UNLOCKING OUR FULL POTENTIAL DISCIPLINED GROWTH FOR A SUSTAINABLE FUTURE - KUMBA IRON ORE LIMITED - Anglo American ...
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KUMBA IRON ORE LIMITED SUSTAINABILITY REPORT 2018 UNLOCKING OUR FULL POTENTIAL DISCIPLINED GROWTH FOR A SUSTAINABLE FUTURE
INTRODUCTION
OUR APPROACH TO REPORTING
Navigating our 2018 reports Online
Each of these reports, with additional updated information, is available on our website:
Our integrated reporting suite
www.angloamericankumba.com
comprises the following reports:
KUMBA IRON ORE LIMITED
SUSTAINABILITY REPORT 2018
CONTENTS
INTRODUCTION BUILDING SOCIAL CAPITAL
1 About this report 42 Upholding high social standards
KUMBA IRON ORE LIMITED SUSTAINABILITY REPORT 2018
UNLOCKING
OUR FULL
POTENTIAL
DISCIPLINED
2 Our values 46 Making a positive social contribution
GROWTH FOR
A SUSTAINABLE
FUTURE
SUSTAINABILITY
3 Creating shared value for stakeholders
REPORT (SR) MANAGING ENVIRONMENTAL
OUR APPROACH IMPACTS
Reviews our approach to managing
our significant economic, social
4 Who we are 54 Environmental management
and environmental impacts, and to
addressing those sustainability issues of 6 Social, Ethics and Transformation 59 Water
interest to a broad range of stakeholders. Committee Chairperson’s review 61 Climate change
10 Our business model and integrated 64 Mine closure, rehabilitation and biodiversity
KUMBA IRON ORE LIMITED
INTEGRATED REPORT 2018
value chain 68 Air quality
12 Chief Executive’s review 70 Mineral and non-mineral waste
14 Measuring our performance
16 Our strategy APPENDICES
UNLOCKING
OUR FULL
POTENTIAL
DISCIPLINED
GROWTH FOR
19 Governance and management approach 72 Performance tables
A SUSTAINABLE
22 Stakeholder engagement
FUTURE
INTEGRATED 81 B-BBEE scorecard
REPORT (IR) 82 Summary GRI table
OUR PEOPLE
A succinct review of our strategy 87 Independent assurance report
and business model, operating 24 Safety and health 90 Reporting criteria
context, governance and operational 37 Workforce culture and capability 91 External review panel – summary report
performance, targeted primarily at 92 Glossary of icons, terms and acronyms
current and prospective investors.
IBC Administration
DISCIPLINED GROWTH FOR
KUMBA IRON ORE LIMITED
ANNUAL FINANCIAL STATEMENTS 2018
A SUSTAINABLE FUTURE
UNLOCKING
OUR FULL
POTENTIAL Cover images
1. Johannes Banda, a Strata Control Officer and Eduan Hattingh, a Geotechnical Engineer at the
DISCIPLINED
GROWTH FOR
A SUSTAINABLE
FUTURE
Kapstevel pit in Kolomela mine selecting the scan area for the ground probe SSR-FX radar to
ANNUAL FINANCIAL 6 monitor high wall stability.
STATEMENTS (AFS) 1 5 2. Otladisa Mokhutsane, a laboratory technician in the quality control laboratorium at Kolomela
mine.
8 2 3. Kuruman Field band performing at a mine visit.
Detailed analysis of our financial results, 3 4. Moabi Tau instructing students, Mapole Melokwe and Nicholas Bohitile at the Tsipi skills and civil
7
with audited financial statements, training centre on the band saw machine.
4 5. Elisa Natlhare, receiving an eye exam from Andrew Magam at Sishen’s Batho Pele mobile clinic.
prepared in accordance with International 6. The “Thaba Tots” Early Childhood Development (ECD) centre, funded by Kumba, opened in
Financial Reporting Standards (IFRS). 2014 for children from the Thabazimbi community.
7. Poliena Melakeso nurse at the UGM clinic in consultation with a patient.
8. Eugine Matlhare, Reginah Konman and Veronica Seleke, all members of the Rerokela Sechaba
Primary sewing and beading cooperative in Groenwater situated near Kolomela.
KUMBA IRON ORE LIMITED
ORE RESERVE (AND SALEABLE PRODUCT)
AND MINERAL RESOURCE REPORT 2018
ORE RESERVE DIRECTORS’ RESPONSIBILITY
(AND SALEABLE The Kumba Board, supported by the Audit Committee, has overall accountability for this
KUMBA IRON ORE LIMITED ORE RESERVE (AND SALEABLE PRODUCT) AND MINERAL RESOURCE REPORT 2018
UNLOCKING
OUR FULL
PRODUCT) report. It delegated the responsibility to oversee the reporting process to its Social, Ethics and
POTENTIAL
DISCIPLINED
GROWTH FOR
A SUSTAINABLE AND MINERAL Transformation Committee, which was assisted by a Steering Committee comprising executive
managers and a dedicated reporting team. The Board collectively reviewed the content of
FUTURE
RESOURCE REPORT
(ORMR)* this report and confirms that it believes this Sustainability Report 2018 addresses our material
issues, and is a balanced and appropriate presentation of the sustainability performance of the
Reported in accordance with the group. The Kumba Board approved this report on 15 March 2019.
South African Code for the Reporting
of Exploration Results, Mineral
Resources and Mineral Reserves Buyelwa Sonjica
(SAMREC Code – 2016 edition). Chairperson: Social, Ethics and Transformation Committee
15 March 2019
* Published on 19 February 2019.
INTRODUCTION PERFORMANCE HIGHLIGHTS AND ABOUT THIS REPORT
PERFORMANCE HIGHLIGHTS
7 high-potential safety 1.80 Fatality-free
Introduction
total recordable
incidents case frequency rate since May 2016
2017: 21 (TRCFR)
2017: 3.23
24% women in 23% women in total 130ha
management workforce rehabilitated during 2018
2017: 22% 2017: 21% 2017: 75ha
R123.5 million R11.8 billion R1.4 billion
spent on direct social spent on procurement from spent on suppliers in host
investment HDSA businesses communities
2017: R106.7 million 2017: R9.3 billion 2017: R520 million
FTSE Russell confirms that Kumba has been independently assessed
according to the FTSE4Good criteria, and has satisfied the requirements For more information, please refer to:
to become a constituent of the FTSE4Good Index Series. Created by the www.issgovernance.com/esg/ratings/corporate-rating/
global index provider FTSE Russell, the FTSE4Good Index Series is
designed to measure the performance of companies demonstrating
strong Environmental, Social and Governance (ESG) practices.
