is to be the world’s best platinum-producing company, delivering superior value to stakeholders relative to our peers
is to safely mine, process, refine and market our products at the best possible cost, ensuring sustainable value creation for all our stakeholders
is to safely and responsibly produce platinum group metals (PGMs) to make a meaningful contribution to the sustainability of our planet
OUR STRATEGIC OBJECTIVES
For more information please refer to the 2018 Integrated Report
Improve efficiencies through operational excellence and safe production
Maintain our social licence to operate
Investment through the cycle
Maintain optionality and position for the future
2018 sustainability performance summary
Statement by the Chairperson of the social, transformation and remuneration committee
WE REMAIN COMMITTED TO ENSURING IMPLATS CREATES AND SHARES VALUE ACROSS ITS STAKEHOLDER GROUPS. TO DO SO WITHOUT HARM IS OUR ONGOING INTENT.
Chairperson: social, transformation
and remuneration committee
It gives me pleasure to introduce Implats’ annual Sustainable Development report and to share some high-level refl ections about our sustainability performance over the year. In conjunction with this opening review, I encourage you to refer to the review by my colleague, CEO Nico Muller (page 12), which outlines Implats’ corporate strategy to shift the organisation away from a labour-intensive model and towards being a value-focused PGM producer. This strategy, which is underway, informs the strategic transformation of the Impala Rustenburg operations. He outlines the issues critical to Implats’ longer-term sustainability, which include:
- the restructuring of Impala Rustenburg over the next two years
- delivering on our commitment to zero harm
- fostering an organisational culture of performance, delivery and accountability
- addressing growing levels of community activism
- proactively responding to the legislative and policy environment in South Africa and Zimbabwe.
Further detail on these and other issues contained in the opening reviews are provided in the respective sections of this report, which supplements our Integrated Annual Report, and outlines what Implats has done to deliver on its strategic commitments across its material sustainability focus areas.
I encourage you to share your feedback on this report in terms of our performance and the quality of disclosure. Frank feedback from stakeholders is essential to foster greater accountability and helps us deliver more effectively on our sustainability goals.
Implats has maintained an impressive ethical culture, supported through our corporate values and visible, ethical leadership.
An important development this year has been the establishment of a social and ethics sub-committee at Impala to strengthen our resources, focus and approach. The transformational restructuring being undertaken at Impala Rustenburg has implications for our sustainability activities and the work of the social, transformation and remuneration (STR) committee. In observing the requirements outlined in King IV™*, the social and ethics sub-committee will undertake complementary work, examining and addressing social and ethics issues impacting employees and communities with a focus on Impala Rustenburg. The transformation of the Rustenburg complex will result in unavoidable job losses. The group is committed to ensuring due care will be taken to minimise job losses. A phased restructuring approach will ensure the Group mitigates the various implementation risks and socio-economic impacts as far as possible. Community development, in consultation with our partners, will also be prioritised to further mitigate socio-economic impacts.
The STR committee’s work during 2018 was substantially supported by the outcomes of a series of deep-dive “bow tie” risk analyses, undertaken as part of the annual work plan. Given the challenges facing the South African mining sector and the organisational change in the Group, the strategic importance of managing human resource-related risks and developing and maintaining positive relationships with employees has taken on renewed signifi cance. As such, the committee focused on gaining a deeper understanding of our people-related risks.
To monitor and improve our sustainability reporting, we engaged external advisory services to provide a critique on our 2017 Sustainable Development report. This evaluation was benefi cial in identifying our strengths and areas for improvement. We acted on several recommendations to improve the quality of disclosure in this 2018 report.
I am particularly encouraged by developments this year aimed at fostering our desired organisational culture of performance, delivery and accountability. We are implementing a more strategic approach to managing our people, to drive our desired workforce culture and capability. Our approach is to instil organisational discipline, enhance people engagement and people management capabilities, empower line managers to take responsibility for people management, and ensure effective performance management to deliver on objectives. We have already seen positive results, refl ected in improved safety performance and productivity, especially at our more challenging mines, Impala Rustenburg and Marula.
