Sustainable
Development Report
2012
About this report
This sustainable development report covers the 2012
calendar year, which coincides with Richards Bay Minerals’
financial year.
Links
Richards Bay Minerals (RBM) comprises the following
privately held companies:
Rio Tinto’s “The way we work” and other policy and
guideline documents are available online at:
www.riotinto.com/library
• Richards Bay Mining Proprietary Limited
• Richards Bay Titanium Proprietary Limited
• Tisand Proprietary Limited
In this report, Richards Bay Minerals, RBM, “we” and “our”
refer to all three companies collectively. Where we mention
Rio Tinto or Blue Horizon, we refer to Rio Tinto International
Holdings Limited and Blue Horizon Investments 41
Proprietary Limited respectively.
Our report seeks to reflect the fact that we have been
operating in a sustainable manner and will continue to
do so in the future. In it we share our successes and
challenges, and offer a candid view of our performance and
strategy going forward.
Our ownership structure has changed significantly in the
past year, with Rio Tinto now holding a majority stake. We
have also taken this opportunity to restructure our report
slightly and improve its quality, depth and comparability.
Minor restatements compared to last year’s report are
noted where applicable.
This report conforms to Rio Tinto’s internal standards and
has been compiled according to the following international
reporting guidelines:
• the International Council on Mining and Metals’ Ten
Principles;
• the Global Reporting Initiative’s reporting standards,
and specifically the Mining and Metals Sector
supplement (G3.1 MMSS); and
• the King Code on Corporate Governance Principles for
South Africa (King III).
Our reporting will continue to evolve. We are aware of
proposed new reporting guidelines and will incorporate
them as they come into effect.
We believe this report represents a Global Reporting
Initiative (GRI) Application Level C Report. External
assurance has been sought only for those elements
requiring it by law. The RBM board has approved the
content of the report and is satisfied that it fairly represents
RBM’s 2012 sustainability performance.
Stakeholders can download copies of this and previous
reports from our website: www.rbm.co.za
Readers can find an index of the International Council on
Mining and Metals’ Ten Principles on page 50.
Readers can find our Global Reporting Initiative content
and index on pages 51, 52 and the inside back cover.
Feedback
We value your feedback. If you have any comments or
queries regarding this report, please contact:
Communications Department
Richards Bay Minerals
Richards Bay
South Africa
PO Box 401
3900
Tel.: +27 35 901 3111
Fax: +27 35 901 3442
E-mail: communication@rbm.co.za
www.rbm.co.za
1
Sustainable development report 2012
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
About this report......................................... IFC
RBM highlights and recognition................... 2
Company overview........................................ 4
Organic growth from Day One......................... 4
Ownership and structure................................. 5
Board of directors............................................ 6
Social well-being......................................... 22
Occupational health and safety...................... 23
Employer of choice........................................ 24
Diversity and equal opportunity...................... 29
Communities................................................. 32
Product responsibility.................................... 34
Geographic location........................................ 7
Environmental stewardship......................... 36
Essential products........................................... 8
Biodiversity.................................................... 37
Market dominance........................................... 9
Energy and greenhouse gas (GHG)
Production process....................................... 10
emissions...................................................... 39
Mining rights and life of mine......................... 11
Water............................................................ 40
Strategic intent............................................ 12
Determining our material issues..................... 12
Sustainability governance.............................. 13
Business strategy.......................................... 14
Managing director’s report ......................... 16
Air quality and emissions............................... 42
Waste management...................................... 42
Distribution network ...................................... 44
Governance................................................. 46
RBM’s board of directors .............................. 48
RBM board committees ................................ 48
Economic prosperity................................... 18
Financial performance................................... 19
Board-level concerns .................................... 49
Local spend................................................... 19
Appendices.................................................. 50
Broad-based black economic
Appendix 1: ICMM principles index................ 50
empowerment scorecards............................. 20
Appendix 2: GRI content index...................... 51
2
RBM highlights and recognition
3
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
A significant economic contributor, both
locally and nationally
Leading the way in skills development and
diversity
• Largest mineral sands producer and beneficiation
company in South Africa
• Progressive leadership and cultural development
programme
• Directly and indirectly, contributed R5.8 billion
(or 0.83 per cent) of government revenues over the
past five years
• Historically disadvantaged South Africans represent
68 per cent of the workforce
• Major employer and largest single tax payer in
KwaZulu-Natal, representing 3.5 per cent of KwaZuluNatal’s gross geographic product
Sought-after production capabilities and
products
• Capable of producing up to 2 million tonnes of product
annually
• One of the world’s lowest-cost titanium feedstock
producers, supplying 14 per cent of the world market
• Supplier of 25 per cent of the world’s high-purity pig
iron, and the second-largest zircon producer worldwide
Ongoing investment in the business
• Women occupy 34 per cent of management and
10 per cent of core mining positions
• Bursaries, study grants and apprenticeships available
to previously disadvantaged individuals
Important community investor
• Productive union and community relations and forums
• Spent R61.3 million on corporate social investment
(CSI) and local economic development (LED), primarily
education and health programmes
• Constructed two clinics in our host communities
• Committed R30 million to the Bambisanani Learning
Community Programme and science centre
• Rio Tinto share of RBM increased to 74 per cent
• To date invested in excess of R1 billion in
community projects
• Successfully converted all mining rights
World-class environmental management
• Furnace 1 rebuild completed successfully
• Best-practice dune forest rehabilitation programme
• Investing in technology to maintain zircon and rutile
quality grades
• Improved water treatment capabilities allow us to reuse
water up to 21 times
• High-performance Organisation Programme
implemented to optimise our logistics
• Implemented real-time emissions monitoring technology
• Zulti South pre-feasibility study well under way to
sustain production past 2034
• Re-use of waste gas (CO) from the smelter plant as an
energy source in the production process allows us to
reduce our GHG emissions
Zero-harm safety culture
Not without our fair share of challenges
• A Lost time injury frequency rate (LTIFR) of 0.26, our
second-best safety performance ever
• Global demand remains subdued, while competing
supply streams have come online close to
lucrative markets
• OHSAS 18001, ISO 14001 and ISO 9001 certified
• Critical control monitoring plans for material risks
developed and monitored
• Mined zircon and rutile quality on the decline
• Host community growth and unemployment rates
on the increase
• Still seeking suitable solutions for managing
radioactive tailings
Company overview
“ ‘Responsible beyond mining.’ Our mission is to be the safest,
most reliable and sustainable industrial minerals supplier in the
world, to the benefit of all our stakeholders.”
Founded in 1976, RBM this year celebrated its 37th year of commercial operations in South Africa.
Today we are an award-winning organisation and continue to mine and beneficiate the mineral-rich sands
of the KwaZulu-Natal seaboard around Richards Bay.
Organic growth from Day One
RBM started operations in the Tisand area in 1977 with one dredge mining plant and two furnaces,
producing approximately 400 000 tonnes of titania slag a year.
In 1986 an additional mining plant and furnace were added, increasing output to 750 000 tonnes per
year. During the early 1990s a fourth furnace and mining plant were added, and our titania slag capacity
increased to 1 million tonnes, while pig iron production rose to 550 000 tonnes per year.
We currently have four plants running in Zulti North with the capacity to produce approximately
2 million tonnes of product annually, including around 100 000 tonnes of rutile and 250 000 tonnes of
zircon per year.
Pre-feasibility studies and stakeholder engagement activities are currently under way in preparation for fullscale mining in Zulti South in 2017.
4
5
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Ownership and structure
Rio Tinto International Holdings
Rio Tinto’s Iron and Titanium (RTIT) division is the world
leader in the provision of high-quality titanium dioxide
feedstock. RBM forms part of RTIT’s stable of mining and
beneficiation operations.
RBM is subdivided into two entities aligned with our main
operations:
100%
Richards Bay Mining
Holdings
• Mining activities are carried out by Richards Bay Mining
(Pty) Limited
In February 2012 Rio Tinto exercised an option to
acquire BHP Billiton’s 37 per cent shareholding in RBM,
which resulted in Rio Tinto increasing its shareholding to
74 per cent. However, as Rio Tinto has been managing
RBM since 2008, the change has had minimal operational
impact, only strengthening RBM’s alignment with Rio
Tinto’s management practices.
The remaining 26 per cent shareholding in RBM remains
unchanged. Twenty-four per cent is held by Blue Horizon,
our black economic empowerment equity partner, and the
remaining 2 per cent share belongs to our Employee Share
Participation Trust.
Blue Horizon is a consortium consisting of lead investors
and our four host communities. This broad-based black
economic empowerment (B-BBEE) component enables us
to meet the compliance targets of the government’s Mining
Charter. It increases our board’s diversity, strengthening
our ability to oversee risks and identify opportunities and
effectively engage with our host communities.
Richards Bay Titanium
Holdings
74%
• Smelting and beneficiation are carried out by Richards
Bay Titanium (Pty) Limited
Shareholder structure
100%
74%
Blue
Horison
Investment
0.1%
ESPS Trust
24%
2%
2%
Richards Bay Mining
99.9%
Tisand
85%
Nozalela
Mineral
Sands
100%
Zululand
Titanium
24%
Richards Bay Titanium
Company overview (continued)
Board of directors
JF Turgeon
(Chairman)
JR Olsen
MLD Marole
EM Dipico
Represents Rio Tinto
United Kingdom
Represents Rio Tinto
United Kingdom
Represents Rio Tinto
South Africa
Represents Blue Horizon
South Africa
JB Magwaza
B Mthethwa
EJ Dorward-King
Represents Blue Horizon
South Africa
Represents Blue Horizon
South Africa
Managing Director
South Africa
* KC Harper is also a board member. She is based in the United Kingdom and represents Rio Tinto.
6
7
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Geographic location
We operate in the uThungulu District Municipality in the
north-eastern region of South Africa’s KwaZulu-Natal
province, with our lease areas falling within the uMfolozi
and uMhlathuze local municipalities. We have four host
communities: Mbonambi, Sokhulu, Mkhwanazi and Dube.
adjoin commercial forestry plantations, sugar cane fields
and farmland as well as human habitation. The area has
good tourism and recreation potential, with some tourism
infrastructure already in place. A number of high-profile
nature reserves protect the area’s rich biodiversity.
Our head office is located at our smelter facility,
25 kilometres north of Richards Bay.
Our mineral lease areas include 60 kilometres of coastal
dunes. When mining began in 1975 the dunes comprised
about 20 per cent grasslands and 20 per cent indigenous
forest, the remaining 60 per cent having already been
planted with commercial forestry.
The area’s mineral-rich coastal dunes stretch for
approximately 60 kilometres along the Indian Ocean and
Lake Nhlabane
RBM
headquarters
and smelter
Tisand
Richards Bay
Richards Bay harbour
Zulti South
To Durban
South Africa
Zulti North
Company overview (continued)
Essential products
We mine heavy metals and turn them into a number of products.
Titania slag
Zircon
Rutile
Pig iron
Titania slag is our core
product and is used
mainly in the production
of titanium dioxide (white)
pigment. We produce
three types of titania slag
(chloride slag, sulphate
slag and fines) which vary
in the size of their particles
and are tailored to different
pigment manufacturing
processes.
Zircon is used in the
production of ceramic tiles
and sanitary ware. Refined
into zirconia, it is used in
a wide range of advanced
heat-resistant ceramic
products and in jewellery
and electronics. Zircon
sand is also used in the
foundry industry.