ABOUT THIS REPORT
PURPOSE AND SCOPE OF THIS REPORT In addition, we have published an Integrated Report (IR),
This report is produced in order to provide our key stakeholders Annual Financial Statements (AFS), and Ore Reserve (and
– namely our shareholders, employees, local communities, Saleable Product) and Mineral Resource (ORMR) report. The
non-governmental organisations (NGOs), investors, customers, reporting process for all our reports has been guided by the
partners, suppliers and government – with a transparent account principles and requirements contained in International Financial
of how we addressed the most material sustainability issues Reporting Standards (IFRS), the IIRC’s International
the Company faced during 2018. The scope of this report Framework, the GRI’s Standards, the King Code on Corporate
covers our Sishen and Kolomela operations, corporate office Governance 2016 (King IV), the JSE Listings Requirements and
in Centurion, the Saldanha port and our marketing activities in the Companies Act, 71 of 2008.
London and Singapore, for the period 1 January to 31 December
2018. Thabazimbi, our operation in Limpopo was transferred to We use a combined assurance model to provide us with
ArcelorMittal SA on 1 November 2018. assurance obtained from management and from internal and
external assurance providers. PricewaterhouseCoopers (PwC)
Our sustainability reporting criteria have been compiled in has provided independent assurance over selected sustainability
accordance with the GRI’s Sustainability Reporting Standards key performance indicators.
(core compliance) and their Mining Sector Supplement.
Our reporting is also aligned with the AA1000 stakeholder PwC’s assurance statement is provided on page 87.
engagement standard, the sustainable development principles
and reporting framework of the International Council on Mining Please address any queries or comments on this report to
and Metals (ICMM), and the principles of the United Nations Bheki Masondo (email: bheki.masondo@angloamerican.com).
Global Compact (UNGC).
Kumba Iron Ore Limited Sustainability Report 2018 1
INTRODUCTION OUR VALUES
OUR VALUES
Safety and health are always first on our agenda
We are committed to zero harm. We believe that all fatalities and injuries
are preventable and that by working together we can make safety and
health a way of life, inside and outside of the workplace.
Image: Employees performing an isolation
CARE AND and lock-out procedure at the life-of-
mine truck workshop at Sishen.
RESPECT
We always treat people with
respect, dignity and common
courtesy – regardless of their
background, lifestyle or position.
We are building trust through
open, two-way communication
ACCOUNTABILITY
every single day.
INNOVATION We take
Challenging the way things ownership of
have always been done is a key our decisions,
priority. By actively developing new our actions and
solutions, encouraging new ways
of thinking and finding new ways
our results.
of working, we are significantly We deliver on our promises
improving our business. and acknowledge our
mistakes. Above all, we
INTEGRITY COLLABORATION never pass blame.
Integrity demands taking No one here is on their own.
an honest, fair, ethical and We are one company with a
transparent approach in shared ambition – all working together
everything we do. It is not to make appropriate decisions
about being popular; it is about and get things done
always doing the right thing. more effectively.
Image: Zenovia Bekend
and Marian Jobs, plant
operators carrying out
maintenance on the conveyors at
the Kolomela primary crusher.
2 Kumba Iron Ore Limited Sustainability Report 2018
INTRODUCTION CREATING SHARED VALUE FOR STAKEHOLDERS
CREATING SHARED VALUE
FOR STAKEHOLDERS
SHAREHOLDERS AND INVESTORS
Introduction
New dividend policy, target Dividends paid to Total dividends paid to BEE
pay-out ratio range of between shareholders in 2018 shareholders since Kumba’s
inception in November 2006
50 to 75% R12.5 billion
headline earnings
of
(2017: R6.7 billion)
R29 billion
(2018: R26 billion)
CUSTOMERS
Reinforce our reputation for
COMMUNITIES quality and consistency
R123.5 million spent on Product quality – average Fe content %
65.1%
direct social investment in 2018
HIV-related services supplied to
more than 10,000 community members
Lump:Fine ratio
through the Ulysses Modise (UGM)
Wellness Clinics
TB screening services supplied to
68:32
6,024 community members
EMPLOYEES
SUPPLIERS Total labour costs of R4,627 billion
paid to our employees
R11.8 billion spent on procurement
from HDSA businesses (2017: R9.3 billion) Employment of local people
Sishen – 86%
R1.4 billion spent on suppliers within Kolomela – 63%
host communities (2017: R520 million)
HDSA and women in management
HDSA in management – 68%
Women in management – 24%
GOVERNMENT
Women in core mining – 20%
TOTAL TAX CONTRIBUTION Training and development
Rand million 2018 Number of participants – 839
Corporate income tax 4,078 Expenditure – R232 million
Mineral royalties 983 % HDSA – 97
Payroll tax 1,093 % women – 32
Skills levy 42
UIF 22
Total 6,218
Kumba Iron Ore Limited Sustainability Report 2018 3
OUR APPROACH WHO WE ARE
WHO WE ARE
WHO WE
ARE
Kumba is a supplier of high-
quality iron ore (64.5% average
Fe) to the global steel industry. We
operate primarily in South Africa, with mining
operations in the Northern Cape, a head office in
LISTED ON THE Centurion, Gauteng, and a port operation in Saldanha Bay,
Western Cape.
JSE LIMITED
Kumba has a 76.3% interest in Sishen Iron Ore Company Proprietary
Limited (SIOC), an entity that we manage. SIOC, in turn, owns the
operating assets of the Company.
The remaining 23.7% interest in SIOC is held by our
black economic empowerment (BEE) partners
Exxaro Resources Limited, a leading BEE
company listed on the JSE (20.6%), and
the SIOC Community Development BEING A
Trust, a trust that funds PARTNER
projects in local
OUR VISION OF CHOICE
communities
(3.1%). Building lasting beneficial
To be a successful and sustainable African relationships is core
supplier of quality iron ore to global and local
to our success. We are a
markets while delivering superior value to our
stakeholders.
significant employer in
the region in which we
operate, and we work with
communities and local
OUR AMBITION governments to create lasting
positive change in these areas.
• Eliminate fatal incidents through a
As at the end of 2018 we
culture of zero harm
• Sustainably extend the life of our assets had 12,050 people in
beyond 2035 employment, comprising
• Significantly improve margins by 6,005 permanent employees,
US$10/tonne to remain globally 5,557 contractors and
competitive and sustainable WHAT WE DO 488 learnerships.
