Overview

Responding to the Mining Charter

The Minerals and Petroleum Resources Development Act, which came into effect in May 2004, will play an important role in the transformation of the mining industry as a whole. Implats has begun to establish processes and put in place structures to enable it to comply (and to monitor this compliance), with the new minerals legislation and the accompanying Broad-Based Socio-Economic Charter for the Mining Industry. Implats recognises the rights of employees and communities affected by its operations. It also aims to develop the potential of employees, both inside and out of the workplace. The board has appointed a Transformation Committee to lead the process of change and to ensure compliance with legislation. The following is a brief response to the Charter. A more detailed response may be found in the Corporate Responsibility Report 2004.

Human Resource Development

• Implats offers every employee the opportunity to be functionally literate and numerate. Some 21.4% of all employees are functionally literate and numerate. Adult Basic Education (ABET) classes are available at all the group's operations on a full or part-time basis. In FY2004, 571 employees participated in ABET at a cost to the company of R5.1 million.
• Implats' Integrated Workplace Skills Development Plan has been accepted by the Mine Qualifications Authority (MQA). R130 million was spent on skills development programmes in FY2004, with some 85% of the workforce having undergone formal training during the year. A particular emphasis is placed on skills development for Historically Disadvantaged South Africans (HDSAs). (HDSA is defined as any person or community disadvantaged by unfair discrimination prior to the new constitution coming into effect in 1993. It includes people of colour, women and disabled persons.) R50 million was spent specifically on the development of HDSA employees on accelerated development programmes.
• Mentorship programmes have been developed for those identified with potential, predominantly amongst HDSA employees and employees from the Royal Bafokeng Nation.

Employment equity

• Implats has published its employment equity plan which has been submitted to the Department of Labour. But, in order to meet the targets set by the new minerals legislation, the group has embarked on additional measures to advance employment equity related both to previously disadvantaged employees and women. These include revised recruiting procedures, additional funding, a "space creation" programme, mentorship schemes, bursaries and graduate recruitment.
• The group's employment equity framework has been developed in consultation with employee representatives, and consultative employment equity committees have been set up at all operations. Progress in employment equity has become an important feature in the performance evaluations of managers.
• Currently, 33% of the group's manager's comprise HDSAs (22% at the mining and mineral processing operations, 42% at Refineries and 33% at the corporate office).
• Talent pools have been identified within the HDSA ranks, with individual development plans being established. A strategy has been developed to fast track HDSA employees into the Paterson E-level band.
• Only 2.6% of the overall workforce are women (2.9% at mines, 15% at Refineries, 13.4% at Mineral Processes, and 30.6% at corporate office). In addition to the employment equity programme, specific interventions include the development of champions and incentives, diversity management programmes and the evaluation and provision of the requisite facilities and policies. (Management is defined as everyone from D level up on the Paterson Grading System.)

Foreign labour

• Currently, 23.6% of the Implats' workforce is foreign. (A foreign labourer is defined as a person who is engaged in a paid activity in a country of which he or she is not a national.) Implats does not discriminate against foreign labour. The group subscribes to the ILO conventions which accord migrant workers equality before the law regarding human rights and labour legislation. An important aim of the group's Transformation Department is to promote a culture of respect for diversity.

Mine community and rural development

• Implats takes seriously its commitment to maximize the sustainable socio-economic development of communities in which it operates to act as a catalyst for development once the mining cycle ends.
• Implats' strategy includes co-operating in the formulation of Integrated Development Plans (IDPs) at a national, regional and local level. Involvement includes taking a leadership role where this is necessary, facilitating industry co-operation and engaging with mine communities. This co-operation is now being extended to labour-sending areas. Key areas of co-operation and influence are the areas around Rustenburg (the Rustenburg Local Municipality, the Bojanale Platinum District Municipality), Springs and Steelpoort (the Sekhukhuneland and Greater Tubatse district municipalities).

Housing and living conditions

• The company subscribes to the ideal that employees should reside with their families in a stable healthy environment within commuting distance of their workplace.
• A housing forum, established on 18 February 2004 and comprising representatives of management and unions, is investigating all accommodation issues, including upgrading company houses and hostels and promoting home ownership through the in-house Home Ownership Scheme. In FY2004, 190 employees became home owners through this scheme.
• It remains a reality though that there will always be a sizeable portion of employees who will choose not to move their families to their region of work and it is the company's intention to convert current hostels into private single accommodation units.
• A recent evaluation of the nutritional value of the meals served to Impala Platinum hostel residents resulted in the appointment of a new contractor to serve more nutritious, balanced meals with effect from September 2004.

Procurement

• Implats has developed a procurement policy which will encourage both the identification and development of accredited HDSA suppliers, and increase the company's spend with such suppliers. (The policy can be found on the company's website at www.implats.co.za). The principles contained in the policy were communicated to more than 4 000 existing suppliers to encourage them to transform their businesses, and to new and potential suppliers so that they may understand the company's requirements.
• Targets are in place for procurement from HDSA companies, at both a group and an operational level. Total affirmative procurement spend in FY2004 was R500 million, well in excess of the target of R400 million. A target of 20% of total procurement through HDSA companies has been set for FY2009.

Ownership and joint ventures

• Implats is committed to achieving the ownership targets set in the minerals legislation and is on track to achieve this within the specified timeframe. The group has - since a land-mark deal in the late 1990s - had the Royal Bafokeng Nation (RBN) as a significant shareholder (1.5%) in the group. This is over and above the royalty agreement with the RBN that exists over the Impala lease area that has seen the payment to the RBN of some R2.5 billion for the last five years. The recently announced sale of Implats' 27.1% stake in Lonplats will lead directly to the creation of Incwala, intended to become a leading empowerment company in the South African resources sector. Implats' Marula operation, has since project inception in 2000, envisaged a broad-based BEE stake.

Beneficiation

• Implats supports the efforts by government to establish industries that add value to the metals and minerals mined in South Africa. Through its world-class precious and base metals refineries Implats is not only able to refine the metals to the required specifications of end users - from ingots to salts - but also offer these facilities to other producers locally and internationally. Through its agreement with A1 Services and Supplies Inc in the United States, Implats is the largest recyler of autocatalysts in the world, all of which are brought into the country from the US.
• Implats has participated in the first platinum jewellery beneficiation project in the country. It also provides metals to one of the largest producers of autocatalysts for local production.

Reporting

• Implats published its first "scorecard" in response to the charter in the 2003 Annual Report. The scorecard has been updated in this report and is reported on more fully in the group's Corporate Responsibility Report 2004.