In its titanium metal form,
rutile is used extensively
in the aerospace industry
where it is valued for
its lightness, strength,
and corrosion and heat
resistance. It is also
used in artificial joints
and pacemakers and
in advanced welding
processes.
Our high-purity pig iron, a
by-product of the smelting
operation, is used in the
production of ductile iron,
which is in turn used
extensively in safety-critical
automotive parts such as
brake calipers and steering
knuckles.
“Producing minerals and metals essential for modern life.”
Titanium dioxide (TiO2) pigment
What is titanium dioxide used for?
Over 90 per cent of the world’s titanium output is used in
titanium dioxide pigment, which provides whiteness and
opacity to products such as paints, paper and plastics.
It is non-toxic and can be used in food colouring,
cosmetics, toothpaste and medicine. It also absorbs
ultraviolet rays and is used in sunscreen and paint to slow
down the sun’s weathering and fading action.
How is it produced?
The production of titanium dioxide pigment starts with the
mining of a group of minerals collectively known as heavy
8
minerals, which RBM extracts from the mineral-rich dunes
in Richards Bay.
These minerals are then processed to remove impurities
(see our production process diagram on page 10) and
produce a titanium dioxide-rich product called titania slag.
The process also produces high-quality pig iron as a byproduct.
RBM sells titania slag to pigment producers around
the world. Our titania slag contains 85 per cent
titanium dioxide, while our rutile contains 94 per cent
titanium dioxide.
9
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Market dominance
“At any one time, no fewer than 20 large ocean-going vessels are either
on the high seas transporting our products to customers across the
world or at anchor loading up or off.”
Thanks to Rio Tinto’s proprietary smelting technology and international marketing links, RBM is highly competitive in
world markets.
We export 95 per cent of our product, yielding a world market share of about 25 per cent in titanium feedstock (titania slag
and rutile), 33 per cent of the world’s zircon output and 25 per cent of the world’s high-purity pig iron.
Europe
Korea
Japan
USA
China
Taiwan
South Africa
Company overview (continued)
Production process
Process
RBM production efficiency analysis
December 2010
December 2011
December 2012
78 107 950
75 151 547
73 004 352
MT
3 207 245
3 218 466
2 932 536
MT
Energy
18 716 920.48
20 264 694.31
16 825 016.84
GJ
Water
31 253 742.40
31 177 532.59
26 644 513.31
m3
1 708 739
1 923 108
1 693 321
MT
Total Titania slag
926 467
1 037 098
880 844
MT
– Chloride slag
799 000
901 658
764 357
MT
– Sulphate slag
98 908
106 489
91 911
MT
– Fines
28 560
28 952
24 575
MT
Zircon
221 987
264 076
263 673
MT
Rutile
75 733
100 406
97 489
MT
484 551
521 527
451 316
MT
1 498 506
1 295 358
1 239 215
MT
Mining activity
Sand mined
HMC produced
Major input materials
Production output
Total products
Pig Iron
Total mineral waste
HMC = Heavy mineral concentrate
MT = Metric tonnes
GJ = Gigajoules
10
11
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Mining rights and life of mine
RBM mineral lease areas
Tisand
3 681.22
Zulti North
4 449.19
Zulti South
3 037.01
Town board
28.00
Smelter site
227.24
Servitudes
133.50
Total
11 556.16
Mining rights
In February 2012 the Department of Minerals and
Resources confirmed, in terms of the Mineral and
Petroleum Resources Development Act 2002, the
conversion of RBM’s old order Tisand and Zulti South
mining rights and approved new order rights for Tisand and
Zululand Titanium. The mining rights came into force on
9 May 2012 and will run until 8 May 2041.
Life of mines
RBM expects to complete the extraction of the high
mineral content reserves of the Zulti North lease area
in 2034. To sustain our slag production as Zulti North’s
reserve diminishes over the next 21 years, we established
the Zulti South project to expand our mining operation to
the Zulti South lease area. Mining of the Zulti South area is
set to continue beyond 2034.
Zulti South project
Established in June 2012, the Zulti South project
spearheads our plan to expand the mining operation to the
Zulti South lease area.
We expect that the pre-feasibility study and
environmental approval processes currently under way
will be completed by June 2015 and production is set to
commence in 2017.
Rigorous engagement with our two host communities,
Dube and Mkhwanazi, resulted in a memorandum of
understanding that covers pertinent social strategies such
as skills and enterprise development, local employment,
and committee structures for transparent communication.
A relocation action plan is still under development by
means of a multi-stakeholder engagement process.
Estimated high mineral content (HMC) reserves (tonnes)
2013 – 2015
8 339 738
2016 – 2018
6 253 942
2 397 291
2019 – 2021
6 214 020
3 735 803
2022 – 2025
6 079 168
2026 – 2027
6 459 184
2028 – 2030
5 428 361
2031 – 2033
2 316 222
Zulti North
1 668
3 581 541
4 555 427
3 821 570
4 898 406
Zulti South
Strategic intent
“We access and use land, rehabilitate unavoidable impacts
and work with local communities to help with their needs in
the most effective manner we can. In all cases, this involves
ongoing consultation with our host communities, public
authorities and others affected.”
Determining our material issues
Richards Bay Minerals has been mining in the Richards Bay area and interacting with the local
communities for 36 years. The issues we deem material have evolved according to the understanding of
the area we have gained over this length of time, and of the issues that have the potential to affect our
business and the region on an economic, environmental and social level.
We share many issues and concerns with the mining sector in general, such as:
• The need for accurate forecasts regarding product prices, market demand and available resources in
order to manage capital effectively.
• The need to manage our environmental impact and rehabilitate previously mined land.
• The need for effective labour relations and community engagement.
We continually reassess our material issues according to changing business and stakeholders’ needs and
concerns, and robust stakeholder engagement, academic research and risk assessments play a critical
role in this process.
Stakeholder engagement
We have a well-established communication and stakeholder relations team that ensures we proactively
engage our material stakeholders. We regularly assess the state of our relationships as well as the
potential risks and impacts associated with them.
Our stakeholders consist of:
• shareholders;
• employees and unions;
• four host communities (Sokhulu, Mbonambi, Dube and Mkhwanazi);
• customers;
• community trusts;
• service providers and local entrepreneurs;
• business chambers;
• special interest groups (such as NPOs and academic institutions);
• utilities, in particular Eskom and Transnet;
• municipal and government departments (local and national); and
• national, regional and local media.
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13
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Host community engagement
Issues of material concern
We have a multi-pronged engagement strategy, and
commission socio-economic baseline, social impact and
heritage assessments of all mining areas. We are proud
of our well-established manner of engaging communities
in preparation for mining, on operational issues during
mining and on post-mining planning. We also have a
rigorous resettlement action plan process that involves all
interested and affected stakeholders, with a special interest
in those community members who will be directly affected
or resettled.
We have grouped our material issues into six main themes
or strategic pillars which define our business strategy.
In line with the six strategic pillars we have established
specific performance measures and targets to assess our
overall performance.
We further seek to support and strengthen traditional
councils’ capacity to effectively deliver on their mandate.
The community empowerment trusts, as equity
shareholder since the 2009 B-BBEE deal, also present
a platform for engagement and assist in the planning
and implementation of all socio-economic development
programmes.
We work closely and in partnership with local municipalities
in the identification of local economic development (LED)
projects. This is done through the integrated development
planning sessions held by the municipalities. Our five-year
integrated development planning (IDP) forms the basis of all
our local economic development activities.
Risk assessment
RBM recognises that risk is an integral and unavoidable
component of our business and is characterised by both
threats and opportunities. We endeavour to foster a riskaware corporate culture in all decision-making.
Our risk management processes follow Rio Tinto’s strict
standards. Every second year we carry out a major risk
and opportunity evaluation. This evaluation considers the
following internal and external factors:
Internal factors
•
•
•
•
•
Key organisational values and strategies
Our current and forecast financial position
Significant operational risks
The expectations of stakeholders, including labour
Critical enabling factors for success, such as our ability
to innovate
External factors
•
•
•
•
•
The local and global economic outlook
Sector-specific challenges
Stakeholders’ concerns
Relevant legislative and voluntary compliance standards
Recognised sustainability risks
The evaluation is scrutinised and updated annually, and any
necessary adjustments are made to our rolling five-year
strategic plan.
Issue of material concern
Strategic pillar
• Health and safety in the
workplace
• Employees’ health
• Legal compliance
Care
• Cost-effective productivity
• Asset utilisation and stewardship
• Good governance
Operational and
financial delivery
• Continuous improvement of
processes
• Robust decision-making
• Production process reliability
• Resource optimisation
Growth and
innovation
• Strong employee relations
• High-performance culture
• Skills acquisition, retention and
development
• Inspirational leadership
People
• Sound environmental
management
• Environmental monitoring and
management
• Good stakeholder relationships
• Maintaining licence to operate
• Embedding sustainable
development
Environment,
communities
and external
stakeholders
• Delivering on customer
expectations
• Effective, fact-based marketing
• Efficient and effective logistics
Customers and
markets
Sustainability governance
We maintain our business viability by actively embedding
long-term concerns into our decision-making processes
and business strategy. We have dedicated teams
overseeing stakeholder engagement, risk management,
corporate governance, communication, human resources,
production oversight and environmental management.
In compliance with the new Companies Act, we
established a Social and Ethics committee in 2012, to
oversee our sustainable development performance.
In this report we cover our material business concerns and
relevant GRI and internal performance indicators.
Business strategy
RBM’s strategic five-year plan details our aspirations and responses
with regards to our material business concerns. We review and update
our strategy annually, and are confident we are on track to meet our
2013 targets.
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15
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Maintain our status as a
“Zero harm” organisation
Our strategy is to create a safe place
of work for all our employees and
contractors. Two aspects are critical
to our strategy, behavioural safety
and reducing the risk in our systems
and processes. Our strategy starts
with leadership development and is
driven through management-worker
health and safety committees.
Be supplier of choice in our
chosen markets
Our strategy is to deliver on
customer expectations through
reliable supply of quality product
against agreed delivery schedules.
Collaboration with Rio Tinto
marketing is a key strategic driver.
Be prime corporate citizen
and developer of choice
Our aim is to build good working
relationships with our host
communities, government and
external stakeholders, and
understand our impact on the
environment. Our strategy is to
develop sustainable communities
and, as part of Rio Tinto's global
commitment, we aim to achieve
a net positive impact on our
environment by closure.
CUSTOMERS
AND
MARKETS
ENVIRONMENT,
COMMUNITIES
AND EXTERNAL
STAKEHOLDERS
RBM
SUSTAINABLE
DEVELOPMENT
FRAMEWORK
PEOPLE
Be the employer of choice
Our strategy is to attract, retain and
develop creative and innovative
employees. Through inspirational
leadership, effective employee
engagement, appropriate
education and training and strong
teamwork, we will drive a culture
of performance.
CARE
OPERATIONAL
AND FINANCIAL
DELIVERY
GROWTH AND
INNOVATION
Add value through operations
Our strategy is to maximise
production at the right quality
through the optimum utilisation of
our assets. This requires that we
manage the ore body responsibly
and apply leading technology
and processes in response to
market-driven production plans.
Key to our strategy is tight financial
management of costs and
working capital. Good corporate
governance includes annual
risk assessments.