• Become the employer of choice,
through a high-performance culture We produce high-grade iron ore, with a
driven by healthy employees Lump-to-Fine ratio of 68:32 in 2018. This ore
is mined at our operations. Export ore is shipped
to customers across the globe from the port operation in
Saldanha Bay. We also have a marketing office in Singapore,
integrated with Anglo American marketing BU, and one in London,
For more on these
wholly owned by Kumba. In total, around 92% of our product is
relationships see pages exported, and around 8% comprises domestic sales. The
37 to 41 of the SR. revenue generated from these sales is used to grow and
sustain the business, which shares its success with
various stakeholders.
To learn more about our operations
see pages 66 to 68 of the IR.
4 Kumba Iron Ore Limited Sustainability Report 2018
KUMBA IRON ORE LIMITED
OWNERSHIP STRUCTURE
Our approach
ANGLO
AMERICAN
PLC
100%
PUBLIC INDUSTRIAL ANGLO OTHER
FOREIGN
INVESTMENT DEVELOPMENT SOUTH AFRICA SOUTH AFRICAN
SHAREHOLDERS
CORPORATION CORPORATION PROPRIETARY SHAREHOLDERS
10.0%
1.1% 12.9% LIMITED 6.3%
69.7%
Anglo American Group companies
KUMBA BEE partners
IRON ORE Government-related bodies
LIMITED
Empowerment partners* 76.3% South African shareholders
Foreign shareholders
23.7%
* Total deemed empowerment shareholding of 29.79%
EXXARO RESOURCES SIOC COMMUNITY consisting of Exxaro Resource Limited (20.6%), SIOC
LIMITED DEVELOPMENT Community Development Trust (3.1%),
20.6% TRUST 3.1% SIOC Envision I (3%, unwound November 2011), Envision II
(3.09%, unwound November 2016).
43.1 Mt
production (2017: 45.0 Mt)
40.0 Mt
export sales (2017: 41.6 Mt)
12,050
employees (2017: 10,727)
292.5 Mt 3.3 Mt
Customers in South Africa, China,
India, Japan, South Korea, Europe
and the Middle East
total tonnes mined domestic sales (2017: 3.3 Mt)
(2017: 271.3 Mt)
Kumba Iron Ore Limited Sustainability Report 2018 5
OUR APPROACH SOCIAL, ETHICS AND TRANSFORMATION COMMITTEE CHAIRPERSON’S REVIEW
SOCIAL, ETHICS AND TRANSFORMATION
COMMITTEE CHAIRPERSON’S REVIEW
It gives me pleasure to introduce
Kumba’s annual sustainability report
and to present the Social, Ethics and
Transformation Committee (Setco)
review. I have had the privilege of
serving on the Board of Kumba since
2012 and am honoured to assume
the role of chairperson of Setco,
since May 2018. I thank my
predecessor, Dolly Mokgatle, for her
leading example.
independently facilitated stakeholder panel, in which we
receive very constructive input on our reporting activities
(see page 91).
DRIVING A CULTURE OF ZERO HARM
Kumba upholds a sacred covenant code with the families
of all our employees to do our utmost to ensure that
Buyelwa Sonjica every employee and contractor at our operations returns
Chairperson: Setco home unharmed after every day’s work. I am pleased to
report that in 2018 we maintained a strong safety and
Our responsibility as Setco is to monitor and guide health performance and ensured ongoing improvements.
Kumba’s performance relating to safety, health and We have operated fatality-free since May 2016 and our
the environment, the provision of a positive social ongoing focus on implementing our comprehensive
contribution, promotion of transformation and sound “elimination of fatalities framework” continues to have a
ethical practices. The Committee also receives positive knock on effect in preventing injuries.
feedback from Kumba’s human resources team on
its activities relating to workforce engagement, talent Building on our progress in 2017, we have seen a further
management and promotion of a strong organisational decrease in the number and severity of injuries recorded
culture. at our operations and achieved almost all of our safety-
related targets for 2018. There were 41 recordable injuries
This has been another very encouraging year for Kumba, at our operations in 2018, of which 21 were lost-time
with the Company’s strong operational and financial results injuries, and no major disabilities sustained. We continue
accompanied by a predominantly positive sustainability to prioritise the prevention of transportation and materials
performance. In this opening review, I reflect on some handling incidents. Our total recordable case frequency
of the key highlights and challenges relating to Kumba’s rate of 1.80 was a 45% improvement on our rate in 2017
sustainability performance over the year and share some and exceeded our targeted 2.75.
forward-looking perspectives. We remain committed to
ensuring that Kumba creates and shares value across We are taking decisive steps to advance further towards
its stakeholder groups. To do so without harm is our achieving our goal of zero harm at our operations. The
ongoing intent. emphasis we continue to place on visible felt leadership
interactions and interventions at Sishen and Kolomela
I encourage you to please share your views with us, both has supported an encouraging increase in the number of
in terms of Kumba’s performance and the quality of high-potential hazards (HPH) reported and addressed to
disclosure. Frank feedback from stakeholders is essential effect more robust controls. This in turn has supported a
to foster greater accountability and helps us deliver 67% decrease in the number of high-potential incidents
more effectively on our sustainability goals. Recognising recorded. It is nonetheless unacceptable that such
the value of external feedback, each year we host an incidents still occur as they expose our employees and
6 Kumba Iron Ore Limited Sustainability Report 2018
contractors to fatal risks. Our leading indicators reflect In 2018 we strengthened our approach to supporting
steady improvements in mitigating risks associated with employees in managing mental health-related issues,
our most challenging areas – transportation and mobile which has driven an encouraging increase in the number
machinery, and working at heights. of employees seeking assistance, and reduction in the
severity of issues presenting problems.
In striving for zero harm, we are continually exploring new
opportunities for improved methods to make mining safer. In managing TB and HIV/Aids our performance is in
I am proud of the leading example Kumba continues to line with World Health Organisation and Department
demonstrate in developing and adopting technologies of Mineral Resources (DMR) expectations and we are
to reduce potentially fatal risks and improve our ability making progress towards meeting ambitious targets,
including the UNAIDS 90/90/90 targets for 2020. Despite
Our approach
to achieve our zero-harm goal. For example, this year
steady improvements in our case detection, reporting and
we collaborated in developing the industry’s first vehicle
disease management in the workplace, we regrettably
intervention system to detect a potential collision and
diagnosed 38 new HIV infections and 25 new cases of
automatically slow down or stop a haul truck to prevent
non-occupational TB in 2018, 11 of which were sero-
a collision. In driving modernisation, we are also advanced
conversions. The estimated prevalence of HIV infection
in the use of drones, mobile devices and digitisation.
