Integrated Reporting 2016
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OUR PERFORMANCE

   

  Social and relationship capital

Our performance against material social and relationship capital issues

 
SLP spend    
  2016   R287.1 million
  2015   R74.6 million
  2014   R133 million
 

The communities in which we operate are key stakeholders with whom we wish to share the economic value we create and to whom we wish to leave a lasting legacy of sustainable benefits.

Meeting the expectations of the UNGC’s Principles 1, 2, 4, 5 and 6 in terms of protecting and upholding human rights and the rights of labour and integrating the SDG goals 1, 2, 10 and 16 into how we do business and our efforts to support their application in broader society.

   

One of the newly-built homes in our employee home ownership scheme

SLP investment in 2016
Labour stability
 
 
Human resource development (R30.4 investment in 2016)

252 youths and adults learned skills that equip them for employment and/or entrepreneurship because of our SLP investment in human resource development.

Agricultural support (R1.3 million investment)

124 farmers in the communities in which we operate were assisted by our investment in feed for their animals during the severe drought affecting the North West province.

 
  • In accordance with our employee relations recognition agreement (ERRA) we signed a long-term wage agreement with the major union, the National Union of Mineworkers (NUM), for implementation in July 2014
  • 86% of our workforce were unionised in 2016
  • There is a closed shop agreement in place at RBPlat following a ballot held by our majority union in 2016, NUM, during which over two-thirds of our employees voted in favour of a closed shop agreement at RBPlat
  • RBPlat is committed to the principle of freedom of association and collective bargaining
  • No industrial action for the past four years
 
 

  HDSA discretionary procurement

  • Our HDSA discretionary procurement represented 79.6% of our total discretionary spend in 2016 (2015: 74.2%), a 7.3% increase year-on-year
  • Our local HDSA discretionary procurement represented 31.1% in 2016 (2015: 19.0%), a 63.4% increase year-on-year


Meeting our commitments both in terms of our wage
agreement and our social and labour plans (SLPs)

     
 
  Risk appetite measure     Performance
in 2016
      Change
year-on-year
      Risk appetite
performance
 
  Social and labour plan annual budget against:
  • Human resource development plan
  • Community economic development plan
    R30.4 million

R3.7 million

      (41.9%)

(21.4%)

     



 
 

Number of justified adverse events leading to negative media mentions

    There was no material adverse media coverage of RBPlat in 2016       No change similar levels of engagement maintained        
 
 
 
 


         
 

Meeting our employee home ownership scheme commitments

  • 413 employees currently own homes in Phase I (80m2 in size)
  • Approximately 730 Phase II homes will be available for purchase by employees during 2017
    SLP 2016 commitments
Education support (investment R2.7 million)
  • Salaries paid of experienced maths and science teachers (one of each)
  • 250% improvement in the number of learners achieving a 50% and above pass in matric maths since the project started in 2012
  • 216% improvement in the number of learners achieving a 50% and above pass in matric science since the project started in 2012
  • Development of management skills of both heads of departments and members of school governing bodies
 
         
 
  Material issue   Issues over which we do not have control   Those over which we do have control   Some control
 
         

Breakdown of SLP spend

Breakdown of SLP spend

Our key social and relationship capital stakeholders

Please refer to pages 142 and 143 of relationship capital for details of our engagement with these stakeholders and how the issues of concern to them and ourselves have been addressed.

Our key social and relationship capital stakeholders

The principles of the UNGC

In terms of social and relationship capital our efforts towards achieving sustainability and our aspiration to deliver More than mining include our support of the UNGC principles 1, 2, 4 and 5.

Human rights

Principle 1
Principle 2

Labour

Principle 4
Principle 5

Meeting and, where possible, exceeding our Mining Charter social and labour plan (SLP) commitments in terms of:

  • SLP human resource development
  • Education support
  • Community skills development.

Supporting the achievement of the UN SDGs by, where possible, integrating them into how we do business and our efforts to support their application in broader society.

