Exxaro is a diversified
black-owned
resources group

with interests in specific markets:

coal (controlled and non-controlled), titanium dioxide and alkali chemicals (noncontrolled), ferrous (non-controlled) and energy (non-controlled).

The group has business interests in South Africa, Europe, the United States of America and Australia. Our asset portfolio includes coal operations and investments in iron ore, pigment manufacturing, renewable energy (wind) and residual base metals.

Exxaro is listed on the JSE and was a long-standing constituent of the Socially Responsible Investment (SRI) index, reconstituted as the FTSE Russell ESG Index in 2015. Exxaro is now included in the FTSE/JSE Responsible Investment Index.

MATERIAL ISSUES FOR 2016

Each year, our material issues are distilled from a comprehensive process that includes internal and external stakeholder engagement combined with prudent risk management. Each material issue includes related high-level risks, as indicated:

Material issue Related risks
Dependency on key customers
  • Eskom
  • ArcelorMittal SA
   
Licence to operate
  • Maintain a social licence to operate
  • Legal and regulatory non-compliance
  • Compliance to environmental legislation
  • Mine rehabilitation
  • Unavailability of water
  • State intervention in the mining sector
  • Acid mine drainage/decanting
  • Geopolitical uncertainty
Capital projects
  • Capital project execution
  • Infrastructure access and capacity
  • Lack of funding for infrastructure
  • Inability to grow (pipeline shrinkage)
 
Business resilience
  • Price and currency volatility
  • Inability to be innovative
  • Cost competitiveness of products
  • Competition and product substitution
  • Unable to meet production demands
  • Stranded assets
  • Cyber security threats
  • Unavailability of energy
  • Inability of IT systems to support business
  • Climate-change concerns
Our people
  • Safety
  • Health
  • Labour unrest
  • Fraud and corruption
  • Unavailability of critical skills
 

SAFETY AND HEALTH

Highlights

  • No work-related fatalities since July 2014: Exxaro completed 30 consecutive months without a fatality by December 2016 – having proved we can reach our target of zero, this is a powerful incentive to all our teams to maintain this outstanding performance
  • Record lost-time injury frequency rate (LTIFR) decreased from 0,17 to 0,09, in 2015, a 47% improvement
  • 7 of 13 operations worked a calendar year without a lost-time injury (LTI), and 12 business units achieved the LTIFR target of 0,15
  • Focused programme rolled out to empower safety, health and environmental representatives with the knowledge to identify risks better and contribute more effectively to reducing safety risks in the workplace.

Lowlights

  • Regrettably, Exxaro received the highest number (5) of section 54 instructions in 2016 (2015: 2), but all were resolved with the authorities.

OCCUPATIONAL HEALTH AND HYGIENE

Highlights

  • Community programme for HIV/Aids
  • Integrated wellness programme for employees

Lowlights

  • Potential impact of chronic diseases of lifestyle on people’s health and safety in the workplace.

Exxaro – reported occupational diseases (cumulative)

  2016 ECC 2015 2014 2013 2012 2011 2010 2009
NIHL 17 6 15 16 8 22 47 12 11
Pneumoconiosis 5 3 15 12 37 24 31 23 2
Silicosis  
COAD 4 1 1 4 2 2 1
Occupational TB 26 10 18 20 40 65 53 52 6
Dermatitis 2 2
Asbestosis 1 1
Work-related upper limb disorders 1
Total 52 20 60 52 87 118 137 90 20

HIV/Aids and TB

The prevalence of HIV/Aids across Exxaro is currently estimated at 6%, well below the industry and national average. With appropriate education, counselling and support, 92% of our workforce (excluding contractors) voluntarily tested between 2010 and 2015, and more are seeking treatment.

We recorded a 169% improvement in the number of employees and contractors enrolled on the HIV/Aids programme to 1 978 in 2016 (2015: 733), with 3 129 employees and contractors on antiretroviral treatment (ART).

We are also making headway in slowing the spread of HIV/Aids (see table below). Between January 2013 and December 2016:

HIV/Aids awareness

Year Attended information session Tested % tested Employees testing positive Enrolled at Dec (cumulative) On ARVs
2013 5 853 3 756 64 314 545 521
2014 5 732 2 804 49 261 675 481
2015* 11 759 4 158 35 252 453 452
2016* 18 845 6 497 34 80 221 1 675
Total 42 189 17 215 41 907 1 894 3 129

* Includes contractors.

