To engender ownership within the company and an identification with the successes (or failure) of projects, and to ensure greater alignment between Implats’ business objectives and the needs of communities, the approach to socioeconomic development encompasses nine areas of activity that are directly managed by identified champions.
In line with the group’s adoption of a new approach to sustainable development, the way in which the group approaches socio-economic development was radically overhauled in FY2009.
Historically, the group operated the Impala Community Development Trust (ICDT), which was the vehicle for corporate giving and the manifestation of the South African operations’ corporate responsibility programmes. However, a number of structural and contextual changes have resulted in the adoption of a different, more integrated and strategic approach to socio-economic development. There are a number of reasons for this, and consequences which are explained in this section.
To engender ownership within the company and an identification with the success (or failure) of projects, and to ensure a greater alignment between Implats’ business objectives and the needs of communities, the approach to socio-economic development now encompasses the following areas of activity:
New approach relies on 'champions’
This new approach also ensures cross-pollination of ideas, and the integration of strategies for a common purpose. For example, the sports development strategy has a clear vision of developing a talent pool for training and development within the company, while the housing and living conditions project has direct spin-offs for BEE procurement, small and medium-sized enterprise development and job creation.
A decision to formally dissolve ICDT was taken by the trustees on 22 June 2009 as it has served its purpose as a vehicle for corporate responsibility. Instead, the group’s approach has been repositioned to ensure delivery of socio-economic development objectives against a set of business imperatives on the one hand, and the needs of stakeholders on the other. The new approach relies heavily on ‘champions’ who are responsible for delivery in various areas.
Following a significant BEE transaction between Implats and the Royal Bafokeng Holdings (RBH), the Impala Bafokeng Trust (IBT) was established to contribute to the social and economic development of the residents of the Bojanala District of South Africa’s North West Province (the province that is home to the Impala Rustenburg operations and the people of the RBH). The trust has as its vision the development of a self-sustaining community, where people living and working in the Bojanala district experience economic well-being and an improved quality of life. The Trust places a specific emphasis on the empowerment of women. Both Implats and the RBH committed to contributing a total of R170 million each over an eight-year period, from 2007 to 2014. While the IBT has assumed some of the projects formerly undertaken by the ICDT, new projects have been identified and are being developed in line with the IBT’s vision.
Also, as part of the group’s applications for the conversions of its mining rights to new order mining rights (which were granted by the DMR for all operations in August 2008), SLPs were developed for the Impala Rustenburg, Marula and Leeuwkop. These SLPs undertook to engage in certain local economic development (LED) initiatives that would benefit the communities surrounding these operations and in areas from which these operations draw their labour (so-called labour-sending areas).
A key feature of the SLPs for the South African operations is Implats’ commitment to enterprise development and local economic development, as well as infrastructure development. Sustainable Development Working and Steering Committees, supported by Project Committees, have been established to review and guide the funding and progression of identified development projects. Implats will steer enterprise development projects through a process of formal application to a high-level pre-feasibility study, and then on to a full feasibility study should the project prove to be merit-worthy. Robust business plans have been and are being developed for each project, with clearly identifiable project milestones and deliverables.
Implats is committed to enterprise development and local economic development
Given Implats’ new approach to socio-economic development and the impact of the global financial crisis, projects initially proposed in the SLPs were reviewed during the year. Following consultation with the DMR certain changes were made and a number of projects have been discontinued after they proved to be unviable. Impala Rustenburg committed to a number of projects in the Eastern Cape and Taung (both key labour-sending areas) and in the Rustenburg region.
A key aspect of the infrastructure development programme, undertaken in support of the company’s SLPs, is the need to ensure the integration of the operations’ infrastructure projects with the integrated development plans (IDPs) and priorities of the local municipalities.
At a group level, Implats continues to support civil society institutions, including:
The NBI was launched by Nelson Mandela in 1995 to enhance the private sector’s contribution to sustainable growth and development in South Africa. A key driver of the NBI is the belief that business and corporate support are necessary to entrench social, economic and environmental stability as pillars of democracy. As part of its endeavours to attain a sustainable society, NBI has Education and Training Programmes, Economic Growth Programmes and Projects, and Sustainable Development Programmes in place to help realise its objectives. NBI is partner to international companies like the World Business Council for Sustainable Development (WBCSD). Recently NBI partnered with Incite Sustainability to bring the Carbon Disclosure Project (CDP) to South Africa.