within our permanent workforce in 2018 was 4.5%. Our
TB incidence rate decreased by 27% year-on-year, to
Managing health risks in the workplace, entrenching 184 per 100,000 of the employees and contractors, which
our critical control management process and mitigation is significantly below the South African average.
measures are realising a steady reduction in levels of
occupational exposure to health hazards. In particular Our community healthcare initiatives continue to improve
to noise and dust, our two main health risks – and fewer access to quality medical and healthcare services and to
health incidents at both Sishen and Kolomela. We do not alleviate some of the mounting pressure on health service
have any machinery at our mines that emit noise levels delivery by government. In 2018 we celebrated a decade
above 107 dB(A), and for a consecutive year we did not of partnering with the Gamagara Municipality and the
record any new cases of noise-induced hearing loss. Provincial Department of Health in operating the UGM
Wellness Clinic in Kathu. The clinic represents one of the
Sishen continues to address challenges with PM10 dust most successful public-private partnership initiatives in
emissions and is implementing an action plan that will the Northern Cape and has a proud history of accolades
drive further reductions to ensure compliance with legal from organisations including the South African Business
limits. This year we focused on installing dust suppression Coalition on HIV/AIDS, the World Health Organization and
and extraction technology in high-risk areas across United Nations International Children’s Emergency Fund. As
our operations, which has enabled us to decrease the examples of positive impact, an average of 1,400 community
number of workers potentially exposed to dust above members receive ARV on a monthly basis from the clinic.
the occupational exposure limit to 104, compared to More than 480,000 people have been educated through the
136 in 2017. We also made ground-breaking progress by clinic on healthy lifestyles, general hygiene, HIV and other
devising innovative design interventions that have ensured conditions, and more than 306,000 people have conducted
HIV testing and know their HIV status.
that no visible dust is emitted during RC drilling – a feat that
was considered to be unachievable.
VALUING OUR PASSIONATE WORKFORCE
In striving to be an employer of choice we have made
We recorded five cases of occupational disease in 2018,
valuable progress in developing an organisational culture
of which four were work-related musculoskeletal injuries
that fosters safety, diversity, innovation and performance.
and one a case of post-traumatic stress disorder following Consequently we have seen great energy and
a truck accident at Kolomela. All individuals have been commitment which has had a positive impact on delivery.
rehabilitated and returned to work. For a consecutive year,
we did not record any new cases of diagnosed occupational Our engagements with employees have reinforced our
respiratory disease, including occupational TB. recognition that a compelling culture is dependent on
leadership being inspiring and motivating as well as taking
Mitigating chronic disease rates in our workforce remain interest in personal development of each and every worker.
a challenge and area of focus. About 2,800 employees To support the delivery of our Tswelelopele objectives – our
and contractors are suffering chronic diseases, the ambitious strategy to radically transform our business and
main conditions being carrying too much body weight, ensure sustained value creation for our shareholders and
hypertension, and high cholesterol levels. Our ongoing stakeholders – a strategic focus has been the introduction
efforts were supported by specific campaigns including of a leadership and culture “architecture”. This has included
weight loss and obesity, smoking, and substance abuse. the rollout and embedding of our Kumba Culture and
Kumba Iron Ore Limited Sustainability Report 2018 7
OUR APPROACH GOVERNANCE AND MANAGEMENT APPROACH
SOCIAL, ETHICS AND TRANSFORMATION
COMMITTEE CHAIRPERSON’S REVIEW
CONTINUED
Leadership Code at all levels, assessing to what extent our leaders We place an emphasis on progressively increasing levels of
are “showing up” on the Leadership Code, and taking actions to procurement from localised suppliers. This is supported by
address identified weaknesses. Other focus areas are building our supplier and enterprise development initiatives. In 2018,
leadership capability, with a particular focus on enhancing front line we spent R1.4 billion on localised procurement with more
supervisor capability, revitalised team development processes, and than 260 suppliers surrounding our mining operations, against
promoting our desired inclusion culture. an ambitious target of R1 billion, and we aim to increase this
expenditure to R2 billion by the end of 2019. In 2018, we spent
Achieving sustainable and tangible transformation is a business R11.8 billion on HDSA businesses, accounting for 81% of our
imperative and is core to our licence to operate. We are pleased discretionary payments.
to exceed all the South African Mining Charter II’s minimum
requirements across the organisation and currently meet the In 2018, we spent R360 million on the housing and
Mining Charter 2018 (MC 2018) targets on Board, Exco, middle accommodation for employees, which is a pillar of our
management, junior management (HDSA), and core levels. We contribution to the wellbeing of our host communities and
are lagging in our performance against MC 2018 targets for employees. Kumba’s three-pronged housing strategy encourages
HDSA and female representation at senior management, and home ownership, offers house rentals, and facilitates alternative
female representation at junior management levels. Our talent accommodation options for employees. Affordability presents
pool and pipeline support our progress, with 97% of employees a challenge for many employees interested in home ownership
participating in our training and development programmes and we continue to seek opportunities to partner in mitigating
being historically disadvantaged South Africans, and 32% being challenges.
women. We invested a total of R232 million on training and
development, amounting to 6% of total payroll. In direct social investments, we spent R123.5 million. On SLP
projects, we spent R55.1 million. We have continued to maintain
We have continued to foster strong and trusting relations with good relations with our host communities and communicate
our employees. A focus in 2018 was on closing out all outstanding effectively about our SLPs and other social commitments.
items from the wage negotiations concluded in 2017, which was
successfully achieved. Of our total workforce, 91% are local, a In pursuing longer-term socio-economic development
level we have maintained since 2016. Our employee turnover initiatives, Sishen is investing in opportunities identified to
rate – the number of permanent employee resignations as a optimally use its non-operational land to benefit the mine and
percentage of total permanent – was 4.14%, well below the surrounding communities. The proposed land-uses centre
7.6% industry benchmark. around game breeding, cattle farming, conservation of land,
eco-tourism and education, land restoration, and leasing and
The pleasing turnaround of the business in 2017 was selling of land. These site-level activities dovetail with the early
underpinned by an extensive organisational restructuring stages of us implementing Anglo American plc’s Collaborative
process followed by targeted initiatives to increase productivity Regional Development programme. This approach recognises
at Sishen and Kolomela. These continued throughout 2018, the limitations of companies acting in isolation to promote
promoting further improvements and an energised workplace. development in host areas, and the potential for collaboration to
In July 2018, we enthusiastically launched our new broad-based enable people to work at scale. The innovative approach starts
employee share ownership scheme, “Karolo”, which ensures that by identifying socio-economic development opportunities with
permanent employees below middle and senior management the greatest potential in a region through spatial planning and
level can be active stakeholders by having a direct interest in the analysis. This provides a visualisation of what the future can
Company’s profit. We have granted share awards and provided bring and creates the catalyst for forging partnerships with a
training on the new scheme to all participants. broad range of stakeholders to plan, finance and deliver those
opportunities. It is about developing and realising a shared vision
MAKING A POSITIVE SOCIAL CONTRIBUTION that supports national, regional and local planning processes and
To be productive, safe, responsible and sustainable, our mines is aligned with the UN Sustainable Development Goals (SDGs).