The sustained good relations the Company enjoys with employees and their union representatives has been evident throughout the restructuring undertaken at Impala Rustenburg during the year. We made every effort to ensure effective consultation and to provide affected employees with the necessary support and assistance. For example, our voluntary separation packages include the opportunity to receive training in a portable skill to use in other occupations/jobs in the future. We have been pleasantly surprised by the understanding shown by many affected stakeholders. Due to the further restructuring expected, the STR committee directed an in-depth review of the employee relations climate, which resulted in focused actions being taken to address areas identifi ed for improvement.
To support the wellbeing of our employees and their families, we initiated a process to review and redefi ne our accommodation strategy. The outcomes of a comprehensive accommodation and living out allowance survey, across the Impala Rustenburg workforce, will provide valuable input to the strategic review. A key objective is to address those employees at Impala Rustenburg operations who are still living in informal settlements.
Employee over-indebtedness is an ongoing challenge we are tackling at our South African and Zimbabwean operations. We have intensifi ed efforts to encourage more employees to use our fi nancial wellbeing services. We monitor levels of indebtedness and suspected cases of indebtedness through payroll checks and have seen pleasing improvements in debt levels. Recognising the signifi cance of emotional wellbeing on safety and productivity, Zimplats has embarked on an aggressive programme to address key mental health issues, in the workforce and broader community.
Across the Group, the management of TB remains under control due to comprehensive screening, case tracing and effective treatment. At our South African operations, the TB incidence rate of 530 per 100 000 employees remains well below the national average of 1 000 per 100 000. Through proactive monitoring and management, we have maintained a 95% level of adherence to treatment for employees on our HIV and TB programmes. In mitigating the major occupational health risk associated with our mining activities, noise-induced hearing loss (NIHL), we have decreased the proportion of employees working in higher risk categories. A particular focus going forward is on the silencing or replacement of rock drills at Impala Rustenburg and Marula operations, to ensure noise levels emitted are below 107dB.
Making a meaningful and visible difference to social transformation is central to our ability to create long-term value and contributes to a sense of ownership and enhanced motivation among employees.
Across the Group we made good progress this year, increasing our levels of localised and preferential procurement. In South Africa, we increased our expenditure with black-owned and black women-owned suppliers. We gained momentum in building local supplier capability, supported through incubation programmes and promoting supplier sub-contracting and skills transfer opportunities.
Through our social investment programme, we contributed meaningfully to mitigating ongoing social challenges in neighbouring communities, notably by developing and improving infrastructure and other social services. Our operations focus on low-cost, high-impact investments and seek opportunities to partner with others to deliver greater impact. We face increasing expectations to deliver greater socio-economic benefi ts, particularly employment and procurement opportunities. Ongoing Company fi nancial constraints impact our spending on social investments and due care is being taken to engage effectively with community representatives and authorities to manage expectations.
In Zimbabwe, Zimplats implemented a highly successful albinism campaign, aimed at promoting levels of awareness and social integration and distributing sun protection materials for people with albinism. The campaign received three national awards and continues to expand its reach across the country. The refurbishment of the Kadoma General Hospital was a major achievement during the year – the facility had not had material maintenance works done in the past 15 years. During the four-month refurbishment, Zimplats worked with seven local enterprises, which used an average labour force of 150, the majority of which were from the surrounding community.
A good performance across key areas of responsible environmental stewardship was maintained. Impala Springs, Impala Rustenburg, Mimosa and Zimplats are certifi ed against the ISO 14001:2015 standard for their environmental management systems and Marula is on track to be certifi ed against the updated standard in 2019. This year, there were no major non-compliances at our operations. Financial constraints have resulted in limited progress in implementing additional effi ciency improvements in our water and energy usage. Water use will remain a critical priority in years to come, along with our focus on driving environmental compliance and ensuring full environmental disclosure on any material incidents.
In closing, I extend my thanks and congratulations to our chief executive, Nico Muller, for his visionary and exemplary leadership, to management, my colleagues on the STR committee, and all employees for their work towards delivering on Implats’ sustainability commitments. I convey my particular appreciation to community representatives and government offi cials for our constructive relationships. We have navigated a diffi cult year through effective collaboration with our stakeholders. We are better positioned to safely and effi ciently mine and produce our metals, ensuring sustainable value creation for all our stakeholders.