Grow value through industryleading technologies
and products
Our growth and innovation strategy
is aimed at building our capacity to
expand operations, while doing so
with increasing efficacy. We apply
Rio Tinto’s business improvement
(BI) process to evaluate projects,
reduce bottlenecks and continuously
improve processes.
Managing Director’s report
“Safety remains our number one
priority. We had a successful year and
I’m delighted everyone who came to
work in 2012 went home safely at the
end of the day. I wish to thank all our
employees and contractors for staying
safe – let’s keep it up!”
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RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
RBM’s ownership structure changed in September 2012,
with Rio Tinto’s shareholding increasing to 74 per cent as
a result of their acquisition of BHP Billiton’s 37 per cent
share. Rio Tinto is now the world’s largest producer of
various industrial minerals. This structural change has not
significantly impacted the way we operate, as Rio Tinto has
been managing our operations since 2008.
Strained global economic conditions continued to affect the
mining sector in 2012, and investors in general remained
cautious. Demand for raw materials, especially in the US
and Europe, fell in line with the dip in construction and
vehicle manufacturing. We remained resilient however, and
countered the weak European demand by growing our
Asian markets.
We have maintained our reputation as a reliable, globally
competitive producer of high-quality mineral products. Our
strong financial performance has enabled us to reward our
shareholders and benefit our host communities.
Maintaining our global competitiveness going forward will
involve addressing four key challenges:
• the difficulty of attracting and retaining skilled individuals;
• the rising cost of electricity;
• risks associated with political and social instability in
South Africa; and
• the growing pressure on local water sources.
Our long-term success relies on having a diverse workforce
working safely at competitive productivity levels. We
continue to be inspired by our leadership development
programme, which is the vehicle for workplace culture
change at RBM and the driving force behind our strategy to
develop a diverse workforce and nurture leadership potential
at all levels within the organisation.
Safety remains our number one priority. I am delighted to
report we suffered no fatalities in the reporting period and we
achieved our second-best safety performance yet.
To tackle the challenge of our own carbon footprint and
to address problems associated with energy supply in
South Africa, we are exploring and implementing a number
of energy-saving initiatives. One of these initiatives includes
improving our energy efficiency by refurbishing a second
smelter furnace, developing more economical compressedair management programmes and installing energy-efficient
lighting and point-of-use power factor correction at
other installations.
RBM values good relations with its stakeholders and works
hard at ensuring open and honest communication. We
engage with our stakeholders extensively, especially around
future plans and business strategy. As a result we remained,
for the most part, unaffected by the serious unrest in the
South African mining sector in the period under review.
Water is a vital resource, both for our operations and our
growing host communities. We have to be responsible
water stewards and play a key role in managing demand
in both the short and long term. Water extraction from our
three water sources is continuously monitored and suitable
lake depth limits are in place to prevent our mining and
smelter operation endangering the ecological balance of
Lake Nhlabane.
Our water usage and practices are based on sound
environmental research. A further independent ecological
study to assess our water resources and management is
scheduled for 2013, and its results will augment data from
past studies.
In September 2012 we played host to the Rio Tinto board
of directors, giving us the opportunity to showcase both our
Esibusisweni rural development centre and our post-mining
coastal dune forest rehabilitation programme.
Conducted in partnership with the University of Pretoria,
the dune rehabilitation project continues to set standards
worldwide and has resulted in 69 scientific publications over
the last two decades. We remain committed to preserving
this unique and culturally significant environment through
scientific research-based practices.
Looking forward, we continue to work hard at maintaining
both our capital assets and human resources – particularly our
core skills – so that we are in a strong position to react quickly
to increased demand when the global economy recovers.
The Zulti South mining pre-feasibility study will be finalised
during the next financial year and mining there is set to begin
in 2016. Our application to convert our old order mining
rights to new order rights has also been successful. Our new
rights came into force on 9 May 2012 and will remain valid
until 8 May 2041.
Being RBM’s Managing Director for the last two years has
been a privilege. I would like to welcome Mr Mpho Mothoa
who will take over from me in 2013. I am confident that
his experience as the Chief Operating Officer at Rössing
Uranium in Namibia, and this 13 years with Rio Tinto, will be
greatly valued at an already strong and resilient RBM.
I thank all our employees for their hard work, our leaders
for leading by example, and our stakeholders for their
valued input, advice and encouragement. Your efforts have
been much appreciated. Special thanks go to our board of
directors and executive team for their insightful leadership
and support and to our host communities and community
leaders for helping us build a sustainable future in harmony
with the local environment.
EJ Dorward-King
Managing Director
Richard's Bay
18
Economic prosperity
19
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
RBM is the largest single tax payer and a major employer
in the KwaZulu-Natal province, representing 3.5 per cent
of KwaZulu-Natal’s gross geographic product. As such, we
directly and indirectly accounted for $713 million (or 0.83%)
to government revenues over the past five years.
Financial performance
Local community spend
Beyond the majority support we give to local suppliers,
we also have a number of corporate social investment
(CSI) and local economic development (LED) projects.
More information about these projects can be found on
page 33.
Revenue/Cash generated from operations
Community investment
2013
forecast
2012
2011
2012
2010
2011
2009
500
1 000
1 500
2 000
2 500
Millions US$
Revenue
2
Local spend
Local supplier spend
We outsource non-core components of the business,
such as security, IT maintenance, plumbing, overhauling,
and others. This enables us to concentrate on our core
business. It also creates a significant opportunity for service
providers and contractors, thus impacting positively on
the economy and the lives of thousands of families locally,
provincially and nationally.
Overall we spent R3.6 billion on South Africanbased suppliers, representing 99 per cent of our total
supplier spend.
Supplier spend
International: 1%
Local community-based
suppliers: 4%
National: 25%
Richards Bay
area: 52%
6
8
Millions US$
CSI
KwaZulu-Natal:
19%
4
Cash generated from operations
LED
10
12
14
Broad-based black economic empowerment scorecards
We seek meaningful transformation that empowers historically disadvantaged South Africans (HDSAs) while maintaining
our ability to grow sustainably. Through our efforts we also hope to advance the social and economic welfare of
host communities.
Our 2009 B-BBEE deal saw us become fully compliant with the Department of Mineral Resources’ (DMR) 26 per cent black
economic empowerment (BEE) ownership target – five years before the 2014 deadline.
Mining Charter
For the Mining Charter Scorecard, we conducted our own assessment as follows:
Element
1 Ownership
2
3
4
5
Description
Minimum target for effective HDSA
ownership
Procurement Procurement of capital goods
and enterprise Procurement of services
development
Procurement of consumables
Multinational suppliers’ contribution to the
social fund
Employment Diversification of
Top management
equity
the workplace to Senior management
reflect the country’s
Middle management
demographics
Junior management
to attain
competitiveness
Core and critical skills
Human
Development of requisite skills, including
resource
support for South African-based research
development and development initiatives intended to
develop solutions in exploration, mining,
processing, technology efficiency (energy
and water use in mining), beneficiation as
well as environmental conservation and
rehabilitation
Mine
Conduct ethnographic community
community
consultative and collaborative processes
development to delineate community needs analysis
6 Sustainable Improvement of the industry’s
development environmental management
and growth
Improvement of the industry’s mine health
and safety performance
20
Weighting
(%)
5
5
5
2
Performance
2011
2012
(%)
(%)
26
39
41
30
•
•
•
•
3
3
4
3
1
5
25
Targets
2012 2013 2014
(%)
(%)
(%)
26
30
48
37
•
•
•
•
26
20
50
25
26
30
60
40
26
40
70
50
43
57
89
56
79
•
•
•
•
•
•
43
54
59
80
90
• 0.50
•
30
•
30
•
40
•
40
•
30
0.50
35
35
40
40
35
0.50
40
40
40
40
40
21
•
16
•
4.5
5.0
4.0
15 LED projects • LED projects • Implementation
accepted by
accepted by
of projects will
communities
communities
serve to enhance
and municiand municirelationships
palities, and
palities, and
amongst
projects
projects being
stakeholders leading
being
implemented
to communities
implemented
owing patronage
to projects.
12 100%
• 100%
• Annual progress
compliant
compliant
achieved against
approved EMPs.
12 100%
• 100%
• Annual progress
compliant
compliant
achieved against
commitments in
the tripartite action
plan on health
and safety.
21
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
This year we improved our score against employment
equity and skills development. We appointed a black
female in an executive position to improve our top
management performance, while our Adult Education
Training (AET) programme continues to expand and deliver
results as part of our Social and Labour Plan.
During a recent site visit by the Mining Qualifications
Authority (MQA), our AET programme received high
praise and we are pleased that four learners successfully
completed AET IEB level 4 in both numeracy and literacy
for the first time in 2012.
Consistent performance for the procurement of services
element remains challenging. To improve our performance
we embarked on a supplier management initiative whereby
all suppliers are required to be BEE compliant. We hope
to achieve a procurement of services score of 60%
(2012: 48%) in the next financial year.
Broad-based black economic empowerment
scorecard
Our progress against the Department of Trade and
Industry’s (dti) Generic B-BBEE Scorecard is presented
below.
Unverified B-BBEE scorecard for 2012
Weighting
Ownership
20
Management
10
Employment equity
15
Skills development
15
Affirmative procurement
20
Enterprise development
15
Socio-economic development
5
Broad-based BEE Score
Score
17.00
6.75
10.32
12.00
16.00
10.57
5.00
77.64
Broad-based BEE Status Level 3
After the 2010 B-BBEE verification we realised that we
had to improve our internal verification methodology. We
therefore conducted transformation training and awareness
sessions, as well as a BEE verification mapping process.
We identified a number of gaps in our existing practices
and therefore developed a data collation framework for
verification purposes. NERA was subsequently appointed
to externally verify our BEE credentials in 2013 for FY 2012.
Our efforts proved successful as we managed to improve
our score in a number of areas. Our scorecard is now a
better reflection of our progress towards transformation.
We did not seek external verification for our 2011
performance in 2012, however NERA will verify our 2012
performance in the second quarter of 2013.
Social well-being
“We remain committed to our goal of
‘Zero Harm’ and are pleased to report
that we had zero fatalities over the past
three years.”
22
23
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Occupational health and safety
by integrating occupational health and safety aspects into
our leadership development programme and our employee
incentive schemes and wellness programmes.
Maintaining our status as a “zero-harm” organisation
through the use of effective health and safety management
systems and practices remains a key priority for RBM.
Our entire workforce is represented in formal joint
management-worker health and safety committees, and
detailed health and safety agreements have been signed
with union representatives.
We believe safety is everyone’s responsibility. We therefore
continuously reinforce our behaviour-based safety culture
Rates of Injury, Occupational Diseases, Lost Days, Absenteeism and Fatalities
Fatalities
Lost time injuries
Medical treatment cases
First aid cases (minor injuries)
Occupational diseases
All injury frequency rate (AIFR)
Lost time injury frequency rate (LTIFR)
Occupational disease frequency rate (ODFR)
2009
1
19
11
71
0
0.69
0.44
0
2010
0
7
18
78
0
0.50
0.14
0
2011
0
12
11
55
0
0.54
0.28
0
2012
0
11
8
67
0
0.44
0.26
0
2012 target
(where
applicable)
0
0
0.51
0
Safety
Health
This year we achieved our second-best safety record of all
time. While we are proud of our accomplishment, we still
had 11 lost time injuries and 67 minor injuries – figures on
which we are determined to improve.