SAMDA is a non-profit organisation started in 2000 as the Junior Mining Initiative with the aim of making contributions on the new minerals legislation to government. However, the need for a permanent lobby to represent the interests of junior mining companies became apparent and SAMDA’s mandate expanded. It was formally launched in 2002. SAMDA’s vision is to promote the development of a vibrant and sustainable junior mining sector and its mission is to create an enabling environment for raising finance, developing skills, practicing responsible environmental management and sustainable development and the maintenance of best practice in the junior mining sector.
Launched in 1999, SAWIMA’s objectives are to assist informal mining groups to obtain mineral rights and to promote female empowerment in the mining industry. Empowering women includes lobbying government on their behalf and influencing policy.
In Zimbabwe the group continues to undertake corporate social investment initiatives in the areas in which significant needs have been identified. These are discussed in more detail.
In total, the group spent R61 million on socio-economic development projects in South Africa in FY2009 (FY2008: R42 million), and a further R900 million on housing to date which is part of the home ownership programme to assist employees in attaining their own property; as well as the upgrade and renovation of housing.
|Programme||Amount spent in FY2009|
|Empowerment of community structures||17 955|
|Health, safety and environment||2 061|
|Government and municipal|
|support infrastructure||4 444|
|Sports development||11 430|
|Enterprise development||9 748|
|Community welfare, art and culture||796|
|Total Socio-economic development||60 825|
|Housing and living conditions||916 658|
|Total Sustainable development||1 263 831|
* SED spend has excluded overhead costs which were included in 2008
* SED spend includes R7.5 million accruals which were excluded in 2008
The Impala expenditure under the auspices of the IBT is included above. The IBT is jointly funded by Implats and RBH. Implats places a great deal of emphasis on ensuring that the expenditure towards projects is used to maximum benefit and for the purposes intended. Implats’ socio-economic development expenditure is externally verified with rigorous monitoring systems in place. In this way the group ensures the maximum impact of its expenditure on beneficiaries. In FY2009, a total of 417 beneficiary organisations benefited from Implats’ socio-economic development expenditure, ranging from SMMEs, co-operatives, CBOs and others (see graph).
In addition, the group has identified the number and nature of its beneficiaries (see graph) which comprised 24 438 beneficiaries in FY09 (5 559 direct and 18 879 indirect).
Some of the key projects that were supported during the year are also discussed below:
|Sector:||Enterprise Development and LED|
|Project:||Business Support Unit (BSU), Marula|
|Project duration:||November 2007 to June 2009|
Marula has established an enterprise development and information unit (BSU) at Burgersfort and in the vicinity of the four farms in which the operation is located. The unit provides assistance to both job seekers and aspirant entrepreneurs in identifying business opportunities and to facilitate their greater participation in the local and regional economy.
During FY2009, Marula initiated a number of support programmes targeting various categories of SMMEs. Significant progress has been made to date, of which the following are highlights:
|Sector:||Empowerment of community structures|
|Project:||Essential Oils Project, Eastern Cape|
|Project duration:||June 2009 to 2014|
Located near Mthatha in the Eastern Cape, the first phase of the Essential Oils project (which involves the cultivation and processing of geranium and tree tea oil, for example), is gaining momentum. Initial site establishment had begun by June 2009. This follows a feasibility study and a due diligence undertaken to evaluate the project and to confirm its economic viability.
