We spoke to Andile Sangqu Executive Head of Anglo American South Africa, to give us insight into the heart of our Transformation Report, which measures our progress against the Mining Charter.
I am heartened by the recognition across the organisation, that delivering on our transformation agenda – within the organisation, our neighbouring communities and the country more broadly – is NON-NEGOTIABLE. There is an understanding that it is far more than simply a compliance requirement. It is not a ‘soft issue’ that we should relegate to secondary status; it is a business imperative. Demonstrating a genuine commitment and ability to deliver on our transformation objectives is an important basis for fostering trust with our stakeholders. The performance review in this report provides a very good indication of our commitment in this area.
In spite of tough operational and contextual challenges, with increased stakeholder expectations across a range of fronts, we have not compromised on meeting our transformation commitments for 2015.
It’s important to recognise that while mining has historically provided the backbone of South Africa’s economy and is pivotal to the task of redressing historical and social inequalities, the sector continues to be under tremendous pressure, with exceptional economic challenges. These include a sluggish domestic economy which significantly affects the industry’s ability to contribute towards creating a more prosperous and fairer society.
The downturn has magnified the systemic challenges inherent in our society, which remains characterised by a persistent mix of legacy issues, dissatisfaction with the pace of delivery of basic services and high levels of inequality and unemployment. Against this backdrop, it is inevitable that mining companies face heightened expectations – notably, for jobs and the provision of services – from communities close to their operations. The complex economic and social landscape has highlighted both the importance of driving our transformation agenda, as well as some of the immense challenges in doing so.
For the mining sector to survive and flourish, it is crucial that the sector plays an active and informed role – in partnership with government, labour and civil society – in ensuring that mineral wealth is generated more responsibly, and that its benefits are shared more equitably between shareholders, workers and the country as a whole. Business, government and labour have engaged on various fronts, with the aim of ensuring the sustainability of the mining sector and its continued contribution to the country’s economic growth and development objectives, as outlined in the National Development Plan.
There remains much to be achieved and there are opportunities to improve our performance. As the sector continues its engagement with government and other stakeholders, we commit ourselves to further our efforts in finding ever more collaborative and innovative solutions to transformation challenges. I am confident that our new business structure and value-oriented strategy will enable us to deliver on the business’s objectives, including our transformation goals. Through engagement and partnership, and collective responsibility, we will bridge the gap between where we are and where we desire to be.
Some key highlights in the report:
Employment Equity:
In spite of challenges in the business environment, we have generally maintained, and in some areas improved, our levels of historically disadvantaged South African (HDSA) representation at management levels, with the overall aggregate improving from 62% in 2014, to 63% in 2015.
Skills development:
We have also developed a strong pipeline of skills, particularly at entry level, as a result of our graduate and fast-tracking programmes, and we focus on ensuring that the skills developed are being used optimally within our business. In 2015, we spent R936 million on HDSA training and development, representing 4.8% of payroll.
Local and preferential procurement:
Our business units spent R36.7 billion, nearly 80% of total expenditure, in South Africa, with BEE-compliant businesses, in 2015. We continue to make good progress in assisting suppliers at all levels to overcome barriers to becoming BEE-compliant. We endeavour to build an inclusive supply base, using procurement opportunities created by our mining operations as a catalyst for local economic growth.
Enterprise Development
In 2015 our Zimele enterprise development initiative provided R308 million in funding for 321 businesses that collectively employed more than 8,600 people and generated turnover of R2.5 billion. Successful SMEs have a positive multiplier effect in the surrounding communities, creating employment opportunities and promoting socio-economic development.
Housing:
A cornerstone of our contribution to community development is our investment in providing quality housing and improved living conditions for employees and their families. In 2015, Anglo American spent more than R1.9 billion on housing initiatives, including expenditure on bulk services, land purchases and housing allowances. More than 10,000 employees remain in company housing, although this number is steadily declining as more houses become available. Since 2010, we have built more than 4,400 houses.
Our investments in housing are supported by our expenditure on community development projects, which focus primarily on supporting education, infrastructure, and community health and welfare. During 2015, our businesses expended R891 million on projects.
We know what we have achieved, what remains to be done and what we need to do to sustain this commitment. Although the challenges are complex, we have the strong leadership and right people to maintain our strategic intent and place our business at the forefront of sustainable initiatives.
To read more visit our website page or download the report.