RBM has a well-established employee wellness
programme, and with KwaZulu-Natal suffering from high
HIV/Aids and tuberculosis (TB) prevalence rates, voluntary
counselling and testing (VCT) for HIV, TB and other chronic
illnesses forms a major part of it. Our goal is for 90 per cent
of employees to know their HIV status and 70 per cent
their overall wellness status by the end of 2013.
Our approach to safety is guided by the Chamber of Mines’
“Road to Zero Harm” campaign and Rio Tinto’s internal
standards. We also comply with both the Occupational
Health and Safety and the Mine Health and Safety Acts of
South Africa.
We identified various risk-reduction opportunities through
a wide-reaching safety risk assessment conducted
in 2011 and in 2012 focused on implementing these
recommendations.
In continuing efforts to improve our safety systems, we have
developed several critical control monitoring plans (CCMPs),
which allow us to assess the effectiveness of the various
safety control systems used throughout our operations. We
also improved our reporting and investigation of significant
potential incidents (SPIs) to lower the number of near-injuries.
To improve the efficacy of all our elected health and
safety executive (HSE) members we have updated our
training modules and will continue to monitor adherence
to these new guidelines via internal and external audits
and inspections.
In 2013 we will continue to stress the importance of
HSE representatives in the workplace and expand their
responsibilities to include a wider range of health and safetyrelated issues.
To achieve this goal, wellness examinations have been
incorporated into the regular occupational health medical
examinations conducted at our on-site health-care facility.
VCT services are also offered to all employees visiting the
facility. We hold regular VCT and wellness days to raise
awareness and urge all employees to get tested.
We focus on a variety of preventative measures to mitigate
the risk of employees developing health-related problems.
These include enforcing the use of personal protective
equipment (PPE) to prevent injury and noise-induced
hearing loss, conducting regular employee hearing tests,
performing blood screening, offering inoculations or
vaccinations for Hepatitis A and Hepatitis B, and making
condoms readily available throughout our facilities.
In 2012 we identified fatigue as a significant risk to the
safety of our employees. During the year we developed
a fatigue management programme which includes
training and screening to minimise the impact of fatigue,
especially in our transport team. We plan to implement the
programme fully in 2013.
Social well-being (continued)
Employer of choice
We aspire to be an employer of choice and attract, retain
and develop creative and innovative employees. We
recognise our employees as central to our organisation’s
success and believe in providing inspirational leadership,
clear direction, strong teamwork processes and a culture of
performance underpinned by relevant and dynamic training
programmes.
We continually investigate and implement initiatives to
improve employee performance, review processes and
structure, attract and retain talent, and align our business
function with our strategy.
This year the number of employees grew by 3.25 per cent,
while the average number of hours worked per employee
decreased marginally by 2.1 per cent.
During the year we reviewed some of our key business
processes and structures and identified various cost-saving
and efficiency-improvement opportunities. Implementing
these proposed changes will continue in 2013.
24
Leadership development programme
RBM’s leadership development programme (LDP) is a
flagship programme that drives cultural transformation
throughout the business. Championed by senior
leadership, the programme’s goal is to:
• increase and sustain employee participation and
engagement;
• improve interpersonal and team relationships;
• improve communication;
• improve safety; and
• increase overall productivity.
Established in 2009, the programme continues to deliver
good results. We have seen a positive change in our
employee engagement as well as our safety record.
External contractors provide a large proportion of our
labour requirement and this poses a significant challenge
to our aspirations to improve the company’s culture. In
response we have embarked on an initiative to partner
with these companies and together develop a leadership
framework in their respective organisations. In 2012 we
conducted our first contractor engagement session.
25
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Employment numbers
Number of employees (permanent and contract)
Total hours worked
Hours per employee
2009
2010
2011
2012
4 582
5 076
4 549
4 697
8 693 593
9 938 393
8 525 923
8 618 795
1 897
1 958
1 874
1 835
Leadership development programme activities
Audience
Activity
Senior
management
Convene engagement forums with RBMs Established forum and held four meetings during the year.
leadership to share LDP programme
One session scheduled for 2013.
successes and examine its business
value and potential.
Employees
Establish a Leadership Connexions (LC)
Completed the programme and presented LC training to a
training programme, based on leadership total of 400 employees in 37 sessions.
development principles. The programme
connects individuals across the
business to improve their team-working
capabilities.
Contractors
Achievements and future plans
Conduct Team Connexion (TC)
sessions with our unskilled/ semi-skilled
employees.
Successfully piloted the programme and held a total of
103 sessions. This programme is set to reach a total of
130 employees.
We will continue the roll out of the TC to the outstanding
27 teams in 2013.
Conduct regular Organisational Culture
Index (OCI) surveys.
Eighty per cent of our employees participated in the 2012
OCI survey. The results were shared with all employees. It
highlighted some opportunities for improvement.
Going forward we will address key items raised by the OCI
through our talent management processes and via the LC
and TC sessions. We also plan to conduct the next OCI in
September 2013.
Conduct one-day leadership orientation
sessions with all new employees.
Training material finalised.
Conducted a total of 20 LDP sessions:
– Six one-day sessions
– Eight adapted sessions for frontline employees
– Six expanded two-day sessions for Shop Stewards
In 2013 we plan to conduct three one-day sessions.
Hold divisional feedback sessions to
analyse the outcomes of the 360 degree
internal assessment of senior leadership
impact (SI) and LC programmes.
Seven divisional feedback sessions completed.
Our General manager will review and implement remedial
actions based on the team assessment report.
Hold debriefs with all individuals that
took part in the 360 degree internal
management impact (MI) and the
lifestyles inventory (LSI) assessments,
and discuss opportunities for personal
development.
Held LSI debrief with 72 individuals, and 13 MI debriefs.
Going forward we will hold debrief sessions with the
outstanding 84 delegates.
Conduct contractor training. This is the
five-day LDP specifically aimed at RBM
contractors.
Condense the programme and tailor the
content to a two- to three-day course.
Programme planning completed.
In 2013 we plan to convene a contractor engagement forum;
conduct a needs assessment; develop tailored proposals; pilot
LDP with the leadership of our contractors; and role out the
programme to all our contractors.
Social well-being (continued)
Remuneration and incentive schemes
Part of our “employer of choice” strategy is to attract and retain key skills by remunerating our employees at wage levels
above local industry standards. We also incentivise our employees by providing performance-linked bonuses and dividend
pay-outs from the employee share participation scheme.
Production bonus pay-outs
2011
2012
Number of employees
Total amount paid
Number of employees
Total amount paid
Q1
–
–
1 146
3 316 858.86
Q2
1 175
4 053 365.77
0*
0.00
Quarter
Q3
1 191
4 046 265.57
0*
0.00
Q4
1 199
3 339 574.57
0*
0.00
3 316 858.86
11 439 205.91
Total
* Targets not met.
Production bonus scheme
Introduced in April 2011, our production bonus scheme is linked to both individual and company-wide targets.
The scheme’s core criteria are safety, productivity, teamwork and cost management indicators, while factors such as
absenteeism and unpaid leave are also factored in. Bonuses are not awarded to employees who fail to report an injury, are
absent without leave or partake in industrial action.
The scheme applies to all permanent bargaining unit employees employed at the date of payment. Payments are made
quarterly in arrears and are limited to 8 per cent of retirement funding income.
With more stringent targets in place this year a total of R3.3 million (2011: R11.4 million) was paid out in bonuses.
Employee share participation scheme
Our employee share participation scheme (ESPS) was established in 2009. Through the scheme, permanent employees
who have been with us for more than six months collectively own 2 per cent of the business and are entitled to a share of its
profits.
All ESPS shares are held in a trust and dividends are paid out biannually to employees. Dividends are based on 0.67 per
cent of RBM’s earnings before interest and tax (EBIT) and all employees receive the same amount.
In 2012 the scheme paid out a total of R30.4 million (2011: R14.2 million) or R15 663 (2011: R8 135) per employee.
Individuals remain beneficiaries of the scheme until the following dividend pay-out should their employment be discontinued
due to death, retrenchment, disability or ill health. Where employment is terminated for other reasons (e.g. resignation,
dismissal, etc.) all ESPS benefits are forfeited immediately.
Dividends* paid to employees
Year
2010
2010
2011
2011
2012
2012
Total
Month
April
September
March
September
March
September
* Dividends refer to after tax payment figures.
26
Number of
employees
1 646
1 647
1 731
1 757
1 804
1 843
8 671
Amount
(R)
2 366.67
2 365.67
4 776.97
5 340.24
5 968.24
8 577.11
Total amount paid
(R million)
3.9
3.9
8.3
9.4
10.8
15.8
52.0
27
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Training and education
South Africa’s chronic shortage of critical skills continues
to influence our business. We have seen a significant
reduction in the number of professionally qualified,
experienced specialists and middle management
employees.
In our social and labour plan (SLP) we have identified
“hard-to-fill-vacancies” and committed ourselves to provide
training support and career development opportunities to
all employees with the ability and desire to obtain these
critical skills.
In this regard the accompanying graph shows a significant
increase in employment of semi-skilled employees across
all age groups, a sign that we are making an investment for
the future.
We provide accredited training in engineering, mineral
extraction, metallurgy and mineral processing, as well as
Adult Basic Education and Training (ABET) Level 1 – 4 in
collaboration with external skills development providers.
These training programmes comply with the Skills
Development Act and are fully accredited by the Mining
Qualification Authority.
Our partnership with NEPAD enables us to nominate
employees with high potential to participate in the Tutu
Leadership Development Programme. During the year one
of our managers completed the programme.
Training hours per employee
Total hours per employee
2009
2010
2011
2012
64 051
80 749
101 826
177 712
2009
2010
2011
2012
4.5
38.6
10.4
36.1
Average hours of training per level
Top management
Senior management
17.6
55.0
27.3
51.9
Professionally qualified, experienced specialists and midmanagement
41.1
65.4
59.4
67.2
Skilled technical and academically qualified workers, junior
management, supervisors, foremen, and superintendents
38.8
47.8
64.3
68.1
Semi-skilled and discretionary decision-making
25.3
29.4
40.6
82.3
Unskilled
32.8
42.4
51.8
75.0
Social well-being (continued)
Speak-OUT
Union representation (permanent employees)
Employees can use our own grievance procedure or the
Rio Tinto Speak-OUT system to anonymously report any
fraud, unacceptable behaviour by employees, or human
rights violations. No such employee-related incidents were
reported during the year.
More information on Speak-OUT is available on page 49.
2012
60.2%
2011
62.3%
2010
60.4%
2009
60.3%
Union representation and labour unrest
Union representation remained stable at around 60.2 per
cent (2011: 62.3 per cent) throughout the year, with
71 per cent (2011: 67 per cent) of our 1 355 unionised
employees represented by the National Union of
Mineworkers. We regularly engage the National Union
of Mineworkers, as well as the other unions, on matters
related to our employees.
We are pleased to report that we continue to have positive
relationships with all the represented unions and for more
than two years there has been no labour unrest.