must operate alongside thriving communities. Our approach
focuses on leveraging core business activities and delivering MANAGING SOCIAL RISKS AND IMPACTS
benefits through partnerships to support sustainable job creation We are very pleased with the successful relocation of the
and effective public service delivery, with the longer-term aim Dingleton community to Siyathemba, a new purpose-built suburb
of reducing the dependency of municipalities, communities and in Kathu, to enable the expansion of Sishen. The process began
small, medium and micro enterprises (SMMEs) on our mines. in 2014 and has been carefully managed in close collaboration
A key mandate of Setco is to ensure that our host communities with the people of Dingleton, the Dingleton resettlement working
are able to remain sustainable beyond life-of-mine. group, the Gamagara local municipality, and the Northern Cape
8 Kumba Iron Ore Limited Sustainability Report 2018provincial government, with great care taken at all times to ensure I am particularly pleased about the significant progress we have
no violation of human rights. The resettlement has involved made at Sishen in integrating mine closure planning with our
517 households accommodating approximately 3,500 people, operational strategies, with a particular focus on progressive
and included building new homes and providing additional rehabilitation of mine impacted land. The operation has rapidly
schools and public facilities. The post-resettlement working scaled up its rehabilitation progress and during 2018, we
group continues to monitor and promote projects to ensure the reshaped 85ha at Sishen, against a target of 50ha, and 44.7ha at
sustainability of the community. As at year-end, we continue Kolomela, against a target of 48ha.
to negotiate a settlement with one resident in Dingleton who
remains resistant to moving and is demanding higher levels of Sishen continues to face dust emission challenges due to high
compensation. winds and dry conditions, but has ensured steady, significant
Our approach
improvements over the last three years. In 2018, we recorded
During 2018, social tensions intensified around our operations, an 80% year-on-year reduction in the number of exceedances.
as anticipated ahead of the national elections in 2019. We We are implementing additional controls to mitigate the main
experienced various political parties mobilising marches and contributors of dust, which are haul roads, crushing activities, and
strike action in the area where Kumba operates, and this is waste dump activities. We aim to have achieved the necessary
expected to continue until the elections are held. Fortunately, reduction in emissions to ensure full compliance with relevant
protests undertaken during the review period were all carried legislative requirements by 2020.
out peacefully.
In ensuring responsible environmental stewardship, we engage
The transfer of the mining right for Kumba’s Thabazimbi mine to regularly with government at all levels to ensure compliance with
ArcelorMittal South Africa was approved by regulatory authorities environmental authorisations and related requirements, including
in October 2018 after regulatory conditions were met. We ceased any instances of environmental incidents or grievances. Sishen
operations at the mine in September 2016 and continued to and Kolomela have environmental management systems that are
invest in maintaining public services in Thabazimbi. ArcelorMittal certified against the ISO 14001: 2015 standard.
is now responsible for the mine’s closure and rehabilitation, and
all social commitments and environmental obligations attached to In 2018, we were issued three pre-non-compliance notices;
the mining rights have been transferred in full. Kumba continues two at Kolomela for illegal clearing of vegetation and one at
to participate in the Thabazimbi Trust and to engage with Sishen regarding poor hydrocarbon and waste management.
ArcelorMittal on its progress in managing the transition. For a third successive year there were no “medium” or “high
impact” (levels 3 to 5) reported, indicating good management
PROMOTING RESPONSIBLE ENVIRONMENTAL of environmental controls across the operations. In managing
STEWARDSHIP low-level incidents, we focus on mitigating hydrocarbon spillages,
It is our responsibility to leave the environment in a good state dust-related incidents, and water leakages/spillages.
for future generations. Our strategy also drives a positive
contribution, including through supporting community water IN APPRECIATION
security, promoting conservation awareness and education, and In closing, I thank my colleagues on the Committee, the executive
delivering positive biodiversity conservation gains. team, under the leadership of Themba Mkhwanazi and Kumba’s
employees for their work in delivering on Kumba’s sustainability
A highlight in 2018 was the launch of Sishen’s Education Centre commitments, and for their contribution to the encouraging
at Tamaga Lodge, situated on the recently proclaimed Sishen performance that we have seen this year. I also wish to express
Nature Reserve, outside of Kathu. The opening of the centre on my appreciation to the Board led by the Chairperson, Dr Mandla
the reserve creates a wonderful opportunity for Sishen to make a Gantsho, for its support and commitment. The latter sentiment
positive impact towards environmental education of the youth in is extended to all those external stakeholders who have shared
the Northern Cape. The Education Centre will be run in partnership their views on Kumba’s sustainability performance and who have
with the Wildlife and Environmental Society of South Africa continued to engage with the Company as it strives to meet
(WESSA) and we see this initiative as a long-term community its commitments relating to zero harm, transformation, socio-
investment project that will uplift the communities surrounding economic development and environmental protection.
the Kumba mines, even beyond the life of Sishen.
Buyelwa Sonjica
We have maintained a good performance across all key areas, Chairperson: Social, Ethics and Transformation Committee
although increased production at our operations resulted in
our water withdrawal intensity increasing to 151ℓ/t compared 15 March 2019
to 147ℓ/t in 2017 and we emitted 0.96 million tonnes of
CO2‑equivalent (Mt CO2e), a 4% decrease on 2017 and achieved
a 7.4% energy saving mainly due to diesel use efficiencies.