Through the key focus areas of our SLPs we contribute to the achievement of the goals of SDGs 1, 2, 4, 5, 10 and 16 which are:

  SDG goals RBPlat’s SLP commitments  
             
Ending poverty, reducing inequality and ensuring inclusive and quality education for all, and promoting lifelong learning
    Community skills development, training and development, job creation with a focus on women in mining, procurement from HDSA businesses and, where possible, local HDSA businesses  
 


Ending hunger by achieving food security and improved nutrition and promoting sustainable agriculture
    Community infrastructure and agricultural support  
 


Promoting peaceful and inclusive societies for sustainable development
    Regularly engage with communities through our community engagement forum, ensure our complaint and grievance mechanisms are available to communities and that any complaints or grievances are addressed, and consult with communities in terms of regulatory requirements  

 

Ratanang MatshekaRBPlat's graduate programme
Our graduate programme provides a number of young people with an opportunity to gain workplace experience and in some cases to find employment.

Ratanang Matsheka’s excellent performance in his matric exams won him a Vice-Chancellor’s scholarship to Wits University. Having completed a BSc in geology at Wits he joined the RBPlat graduate programme in 2012. His performance on the programme resulted in him being appointed as a geologist at BRPM before he completed the two-year graduate programme.

Currently, Ratanang is one of the section geologists at BRPM’s South shaft. His interest is resource geology, which requires a knowledge of database management. To help him develop his skills in this area he has found himself a mentor with database management skills. Ratanang has been provided with a mentor to develop his database management skills.

 

Social capital

We want to achieve real change for our communities through delivering on our SLP commitments and building social capital rather than regulatory capital. To achieve this our projects need to be sustainable and to build sustainable value, which is the most challenging part of local economic development.

Towards sustainable communities

We have submitted our close out SLP report for the period 2010 — 2014 to the DMR and our proposed SLPs for the period 2015 — 2019. The revised Mining Charter has not as yet been finalised and our proposed SLP plans have not as yet been approved by the DMR.

In the meantime, we have continued to apply and, where possible, exceed the targets set for the final year of the previous Mining Charter.

As we advised in 2015, the negative impact of market conditions on our ability to generate revenue meant we had to make some tough budget choices, which included reducing our planned SLP expenditure in 2015 to R74.6 million (a 44.0% reduction year-on-year) and to R36.0 million in 2016 (a 51.7% reduction year-on-year), however, R251.1 million was also invested in our employee home ownership scheme in 2016.

During 2016 the improvement in our revenues, mainly as a result of the rand falling against the US$, allowed us to increase our SLP expenditure by R1.3 million, which we used to assist farmers in the communities in which we operate who have been badly affected by the prevailing drought conditions.

We remain committed to delivering on our five-year SLP plans and increasing our SLP expenditure as our financial performance allows. See graphs for details of SLP spend over the past three years.

Our focus in 2016

SDGsWe chose to focus on investing where we believed our investment would contribute most both to the sustainability of the communities in which we operate and that of our business.

SLP human resource development and community skills training: Ending poverty, reducing inequality and ensuring inclusive and quality education for all, and promoting lifelong learning

By offering both the youth and adults from the communities in which we operate the opportunity to learn skills and gain employment, our SLP investment of R30.4 million in our human resource development during 2016 has increased the number of youths and adults who have relevant skills, including technical and vocational skills for employment, decent jobs and entrepreneurship. It also offered those who needed it the opportunity to become literate and numerate. Please refer to the human capital section of this report for information on our human resource training and development programmes during 2016. We will be continuing with our community portable skills programme in 2017 through which community members can gain skills that equip them for employment outside the mining industry.

Education support

The five-year plan that supports the first phase of our education support programme is being implemented in partnership with the Royal Bafokeng Institute (RBI) in both primary and secondary schools in our communities. The project, which started in 2013, is designed to address:

  • maths and science learning
  • governance
  • school management skills at all levels including school governing bodies
  • infrastructure
  • safety and security.

