Composition and responsibility of the board, and board sub-committees

At the end of June 2009, the board comprised 13 directors, seven of whom were independent non-executive directors, two were non-executive directors and four were executive directors. The chairman, Dr Fred Roux, is an independent non-executive director and the roles of the chairman and CEO are separate.

The role of the board is regulated by a formal board charter which defines matters reserved for board approval. A formal approval framework is in place which defines the powers and authority of the board and management. The board charter (PDF - 140KB) is available as indicated.

Board functions are supported by the following committees of the board:

• Audit Committee
• Nominations Committee
• Safety, Health, Environmental and Quality (SHEQ) Audit Committee
• Remuneration Committee
• Transformation Committee

All board committees have varying degrees of responsibility for matters pertaining to sustainable development, but ultimate responsibility remains with the board.

A two-year evaluation process of the board, board chairman, board committees and committee chairmen began in 2009 and will conclude in 2010.

All senior management and executive director compensation is linked to performance as measured against agreed Key Performance Indicators (KPIs) and is reviewed at least once a year. These KPIs are specific to their area of discipline and are linked to environmental, economic and social aspects.

Safety, Health, Environmental and Quality Audit Committee

There are five members of the SHEQ Audit committee, including the CEO and an external consultant. Members of management are invited to attend the meeting as necessary. The committee is chaired by Dr Khotso Mokhele (independent non-executive director). In terms of its mandate, the committee’s role is to monitor and review health, safety and environmental performance and standards and to provide advice and guidance on management’s efforts in this regard.

The committee meets at least once a quarter. At least two of these meetings per annum are held on operational sites.

Transformation Committee

This committee comprises ten members, three of whom are independent non-executive directors, a non-executive director, four executive directors and two executives. The committee is chaired by Dr Khotso Mokhele (independent non-executive). The Transformation Committee is responsible for monitoring progress in achieving a transformed workforce. In particular, it is responsible for:

• advising and guiding the board in any decision-making process relating to transformation;
• guiding the organisation on issues of transformation;
• consulting all role players to ensure commitment and the adoption of an inclusive approach in addressing transformation issues;
• providing quality assurance regarding the implementation of all transformation processes; and
• ensuring transparency in communication.

The challenge of achieving the company’s strategic imperative of becoming a transformed workplace hinges on it meeting and exceeding its targets and the numerical goals set as per the Employment Equity Act, the Minerals and Petroleum Resources Development Act (MPRDA) and the related Mining Charter.

Risk management

The board has ultimate responsibility for establishing a framework for internal controls, including appropriate risk management and good corporate governance frameworks and systems. Implats has established key controls that focus on critical risk areas identified by line management, facilitated by risk management, assessed and evaluated by the internal audit function. Every critical risk and control, as well as any associated tasks, have a designated line management ‘owner’. The controls are designed to provide a cost-effective assurance that Implats’ assets are safeguarded and that liabilities and working capital are efficiently managed. Established organisational policies, procedures, standards, guidelines, structures and delegation frameworks provide appropriate levels of direction, accountability and segregation of responsibility, which facilitate self-checking and monitoring mechanisms. Internal audit, in partnership with senior management, monitor these controls and risk management processes.

Group internal audit is an independent, objective assurance that delivers substantial benefits to Implats by primarily focusing on systems of internal control, resulting in better risk management and good governance as well as the achievement of set business objectives. Matters pertaining to sustainability are an integral part of the risk management process. The strategic risks which have been identified by the group and the areas of focus are listed under the Summary of Implats' strategic risk focus in 2009 of the Annual Report 2009. A comprehensive discussion on risk factors may be found on the website at www.implats.co.za.

Code of ethics and conflicts of interest

Implats has in place a Code of Business Practice, to which all employees and suppliers are expected to adhere. The policy outlines the management of conflicts of interest, the prevention of dissemination of company information, the rules for the acceptance of donations and gifts, and protection of intellectual property and patent rights of the company. The policy outlines the disciplinary action (including dismissal or prosecution) which will be taken in the event of any contravention.

A ‘whistle-blowing’ toll-free helpline is in place to facilitate the confidential reporting of alleged incidents which are reported to the chairman of the board. (See the Economic performance section). Board members declare their interests (if any) on a regular basis.

Relations with shareholders and employees

Investors, fund managers, analysts, the media and the market are kept fully, timeously and openly informed of all developments. Implats communicates regularly with shareholders and other stakeholders regarding its financial and operational performance. Communication with interested institutional and private investors pays due regard to the statutory and regulatory requirements on the communication of price-sensitive information by the company and its officers. Shareholders may raise issues with management formally through the annual general meeting, or through the investor relations function at any time.

Similarly, a comprehensive communication programme is in place to communicate with employees on an ongoing basis, and in respect of certain events. This is done through face-to-face communication, briefs, newsletters, videos, email, intranet, etc. Employees may raise issues of concern through their line managers, through an employee hotline or through the whistleblowing process (should they wish to remain anonymous).

Commitments to external initiatives

Implats is committed to reporting in line with GRI. The group is a signatory to the UN Global Compact. In FY2009, Implats was again admitted to the JSE Limited’s Socially Responsible Investing (SRI) Index.