Union membership in 2012
Solidarity: 4
UASA: 209
NUM: 964
RBEU: 178
Labour unrest
Year
Number of
strikes
Date
Duration
Location
2009
1
9 July
1 day
RBM head
offices
Recruitment
An agreement was reached
with NUM to ensure qualified
candidates were hired as
contractors
2010
1
27 August –
1 September
4 days
RBM head
offices
Company
conditions
An agreement was reached at
the CCMA when revised threeyear offer was accepted by NUM
2011
None
2012
None
28
Reason for
unrest
Response
29
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Diversity and equal opportunity
We have set out specific human resource development
targets in our social and labour plan (SLP). Notably, we
aspire to have a 40 per cent female employee complement
by 2013 as part our drive to increase the number of
historically disadvantaged women in mining and exceed
the goals set out by the South African Mining Charter.
Employees by sex
Male
2009
2010
2011
2012
1 522
1 582
1 598
1 975
205
247
281
363
1 727
1 829
1 879
2 338
Female
Total
Although still far from achieving our 40 per cent goal (2012:
15.5 per cent), we have seen average growth of 1 per cent
per annum over the last four years.
Employees by race
African
2009
2010
2011
2012
1 207
1 279
1 311
1 673
29
33
38
48
148
164
172
211
Coloured
Indian
White
343
353
358
406
Total
1 727
1 829
1 879
2 338
Employees by age
2009
Under 30
2010
2011
2012
279
341
338
501
30 – 50
1 080
1 082
1 118
1 277
Over 50
368
406
423
560
1 727
1 829
1 879
2 338
Total
The proportion of employees below 30 years of age
continues to rise, while the number of employees aged
between 30 and 50 has declined by 7.9 per cent over the
past four years.
Eight-five per cent (2011: 87.4 per cent) of our workforce is
made up of skilled and semi-skilled employees.
People living with disabilities are proportionally underrepresented at RBM, without any significant movement
overall in this area. In 2011 0.2 per cent of the workforce
included people living with disabilities, a reduction from
0.3 per cent in the previous two years.
The proportion of foreign nationals working at RBM has
remained unchanged for the last four years at 0.1 per cent
of the total workforce.
There has been no significant movement overall in our
race demographics. We are on track in terms of the Mining
Charter Scorecard, but with opportunities for improvement
in terms of the DTI’s generic scorecard in terms of
employment equity.
Employees per level*
2009
2010
2011
2012
Top management
12
11
8
6
Senior management
25
24
31
41
Professionally qualified, experienced specialists and midmanagement
258
279
197
216
Skilled technical and academically qualified workers, junior
management, supervisors, foremen, and superintendents
681
712
757
837
Semi-skilled and discretionary decision-making
751
803
886
1 150
Unskilled
0
0
0
0
Temporary employees
0
0
0
88
1 727
1 829
1 879
2 338
Total
* Applies only to employees on our payroll and excludes contract labour.
Social well-being (continued)
30
31
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Case study: Women in Mining Forum
We are challenging the notion that “women don’t work
in mines”, with an increase in female employees from
11.9 per cent in 2009 to 15 per cent in 2011.
We are proud to have exceeded the Mining Charter’s target
of 10 per cent by 2014, but we are aware that equity,
especially in this context, requires special consideration
of what kind of working conditions help women excel.
Further, the employee body as a whole needs to develop
an appreciation for the unique contribution women make in
our industry.
We have established a Women’s Forum, with women
representing all levels and divisions within the company.
The Women’s Forum creates a platform for raising
women’s issues within the company and the sector, for
devising strategies for promoting mining as a career option
for women and providing opportunities for women in
the sector.
The first Women in Mining Workshop was held in
October 2011, fittingly opened by our first female
managing director, Elaine Dorward-King.
Social well-being (continued)
Communities
RBM enjoys stable and mutually beneficial relationships
with its host communities. Formal engagement is
overseen by our host communities’ traditional councils,
but our engagement extends further to include youth
structures, job-seekers’ committees, women forums, and
environmental and SMME forums. These relationships
were enhanced when our host communities became
shareholders in 2009.
Managing community concerns
Resettlements
Resettlement is a major disruption and we work closely
with host communities to ensure that households affected
by our mining activities are not materially disadvantaged.
We follow the International Finance Corporation and
Rio Tinto resettlement guides, and all households affected
by physical or economic displacement are eligible for
compensation and resettlement assistance. Although
no resettlements took place during 2012, we upgraded
the houses of five households previously relocated in the
Mbonambi community, Tisand area.
Our planned mine expansion programme in Zulti South
is expected to impact both the Dube and Mkhwanazi
communities. A Resettlement Action Plan conducted
in 2010 to 2012 revealed that the project might affect
135 ancestral burial sites, 35 living heritage sites,
79 homesteads, and total of 586 occupiers of fields
for livelihood.
32
“Our host community
engagement has improved
over the past four decades.
Our current engagement
in preparation for mining in
Zulti South, for example,
is far more robust than
original engagements in
preparation for mining in
Tisand.”
33
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Disputes
RBM has a formal grievance and compensation procedure,
which we communicate regularly to our communities,
and any community member is able to submit a matter
for consideration. Fairness is assured through the use of
independent structures to lodge complaints.
Our community complaints register tracks all community
complaints, outcomes and compensation records. We
handled 46 complaints in 2012, of which 43 were resolved,
while three were still under investigation at year-end.
Community investment
Our community investment is guided by Rio Tinto’s
stringent community engagement standards, and our
community development plans (CDPs) and activities are
based on independent community baseline studies and
project-specific evaluations.
We continue to channel our community investment into
education, health, agriculture, and business development
programmes within our communities.
to apply our resources. In doing so we have developed a
multi-pronged approach to improve the quality of education
in our host communities.
Our rural infrastructure development programme builds,
renovates and upgrades schools and specialised
classrooms such as science laboratories, computer
rooms and libraries. During 2012 we built one new school
building, two science laboratories, and eight multi-purpose
classrooms and renovated two schools at a cost of
R5.4 million.
Beyond improving local educational facilities themselves,
local students with the potential to excel are offered
after-school tutoring to prepare them for tertiary studies,
while our teacher development programme helps local
teachers improve their tutoring skills. Twenty-one heads
and managers of local schools also attained leadership
development certificates.
Breakdown of community spend
We have also realised that we can improve the outcome
of our internal staff-related programmes by engaging our
host communities, and RBM safety, HIV/Aids and skills
training now form part of some of our community-based
programmes.
Rm
2011
2012
Education
28.2
18.0
Health and HIV/Aids
6.3
4.8
Business development
1.2
3.7
Sport and recreation
1.3
1.2
Education
Agriculture
1.1
5.5
–
8.6
12.7
9.4
8.9
10.1
59.8
61.3
We work in partnership with the KwaZulu-Natal
Department of Education, traditional councils, NGOs and
schools to assess local needs and determine how best
Transport
Other*
Project management
Total
* This item refers to our collective spend on accommodation and environmental
and cultural heritage projects within our local communities.
Breakdown of community spend (Rm)
Total community spend (Rm)
44.1
17.2
2012
61.3
Project management
45.3
14.5
Education
2011
59.8
12.5
Other*
6.0
2010
18.5
Health and HIV/Aids
18.2
70.0
2009
88.2
CSI
Transport
LED*
Total
Agriculture
Business development
Sports and recreation
Social well-being (continued)
Health and wellness
Our community HIV/Aids and TB programme is now in its
14th year of operation.
The awareness aspect of the programme is run by local
women and empowers primary school learners to deal
with HIV/Aids in an informed manner. It currently runs in
13 schools, with a further 23 schools scheduled to join the
programme during the next financial year, reaching over
35 000 learners annually.
Our community health and wellness support programme,
conducted in partnership with local government and other
stakeholders, now supports nine community clinics. Two
new clinics were built and donated during the year, making
treatment for HIV/Aids, TB, and chronic and communicable
diseases more readily available to local community
members.
We have built three sports fields in Zulti South and use
sports tournaments as a platform for promoting active
lifestyles and healthy diet as essential components in
maintaining good health.
Local economic development and rural
advancement (LED and RA)
As required by law, a formal social and labour plan (SLP)
has been drawn up to guide the ongoing local economic
development (LED) activities. Financially we only consider
projects listed in our SLP as LED. From a management
perspective, however, these projects are no different from
our other community investment work and therefore many
LED projects have already been discussed elsewhere in
the report.
Further LED projects included the construction of a road
linking Mbonambi with Richards Bay, the enrolling of
20 young adults in driver’s licence training, and improving
the employability of 800 job-seekers through our work
readiness initiative (WRI).
Our two-year SMME training and mentorship programme
is currently helping 11 small businesses improve their
business and financial performance. In addition, we help
rural subsistence farmers with food safety standard and
agricultural training, and host a bimonthly food market
where they can sell their produce.
Product responsibility
Product and service labelling
Our products are stable, non-corrosive and carry low
health risks. Material safety data sheets (MSDS) for our
products are available on request and attached to all
product shipments. Each MSDS provides the following
information:
Material safety data sheet information
Included
Comment
The sourcing of components of the product or service
No
Not applicable
Content, particularly with regard to substances that might
produce an environmental or social impact
Yes
Safe use of the product or service
Yes
Disposal of the product and environmental/social impacts
Yes
Other
No
34
No supplementary information needed
35
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Environmental stewardship
“Respect for the environment is central to our approach to
sustainable development. We conduct our business with a
long-term integrated view on land stewardship. Our land use
management plan incorporates a multi-stakeholder biodiversity
strategy through which we aim to achieve ‘net positive impact’
(NPI) on biodiversity by mine closure.”
36
37
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
RBM’s success depends on our sensitivity to and ability to
manage our impact. We minimise harm to the environment
by designing, operating and closing all of our operations
in an environmentally responsible manner. To this end we
incorporated Rio Tinto’s ten environmental standards into
our environmental management plan. These relate to land
use, biodiversity, water, mine closure, non-mineral and
mineral waste, air quality and hazardous substances.
Biodiversity
RBM mines in an area that is globally recognised for its
biodiversity, with more than 4 000 hectares of the land in
our care lying within ten kilometres of a nature reserve and
world heritage site.
The maintenance of environmental quality in areas where
we operate and the rehabilitation of land affected by our
operations are thus central to RBM’s social “licence to
operate” and its continuing ability to obtain access to land
and resources.
We therefore proactively minimise the footprint of our
mining activities through concurrent rehabilitation. In
addition, we are investigating ways to protect and preserve
the area's biodiversity for future generations. Through our
biodiversity action plan we therefore aim to achieve net
positive impact on biodiversity by mine closure.
Impact on land held as at December 2012
Hectares
Total land holdings
11 556
In use (current operational area)
4 141
Land affected by mining and production
activities
4 141
Rehabilitated area
2 954
– Indigenous coastal dune forest
– Commercial forestry
Land returned to host communities
Balance of land not yet affected
996
1 958
244
7 415
Mine rehabilitation
The need for ecological restoration of land affected by
economic development is universally recognised.
RBM’s rehabilitation programme is based on land use and
land cover prior to mining. We therefore aim to restore
one-third of the land affected by our mining operation
to indigenous vegetation typical of the region, while
commercial forestry is re-established on the remainder
of the land which is then gradually returned to local host
communities as an economic asset through a partnership
with the Department of Forestry.
The forestry component is run in conjunction with the
Department of Agriculture, Fisheries and Forestry (DAFF),
and returns approximately 55 hectares in Kwambonambi
and 25 hectares in Sokhulu of forested land to host
communities annually. An RBM-sponsored skills transfer
programme supports sustainable and continuing profitable
land use.
