Materiality summary

In our view, the most material non-financial, or underlying ESG issue for the mining industry is how to deal with the expectations of surrounding communities in the face of the new reality of mechanisation and thus fewer jobs.

Leading the top half of the materiality table are labour, societal and environmental issues:

• Management of retrenchments and worker relationships as the labour force is pared down
• Management of financial hardship facing miners (e.g. through retailers’ irresponsible lending and garnishee orders)
• Gap between executive compensation and miners’ wages
• Meeting local community expectations for development projects
• Artisanal and illegal mining
• Product beneficiation to develop downstream industries in local economy
• Biophysical impact of operations in the form pollution, acid mine drainage, etc.
• Energy efficiency and carbon footprint
• Mining Charter requirements for industry and internal equity

Results

• The mining sector scored highest amongst all sectors surveyed, a reflection of maturing leadership response post Marikana.
• All except Royal Bafokeng showed mature reporting for safety issues
• Lonmin, Anglo Gold Ashanti, Gold Fields and Amplats scored well for community engagement
• Only Anglo Gold Ashanti takled the issue of artisans and illegal mining maturely, drawing on international experience
• Despite poor outlook for the business, Lonmin showed the highest leadership maturity across most material issues
• Amplats consistent and competent, but uninspiring
• Sibanye presents strong and decisive leadership, but generally poor discussion of issues
• Harmony lags as in industry follower and Royal Bafokeng’s poor reporting wholly inadequate