Employee wellness

Exxaro’s employee assistance programme ensures that any of our people facing difficulties have access to an external counselling service. This is a preventive measure that helps employees manage personal concerns, and assists management in minimising productivity issues.

During the year, our people again used this service for:

  • Financial issues
  • Personal and emotional difficulties
  • Family matters
  • Work-related challenges
  • Dependency on substances.

PEOPLE

Highlights

  • Exxaro’s talent pipeline and feeder schemes enabled over 950 jobless youth to obtain occupational qualifications, in-service training and employment
  • Ensuring Exxaro receives tax benefits and SETA grant benefits of over R35 million in the training and development programmes.

Lowlights

  • Organisational restructuring has strained employee morale.

Employment equity

Ten years into our journey as one of the largest black-owned mining companies in South Africa, we continue to benefit from developing the skill levels of our workforce and enabling progress as the cornerstone of our commitment to meeting our transformation objectives. Employment equity is just one way to realise this commitment, supported by continuous diversity programmes and engagement at our business units.

Our employment equity strategy is founded on detailed plans developed by each business unit in consultation with its employees and unions. By following these plans, each unit ensures that recruitment and skills development are managed responsibly, advancing transformation without affecting existing positions. Each business unit has a dedicated senior manager for employment equity, as well as an employment equity forum that is actively involved in developing, monitoring and communicating employment plans.

These plans are due for review in 2017, when we will assess our progress over the last five years and implement measures to meet our targets and address areas of concern. We will also consider the alignment of our targets to other legislative guidelines such as the revised mining charter and BBBEE codes.

The breakdown of our annual employment equity reports, as submitted to the Department of Labour, is shown below.

  Male Female Total      
Category % black Number % black Number % black Number Target black Total % Target
HDSA
Top management 66,67 2 0,00 0 66,67 2 50,00 66,67 50,00
Senior management 29,76 25 10,71 9 40,48 34 37,00 48,81 43,00
Middle management 38,224 245 17,00 109 55,23 354 47,00 73,95 59,00
Junior management 48,47 1 190 16,25 399 64,73 1 589 57,00 74,09 80,00
Women           1 373 10,00 19,48  
People with disabilities           95 2,00 1,35  

As submitted to the Department of Labour on 31 December 2016.

COMMUNITIES

Highlights

  • Increased investment of R49 million
  • Nearly R400 million spent over 10 years.

Focus areas

OUR ENVIRONMENT

Highlights

  • All operations now have integrated water use licences (IWULs)
  • Environmental licence for Glisa water treatment plant obtained

Lowlights

  • Delays in finalising appeals lodged against some projects such as Thabametsi and Belfast.

ENERGY

Energy management procedure

Energy efficiency plans

CO2 emissions reports

Responsive resource utilisation

Targets

Climate change

Energy efficiency reports

WATER

Water management procedure

Water management plans

Water-related risk assessment

Water efficiency plans

Water authorisation

Financial impact of water management/treatment. Water monitoring and reporting

WASTE

Waste management procedure (including classification)

Waste authorisation

Waste transporting, transportation and disposal procedure

Waste management and reporting

Waste efficiency reports

ECOLOGY

Biodiversity management procedure

Biodiversity impact management

Biodiversity management plans

Ecological effect impact procedure

ECR authorisation

Biodiversity monitoring and reporting

Ecology efficiency reporting

CLOSURE AND ONGOING REHAB

Mine closure and ongoing rehabilitation procedure

Integrated mine closure plan

Financial provision

Closure objectives – management plans

Mine closure impact assessment

Ongoing rehabilitation monitoring and reporting

Closure and ongoing efficiency reports

LAND MANAGEMENT

Land management procedure

Land management procedure

Operational land management plan

Land disposal strategy

Land management efficiency reports

AIR

Air quality authorisations (AEL)

Air quality management procedure

Air quality impact assessment

Air quality management plans

Air quality monitoring and reporting

Stakeholder forum

Energy efficiency reports