IMPLATS IS COMMITTED TO MAINTAINING THE HIGHEST STANDARDS OF GOOD GOVERNANCE IN ORDER TO PROMOTE QUALITY DECISION-MAKING AND ENSURE THE EXECUTION OF THESE DECISIONS WITHIN A DISCIPLINED FRAMEWORK OF POLICIES, PROCEDURES AND AUTHORITIES.
We have a structured and systematic approach to managing our most signifi cant social, economic and environmental impacts and to addressing the material interests of our priority stakeholders.
Board level: At board level, sustainability issues are addressed through the following committees:
- The social, transformation and remuneration (STR) committee is responsible for the Group’s activities relating to: social and economic development; transformation; public safety; consumer relationships; labour and employment issues; and remuneration. The committee has delegated the oversight for health and environment to the health, safety, environment and risk (HSER) committee and the oversight of ethics to the nominations, governance and ethics (NGE) committee.
- social and ethics committee (SET) has been established to undertake complementary work examining and addressing social and ethics-related issues impacting employees and communities with a focus on Impala Rustenburg operations. The committee held its inaugural meeting on 25 May 2018.
- The HSER committee guides strategy, assesses the adequacy and appropriateness of HSE policies, standards and procedures and reviews Group-wide performance and risk management practices quarterly. The committee also investigates and reviews all major incidences within the ambit of its work.
- The audit committee oversees the appointment of the assurance provider for non-fi nancial performance each year. The results are presented to both the audit and STR committees with the necessary recommendations and action.
The Group’s risk function is disseminated throughout all committees, except the NGE committee.
Further details of the composition and activities of these board committees are provided in our Integrated Report.
Executive level: At an executive level, sustainable development falls under the responsibility of the executive committee (Exco), which is responsible for reviewing performance in terms of the Group’s non-fi nancial indicators. The Exco lends support to the board’s HSER committee, STR committee, SET committee and audit committee.
Performance evaluation: Sustainability objectives form part of the key performance indicators (KPIs) against which Implats’ management and executives are measured.
Focus areas, policies and procedures: Management of our employees is headed up by a dedicated Group executive for human resources reporting to the CEO. The scope of work includes remuneration, human resource development, talent management and employment equity. Group policies and procedures on people management issues are established at corporate level and apply at our operations. Our policies and procedures are aimed at contributing to sound employee relations, attracting and retaining talent and ensuring the continuous development of our employees, while offering opportunities for career progression with a particular emphasis within our South African operations on historically disadvantaged South Africans (HDSAs). All contracting employees are vetted and assessed according to our own internal standards. The human resources function was identifi ed as a strategic priority in the FY2018 business plan and a series of deep-dive risks analyses were undertaken into human resource related risks.
Transformation: Each operation has a transformation committee comprising representatives from management, unions and women, as well as various other stakeholder groups who contribute to overseeing and advancing transformation at each operation. The operational committees report to the Group STR committee. Our operations also have community forums, at which issues of concern to local communities – such as employment opportunities, skills development, procurement, community development projects and health, safety and environmental performance – are discussed. Issues arising from these community forums are relayed to the operational committee and, ultimately, to the Exco. These are elevated to the STR committee quarterly and to the board as required.
Group and site-specifi c HSE policies, procedures and standards are in place to ensure compliance with legislative requirements and support our vision of zero harm. Responsibility for implementing HSE policies and procedures rests with line management. All operations submit quarterly performance reports to the boardappointed HSER committee. Group and operational level HSE specialists support line management to implement the strategy and to monitor and manage performance.
The Group’s environmental team has close links with operational and project management and is involved in due diligence exercises in connection with acquisitions and the development of strategic initiatives. Policy implementation is enhanced by our commitment to maintaining ISO 14001 certifi cation for our environmental Sustainability governance Implats Sustainable Development Report 2018 16 management systems. The Group’s internal auditors and external auditors conduct regular compliance audits. In addition to the ISO 14001 certifi cation, the refi neries are signatories to Responsible Care® and retained their certifi cation. We follow the International Council on Mining and Metals (ICMM) guidelines to improve our approach and practices. Key sustainability data are externally assured.
At Impala Rustenburg, Marula and Impala Springs we have identifi ed and are addressing compliance gaps relating to the ISO 45001 standard (which replaced the widely implemented OHSAS 18001), with a view to achieving certifi cation. (The health and safety management systems standards will be rolled out at all non-certifi ed operations during FY2019.)