The project engages with learners, teachers, school management teams and school governing bodies, with the aim of increasing the number of secondary school learners studying maths and science and improving their results.

Maths progress

Since the project started in 2013 the number of learners choosing to study maths has more than doubled. In 2016, 51 learners wrote maths for matric:

  • 35.3% achieved a pass at 50% and above.

The year before the project started (2012):

  • 20 learners wrote maths for matric of which 10 achieved a pass at 50% and above.

Science progress
  • In 2016, 42 learners wrote matric science and 38 achieved a pass at 50% and above.
  • In 2012, 20 learners wrote matric science and 12 achieved a pass at 50% and above.

The number of learners who qualify for university entrance has significantly improved for maths and science learners, with 47% of the maths learners qualifying for university entrance.

  A science class in the science laboratory at Charora High School which was provided by RBPlat
A science class in the science laboratory at Charora High School which was provided by RBPlat
Encouraging feedback

We were very pleased to receive feedback from one of our neighbouring platinum mines who, realising that more of the learners who qualified for their bursaries came from Charora High School than any other school in the area, investigated why this was so. They concluded that the dedicated, qualified maths and science teachers sponsored by RBPlat are having a huge impact and the school is well on the way to establishing a maths and science culture.

ON THE WAY TO BRIGHT FUTURES

The achievements of Charora High School students, who have benefited from the maths and science project, deserve recognition.

  • Tintswala Mhlongo, who is studying for a national diploma in extraction metallurgy (engineering) at the University of Johannesburg, is in her third year of study
  • Tumelo Modubung, who is studying for a mining engineering degree, is also in his third year of study at the University of Johannesburg
  • Biza Napthtaly, is also studying mining engineering at the University of Johannesburg. He obtained a distinction for science when he wrote matric in 2013.


SDG2SDG2
Ending hunger by achieving food security and improved nutrition and promoting sustainable agriculture

Our efforts towards achieving food security and improved nutrition in our communities include turning a start-up vegetable growing project into a commercial enterprise and training members of 76 households in vegetable growing methods, providing them with tunnels for growing vegetables, various facilities for collecting rain water, two 5 000 litre buried storage tanks to store the rain water and a hand pump. Previously, we assisted the local livestock farmers to find sustainable solutions to the challenges they faced, which included insufficient grazing facilities.

This year we were able to assist them by investing R1.3million in feed for their animals and the repair and maintenance of the windmills that provide water for the animals during a period of severe drought.

SDG1
SDG1
Towards eradicating poverty by developing local supplier capacity and strengthening localvalue chains and building effective, accountable and inclusive institutions at all levels

RBPlat’s HDSA policy actively encourages our procurement department to engage with local suppliers and explore opportunities to maximise local procurement. Inaddition to ensuring we meet and exceed our Mining Charter scorecard HDSA procurement requirements, ourcommitment to local HDSA procurement is aimed at alleviating poverty and creating jobs in the communities in which we operate.

We assist SMMEs with the challenges they face, such as difficulties with accessing finance, a lack of capacity to compete with established businesses and a lack of technical skills. Our enterprise development programme identifies opportunities for switching to local SMME suppliers and encourages non-HDSA suppliers to merge with or form joint ventures with local SMMEs. We partner with Royal Bafokeng Enterprise Development (RBED), which assists us with the identification of local SMMEs.

Investing in enterprise development

In 2017 we will be investing approximately R2.1million in developing the capacity and skills of local HDSA suppliers. We will be partnering with the Industrial Development Corporate (IDC) and the North West Development Corporation (NWDC) on this programme.

Supplier screening

We began screening and monitoring the compliance of our suppliers in terms of environmental management, labour practices, human resources and social compliance in 2015 and finalised the analysis in 2016. This process helped us to identify suppliers who need to improve their environmental, social and governance compliance. During 2017, we will be engaging further with these suppliers.