Kumba Iron Ore Limited Sustainability Report 2018 9OUR APPROACH OUR BUSINESS MODEL AND INTEGRATED VALUE CHAIN
OUR BUSINESS MODEL AND INTEGRATED
VALUE CHAIN
OUR OUTPUT
43.1 Mt high-quality haematite iron ore, with a lump-to-fine ratio of 68:32 (2017: 66:34). Sishen produced
products with an average Fe content of 64.6% and Kolomela averaged 64.3% for 2018. Our product portfolio
includes niche lump products, as well as standard fines and standard lump
COMPETING ON REVENUE
OUR REVENUE
Iron ore prices Iron ore sales volumes Rand/US$ exchange rate
securing a premium for higher US$ iron ore prices partially offset
hampered by logistical challenges
our higher quality ore by a marginally stronger Rand
Our value proposition OUR ACTIVITIES (See page 14 of the IR)
• Exploration: Identifying potential new resources, primarily in the
Northern Cape
CUSTOMER VALUE PROPOSITION • Mining: Extracting iron ore in the Northern Cape
• Beneficiation: Improving the final product quality, using dense media
separation (DMS), jig technology and ultra-high density media
The reliable supply of high-quality iron ore separation (UHDMS)
• Blending and outbound logistics: Providing and transporting niche
products
• Shipping, marketing and selling: Servicing markets in South Africa
EMPLOYEE VALUE PROPOSITION and globally
• Rehabilitation and environmental stewardship: Across all relevant
stages of the production process
The opportunity to earn, learn and grow in
a zero-harm environment, supported by a
KEY RESOURCES AND RELATIONSHIPS
HOW WE CREATE VALUE
high-performance culture
• The quality and availability of certain natural resources, such as iron ore,
land, water and energy
SOCIETAL VALUE PROPOSITION • Concluded prospecting and mining rights – awarded by national
government
• Regulatory permits and licences – from national, provincial and local
Improving people’s lives through our government
innovation-led approach to sustainable • Social licence to operate – provided by communities, their
mining that converts mineral resources representatives and NGOs
into long-term value, contributes to socio- • Financial capital – from shareholders and lenders
economic transformation, and fosters
• Infrastructure and support services – including especially the rail and
inclusive and environmentally responsible
economic growth port services provided by Transnet
• Positive relationships with employees and trade unions
• Technical, commercial and managerial skills and experience – amongst
employees, management and leadership teams
SHAREHOLDER VALUE PROPOSITION • Exploration, mining and processing technology and techniques – in
technical teams and contractors
• Key service providers and suppliers – with a strong focus on building
Provide sustained and growing financial BEE and a strong local supplier base
returns and dividends throughout the • High levels of customer satisfaction within a loyal customer base
commodity cycle, through responsible
• Strong reputation – including particularly with the media and financial
management and good governance
analysts
OUR OPERATING CONTEXT: OUR COSTS
Issues impacting value TO MAINTAIN THE CURRENT VALUE PROPOSITION
• Iron ore price volatility DISTRIBUTION (rail, port and freight) LABOUR
• Flattening of the producer cost curve globally ENERGY (liquid fuel and electricity) CONSUMABLES
• Impact of external variables
• Rising expectations across stakeholder groups CAPITAL EXPENDITURE MAINTENANCE
• A strong sector-based commitment to eliminate
fatalities MINING AND NON-MINING CONTRACTORS
• Group-wide drive for operational excellence and SOCIAL INVESTMENTS REHABILITATION
sustainable development
• Maintaining the quality of iron ore reserves and BENEFICIATION DRILLING AND BLASTING
life of asset
• Challenges in the regulatory and policy TO EXPAND THE VALUE PROPOSITION
environment
CAPITAL EXPENDITURE EXPLORATION MARKETING
10 Kumba Iron Ore Limited Sustainability Report 2018POTENTIAL FOR REVENUE
DIFFERENTIATION SENSITIVITY ANALYSIS
Ability to achieve quality and lump premia
for superior ore quality (64.5% Fe vs 62% Fe
Our approach
benchmark)
1% change to key operational drivers, each
Price differential potential due to higher tested independently
lump:fine ratio (68:32 vs global average
of 20:80) Sensitivity analysis (1% change) – EBITDA impact (Rm)
Ability to respond quicker to market (260) Export volume 260
volatility than competitors due to greater
operational flexibility as a result of our size (375) Export price 375
and superior ore quality
(400) Currency 400
Stronger price realisation, driven by
effective marketing activities
(600) (400) (200) 0 200 400 600
OUR 1. Third-party 2. Commodity 3. Safety and
STAKEHOLDER PERCEPTIONS
infrastructure markets and Health CHANGE PER UNIT OF KEY
TOP 10 exchange rate OPERATIONAL DRIVERS,
THE OPERATING ENVIRONMENT
RISKS fluctuations EACH TESTED INDEPENDENTLY
4. Stakeholder 5. Socio-economic 6. Cyber risk 7. Legislation
relations and and governance and regulatory
social licence to current compliance
operate challenges Sensitivity analysis Unit change 2018 EBITDA impact
Currency (R/US$) R0.10/US$ R300m
Export price (US$/t) US$1.00/t R520m
8. Managing 9. SIOC 10. Resource For more information Volume (kt) 100 kt R65m
change empowerment depletion and see page 36 of the IR
(transformation status securing our Unit change Breakeven price impact
of the business) growth Currency (R/US$) R1.00/US$ US$3.00/t
POTENTIAL FOR COST DIFFERENTIATION
BREAKEVEN PRICE
Scope for differentiation through UHDMS
technology
Further leverage in operating costs through Breakeven price
enhanced operating efficiencies
2 41
Ability to deliver costs reductions in the 4
supply chain
40 (2)
(1) 2 39
(4)
Further diversify customer portfolio with
sales in regions utilising direct-charge
materials
Higher stripping ratio due to inherent
2017
Cost
savings
Price
premium
SIB
Total after
controllables
Lump
premium
Escalation
Freight
2018
characteristics of the ore body resulting
in higher mining costs
Higher costs associated with distance from
ports, and Australian competitors closer to
key market in China
Kumba Iron Ore Limited Sustainability Report 2018 11OUR APPROACH CHIEF EXECUTIVE’S REVIEW
CHIEF EXECUTIVE’S REVIEW
Despite a challenging operating
environment, this has been a year
of solid performance for Kumba,
in which we achieved some
important milestones in our
“Tswelelopele” strategy of unlocking
Kumba’s full potential and delivering
on our core purpose of providing
superior value to our stakeholders.
From a sustainability perspective,
it is particularly pleasing to report
that we have met our commitment
to remaining fatality-free and
achieved significant improvement
across multiple safety and
occupational health indicators,
as well as delivering positive
Themba Mkhwanazi
Chief Executive
progress on our social and
environmental commitments.
During 2018 the mining industry in South Africa These results, which make us the most improved business
regrettably experienced a high rate of fatalities, while in the Anglo American plc group, reflect the dedication
globally 2019 started with the devastating incident at of Kumba’s managers and employees in making safety
Vale’s operations in Brazil. We are deeply saddened a top priority and embedding our fatalities elimination
by this tragic loss of lives of our peers, and extend our framework. While this safety performance is pleasing,
thoughts and prayers to their families and loved ones. we recognise that we cannot let up on our efforts in
As a sector, we are looking to learn from this tragic striving for zero harm. To further emphasise that safety
incident, which brings home the reality of the risks in is non-negotiable, Kumba has linked safety to business
mining, and so clearly highlights why the safety of our performance through its incentive structure.
people is our first priority.