Various internal and external review and assurance programmes ensure that priority unwanted risks are identifi ed and that adequate controls are in place to manage them. A detailed review of our risk management practices is provided in our Integrated Report.
Our approach to social performance is informed by our values and our business and ethics principles; all our operations apply high social performance standards in line with our sustainable development policy, community policy and legal frameworks of the countries in which we operate. We are investigating the implementation of ISO 26000 to provide guidance on social responsibility. We seek to engage with affected communities to avoid, prevent and mitigate adverse impacts of our activities, and to build development opportunities. We invest in developing and maintaining constructive relationships with the stakeholders and communities around our operations. This is essential to maintain and strengthen our sociopolitical licence to operate. Inclusive stakeholder engagement underpins our approach to respecting human rights and to responding to legitimate stakeholder aspirations and concerns. Extending the positive benefi ts of mining, notably by developing infrastructure and creating opportunities for local businesses, also promotes social stability and builds resilience within communities to prosper beyond mine closure.
The sustainable development department at Impala Rustenburg manages the socio-economic development initiatives at our South African operations. A technical team is responsible for implementing the projects, working with the stakeholder engagement department. We identify community projects based on a needs analysis, undertaken in consultation with stakeholder representatives from communities, local government and employees. The sustainable development project steering committee reviews the proposed projects after due diligence. Once approved by the project steering committee, the projects are recommended to the Group’s executive committee, a multi-disciplinary executive-level management team that evaluates the merits of investing in each project. In Zimbabwe, sustainable development initiatives are implemented and managed by the stakeholder engagement executive supported by technical personnel from the operations. Each year an independent verifi cation is conducted on selected social projects, based on the fi nancial, legal and reputational risk as well as to determine impact, progress and potential remedial action where a project faces possible failure. A summary of this can be found on Page 58.
We have a large and diverse base of more than 2 200 suppliers from which we procure goods and services including heavy equipment, process chemicals, fuel and lubricating oils, labour, explosives, underground support grinding media, drilling equipment, electrical equipment, safety clothing, tyres and many more. There is an increasing expectation of business to demonstrate accountability in ensuring responsible business conduct by all parties in corporate supply chains. We have clear principles that guide the selection of reputable contractors with the right skills and values systems to do specifi c tasks that we are not able to do.
All our suppliers are appraised of our policies and business practices and are expected, as a minimum, to abide by these principles in their business conduct and practices at all our operations. To strengthen our approach, we are developing a supplier code of conduct which will detail the mandatory standards that suppliers must achieve, and those that we strongly encourage. We conduct ad hoc supplier audits against our standards on various criteria including health, safety and labour practices. In the year under review, there were no incidents of supplier non-compliance.
We are progressively implementing a SAP Ariba system that will ensure that all our suppliers are legally compliant. We focus on increasing our levels of expenditure with local and black-owned suppliers and on developing existing procurement capacity in the areas close to our operations. We also support initiatives to stimulate local manufacture and technology development, thereby increasing our contribution to empowerment. Increased pressure is being exerted during all interactions with untransformed suppliers to improve the pace of transformation.
We follow the International Council on Mining and Metals guidelines
We subscribe to the United Nations Guiding Principles on Business and Human Rights
We are committed to the United Nations Global Compact
We support the Extractive Industries Transparency Initiative (EITI)
We participate in the annual climate change and water disclosures of the CDP
We are a member of the National Business Initiative (NBI)
Our initiatives support the United Nations Sustainable Development Goals
Safe and effective people who respect and care
An engaged and productive workforce is essential for delivering on our objectives.
We focus on ensuring that our employees are motivated, have the ability and requisite skills to carry out their duties and that they operate in a safe, fair and ethical work environment. In return for the skills, capabilities and experience our employees bring to our business, we aim to offer a compelling employee value proposition and a great place to work. Our longer-term vision is to progressively mechanise our mining processes, while continuing to improve levels of workforce proficiency, satisfaction and diversity.
The sustainability of our mining activities depends ultimately on the wellbeing and prosperity of our mine communities.