In the long term, the project will create a sustainable, labour intensive, essential oil producing business. Part of the first phase of the project is the design and establishment of an institutional framework to ensure that the community receives the maximum benefit from the project, while receiving the appropriate management and technical training. The first phase of the project will create up to 30 jobs at a cost of R5.5 million. Impala will facilitate future expansion of this project in co-operation with the Eastern Cape Development Corporation and possibly other development agencies. Stakeholders have been identified in different tiers of national and provincial government, local government and traditional authorities, villages and communities and the land owners.
|Sector:||Empowerment of community structures|
|Project:||Bakery project, Taung|
|Project duration:||March 2009 to 2012|
The Rethuseng Bread Basket in Reivilo is owned by five local entrepreneurs. Their equipment is more than 20 years old, very inefficient and unreliable. Frequent breakdowns and a shortage of operating capital means that the bakery is not able to provide regular or quality supplies of bread to its market. The owners sometimes earn as little as R200 per month. This project will thus assist this existing bakery in establishing a sustainable business. The project entails the upgrading of current premises with appropriate equipment to enable reliable supply and greater volumes. All beneficiaries will be trained and the implementation period includes a full time on site project manager for the first six months. The project manager will transfer business management skills to the future bakery manager. This also includes the development of an identified market base.
Good progress has been made, with all the equipment delivered in June 2009, and operations beginning at that time. The cost of the project is R1.4 million and at full production it will create up to 15 new direct jobs. The project will be held by members of the local community.
|Sector:||Empowerment of community structures|
|Project:||Piggery project, Rustenburg|
|Project duration:||May 2008 to April 2011|
The project was initiated to assist 10 pensioners in building infrastructure for a piggery. Over time the scale of the project has changed significantly based on feasibility studies and extensive research undertaken in conjunction with the Department of Agriculture and the South African Pork Producers Organisation. Initially this had been scoped as a fully integrated piggeries end product operation, but the capital outlay would have been too significant. A more viable alternative is an operation that takes young ‘weaners’ and grows them for sale. A full feasibility study and environmental impact study will begin in FY2010. In the interim, Impala has assisted the current owners through donations of young ‘weaners’ and feed, as well as the funding of small scale construction. The total joint funding required for the project is estimated at R2.5 million.
|Project:||HIV & AIDS initiatives|
Impala Springs makes an effort to support local communities affected by the HIV & AIDS pandemic through the support of local NGOs. Among the projects that received support (amounting to R423 000) during the year were:
The post-matric programme offered by the Ukuqonda Institute is a mathematics and science-based additional school year. The purpose is to add to the pool of successful university graduates in engineering, scientific and related fields. It is currently based at Grenville High School in Rustenburg. Applicants are primarily drawn from historically disadvantaged backgrounds and are put through an intensive interview procedure in which their overall capacity to take advantage of what is offered by the programme is assessed. In 2009, the intake was increased to 47 and divided into two main groups. There is also a support component for the students who are already enrolled in higher institutions of learning in cases where it is required.
The focus is two-fold. The first one is to produce an individual who has acquired the academic and social maturity to cope with the heavy demands placed on university engineering and science students.
The other purpose is to offer individuals opportunities to improve their academic performance. See the case study.
|Project:||Maths and Science Schools Incubator Programme|
Impala Refineries continues to place a great deal of emphasis on developing mathematics and science in local schools through its Maths and Science Incubator programme. Some of the areas of focus in FY2009 were:
|Project:||Libraries, Eastern Cape|
|Project duration:||March 2008 to June 2009|
Two libraries have been set up by the company in the Lusikisiki and Flagstaff municipalities, and a third is being established in the Neath community, some 55km from Port St John’s. The libraries are fully equipped, not only with literature and reference material, but also with working spaces and internet access. They are well-used by a cross section of the population, from learners and students, to NGOs and community members. In total the cost of the project is R250 000. These are the rural areas where there is a great need for access to information (especially internet and reference books) and this infrastructure was not previously available.
|Project:||Fort Hare Geology Project, Eastern Cape|
|Project duration:||July 2008 to June 2010|
Impala contributed to the refurbishment of the Geology laboratory at Fort Hare University, including the donation of 25 computers. The intention is to improve the standard of geology teaching, with the possibility of providing geological recruits to Implats in the future. The cost of the project will be R1 million.
|Project:||Marula schools infrastructure|
|Project duration:||June 2009 to June 2010|
Marula committed R5 million towards a school infrastructure development programme in a project undertaken in conjunction with the Department of Education. A joint committee was established in late 2008 to oversee the reconstruction of eight of the most needy schools in the district. This followed a site inspection that revealed that there were many schools in the area that had very poor infrastructure, with many buildings having been condemned. Two schools have been prioritised at Marula for attention in FY2010.
|Project:||Rehabilitation of quarries, Eastern Cape|
|Project duration:||September 2008 to December 2010|
Also located near Mthatha in the Eastern Cape, this project involves the rehabilitation of quarries that were created to obtain gravel for road construction in the past. These borrow pits pose environmental, safety and health risks to humans and animals.