Our discretionary procurement spend

We increased our total HDSA discretionary procurement spend by 7.3% in 2016. We exceeded all the targets we set ourselves, which were in two cases 10% higher than the targets set by the DMR for the final year of the 2010 to 2014 Mining Charter. Our service target was 5% higher than the DMR target. We were very pleased to have exceeded our target for local HDSA discretionary procurement, which we had set at 30%. We achieved 31.1%.

Total HDSA discretionary procurement

Categories DMR targets
%
RBPlat
targets
%
Discretionary
procurement
spend
R (million)
HDSA
procurement
spend
R (million)
2016
% of total
discretionary
procurement
spent with
HDSA
companies
%
2015
% of total
discretionary
procurement
spent with
HDSA
companies
%
 
Capital 40 50 520.9 379.1 72.8 72.7  
Consumables 50 60 438.6 304.6 69.4 76.8  
Services 70 75 1 118.3 970.5 86.8 75.6  
Total spend     2 077.8 1 654.2 79.6 74.2
 


Total local HDSA discretionary procurement

Categories RBPlat
targets
%
Local HDSA
procurement
spend
R (million)
2016
% of total
HDSA
discretionary
procurement
spent with
local HDSA
companies
%
2015
% of total
HDSA
discretionary
procurement
spent with
local HDSA
companies
%
 
Capital 30 89.9 31.1 19.0  
Consumables 30 29.6
Services 30 394.2
Total spend   513.7


Relationship capital

We have identified stakeholder engagement and responsiveness as a material issue for RBPlat.

Our ability to build a stock of relationship capital depends on how effectively we can engage, listen and respond to our stakeholders and build effective relationships with them. Each capital consists of resources and relationships and it is difficult to always get these relationships right. Stakeholder engagement can affect every aspect of our business, positively or negatively, including our social licence to operate and our ability to achieve long-term sustainability.

SDG16SDG16
Promoting peaceful and inclusive societies for sustainable development

We identify our stakeholders by assessing the:

  • overall importance of the stakeholder to RBPlat
  • extent to which the stakeholder can impact RBPlat and to which RBPlat can impact the stakeholder
    • both negatively and positively
    • and the significance of this impact on our ability to retain our social licence to operate and achieve sustainability
  • importance of the stakeholder’s support in achieving our strategic objectives
  • risks associated with not planning to engage with a stakeholder and not engaging effectively.

 

Stakeholder relationship assessment process

Stakeholder relationship assessment process

In 2015 we successfully introduced a pilot stakeholder relationship assessment process, conducted by independent researchers, who interviewed stakeholders from the community, government (the DMR), analysts and unions, and the internal stakeholders who interact with these stakeholders. The aim of this process was to determine the quality of the relationships and enhance our understanding of issues material to these stakeholders. This process will be undertaken biennially going forward.

We take into consideration throughout the year the issues that our stakeholders indicate are material to them during various engagements and interactions, such as through our annual general meeting, investor presentations, face-to-face meetings, emails and telephone calls, among other methods including active engagement.

The focus areas of our stakeholder engagement

  Stakeholders   Objective     Our activities  
  Investor community    
  • Provide the information investors and potential investors need to make informed decisions about our business
   
  • Annual general meetings
  • Results presentations
  • One-on-one meetings
  • Roadshows
  • Conference calls
  • Site visits
  • Conferences
 
  Communities in which we operate and community institutions

Royal Bafokeng Nation

Royal Bafokeng Administration (RBA)

Royal Bafokeng Institute (RBI)

Royal Bafokeng Enterprise Development (RBED)

   
  • To establish effective community engagement structures through which we can listen to and understand community issues and respond rapidly to them
  • Effectively communicate with communities regarding addressing local economic development through our SLPs
  • Protect our social licence to operate
  • Facilitate community engagement regarding regulatory processes, such as environmental impact assessments
   
  • Community engagement forum
  • Community engagement forum subcommittees
  • Open days
  • Communication skills training for community leadership
  • Enterprise development workshops
  • Bi-annual community newsletter
 