In addition to driving safety, we have been managing the
health and wellbeing of our people, and implementing
Against this background, it is pleasing to report that we
measures to safeguard the environment. We have seen
have had another fatality-free year, honouring our sacred
a steady reduction in levels of exposure to our primary
covenant code and ensuring that every employee and
occupational health hazards, namely noise and dust, as
contractor returns home safely, making it two and a half
well as fewer health incidents at both Sishen and Kolomela.
years without a fatal incident. We have seen a significant
This year five new cases of occupational health diseases
further improvement in our leading and lagging safety
were diagnosed and reported; we have seen a marked
indicators, reducing the number of high-potential incidents
improvement in awareness of HIV with 91% of employees
(HPIs) by 67% and achieving a total recordable case
having undergone HIV testing and counselling. We also
frequency rate (TRCFR) of 1.80, well below our target of
saw good results from our environmental programme.
2.75. This positive safety performance has been achieved
No major environmental incidents were reported for the
through the focused implementation of our “elimination of
third consecutive year and we have successfully scaled up
fatalities framework”, which seeks to ensure a step change
our rehabilitation programme. Although Sishen continues
in our management of high-level safety risks. In addition
to face dust emission challenges due to high winds
to driving a strong safety mindset, we have harnessed
and dry conditions, the operation has delivered steady
new technologies to improve our safety performance,
such as the automation of braking on trucks and collision improvements over the last three years.
avoidance systems, and the use of drones to inspect areas
of work during high-risk activities such as blasting.
12 Kumba Iron Ore Limited Sustainability Report 2018We have made some good progress this year with the the government’s national transformation objectives
relocation of members of the Dingleton community in full and I believe that, along with our parent company Anglo
alignment with the International Finance Corporation’s American plc, we have a long and proud track record in
(IFC) performance standards. Of the 517 original families promoting socio-economic transformation in the country.
at Dingleton, only 10 households remain to be resettled We are certainly committed to continuing that journey.
in the new purpose-built suburb of Siyathemba in Kathu.
Kumba has invested around R3 billion in establishing Through our activities this year we have been delivering
Siyathemba, building houses, a school, clinic, police station on our key objective of providing superior value to all our
and associated infrastructure, and establishing effective stakeholders:
community representative forums. Engagements with the • our employees, who are at the heart of our business,
Our approach
remaining households at Dingleton are ongoing and the received R4.6 billion in salaries and benefits
legal process remains on track. • we created R12.5 billion of value in cash dividends for
our shareholders – including employees and our
In October 2018, the transfer of the mining right for empowerment partners Exxaro and the SIOC
Kumba’s Thabazimbi mine to ArcelorMittal South Africa Community Development Trust – and delivered
was approved by regulatory authorities. Responsibility headline earnings of R30.28 per share, an excellent
for the mine’s closure and rehabilitation, and for meeting outcome given the challenges experienced this year
required social and environmental obligations, now rests • the South African fiscus received around R4 billion in
with ArcelorMittal. Kumba continues to participate in the income tax, as well as royalties of R1 billion
Thabazimbi Trust and to engage with ArcelorMittal on its • we continued to promote local businesses with close
progress in responsibly managing this transition. to R12 billion of products and services procured from
BEE suppliers, of which R1.4 billion was spent with
Building a world-class operator that is resilient and agile, 267 businesses within our host communities,
requires that we develop and leverage the talent of our 40% above what we targeted for the year; in line with
people. Following the successful completion of the our aspiration to create five jobs for every permanent
extensive organisational restructuring process, undertaken job, these businesses created around 2,700 new jobs
from 2016 to 2017, we have been implementing and provided income for over 16,000 people
various initiatives aimed at developing and embedding • communities in the Northern Cape also benefited from
an organisational culture that fosters safety, diversity, R123.5 million in social investment projects
innovation and performance. We have been rolling out
the Kumba Culture and Leadership Code across the Underpinning our ability to deliver on our strategy, and
Company, undertaken a comprehensive leadership progress towards our goals, has been the relentless focus
assessment process, launched a leadership capability and dedication of our 12,000 workers. Our positive results
development programme, and introduced a revitalised this year reflect the quality both of the leadership team
team development process across Kumba to build and the amazing people across the Company, who have
team cohesiveness and effectiveness. In July 2018, displayed a strong commitment to fostering teamwork,
we introduced our new broad-based employee share driving accountability, and showing good natured
ownership scheme, “Karolo”, for permanent employees enthusiasm in the execution of their duties. I wish to thank
below middle and senior management level. We have each and every one of Kumba’s employees and contractors
granted share awards and provided training on the new for this commitment that provides the foundation for
scheme to all participants. ensuring the Company’s continued success.
Kumba welcomes the gazetting of Mining Charter 2018 Finally, I extend my appreciation to my colleagues on the
by the Minister of Mineral Resources in September 2018, Kumba Board and executive team for their counsel and
and we appreciate the efforts made by the Minister and his support in developing and delivering on Kumba’s strategic
team to engage with stakeholders in finalising this Charter. ambitions. This has been another encouraging year for
While we appreciate the significant improvements on the the Company, which I believe sets us up well for further
earlier draft, we nevertheless believe that there are some value growth.
aspects that may negatively affect the sustainability of the
industry and undermine our ability to create and share
value. We are also concerned that, in certain respects, the Themba Mkhwanazi
Charter will be difficult to implement legally and practically, Chief Executive
resulting in unintended, adverse consequences for the
sector. Kumba has consistently affirmed its support for 15 March 2019
Kumba Iron Ore Limited Sustainability Report 2018 13OUR APPROACH MEASURING OUR PERFORMANCE
MEASURING OUR PERFORMANCE
FOR THE YEAR ENDED 31 DECEMBER
VALUE PILLAR
SAFETY AND HEALTH ENVIRONMENT SOCIO-POLITICAL
STRATEGIC
CSR CSR CSR
FOCUS AREAS
Elimination Provide Provide Provide Proactively Focus Provide Proactively Provide
of fatalities leadership extensive leadership engage on the leadership engage extensive
through on support on with key Northern on with key support
a culture of responsible to our responsible stakeholders Cape responsible stakeholders to our
zero harm citizenship employees citizenship citizenship employees
2018 2017 2016 2018 2017 2016 2018 2017 2016
Positive outcome KPI Fatal injury frequency rate (FIFR) Energy consumption Social way assessment scores
(million GJ) (out of five) (for detail refer to
= Neutral outcome page 43 of the SR)
Negative outcome
0 0 0.016 8.85 8.94 8.45 3.0 3.1 3.3
KPI Total recordable case GHG emissions (Mt CO2-
frequency rate (TRCFR) equivalent)
1.80 3.23 3.90 0.96 1.00 0.94
KPI New cases of occupational Total water withdrawals
disease (for detail refer to (million m3) (for detail refer to
page 31 of the SR) page 77 of the SR)
5 2 12 30.8 33.2 24.1
KPI Number of level 3, 4 or 5
environmental incidents
0 0 0
* Including retrenchments for 2016.
