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South African mining companies drive transformation agenda

Since the birth of democracy South Africa in 1994, transformation in the mining sector has ranked high on the government’s agenda as it seeks to redress the imbalances of the past. Since then, mining companies have made considerable strides towards transforming their own businesses and more importantly, contributing to the socio-economic upliftment of the country. GERARD PETER reports.

The Mining Charter was first implemented in 2002 and was amended in 2010 and again in 2018. Its main objective is to facilitate meaningful participation of Historically Disadvantaged South Africans (HDSAs) in the mining and minerals industry, by deracialising the ownership of the industry, expanding business opportunities for HDSAs, and enhancing the social and economic welfare of employees and mine communities.

The 2018 Mining Charter is aimed at accelerating transformation in the sector and sets out targets around six elements to achieve this goal. These are ownership, employment equity, human resource development, inclusive procurement, enterprise and supplier development (ESD), and housing and mine community development.

While there have been concerns that the targets set out are too stringent, according to a 2019 Minerals Council South Africa survey, “Real and sustainable progress has been made in addressing imbalances and transforming the sector over the last decade and the industry is committed to making every effort to achieve the set targets.”

A commitment to social investment

One area where mining companies are making good inroads in transformation is social investment in mining communities. One company at the forefront of this is Exxaro, one of South Africa’s largest black-empowered resource companies. According to its 2020 Annual Report, it places a strong focus on ESD and community infrastructure projects.

THIS ARTICLE FIRST APPEARED IN MINING REVIEW AFRICA ISSUE 4, 2021
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Last year, R25 million was spent on schools, building an ESD Hub and water infrastructure projects through its Social and Labour Plans (SLP), in both Mpumalanga and the Waterberg. It is estimated that 1 446 community members will benefit from services provided from these projects. A total of 151 jobs were created during the construction period.

Exxaro also provided funding, totalling R105.1 million, to seven SMMEs through its ESD programme. It is also supporting skills development through initiatives such as a Financial Excellence Programme with SAICA Enterprise Development and a Contractor Development Programme with the Gordon Institute of Business Science (GIBS).

The partnership with GIBS seeks to empower local entrepreneurs. The programme aims to promote and support the advancement and empowerment of local Exxaro suppliers by providing business education and mentorship. The programme will provide a unique intervention that combines selected accredited unit standards with customised mining and Exxaro-specific content to maximise impact and relevance for participants. ​

The objective of the programme is to improve local economic development in host communities by empowering suppliers, who in turn impact their families and communities through job creation and poverty alleviation.

The scope of the programme covers four primary domains: Leadership, entrepreneurship, people management, and business management practices. It is intended to empower participants to acquire the industry knowledge, skills, attitudes, and values required to make their businesses more competitive and to respond to the challenges of the economic environment.

“Partnerships and collaborations are empowering both to ourselves and communities to address today’s socio-economic challenges,” says Exxaro CEO, Mxolisi Mgojo. “And by using our industry knowledge and resources to upskill up-and-coming entrepreneurs, we can grow new businesses and communities by providing knowledge and mentorship at a grassroots level.”

Empowering tomorrow’s leaders

Exarro believes that empowering and developing the youth is vital to reducing the country’s unemployment crisis by bridging the skills gap, hence its significant investment in youth development through skills programmes, learnerships and internships. 

In 2020, the company sponsored 411 engineering learners, 33 miner learners, 90 operator learners, and 19 business administration learners as part of its formal engineering and mining learnership programme. Of these, 89% of learners were black, including 38% black female youth. The learnerships take place at the Grovos Training Centre in Lephalale and the Colliery Training College in Mpumalanga and include formal theoretical and practical training in core skills, such as plant and mobile equipment operation. The learners also receive a monthly allowance while in training.