The key objective of this project is to develop a rehabilitation programme for the old borrow pits, and to restore and safeguard the environment. Secondary objectives include the creation of employment for the duration of the project for communities and members of SAWIMA, as well as the transfer of skills and training to community members (focusing on women) to undertake rehabilitation work. A local team will be established that has the knowledge and skills to participate in future rehabilitation projects of other borrow pits in the Eastern Cape.
The current phase of the project will be the rehabilitation of two pits 29 kilometres west of Mthatha at a cost of R800 000. Final surveying of the area has been undertaken and a project plan has been developed. Implementation started in late FY2009. The project will be implemented by an independent company that specialises in rehabilitation work and community projects in partnership with SAWIMA.
|Project:||Community Environmental Rehabilitation Programme (CERP)|
|Project duration:||September 2008 to December 2010|
This is the follow up to the highly successful Monontsha woodchips project, which involves community rehabilitation of Impala’s tailings dumps. As the tailings rehabilitation project will come to an end within the next three to four years, alternatives were sought to make this project sustainable beyond the scope of the current rehabilitation project. A feasibility study was conducted on a new woodchip/organic fertilizer project, that will see the use of woodchips (waste material from the timber used underground) and sewage. The new project will still include composting of woodchips but at a much bigger scale than currently being undertaken. A small part of the compost will still be used for rehabilitation activities and some compost will be sold on the market but the bulk will be chemically enriched, pelletised and marketed as an organic soil-curing fertiliser. A suitable site is being sought. The project is being established at a cost of R5.3 million, and will sustain 65 jobs.
|Sector:||Business against crime|
|Project:||Springs Safety Community Policing Forum|
|Project duration:||June 2009 to September 2009|
In support of local business against crime campaigns, Impala Springs' contributed R250 000 to:
The functioning of the IBT continued to gain momentum during the year. An office was established in Tlhabane and the set of projects identified received funding and support. Some of these projects were transferred from the ICDT.
The focus of the IBT is the Bojanala district, which is rich in resources and enjoys a degree of communal wealth, but in which at the local and individual family level, many people remain poor. At the most basic level, many are not able to feed themselves or their families and numerous healthcare challenges exist in the community. These challenges include a high level of HIV prevalence, people contracting and dying from preventable and contractible illnesses and the low ratio of health care workers to families. A cycle of poverty persists with a high proportion of youth and adults being unable to participate in the mainstream economy, through a lack of opportunity and inappropriate experience and education. Additionally, there are many youth and children who live in difficult circumstances in child/youth or parent-headed households as a consequence of the AIDS pandemic.
The IBT’s approach is multi-faceted and, while its primary role is that of grant-making, it also recognises the value of, and invests in brokering common purpose partnerships and joining others in advocacy initiatives on issues relevant to their collective work.
Priority areas identified by the IBT for support, directly and in partnership with government and other organisations are:
Other organisations with which the IBT is involved are:
The trust is guided by a board of trustees, and managed professionally by an independent consultant. For further information on the IBT see the IBT website at www.ibt.org.za.
A cycle of poverty exists in the area, which the IBT aims to address
As part of its commitment and mentoring to the holistic development of the community in which it operates and to develop the pool of talent from which the company will draw its employees in the future, Impala Platinum launched the Impala Sports Academy in 2006. From small beginnings – supporting ad hoc sporting clubs in which its employees are involved and its two-year sponsorship of the local provincial rugby team – the academy has become a centre of sporting excellence in North West Province and beyond. Impala has chosen sport as a channel for education, transformation, and individual development, with coaches, programmes and facilities in four key sporting disciplines: cricket, football, rugby and netball.