RBM’s rehabilitation programme is unique and kickstarts ecological processes that restore coastal dune
vegetation typical of the region. Long-term independent
studies conducted by the University of Pretoria show that
regenerating areas are likely to regain the biodiversity
of comparable undisturbed coastal dune forests within
70 years, whilst many forest-dwelling small mammals, birds
and invertebrates can already be found in rehabilitated
areas as young as 17 years.
This international best-practice rehabilitation effort
showcases our long-term commitment to ecological
restoration and the power of its local science partnerships.
Our programme has been the subject of over
30 postgraduate theses and resulted in over 35 scientific
papers in peer-reviewed journals. Our more accessible
2012 booklet about the restoration programme continues
to be in demand worldwide.
RBM believes in engaging fully and frankly with its local
partners and stakeholders. A May 2012 workshop shared
our biodiversity action plan procedures and achievements
with local stakeholders. Stakeholders’ concerns were aired
and ideas regarding the eco-tourism potential of the area
developed. A follow-up workshop is planned for 2014.
Land disturbed and rehabilitated
Hectares
2009
2010
2011
2012
Land disturbed
138.2
131.5
156.8
172.7
Existing vegetation
105.9
110.5
112.9
144.3
32.3
21.0
44.0
12.6
Rehabilitated area
147.2
150.5
159.8
131.1
Cumulative operational area at year-end
746.1
739.0
772.0
809.0
Rehabilitated land redisturbed
Restoring indigenous coastal dune forests
Following mining, the dunes are restacked to mimic the pre-mining topographic profile; topsoil is spread and sown
with a cover crop that includes indigenous grass seeds and additional seeds of the naturally occurring pioneer
species, Sweet-thorn (Acacia karroo). Thereafter, shade-netting is erected and this acts as a drift fence to prevent
wind erosion. Within three years A. karroo has grown to form a dense shrubland that gradually thins as the plants
grow and mature to form a woodland within 10 years. By 20 years, forest tree species have begun to replace these
pioneer species and undergrowth begins to develop. By 30 years many of the A. karroo trees have died and patch
dynamics take over as the woodland becomes more and more like coastal dune forest.
38
39
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Energy and greenhouse gas
(GHG) emissions
Mining and smelting require large amounts of energy.
Our primary source of energy is electricity supplied
by Eskom, which accounts for about 70% of our total
CO2e GHG emission. This is followed by anthracite
at 25 per cent, with sundry other sources making up
the balance.
In 2012 RBM used 16.8 million GJ (2011: 22.3 million GJ)
of energy – a reduction of about 17 per cent on 2011.
The reduction resulted from Smelter furnace and Slag
Plants Aero Fall Mill shutdown due to refurbishment and
maintenance respectively.
cleaned and used for preheating and drying mineral ore in
other plants. Other energy efficiency measures are being
implemented and include staff energy awareness initiatives.
Overall, we managed to improve our energy efficiency by
7.2 per cent per tonne of final product over the reporting
period.
Our greenhouse gas emissions are calculated following
Eskom’s recommended conversion factor, while all other
sources use conversion factors agreed upon between
RBM and Rio Tinto.
Reducing energy consumption is an ongoing challenge.
Our smelter refurbishment programme continues to roll out.
Excess carbon monoxide from the Smelter is captured,
In 2012 RBM secured a 17 per cent reduction in CO2e
emissions, in line with our reduced electricity usage. Our
1.82 CO2e per tonne of final product figure continues to
be well within RBM and Rio Tinto’s target. We furthermore
estimate that around 4 per cent of our emissions are either
reabsorbed or off-set by rehabilitation work.
Energy efficiency (GJ/tFP)
GHG emission efficiency (tCO2e/tFP)
2012
9.74
2012
1.82
2011
10.42
2011
1.92
2010
10.83
2010
2.07
2009
9.82
2009
1.88
Target efficiency: 1.97
Target efficiency: 10.85
Greenhouse gas emissions (tCO2e)
Sources of GHG emissions
Our approach to managing GHGs:
Other:
149 659.08
Anthracite (coal):
896 720.96
Energy
reduction
initiatives
Electricity:
2 496 636.94
Climate
change risk
assessment
Data management
system for accurate
data analysis
Sustained
management
of GHGs
Furnace rebuild to
improve efficiency
The numbers above represents an annual average of data analysed over a fouryear period (2009 – 2012).
“Other” consists of carbide, diesel, electrodes, land cleared, paraffin and petrol.
Revegetation
of mined
area as
carbon
sink
Environmental stewardship (continued)
Water
Water is a vital resource for the communities in which we
operate. It is also required at every stage of our operation
from exploration, mining, processing, smelting and refining
and drinking. Operating in an area that is classified as
“water scarce”, the threat posed by climate change
necessitates us strategically manage water security in and
around our operations.
We use three water sources: Lake Nhlabane, the uMfolozi
River and Lake Nsese. The use of these water sources
is based on permitted abstraction limits, reliability, cost
and quality.
RBM is committed to reducing fresh water abstraction and
improving both water recycling and efficiency. We have a
stringent and coherent water supply management plan in
place to achieve these goals.
Specifically, we manage the amount of water extracted
from all available fresh water sources, the quality of water
required, surplus storm water and groundwater as well as
our discharge. We work closely with local stakeholders to
manage our impact.
The reduction seen in our total water usage/loss and
fresh water extraction is largely due to the refurbishment
work conducted on Furnace 1 of our smelter and the
replacement of old infrastructure during the year. Our
increased on-site water storage capacity has improved our
water recycling capabilities and thereby improved our fresh
water efficiency figure.
Average fresh water consumed per tonne
of final product (m3/tFP)
Fresh water withdrawn per source (m3)
2012
9.10
2011
12.80
2010
13.29
2009
16.52
3 271 629.00
2012
11 374 345.60
1 622 263.00
13 128 339.00
2011
3 766 791.10
8 202 473.91
Total water consumed per operation (m3)
2012
26 644 513.31
2011
31 177 532.59
2010
31 253 742.40
2009
29 106 450.38
12 010 263.00
2010
5 234 234.90
8 505 195.00
10 406 067.00
2009
8 863 420.00
7 803 057.56
uMfolozi River
Lake Nhlabane
Lake Nsese
The uMfolozi River is a preferred water source for the mining operations and it is a seasonal source hence the
mining operations are also supplied from Lake Nhlabane.
Lake Nhlabane is the preferred water source for our smelting and processing operations. However, the lake is an
important local ecosystem and RBM carefully alternate between water sources to maintain supply without damaging
the lake’s ecology.
Lake Nsese (also known as Nseleni River or Mposa) water is supplied by Mhlathuze Water Board and serves as
backup to cover shortfalls in other sources. It is also RBMs least preferred source as it is a communal source.
40
41
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Reusing and recycling water
A significant portion of the water used in our smelting
and processing operations is recycled and reused at the
mining operations.
Some of the process water including rainwater and run-off
from our smelting and processing facilities is captured
and pumped to the water treatment plant for treatment
and reuse up to five times per plant.
We capture and recycle approximately 7 million cubic
metres of water every year.
6 888 578.00
2011
7 338 392.58
2010
5 504 728.50
2009
5 695 174.82
RBM has approximately 75 water quality sampling
points covering all areas of its operations. Sampling
is continuously monitored to maintain accuracy and
relevance.
Sustainability studies for the uMfolozi River and Lake
Nhlabane have been conducted. The uMfolozi River
study indicated that we could safely increase extraction
during favourable conditions when the river level exceeds
1.8 metres above sea level. We therefore upgraded our
uMfolozi pumping station during the year to capitalise on
these sporadic opportunities.
Plans for 2013 include improving our storm and processwater capturing, increasing our water treatment plant
capacity, addressing the water efficiency of tails stacking
operations at the mining plants and recommissioning the
ageing Nhlabane study next year to inform and update our
management approach.
Smelting and processing water reused in the
mining operation (m3)
2012
Water quality monitoring and resource
management
Average water level of water sources (meters above sea level)
0.95*
2.27
2.18
1.78
3.55
2010
2009
2012
uMfolozi River level
2012
2011
3.06
2.72
2.74
Lake Nhlabane level
2011
2010
2009
* During 2012 uMfolozi Lake levels were low and no pumping from this source took place. During this time RBM upgraded the pump station at the river. The main water
source during this period was Lake Nhlabane.
Environmental stewardship (continued)
Air quality and emissions
Accurate air quality monitoring and assessment is essential
for effective air quality management.
The main air emissions from our operations are particulates
(fine and course dust). Sulphur dioxide (SO2), Nitrogen
Oxides (NO2) and volatile organic compounds (VOCs) are
emitted in limited quantities.
Air quality monitoring
Our approach to managing air quality emissions is
governed by recommended best practice prescribed by
Rio Tinto’s environmental standards and South Africa’s
national legislation.
Ambient air quality monitoring enables us to estimate
and manage potential impacts to the surrounding areas.
While we have a well-established established dust fallout monitoring and control programme in place, we have
recognised the need to expand on our ambient air emission
programme and therefore will be installing one permanent
and one mobile ambient air quality station in 2013.
Point source monitoring allows for the accurate measuring
of emissions generated by individual stacks. Frequent tests
show that our stack emissions and air cleaning equipment
availability are within statutory limits. However, to improve
our monitoring, reduce our emissions and meet expected
future compliance requirements, our current annual
isokinetic sampling will be augmented by a system capable
of continuously monitoring emissions.
Ambient air emissions by type (tonnes)
748.58
273.10
602.00
1 192.55
297.98
561.00
1 182.00
42
Our main focus in recent years has been reducing the
financial and environmental cost of mineral waste and
increasing the recovery of previously lost minerals.
Our tailings treatment plant (TTP) extracts residual minerals
from tailings. Since the start of its operations in March
2011 the plant has treated 3.3 mega-tonnes of tailings. All
minerals separation plant (MSP) tailings now go straight
to the TTP, and we expect to process an estimated
10.5 million tonnes of stockpiled historical tailings over the
next ten years.
Research indicates that our Smelter clarifier waste contains
a substantial amount of recoverable mineral product. Various
options to recover this are being evaluated. We hope thereby
to increase our overall extraction efficiency and eliminate the
need for the current smelter waste disposal site.
The National Nuclear Regulator (NNR) has very strict
standards according to which any radioactive waste, even
if it is minor, must be maintained, and strictly licenses
and monitors any mining operation that has traces
of radioactivity. The NNR regulates all NORM-related
activities and RBM adheres to its standards. We also
possess a Certificate of Registration issued by the NNR in
this regard.
1 248.00
2009
Mineral Waste
The mineral-rich dunes we mine contain naturally
occurring radioactive materials (NORM), or radio-nuclides.
These naturally occurring radio-nuclides are carried through
our mining and beneficiation processes.
355.37
2010
Our operation inevitably generates waste. We categorise
our waste, which is subject to comprehensive recording
and tracking, as mineral or non-mineral. We are among the
first companies in the mining sector to have registered with
the government’s South African Waste Information System
(SAWIS) industry waste management database.
Mineral waste radiation
737.70
1 206.75
2011
Waste management
Our mineral waste is stockpiled in controlled areas within
the mining lease.
353.61
2012
A review of plant wide total emissions is envisaged in 2013.
This review will focus on the efficiency and availability of air
quality abatement equipment such as baghouse, scrubber
and cyclone systems. The aim is to benchmark our current
technology against the latest technology in order identify
possible further improvement areas.