14 Kumba Iron Ore Limited Sustainability Report 2018PEOPLE PRODUCTION (Mt) COST FINANCIAL
Our approach
CSR
Provide Implement Provide Implement Extend life Compete Unlock full Sustainably Use Unlock full Sustainably Use
leadership the extensive the of current through infrastructure operate technology infrastructure operate technology
on operating support operating mines premium potential mines to extract potential mines to extract
responsible model to our model products at a lower maximum at a lower maximum
citizenship employees unit cost ore value unit cost ore value
2018 2017 2016 2018 2017 2016 2018 2017 2016 2018 2017 2016
Voluntary labour turnover (%)* Sishen mine (for detail refer to Sishen mine free-on-rail Return on capital employed
page 66 of the IR) (FOR) cash unit cost = (ROCE) (%) (for detail refer to
(Mt) page 54 of the IR)
= Rand/tonne (for detail refer to
page 56 of the IR)
4.1 4.4 49.5 29.2 31.1 28.4 290.0 287.3 296.2 49 53 51
Women in management (%) = Kolomela mine = US$/tonne (for detail refer to Earnings per share
(Mt) page 56 of the IR) (Rand per share) (for detail
refer to page 54 of the IR)
24 22 21 13.9 13.9 12.7 21.9 21.6 20.2 30.08 38.63 26.98
Women in workforce (%) Kolomela mine FOR cash unit Attributable free cash flow
cost (Rm) (for detail refer to
page 58 of the IR)
= Rand/tonne (for detail refer to
page 57 of the IR)
23 21 21 248.6 236.7 201.1 7,817 12,338 11,183
Historically disadvantaged = US$/tonne (for detail refer to
South Africans (HDSAs) page 57 of the IR)
in management (%)
68 66 62 18.8 17.8 13.7
Kumba Iron Ore Limited Sustainability Report 2018 15OUR APPROACH OUR STRATEGY
OUR STRATEGY
Our strategy known as Tswelelopele is structured around key focus areas and delivered
over three horizons to guide our actions to achieve our ambition of US$10/tonne margin
enhancement and extend the life of our assets beyond 20 years
OUR VISION
To be a successful and sustainable African supplier of quality iron ore to global and local
markets while delivering superior value to our stakeholders
STRATEGIC
AMBITION
BECOME THE EMPLOYER
IMPROVE MARGINS BY OF CHOICE, THROUGH A
ELIMINATE FATAL US$10/TONNE TO HIGH-PERFORMANCE
INCIDENTS THROUGH REMAIN GLOBALLY SUSTAINABLY EXTEND CULTURE DRIVEN BY
A CULTURE OF ZERO COMPETITIVE AND THE LIFE OF OUR HEALTHY MOTIVATED
HARM SUSTAINABLE ASSETS BEYOND 2035 EMPLOYEES
WE DELIVER OUR STRATEGY OVER THREE HORIZONS THROUGH OUR TSWELELOPELE PROGRAMME
HORIZON 3:
HORIZON 1: HORIZON 2: Expanding the business into
Operating assets at full potential Leveraging endowment attractive adjacencies
Identifying and realising
Sustainably operate mines at a lower unit cost to remain competitive through a reduced
opportunities beyond the existing
cost base and a step-up in productivity
asset base
Compete through premium products to maximise price premium realised
and to maintain differentiated customer relationships
Implement the Operating Model
Extend life of current assets
to ensuring the stable and capable
through low-grade projects, and
processes leading to the delivery of
business development activities
business expectations
Focus on the Northern Cape, as the
region contains the most attractive
ore bodies
Use technology to extract maximum
value from our ore. Focus on
step-change opportunities
Unlock full infrastructure potential
to support maximum export volumes
over the medium term
KEY ENABLERS
CSR
Align marketing and Reinforce product Proactively engage Leadership and culture, Provide leadership
operational activities to quality and with key stakeholders embedding a culture through responsible
ensure product produced consistency to reinforce our that fosters safety, citizenship, displaying
efficiently matches partnership approach diversity, innovation care for safety, health
customer needs and organisational and the environment
effectiveness
16 Kumba Iron Ore Limited Sustainability Report 2018Through our Tswelelopele (Ore to Awe) programme – aimed at unlocking our
full potential and deliver value for all stakeholders – we are focusing our actions
on making Kumba more competitive within the context of continuing volatility in
global markets.
We recognised the need to enhance our competitive position Developing trust as a corporate leader, providing ethical value
Our approach
and agreed to embark on a journey to drive the business to its full chains and improved accountability to the communities we work
potential. Our strategic response has four main ambitions: with
• achieve our goal of zero fatalities, through a culture of zero
harm
• sustainably extend the life of our assets beyond 2035
• significantly improve margins by US$10/tonne to remain
globally competitive and sustainable
• become the employer of choice, through a high-performance
culture driven by healthy motivated employees
To achieve these ambitions, we have structured our strategy
around three time-based transformation horizons, with key Building thriving communities with better health, education and
strategic focus areas and key enablers to realise our ambition. levels of employment
For a detailed review of our strategy please refer to page 3 of the
IR.
SUSTAINABILITY STRATEGY
We have developed our strategy through extensive internal
(with our parent company Anglo American plc) and external
engagement and analysis of critical opportunities and risks,
including the UN Sustainable Development Goals (SDGs). Maintaining a healthy environment by creating waterless, carbon
Our strategy is about making a more strategic and holistic impact neutral mines and delivering positive biodiversity outcomes
on the ground and it comprises mutually reinforcing elements
that will positively transform how our stakeholders experience our These pillars complement our Tswelelopele strategy to ensure
business. The strategy is built around three global sustainability that we deliver sustainable value to our stakeholders and
pillars: consistent shareholder returns.
• Trusted corporate leader
• Thriving communities
• Healthy environment
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