The development of HDSA sportsmen is an important feature of the programme, with a grass-roots outreach programme a fundamental part of the initiative
In conjunction with and as part of the sports development programme, the company has – in collaboration with its training department – developed a learnership scheme in basic mining and engineering related disciplines – for promising and talented young sportsmen. The learnership scheme, which started in January 2009 provides full-time skills training, while at the same time providing the talented young sportsmen with professional sporting training. In FY2009, four new enrolments on learnerships were offered. A basic survey course is also being developed. This scheme ensures that sportsmen and women who may or may not become professionals for a limited period of time, have a career to fall back on once their sporting careers come to an end, and provides Impala with a source of trained talent.
The development of HDSAs is an important feature of the programme, with a grass-roots outreach programme a fundamental part of the initiative. Scores of young South Africans in the region are being exposed to a variety of sporting activities, and discipline, team spirit and the other positive characteristics associated with sport. This outreach initiative extends into local schools too, where training is provided in coaching and refereeing/umpiring, so that they too become ambassadors of sport.
Currently, there are some 1 952 participants of the sports development programme, with a majority in soccer (which has 575 senior team members). Soccer coaches have attended internal courses run by the South African football governing body SAFA, to qualify them as fully fledged coaches. The netball club is also growing with a number of new players attending training sessions
Implats has committed to provide 10 bursaries per annum for tertiary education, five for students from the Eastern Cape and five in the Taung area. The cost of the programme is R15 million. In addition, five learnership opportunities are also created per annum, for a period of five years, five in the Eastern Cape and five in the Taung area. This is over-and-above the bursaries provided as part of human capital development.
Historically in the southern African mining industry, accommodation for employees at all levels has been provided by the respective mining companies. This has been largely for two reasons:
The legacy of the migrant labour system in South Africa, which draws large numbers of employees from neighbouring countries and rural provinces in South Africa (the so-called labour-sending areas), has further exacerbated the situation. Employees may work at mining operations for a significant portion of the year while their families remain in their home villages and towns. Mining companies historically accommodated senior and supervisory employees in mine villages, and lower level employees in singles’ quarters. While these singles’ quarters provide safe and adequate rooming facilities, room densities were typically high (with up to 10 people per dormitory), with little privacy.
It should be noted that South Africa as a whole continues to experience massive housing shortages, despite significant efforts to address this issue by national and local governments and the private sector. Combined with a high rate of urbanisation and an influx of work seekers to the mining centres, this has resulted in the unprecedented growth of informal settlements, most of which have no services or infrastructure either currently, or planned.
The scope of the challenge facing Impala Rustenburg (which employs the majority of the group’s employees and is the only operation with singles’ quarters) is illustrated as follows: At the outset of this process (in June 2007), about 30% of employees resided in single sex residences, while about 50% had opted to move out of these residences and rent private accommodation. Unfortunately, many of those who had moved out of company-owned singles’ accommodation are now living in informal settlements (owing to the high cost of living in towns and suburbs), which is not optimal for employee health and well-being.
A survey undertaken at the beginning of the process by Impala Rustenburg indicated the following about single sex accommodation dwellers and those residing privately:
Given the change in the group’s approach to the management of human resources and in line with commitments made by the company regarding the Mining Charter, Implats embarked on a new approach to housing and living conditions in May 2007. This new approach will see the significant upgrading of housing and living conditions for employees across the group through:
In all of the above options, emphasis is placed on accommodating employees with their families where this is possible and desired by the employee. Underpinning Implats’ vision is that the provision of attractive housing and living conditions, with associated facilities such as schools, shopping centres and places of worship, is a very positive incentive in attracting and retaining skilled personnel.
Implats embarked on a new strategic approach to housing and living conditions
BEE procurement and job creation are spin-offs from the housing and living conditions project
An integral part of Implats’ strategy is ensuring that the significant capital expenditure contributes to economic development in the region through the development and support of BEE construction and subcontracting companies, and the creation of jobs and skills transfer for local community members (See the Economic Performance section). More than 2 000 people have been employed as part of this project, anymore than 100 people have received formal skills training in areas such as bricklaying, paving and tiling through an Implats-led training programme. Informal, on-the-job training is an ongoing process.
