A development focus area commitment to working with partners. Competition winners are seconded is to use them in stationary and portable to international businesses owned by devices. Fuel cells have the potential to De Beers’ beneficiation initiatives include De Beers’ clients. boost demand for platinum, which is used diamond sorting, valuing, cutting, polishing, Forevermark: In February 2012, in as a catalyst in the cells. The technology marketing and retail, as well as indirect partnership with Caratco, the exclusive is considered suitable for Africa since fuel activities such as information technology, distributor for South Africa, De Beers cells do not require electricity, do not emit banking, security and transport. Through launched Forevermark in the country in noxious gases, and could cut reliance on De Beers’ beneficiation strategy, the order to promote local jewellery design and coal-fired power plants mining and trading of diamonds bring ancillary economic and social benefits. manufacturing. Forevermark is De Beers’ • Platinum is involved in investigations into Key contributions include a skilled and own proprietary diamond brand. It was initially developing a commercially viable fuel cell educated workforce, inward and locally launched in Hong Kong, China, India, Japan industrial zone in the Rustenburg area that based investment, and a more entrepreneurial and the US before coming to South Africa. will attract developers, experts in the field culture. and investors, and promote skills transfer, job creation and capacity building In South Africa, De Beers supports the • Together with its partners, Platinum development of all aspects of the diamond is investing in the development of production pipeline through various initiatives, underground fuel cell locomotives as well summarised below. The company also as a fuel cell dozer for use in the mining supports emerging entrepreneurs in the environment. Beyond mining, it is exploring industry who have no alternative access to the development of a fuel cell home rough diamonds. generator designed to provide efficient, Supplying to local beneficiators: De Beers reliable power to rural communities that continues to supply the equivalent of 40% are not connected to the electricity grid of its total gross sales to local clients. These • In parallel with product development, include some of the largest employers a local manufacturing strategy and within the manufacturing sector, who the securing of potential customers employ approximately 85% of the estimated are being considered as part of the 900 diamond cutters and polishers who commercialisation process. make up the sector. Platinum Group Metal Development Fund State Diamond Trader: De Beers was • Platinum established the Platinum Group instrumental in forming the State Diamond Metal Development Fund (PGMDF) in Trader (SDT), a state-owned entity that buys 2009 to increase the use and application and sells rough diamonds in order to promote of PGMs in South Africa. The fund invests equitable access to and beneficiation of in entities that either support PGM product diamond resources. De Beers has seconded development or use PGM technologies four highly skilled sorting and valuation in their products or processes. PGMDF personnel to the SDT and has also made focuses on local beneficiation and provides sorting equipment available to it. capital to innovators and entrepreneurs
2012 | 71 AAESS Anglo American EMEA Shared Services in South Africa ACRONYMS AAIC Anglo American Inyosi Coal (Pty) Limited AASA Anglo American South Africa Limited ABET Adult basic education and training ACD Anglo American’s Corporate Division ARD Acid rock drainage ART Anti-retroviral therapy AOPL Anglo Operations (Pty) Limited BBBEE Broad-based black economic empowerment BEE Black economic empowerment BLAST Building leaders and shaping talent CBM Coal bed methane CDPs Career development panels CDT Community Development Trust
CO2e Carbon dioxide equivalent CSIR Council for scientific and industrial research DBCM De Beers consolidated mines DBGS De Beers group services DBSA Development Bank of Southern Africa DHS Department of Human Settlements DMR Department of Mineral Resources DoE Department of Energy DoH Department of Health DoL Department of Labour DRP Debt-rehabilitation programme DST Department of Science and Technology DWA Department of Water Affairs EAP Economically active population ED Enterprise Development EE Employment equity EIA Environmental impact assessment EIP Entrepreneur internship programme EMEA Europe, Middle East and Africa EMPs Environmental management plans EMPR Environmental management programme report EMS Environmental management system ESOPs Employee share ownership plans ESTC Engineering skills training centre FLC Foundational learning certificate FFI Fauna & Flora International FIFR Fatality injury frequency rate GAVI Global alliance for vaccines and immunisations GCC Government certificate of competence GDP Graduate development programme GHG Greenhouse gas GJ Gigajoule HCT HIV counselling and testing HDSAs Historically disadvantaged South Africans HIV/Aids Human immuno-deficiency virus/Acquired immuno-deficiency syndrome HRD Human resource development IDC Industrial Development Corporation IDP Integrated development plan IWTTSA Integrated water task team for South Africa IWULAs Integrated water use licence agreements KIDJA Kimberley International Diamond Jewellery Academy
Download a QR code reader to your smartphone LED Local economic development or tablet device and scan the QR code which will direct you to our website to view or download the LFI Learning from incidents Anglo American transformation report 2012. LTIs Lost-time injuries Alternatively, visit: http://ourviews.angloamerican.co.za LTIFR Lost-time injury frequency rate
72 | Transformation Report 2012
Acronyms
MBFP My budget fitness programme METF Minerals education trust fund Mℓ Million litres MMTC Mechanised mining training centre MPRDA Minerals and Petroleum Resources Development Act MQA Mining qualifications authority NGO Non-government organisation NPC Non-profit company NIHL Noise-induced hearing loss NQF National qualifications framework OHS Occupational health and safety ORMP Operational risk management process OSD Operational skills development PCP Personal change programme PGI Platinum Guild International PGMs Platinum group metals PITs Professionals-in-training PME Programme for management excellence PMT Practical management training PPE Personal protective equipment QCTO Quality council for trades and occupations R&D Research and development S&SD Safety and sustainable development SACCCS South African Centre for Carbon Capture and Storage SADC Southern African Development Community SARS South African Revenue Service SAVs Single accommodation villages SDP Social development programme SDT State diamond trader SEAT Socio-economic assessment toolbox SETA Sector education training authority SIP Safety improvement plan SLAM Stop, look, assess, manage SLP Social and labour plan SMMEs Small, medium and micro enterprises SRM Supplier relationship management TAP The achiever programme TB Tuberculosis the dti The Department of Trade and Industry TTC Technical training campus VCT Voluntary counselling and testing VFL Visible felt leadership WETT Water efficiency target tool WHO World Health Organisation XRM X-ray microscopy Anglo American South Africa Limited PO Box 61587 Marshalltown Johannesburg 2107 South Africa Tel +27 11 638 9111 www.angloamerican.co.za Head of transformation and regulatory affairs Lindiwe Zikhali Tel +27 11 638 3232 Media enquiries Hulisani Rasivhaga Tel +27 11 638 4401
Cover image: Receiving operator training on a Bucyrus SKL drill rig are trainee operators Hein Roets, Gabriel Bosman, Florencia Bekend and Nattie Groenewald. The senior instructor is Enos Dladla (far right).