To acquire practical experience in the industry, Exxaro also provides internships for recent graduates, equipping 110 interns with impactful workplace exposure and hands-on training in 2020. All the interns were black and 45% were black female youth. “So much has changed in our industry over the years and more young black people are attracted to a career in mining and engineering. And with digitalisation, the mining sector is about to get even more exciting and appealing for the youth,” explains Mgojo.

“The youth of today are very conscientised when it comes to issues like social inequality and environmental stewardship, issues which affected them directly and may severely impact their future if unabated. They challenge us to question what we are doing to build a better world for our future generations. Young South Africans want to work for organisations that have a social conscience and are driving initiatives that address socio-economic challenges. That’s why everything we do is geared towards a much bigger purpose: To power better lives while being resilient and growing our business,” he emphasises.

From the boardroom to communities

Another company that is passionate transformation is Menar. Through its Social Licensing department it aims to uplift local communities by developing and implementing SLPs and Local Economic Development (LED) projects in the form of skills development, mine community development projects, economic empowerment and transformation.

The Social Licensing team supports the group’s human resources and procurement departments in promoting local employment and procurement opportunities. All Menar companies are committed to supporting local community businesses through local enterprise development initiatives such as aiding in building and capacitating SMMEs and integrating them into its mines’ procurement supply chain.

For example, Menar subsidiary Canyon Coal appointed Atang Logistics, which is run by Cultura Park local residents Ofentse Tabane and his brothers Mpho and Lebogang, to transport coal from its Khanye Colliery to the nearby Bronkhorstspruit siding in Gauteng.

This family-run company has been in existence for over 20 years, largely transporting coal to Eskom power stations in Mpumalanga. The company with a fleet of 25, 34-ton side-tipper trucks – all owned by Atang Logistics – has serviced both large and small coal mining companies.

Ofentse has been in the industrial and mining sector since 2013 and is responsible for business development at the company. Mpho is an accredited international trader who heads up the procurement and marketing departments, while Lebogang leads the technical logistics operations of the company.

Ofentse has always wanted to work at home but was previously forced to live in different places owing to work needs. “It was extremely difficult for me to find work in Bronkhorstspruit so I couldn’t stay here,” he laments.

However, he notes that the relationship with Canyon Coal has been a crucial lifeline for the company, as because of the down turn in the market and the additional pressures placed on the sector owing to the COVID-19 lockdown the company had lost other business contracts. “I am very appreciative for the opportunity that Canyon Coal has granted our company and for helping to save the livelihoods of my family and employees. It is our hope to build on this relationship with Canyon Coal and be part of the company’s ongoing growth trajectory,” he states.

Canyon Coal group procurement manager Carmia Pretorius states, “Canyon Coal is committed to supporting local, historically disadvantaged South African companies such as Atang Logistics and integrating them into our supply chain in line with our obligation in terms of the Mining Charter.”

A keen focus on education

Meanwhile, Adult Basic Education Training (ABET) forms part of the skills development commitment within the SLP for Khanye Colliery. The aim of ABET is to develop the educational levels of the community through learning.

It is with this vision in mind that Canyon Coal recently opened a newly built ABET centre at Khanye Colliery. The centre offers educational courses to local community members. The programme offers all eligible community members opportunities to become functionally literate and numerate. The courses offered at the centre include communication in English and mathematics.

“Previously ABET participants attended courses at an external venue located near the mine in Bronkhorstspruit and later moved to Khanye Colliery’s training centre,” explains Menar SLP manager Nthabiseng Ocia Mueti. “This was not an ideal situation which prompted the move to build a dedicated ABET centre. “

The ABET centre cost around R300 000 to build and includes a fully equipped lecture room and can accommodate a maximum number of 20 people (in accordance with COVID-19 spacing regulations), separate male and female bathrooms, as well as a lunch room. The centre was built by a small local construction firm, Zonke General Trading.

Mueti adds, “Between 2015 and 2017, 60 leaners were trained in communication through Khanye Colliery’s ABET programme. While between 2018 and 2019, 9 groups of 15 people received training varying from Level 1 to Level 4 in numeracy and literacy.