At Marula, where there is no legacy of singles’ quarters, the strategy focuses on the following areas:
Planning for home ownership of some 500 units has commenced with the procurement of land although this has been deferred due to the current economic climate.
The Implats board approved a significant capital expenditure programme of R2.5 billion to enable the rapid implementation of this strategy for Impala Rustenburg and Marula with R1 billion expenditure to date from inception. However, owing to the recent economic downturn a revised five year capital expenditure plan has been implemented.
Good progress has been made with the implementation of this strategy at both Impala Rustenburg and Marula. However, all Marula home ownership projects have been deferred. Key to the implementation of this strategy was the requirement that, on the conclusion of mining operations in the area, the community should be viable and sustainable.
At the end of June 2009, the upgrading of 50% of the North and 70% of the South residences at Rustenburg to apartment-style units with private bedrooms, bathrooms and a common living area had been completed. Around 40% of the No 9 residence had been converted into family units. These newly converted single residences (accommodating 6 300 residents), were well received by employees and unions. Included in the residence makeover was the complete rebuilding of the residence kitchens and dining halls, as well as the provision of a card-operated meal/grocery outlet (‘Miner Diner’) that provides employees with meal options and allows for personal taste and choice. The remaining units to be converted at the residences will be completed in the near future.
New housing units (a total of 318 at the end of June 2009), earmarked for employees with ‘critical skills’, have also been purchased and developed. These units comprise three bedrooms, two bathrooms and lock-up garages and have proved to be a valuable competitive advantage to Impala in the marketplace. A total of 89 units have been constructed in Burgersfort for the Marula operations.
Possibly the most significant development has been the ambitious programme to promote home ownership and the company’s involvement in Sunrise Park in the Boitekong area, a suburb of Rustenburg. The project was planned and undertaken with the close co-operation of the local municipality with the company undertaking the town planning, infrastructural development and servicing. A total of 1 579 units is being constructed, with 32% of these having been completed by year-end.
The two and three-bedroom units are situated on fully serviced stands with freehold title and completed infrastructure such as tarred roads, street lights and storm water drainage. The units are typically of a higher quality than most neighbouring units. They are sold to qualifying applicants at cost price with finance being facilitated by Impala. Extremely favourable financing terms were negotiated with a preferred financial institution on behalf of employees. By year-end a total of 150 units within this development had been sold and occupied.
Going forward, a number of additional accommodation interventions are planned and will be pursued, depending on prevailing economic conditions and demand.
A total of 1 588 units are being constructed in Sunrise Park
In Zimbabwe the group continues to undertake corporate social investment initiatives in those areas in which significant needs have been identified. These, to date, have been in education and health.
Further details on specific projects appear below.
Mimosa’s social responsibility is aimed at making a lasting impression on the community in which it operates, even long after the mine has ceased to operate. The projects here focus primarily on, but are not limited to, education, community development and primary health care.
Some of the specific projects supported by Mimosa in FY2009 include:
Zimplats aims to achieve meaningful and sustainable interventions towards social development, in partnership with local communities. This collaborative approach facilitates ownership and commitment from the beneficiaries.
Zimplats aims to ensure that it makes a positive contribution to poverty alleviation and community development by providing infrastructure and enabling government to improve service delivery and local economic development. Although Zimplats’ overriding goal is to assist a broad range of stakeholders, it places a specific emphasis on youth, orphans and child headed households, the elderly and people living with disabilities.
During FY2009, Zimplats spent approximately R311 million on socio-economic development projects in Zimbabwe (FY2008: R400 000).
In FY2009, there were more than 5 000 direct and many more indirect beneficiaries of this expenditure.
Zimplats corporate social investment programme focuses mainly on education, health – both primary and secondary health care – and the management of HIV & AIDS. Other areas of focus include safety and security including road safety awareness campaigns and infrastructure development for the Zimbabwe Republic Police (ZRP). Zimplats has also supported income-generating projects through the establishment of agricultural projects for small-scale farmers near the Ngezi mine.
Some specific projects carried out by Zimplats in FY2009 include the following.