In seeking to build and maintain our social licence to operate, we invest in socio-economic development initiatives drive our legislated transformation requirements and engage proactively with community representatives and government officials at all levels.
Conserve natural resources and mitigate impacts
Our environmental policy commits the Group to demonstrating responsible stewardship of our natural resources and to mitigating the unavoidable environmental impacts of our mining activities with a particular focus on the following areas:
- Ensuring full compliance with regulatory requirements
- Promoting responsible water stewardship by minimising water use and water pollution
- Responding to climate change risks and opportunities, and promoting responsible energy management
- Minimising our negative impacts on air quality
- Managing our waste streams
- Promoting responsible land management and biodiversity practices
Regular engagement with our key stakeholders is central to our efforts to identify and address issues and impacts timeously. An overview of our management approach to responsible environmental stewardship is provided on page 16.
|Own (permanent) employees**||Number||36 002||38 334||38 189||40 019||40 238|
|Contractors**||Number||15 336||14 334||13 221||14 729||15 602|
|Women in total workforce in SA||Percentage||11||11||11||11||10|
|Managers who are female||Percentage||22||21||20||20||19|
|Unionised workforce in South Africa||Percentage||81||76||75||82||79|
|Female to male pay ratio in South Africa||1.06:1||1.07:1||1.07:1||0.9:1||1.05:1|
|Female to male pay ratio in Zimbabwe||1.09:1||1.02:1||1:1||1:1|
|Skills development expenditure in South Africa||Rm||485||548||512||523*||331*|
|Skills development expenditure in Zimbabwe||US$ 000||4 991||4 838||4 905||5 304||5 909|
|**||Includes Mimosa employees and contractors attributable to Implats.|
|Work-related fatal injuries (own employees and contractors)||Number||7#||9||11||7||4||9|
|Medical treatment cases*||Number||747||881||702||546||545||702|
|Lost time injuries||Number||650||723||782||559||369||579|
|Employee hours worked||Number||177 021 537||122 070 071||120 520 676||121 034 823||94 056 773||137 598 336|
|Fatal injury frequency rate||Pmmhw**||0.060||0.074||0.019||0.058||0.043||0.065|
|Lost time injury frequency rate (including restricted work cases)||Pmmhw||5.55#||5.95||6.49||5.27||6.10||5.80|
|Total injury frequency rate||Pmmhw||11.93#||13.14||12.31||9.78||11.9||10.91|
|Medical treatment case frequency rate||Pmmhw||6.37||7.22||5.82||4.51||5.79||5.11|
|Total injuries||Number||1 396||1 604||1 484||1 183||1 119||1 501|
|Section 54 stoppages (excluding Section 55s)||Number||39||92||80||55||52||65|
|#||Indicates independently assured numbers.|
|Employees on wellness programme||Number||7 087||7 278||6 891||6 140||6 286|
|Voluntary counseling and testing interventions||Number||12 154#||16 733||10 867||11 875||10 086|
|Employees known to be receiving antiretroviral treatment||Number||5 942#||5 174||4 843||4 429||4 276|
|Total new cases of pulmonary tuberculosis (TB)||Number||154#||199||171||304||268|
|Total new HIV cases||Number||650||1,077||823||952||830|
|Total new noise-induced hearing loss (NIHL) cases submitted (+10% shift)||Number||102#||88||120||49||36|
|Total NIHL cases compensated||Number||65||57||59||36||19|
|TB incidence rate||Per 100 000 employees||530||519||447||755||841|
|HIV total medical incapacitation||Number||836||265||377||505||331|
|Tonnes milled (excluding Mimosa)||000t||19 355||18 332||18 426||16 024||13 916|
|Tonnes milled (including Mimosa)||000t||22 157||21 061||21 067||18 610||16 369|
|Refined platinum||000oz||1 468||1 530||1 438||1 276||1 178|