Sulphure Dioxide (SO2)
Nitrogen Dioxide (NO2)
Dust (PM10)
43
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Accordingly, the mineral waste or tailings from our mineral
separation plant and roaster plant are stockpiled in a
licensed and restricted area on the Tisand lease area, also
known as Stockpile H.
The increase in hazardous waste to 644.85 tonnes
(2011: 515.3 tonnes) is attributable to increased vehicle
fleet and maintenance activities.
Recycling non-mineral waste
These tailings, which were historically stockpiled are now
being re-processed in Tailings Treatment Plant, which
started in 2011 when we commissioned our TTP. Following
reprocessing, the reprocessed mineral tailings are
returned to the licensed stockpile area. Alternative ways of
managing the tailings are being investigated to mitigate the
impact these tailings might have post mine closure.
Non-mineral waste
Non-mineral waste is divided into hazardous and nonhazardous. Hazardous waste is handled by registered
hazardous waste service providers who provide RBM with
certificates of safe disposal.
Waste minimisation starts with waste segregation. Five
major waste streams were identified at RBM, and we have
initiated an in-house recycling programme. This strategy
has already improved operational control and helped
prevent the mixing of hazardous and non-hazardous waste.
Scrap metal is currently collected and sold. To ensure
compliance against the requirement of the NEMA: Waste
Act, 59 of 2008, RBM applied for a waste licence for its
salvage yard operations. The licence is expected in Q1
of 2013.
Improving our efforts towards the recycling of non-mineral
waste will remain a primary key focus area for 2013.
Mineral tailings and non-mineral waste
2012
2011 (metric tonnes)
2009
2010
Minerals separation plant
966 535.00
654 030.56
974 553.48
907 943.33
Mineral
Roaster plant
222 442.00
285 378.00
334 651.00
273 495.00
Mineral
Smelter clarifier
28 347.00
27 914.00
28 846.00
24 226.00
Mineral
Historical tailings (fed to TTP)*
–
–
(415 034.47)
(992 060.51)
Mineral
Tailings from MSP (fed to TTP)*
–
–
(730 654.01)
(916 065.16)
Mineral
Tailings treatment plant*
–
–
828 261.56
1 540 697.53
Mineral
Other**
Type
Source of tailings
Mineral
Total mineral waste
12 058.00
16 177.00
17 702.00
13 881.00
1 231 391.00
985 509.56
1 040 336.56
854 129.19
26.71
26.00
35.00
27.00
Non-mineral
Highly hazardous waste ***
Non-mineral
Low hazardous waste*** *
395.21+
255.45+
480.30
617.85
Non-mineral
Non-hazardous waste*** **
1 540.80
1 423.00
1 465.53
1 417.98
1 962.72
1 674.45
1 980.83
2 062.83
Total non-mineral waste
*
he TTP (tailings treatment plant) was commissioned in March 2011, since when both stockpiled and currently arising tailings from the MSP are fed into it for further
T
mineral extraction.
** Other mineral waste consists of baghouse dust from the roaster plant.
*** Highly-hazardous waste consists of tetrabromoethane-contaminated waste, fluorescent tubes and clinic waste.
*** * Low-hazardous waste consists of rubber-based waste, asbestos, paint and hydrocarbon-contaminated waste, sewerage sludge, and grease and oil drums.
*** **Non-hazardous waste includes general municipal waste and salvageable waste such as scrap metal, non-compressible waste such as wood and building rubble.
+ We restated the low hazardous waste values for 2009 and 2010 as the values in our 2011 report were incorrect.
Environmental stewardship (continued)
Distribution network Most of our product is exported and travels the
27 kilometres to the Richards Bay harbour by rail.
The combination of rail and the harbour’s multipurpose,
bulk handling plant minimises the environmental
impact associated with road transport and provides
a cost-effective way to distribute millions of tonnes of
product worldwide.
Our fully computerised 26-kilometre-long on-site conveyor
belt network also has negligible environmental cost.
Radiological impact
study
Measurements of external radiological dose
rate at a number of random locations around
operational areas and in town indicate that
the external dose to members of the public
exceeds 0.25 mSv.a-1 in most locations
tested. Occupational dose values in the
same area are all lower than 1 mSv.a-1 and
the area may be classified as uncontrolled in
terms of worker exposure.
A human behavioural and impact analysis
revealed that humans in the vicinity of
proposed deposition and RBM’s greater
operational areas will not be exposed
(individually or combined through
ingestion and external exposure routes)
to a radiological dosage that exceeds the
maximum recommended dose criteria used
for the assessment.
44
45
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
46
Governance
47
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
RBM board of directors
Non-executive
Executive
Rio Tinto
Blue Horizon
RBM
JF Turgeon (chairman)
B Mthethwa
EJ Dorward-King
JR Olsen
EM Dipico
KC Harper*
JB Magwaza
MLD Marole
RBM board committees
Audit
Social and ethics
Marketing
Technical review
Directors
EJ Dorward-King (MD)
EJ Dorward-King (MD)
EM Dipico
JB Magwaza
JB Magwaza
JR Olsen (chair)
JR Olsen
JF Turgeon
KC Harper
KC Harper (chair)
MLD Marole (chair)
–
Other members
Chief financial officer
Chief financial officer
Didier Arseguel (Chair)
Internal audit manager
Internal audit manager
Jared Osborne
Legal and admin services
manager
Legal and admin services manager
Euan Harvey
General manager: Corporate and community relations
Ward Selby
Finance manager
General manager: Human resource
Tony Eltringham
Auditor (external)
General manager: Technical
Martin Meyer
Sibongile Mthembu
Johan Jacobs (Secretary)
* Ms KC Harper took over Mr CM Bateman’s responsibilities after he stepped down as RBM director and transferred elsewhere within Rio Tinto.
RBM consists of two operating companies, Richards
Bay Mining Proprietary Limited and Richards Bay
Titanium Proprietary Limited. The two companies’
common shareholders have appointed one board of
directors to oversee both companies’ governance and
business operations.
RTIT is therefore mandated to execute RBM’s approved
budget and act upon all matters, as specified in the
agreement, which pertain to RBM’s ordinary course of
business. RTIT has delegated certain obligations under
the agreement to the managing director and to the chief
financial officer of RBM.
RBM’s shareholders entered into an agreement on
11 December 2008, which prescribes how the shareholders
will manage their governance responsibilities over the
two operating companies. In terms of the agreement
Rio Tinto Iron and Titanium Limited (RTIT) is responsible for
running RBM’s operations on a day-to-day basis.
The board has applied its mind to RBM’s material
issues, risks and opportunities. The board’s efficacy
in mapping out a suitable strategic response and
overseeing its implementation is evident throughout this
sustainability report.
Governance (continued)
RBM’s board of directors
The departure of BHP Billiton as a shareholder in
September 2012 necessitated a restructure of RBM’s
board of directors. The four BHP Billiton directors stepped
down, reducing RBM’s board from 12 to eight. Since
September four non-executive representatives from
Rio Tinto, three from Blue Horizon and RBM’s executive
managing director now make up RBM’s board of directors.
Rio Tinto is charged with appointing our chairman of the
Board. No independent directors serve on the board.
Although RBM’s board has shrunk, the business is
benefiting from greater access to Rio Tinto’s technical
expertise, support and business networks as a world
leader in the mining and smelting industry. The smaller
board has enhanced our leadership’s efficacy and focus
on our material issues, risks and opportunities, and
strategic planning.
The board meets on a quarterly basis and is supported
by a number of standing committees established to
advise and assist the board in fulfilling their oversight
responsibilities.
RBM board committees
RBM has four board committees, the latest of which is
the social and ethics committee established in 2012 as
required by South Africa’s Companies Act of 2008.
No changes were made to the number or structure
of the board committees as a result of the change of
shareholding. The Rio Tinto directors filled all committee
vacancies caused by the departure of BHP Billiton.
Rio Tinto is also charged with appointing all committee
chairmen, while the board elects all other committee
members.
Audit committee
The audit committee meets at least twice a year and
assists the board in fulfilling its oversight responsibilities
with regards to RBM’s financial reporting process,
system of internal control, audit process, and compliance
monitoring against relevant laws and regulations. The audit
committee abides by its code of conduct as prescribed by
48
the RBM board audit committee charter. RBM’s company
Audit Forum supports the committee in executing its
mandate.
The committee consists of four directors – two appointed
by Rio Tinto, one by Blue Horizon, and RBM’s managing
Director, plus other persons as decided by the board.
Social and ethics committee
Established during the period under review, RBM’s social
and ethics committee is responsible for overseeing RBM’s
social and economic development programmes, corporate
citizenship, human rights standards, anti-corruption
measures, environmental concerns, health and public
safety, product stewardship, and labour and employment
practices.
The committee meets at least twice a year and consists of
four directors – two appointed by Rio Tinto, one by Blue
Horizon, and RBM’s managing director, plus other persons
as decided by the board.
Marketing committee
The marketing committee meets quarterly to discuss
RBM’s marketing strategy, the mandate of RBM’s
marketing agent in relation to annual price negotiations
and other material marketing decisions, and make
recommendations to the board.
Rio Tinto Iron and Titanium (RTIT) has been appointed
marketing agent to sell RBM’s products under the terms of
a sales agency agreement.
The committee comprises three members – two appointed
by Rio Tinto and one by Blue Horizon.
Technical review committee
The technical review committee discusses and exchanges
ideas in relation to technical and operating issues which
may arise. The committee acts in an advisory capacity to
the board regarding technical and operating matters.
The committee comprises ten members who are
generally not members of the board of directors but have
appropriate technical experience. The committee meets
twice a year.
49
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
Board-level concerns
Guiding policies and processes
RBM subscribes to the following Rio Tinto Standards on
business integrity and compliance:
The way we work
www.riotinto.com/library/3608_policies.asp
Business integrity (anti-corruption) standard
compliance.riotinto.org/anticorruption.asp
Business integrity (conflicts of interest) standard
compliance.riotinto.org/coi.asp
Anti-bribery due diligence standard
compliance.riotinto.org/res_agentvet.asp
The standards are communicated to the business, together
with any guidance and support that may be necessary.
RBM also offers training on the respective standard to both
employees and contractors. RBM vendors and contractors
are expected to uphold the governance principles
prescribed by these standards.
Risk management
RBM is committed to managing risk in a proactive and
effective manner. This requires quality risk analysis to inform
management decisions at all levels within the organisation.
Regulatory compliance
The Audit Forum also oversees RBM’s business
compliance programme. The forum reports to the
audit committee on any significant matters related
to compliance, risk management, internal control
environment, insurance risk management and
information systems.
RBM’s Legal and Administrative Services department
continually monitors RBM’s legislative and regulatory
environment. The department advises all business divisions
on relevant new and potential regulatory amendments
that might materially impact RBM. The department forms
part of RBM’s financial division, but also reports to RBM’s
Audit Forum. In specialised areas, external advisers
and specialists are consulted to assist with compliance
concerns and the implementation of new legislation.
Speak-OUT
In line with our guiding policies, all employees and
contractors have access to Rio Tinto’s confidential and
independent Speak-OUT service. Speak-OUT can be used
to report any concerns, issues or ideas individuals might
have. The facility is widely advertised and actively used.
Speak-OUTs are investigated internally and reported to our
human resources general manager for action. Summary
reports are submitted to RBM’s audit committee for review.