 “Menar and Canyon Coal believe that education empowers people with the knowledge and skills needed to build a better future for themselves. ABET courses play an active role in supporting the socio-economic development of communities by investing in the future through empowering local people with improved educational standards,” she concludes.

Collaboration drives sustainable economic growth

There is no doubt that transformation in mining requires a collaborative effort both government and key mining stakeholders. One such initiative is the Impact Catalyst.

The Impact Catalyst is an initiative founded by Anglo American, Council for Scientific and Industrial Research (CSIR), Exxaro, World Vision South Africa, Industrial Development Cooperation (IDC) and Zutari, to create mechanisms that drive development initiatives through public-private partnerships. It was first launched in Polokwane in 2019 and in June this year, the initiative was launched in the Northern Cape.

Despite significant financial investment by mining companies in Northern Cape communities, these organisation’s efforts were often not meeting the real needs of communities, or were not as efficient and effective as they could have been because companies were working in isolation.

Subsequently, Anglo American Kumba Iron Ore, Assmang, Deloitte, Department of Mineral Resources, Industrial Development Corporation (IDC), Kudumane Manganese Resources, Minerals Council South Africa and South32 have joined together to collectively catalyse socio-economic impact in the region.

The programme being pursued by the Impact Catalyst follows the establishment of the Northern Cape Shared Value Project. The programme was initiated in 2017 under the auspices of the Minerals Council South Africa, Assmang, Kudumane Manganese Resources, Kumba Iron Ore and South 32, and undertaken by Deloitte. “Building on the Shared Value work that has already been completed, the Impact Catalyst will provide various socio-economic actors with a transparent, efficient and effective platform to collaborate throughout the Northern Cape,” says Roger Baxter, CEO of the Minerals Council South Africa.

The official provincial unemployment rate of the Northern Cape stood at 28,7% at the end of the fourth quarter of 2020, further emphasising how crucial a collective partnership is to bring socio-economic prosperity to the region. To address some of the socio-economic difficulties in the Northern Cape, the Impact Catalyst will prioritise the following programmes:

  • Schools and community information and communications technology (ICT): Providing communities with the required broadband infrastructure and ICT services.
  • Health: Implementing community orientated healthcare services and health infrastructure support, which can include support for the Covid-19 vaccination drive.
  • Economic development: Implement and create a Northern Cape ESD programme to identify supplier and enterprise opportunities.
  • Municipal capacity development and infrastructure support: Supporting the municipality to develop the required capabilities to enable service delivery.
  • Early childhood development: Construction and operationalising best practice early childhood development centres in communities. 

“The beauty about Impact Catalyst is its collaborative approach,” says André Joubert, CEO of ARM Ferrous. “They will assist us to collaborate with not only mining companies, but communities, traditional leaders, municipalities, and provincial and national government to ensure that we all work together towards one plan, and one objective; to uplift the economic viability of the communities in which we work.”  

Themba Mkhwanazi, CEO of Kumba Iron Ore adds, “We would not exist if not for our communities, they are the lifeblood of our business. Collaborative regional development sits at the heart of our Sustainable Mining Plan, which sets out a pathway for us to build thriving communities by working collaboratively with community representatives, faith-based groups, businesses and entrepreneurs, government, academics and NGOs – to deliver on our promise. Through our collaborative efforts and the by in of our host communities, we hope to play a part in shaping the future of the Northern Cape and its people.”

Speaking on the initiative Northern Cape Premier Zamani Saul states, “The Northern Cape province has immense potential for development and growth, but it is also a province facing significant economic challenges. Through collaborative initiatives like the Impact Catalyst that bring government, business, and civil society, we are building a region that is resilient, thriving and inclusive and can better serve the aspirations of our people.”

Gerard Peter
Gerard Peter is a content creator and media strategist with more than 23 years' experience in new and traditional media.

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