|PGMs (6E)||000oz||2 925||3 099||2 908||2 618||2 370|
|Revenue||Rm||35 854||36 841||35 932||32 477||29 028|
|Capital invested||Rm||4 606||3 432||3 560||4 287||4 345|
|Income tax paid||Rm||1 336||1 312||883||401||144|
|Unit cost1 per oz Pt||Rand||25 230||22 691||21 731||22 222||19 430|
|1||Excluding share-based payments.|
|#||Indicates independently assured number.|
|Group material consumption|
|Diesel||000 litres||23 921||23 072||22 523||21 748||21 776|
|Coal||Tonnes||138 079||161 446||153 309||138 653||127 883|
|Industrial burning of oil||000 litres||1 884||1 316||1 222||1 633||1 264|
|Energy consumed||GJ000||16 978#||18 065||17 328||15 937||14 395|
|Energy intensity||GJ/tonne milled||0.7663||0.8577||0.8225||0.8564||0.8794|
|Total water withdrawn||Ml||25 790#||25 709||26 703||25 376||21 365|
|Water re-used/recycled in processes||Ml||21 245||21 776||18 825||14 325||13 409|
|Total water consumed||Ml||47 040#||47 485||45 528||39 701||34 775|
|Total water consumed which is re-used/ recycled||Percentage||45||46||41||36||39|
|Unit water consumption||Ml/tonne milled||2.12||2.25||2.16||2.13||2.12|
|Direct CO2e emissions||Tonnes||393 480#||409 785||381 780||349 000||323 997|
|Indirect CO2e emissions||Tonnes||3 174 975#||3 298 899||3 286 098||3 001 522||2 714 157|
|Total CO2 intensity||t000/t milled||0.1610||0.1761||0.1741||0.1801||0.1855|
|Direct SO2 emissions||Tonnes||28 266||29 373||31 392||27 706||30 735|
|Total direct SO2 intensity||Tonnes/6E refined Oz||0.0097||0.0095||0.0108||0.0106||0.0130|
|Total NOx||Tonnes||14 156#||14 574||14 435||13 459||12 107|
|Disturbed areas rehabilitated||Hectares||19.5||71.2||27.5||9.4||46.6|
|Rehabilitation liabilities/current costs||Rm||2 378||1 932||1 770||1 434||1 199|
|Rehabilitation provisions||Rm||1 225||1 099||1 081||848||675|
|General waste to landfill||Tonnes||5 323||4 467||4 457||6 884||3 001|
|Hazardous waste disposed of to landfill||Tonnes||13 573||10 918||8 997||7 131||8 251|
|Tailings disposed to tailings facilities||000 tonnes||22 166||21 258||20 936||17 891||16 004|
|Waste rock disposed to rock dumps||000 tonnes||776||869||911||824||778|
|Level 4 or 5||Number||0||0||0||0||0|
|#||Indicates independently assured numbers.|
|Community development expenditure (South Africa)||Rm||137#||106||105||83||71|
|Community development expenditure (Zimbabwe)||US$000||8 967||4 918||4 743||5 105||8 915|
|Total discretionary procurement in South Africa||Rbn||9.1||8.7||8.1||7.6||7.9|
|Procurement: BEE expenditure in South Africa||Rbn||6.7#||6.7||6.1||7.6||5.1|
|Procurement: localised expenditure in South Africa||Rbn||2.9#||2.6||2.5||2.4||2.0|
|Procurement: localised expenditure in South Africa||Percentage of total||31||29||31||32||26|
|Total supplier expenditure in Zimbabwe||US$m||436||429||416||295*||326*|
|Procurement: localised expenditure in Zimbabwe*||Percentage of total||75||71||73||73||66|
|#||Indicates independently assured number.|
|Combined (South Africa)||A||C||I||W||A||C||I||W||Male||Female||Male||Female||Total|
|Professionally qualified and experienced|
|specialists and mid-management||169||8||17||218||54||1||11||61||9||1||421||128||549 4|
|Skilled technical and academically qualified workers, junior management, supervisors, foremen, and superintendents||3 141||21||6||618||590||7||3||84||273||3||4 059||687||746|
|Semi-skilled and discretionary decision making||8 493||13||4||82||987||6||1||24||1 593||4||10 185||1 022||11 207|
|Unskilled and defined decision making||12 824||10||0||9||1 790||1||0||0||1 408||36||14 251||1 827||16 078|
|Total permanent employees2||24 652||54||30||972||3 428||15||17||175||3 286||44||28 994||3 679||32 673|
|Grand total||24 700||56||30||976||3 466||15||17||177||3 286||44||29 048||3 719||32 767|