To support this commitment, risk analysis is applied across
the business following the principles set out in RBM’s Risk
Standard. Our board of directors is responsible for the
risk management process. The audit committee has laid
down our risk management policy and ensures ongoing
compliance.
Speak-OUT reports typically involve safety concerns,
criminal conduct, potential efficiency improvements
and community issues, along with cases of wrongful
termination, discrimination, harassment, violence and
substance abuse.
Our Audit Forum oversees compliance during the execution
of our risk management programme and monitors the
progress made with regards to all close-out actions
identified in RBM’s compliance and strategic risk registers.
The forum is also charged with compiling regular high-level
risk reports for the audit committee.
Our internal control committee reviews all reported
instances of theft or fraud. The committee meets monthly
and reports to RBM’s Audit Forum.
Fraud and theft
Appendices
APPENDIX 1: ICMM Principles Index
International Council on Mining and Metals (ICMM)
Born out of the Global Mining Initiative, the ICMM was established in 2001 to improve sustainable
development performance in the mining and metals industry. Rio Tinto is a founding member of the
ICMM and as a subsidiary we are committed to ICMM’s Sustainable Development Framework.
Interested readers can use our ICMM Ten Principles Index below to find out where in this report we
reported against each of the ten ICMM principles.
In this report we strive to provide a holistic and integrated representation of our efforts to drive
mining forward in a sustainable matter.
While we have various internal audit structures in place to ensure that our data is accurate, we
have yet to seek external verification for most of our sustainability figures. Currently only those
indicators legally required by law are externally assured, such as our B-BBEE Scorecard.
Ten Principles Index
Principle
50
Description
Page reference/direct
answer
Principle 1 Implement and maintain ethical business practices
and sound systems of corporate governance.
Governance
Principle 2 Integrate sustainable development considerations
within the corporate decision-making process.
Strategic intent
Principle 3 Uphold fundamental human rights and respect
cultures, customs and values in dealings with
employees and others who are affected by our
activities.
Social well-being,
Governance
Principle 4 Implement risk management strategies based on
valid data and sound science.
Strategic intent
Principle 5 Seek continual improvement of our health and
safety performance.
Social well-being
Principle 6 Seek continual improvement of our environmental
performance.
Environmental stewardship
Principle 7 Contribute to conservation of biodiversity and
integrated approaches to land use planning.
Environmental stewardship
Principle 8 Facilitate and encourage responsible product
design, use, reuse, recycling and disposal of our
products.
Social well-being,
Environmental stewardship
Principle 9 Contribute to the social, economic and institutional
development of the communities in which we
operate.
Economic prosperity
Principle 10 Implement effective and transparent engagement,
communication and independently verified
reporting arrangements with our stakeholders.
About this report
51
RICHARDS BAY MINERALS
SUSTAINABLE DEVELOPMENT REPORT 2012
APPENDIX 2: GRI CONTENT INDEX
Global reporting initiative (GRI)
We continue to follow the GRI G3.1 guidelines, and more specifically the Mining and Metals Sector Supplement (MMSS), in
preparing this sustainable development report. Our GRI Content Index below will direct readers to the applicable sections
where we reported on the various GRI indicators.
Our GRI content index
Profile
Disclosure
Description
Page reference/direct answer
STANDARD DISCLOSURES PART I: Profile Disclosures
1. Strategy and Analysis
1.1
Statement from the most senior decision-maker of the organisation.
MD’s report
2. Organisational Profile
2.1
Name of the organisation.
Front cover
2.2
Primary brands, products and/or services.
Company overview – Essential products
2.3
Operational structure of the organisation, including main divisions, operating
companies, subsidiaries, and joint ventures.
Company overview – Ownership and
structure
2.4
Location of organisation’s headquarters.
Company overview – Geographic location
2.5
Number of countries where the organisation operates, and names of countries
with either major operations or that are specifically relevant to the sustainability
issues covered in the report.
Company overview – Geographic location
2.6
Nature of ownership and legal form.
Company overview – Ownership and
structure
2.7
Markets served (including geographic breakdown, sectors served and types of
customers/beneficiaries).
Company overview – Market dominance
2.8
Scale of the reporting organisation.
RBM Highlights and recognition, Company
overview, Social well-being – Employer of
choice
2.9
Significant changes during the reporting period regarding size, structure or
ownership.
About this report, MD’s report
2.10
Awards received in the reporting period.
RBM Highlights and recognition
3. Report Parameters
3.1
Reporting period (e.g. fiscal/calendar year) for information provided.
Calendar year
3.2
Date of most recent previous report (if any).
2011
3.3
Reporting cycle (annual, biennial, etc.)
Annual
3.4
Contact point for questions.
About this report
3.5
Process for defining report content.
About this report
3.6
Boundary of the report (e.g. countries, divisions, subsidiaries, leased facilities,
joint ventures, suppliers). See GRI Boundary Protocol for further guidance.
About this report
3.7
State any specific limitations on the scope or boundary of the report (see
completeness principle for explanation of scope).
About this report
3.8
About this report
Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced
operations and other entities that can significantly affect comparability from period
to period and/or between organisations.
3.10
Explanation of the effect of any restatements of information provided in earlier
reports, and the reasons for such restatement.
Minor restatement noted and explained
where applicable
3.11
Significant changes from previous reporting periods in the scope, boundary, or
measurement methods applied in the report.
No such changes we made
3.12
Table identifying the location of the Standard Disclosures in the report.
GRI index
Profile
Disclosure
Description
Page reference/direct answer
4. Governance, Commitments and Engagement
4.1
Governance structure of the organisation, including committees under the highest Governance report
governance body responsible for specific tasks, such as setting strategy or
organisational oversight.
4.2
Indicate whether the chair of the highest governance body is also an executive
officer.
Governance report
4.3
For organisations that have a unitary board structure, state the number and
gender of members of the highest governance body that are independent and/or
non-executive members.
Company overview – Board of directors,
Governance
4.4
Mechanisms for shareholders and employees to provide recommendations or
direction to the highest governance body.
Our board of directors consists of
Rio Tinto and other shareholder
representatives. Employees report via
management and various committees
supporting the executive team
4.14
List of stakeholder groups engaged by the organisation.
Strategic intent – Stakeholder engagement
4.15
Basis for identification and selection of stakeholders with whom to engage.
Not reported
STANDARD DISCLOSURES PART III: Performance Indicators
Economic
Economic performance
EC2
Financial implications and other risks and opportunities for the organisation’s
activities due to climate change.
Strategic intent, Environmental
stewardship
EC4
Significant financial assistance received from government.
We did not receive any financial assistance
Market presence
EC6
Policy, practices and proportion of spending on locally-based suppliers at
significant locations of operation.
Economic prosperity – Local supplier
spend
EC7
Procedures for local hiring and proportion of senior management and workforce
hired from the local community at significant locations of operation.
Economic prosperity – Broad-based
economic empowerment scorecards
Indirect economic impacts
EC8
Development and impact of infrastructure investments and services provided
primarily for public benefit through commercial, in-kind or pro bono engagement.
Social well-being – Communities
EC9
Understanding and describing significant indirect economic impacts, including the Economic prosperity
extent of impacts.
Environmental
Materials
EN1
Materials used by weight or volume.
Company overview – Production process
EN2
Percentage of materials used that are recycled input materials.
Environmental stewardship – Water
EN3
Direct energy consumption by primary energy source.
Environmental stewardship – Energy and
greenhouse gas emissions
EN4
Indirect energy consumption by primary source.
Environmental stewardship – Energy and
greenhouse gas emissions
EN7
Initiatives to reduce indirect energy consumption and reductions achieved.
Environmental stewardship – Energy and
greenhouse gas emissions
EN8
Total water withdrawal by source.
Environmental stewardship – Water
EN9
Water sources significantly affected by withdrawal of water.
Environmental stewardship – Water
EN10
Percentage and total volume of water recycled and reused.
Environmental stewardship – Water
EN11
Location and size of land owned, leased, managed, in or adjacent to, protected
areas and areas of high biodiversity value outside protected areas.
Environmental stewardship – Biodiversity
EN12
Description of significant impacts of activities, products, and services on
biodiversity in protected areas and areas of high biodiversity value outside
protected areas.
Environmental stewardship – Biodiversity
Energy
Water
Biodiversity
52
Profile
Disclosure
Description
Page reference/direct answer
MM1
Amount of land (owned or leased, and managed for production activities or
extractive use) disturbed or rehabilitated.
Environmental stewardship – Biodiversity
EN13
Habitats protected or restored.
Environmental stewardship – Biodiversity
EN14
Strategies, current actions, and future plans for managing impacts on biodiversity. Environmental stewardship – Biodiversity
Emissions, effluents and waste
EN16
Total direct and indirect greenhouse gas emissions by weight.
Environmental stewardship – Energy and
greenhouse gas emissions
EN17
Other relevant indirect greenhouse gas emissions by weight.
Environmental stewardship – Energy and
greenhouse gas emissions
EN18
Initiatives to reduce greenhouse gas emissions and reductions achieved.
Environmental stewardship – Energy and
greenhouse gas emissions
EN20
NOx, SOx, and other significant air emissions by type and weight.
Environmental stewardship – Air quality
and emissions
EN22
Total weight of waste by type and disposal method.
Environmental stewardship – Waste
management
MM3
Total amounts of overburden, rock, tailings and sludges and their associated
risks.
Company overview – Production process,
Environmental stewardship – Waste
management
Social: Labour Practices and Decent Work
Employment
LA1
Total workforce by employment type, employment contract and region, broken
down by gender.
Social well-being – Diversity and equal
opportunity
Labour/management relations
LA4
Percentage of employees covered by collective bargaining agreements.
Social well-being – Employer of choice
MM4
Number of strikes and lockouts exceeding one week’s duration, by country.
Social well-being – Employer of choice
Occupational health and safety
LA6
Percentage of total workforce represented in formal joint management-worker
health and safety committees that help monitor and advise on occupational
health and safety programmes.
Social well-being – Occupational health
and safety
LA7
Rates of injury, occupational diseases, lost days, and absenteeism, and number
of work-related fatalities by region and by gender.
Social well-being – Occupational health
and safety
Training and education
LA10
Average hours of training per year per employee by gender and by employee
category.
Social well-being – Training and education
Social: Society
Local Communities
MM6
Number and description of significant disputes relating to land use, customary
rights of local communities and indigenous peoples.
Social well-being – Communities
MM7
The extent to which grievance mechanisms were used to resolve disputes relating Social well-being – Communities
to land use, customary rights of local communities and indigenous peoples, and
the outcomes.
SO9
Operations with significant potential or actual negative impacts on local
communities.
Social well-being – Communities
SO10
Prevention and mitigation measures implemented in operations with significant
potential or actual negative impacts on local communities.
Social well-being – Communities
Resettlement
MM9
Sites where resettlements took place, the number of households resettled in each Social well-being – Communities
and how their livelihoods were affected in the process.
Social: Product responsibility
Product and service labelling
PR3
Type of product and service information required by procedures, and percentage
of significant products and services subject to such information requirements.
Trialogue | GroundPepper
Social well-being – Product responsibility
Richards Bay Minerals
Communications Department
Richards Bay Minerals
PO Box 401, Richards Bay, 3900 South Africa
Tel: +27 35 901 3111
Fax: +27 35 901 3442
E-mail: communication@rbm.co.za
www.rbm.co.za