  Employees, contractors and unions    
  • Labour stability
  • Safe production
  • Increased productivity
  • Healthy workforce
  • Communicating our fair implementation of our wage agreement
  • Engaged, informed employees and union
   
  • Communications including Lebone newsletter, monthly CEO communique, CEO face-to-face sessions with employees regarding key issues, employee portal, employee radio broadcasts, use of screens in business areas and taxis for safety messages, and SMS communication
  • Negotiated for all volume contractor employees to be members of Platmed
  • Peer group educators provided information on lifestyle diseases and HIV/Aids
 
  Business and joint venture partners and neighbouring mines    
  • Successfully renegotiate concentrate offtake agreement for UG2 ore
  • Partner with our neighbours to increase the effectiveness of our investment in local economic development
   
  • Engagement with Sibanye on renegotiation
  • Partnered with Glencore to provide a water supply to a community
 
  Providers of debt    
  • Provide the information they need to make informed decisions regarding funding of our growth project
   
  • Regular engagement with South African banks
  • Provision of information
 
  Local and national government and regulators

Departments:

Education

Health

Mineral Resources

Traditional Affairs and Cooperative Government

Rural Development and Land Reform

Water and sanitation

   
  • Ensuring we comply with all reporting and engagement requirements with regard to the laws and regulations that apply to our business/operations
  • Communicating the impact of our efforts to build sustainable value through our delivery on our SLPs
  • Recognition of the contribution that RBPlat and the mining industry as a whole is making to local economic development
   
  • Reduction of safety stoppages
  • No cases of non-compliance
  • Water use licences approved
  • Environmental assessment applications approved
  • Submission of our close out report for our 2010 2014 SLP to the DMR
  • Submission of our plans for our 2015 2019 SLP to the DMR
  • Approval of our plans for our 2015 2019 SLP
  • Aligning our SLP with the Rustenburg Local Municipality’s Integrated Development Plant (IDP)
 
  Industry bodies    
  • Contributing to industry efforts regarding the negotiation of the revised Mining Charter and legislation impacting the sustainability of the mining industry and its ability to attract investors
  • Certainty regarding the conditions of the revised Mining Charter
  • A revised Mining Charter that facilitates the participation of mining companies in the economic development of their local communities and encourages investment in the South African mining industry
   
  • Participation through our industry body, the Chamber of Mines, in the engagement with the DMR on the need to make changes to the revised Mining Charter in the interests of the sustainability of the South African mining industry
 
  Civil society    
  • RBPlat’s role in terms of its corporate responsibility
  • Communicating our performance on issues of interest or concern to civil society groups
   
  • Reporting in our integrated report
  • Providing detailed information on our activities on our website
  • Responding to communications from civil society bodies
 


Key issues raised by our stakeholders during 2016

  Issues   Stakeholders most concerned with this issue     Location of information on our response to this issue  
 

Impact of global economic and market conditions on RBPlat’s ability to deliver on its strategic objective of organic growth, through the ramping up of Styldrift I

   
  • Investor community
  • Business and joint venture partners
  • Providers of debt
  • Employees and unions
  • Local communities
   

94

 
  The impact of costs and in particular labour costs on profitability    
  • Investor community
  • Joint venture partners
  • Providers of debt
   

104

 
  Funding of the outstanding capital requirements for the ramp-up of the StyldriftI project    
  • Investor community
  • Joint venture partners
  • Providers of debt
  • RBPlat leadership
   

94

 
  Safety performance    
  • DMR
  • Investor community
  • Business and joint venture partners
  • RBPlat leadership
  • Employees and unions
  • Local communities
   

117

 
  Uncertainty regarding the DMR’s approach, excessive safety stoppages, and the new Mining Charter    
  • Investor community
  • RBPlat leadership and its employees
  • Local communities
   

79

 

 


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Royal Bafokeng Platinum Integrated Annual Report 2016 | Company website