Social capital

APPROACH AND STRUCTURE

Northam understands that it does not operate in isolation from the communities and environments in which its mines are located. As a result, the company plays a responsible and co-operative role in these areas, providing meaningful and relevant contributions to their social and economic upliftment, wherever possible.

The company has a stakeholder engagement policy in place, as well as a community and rural development strategy. This strategy has been developed at group level and provides governance and strategic direction for the identification and implementation of community projects. It includes stakeholder mapping, an analysis of expectations and immediate risks, and a protocol for constructive engagement with government and related stakeholders to ensure a co-ordinated approach to community development.

Northam’s compliance with the requirements of the MPRDA and the Mining Charter demand a focused approach to contributing to mine, community and rural development. The company has therefore paid a great deal of attention to the establishment of LED projects as identified in its SLPs. The SLPs are aligned with the IDPs of the local municipalities concerned in an effort to avoid the duplication of work, and to address real, identified community needs. In addition to LED, Northam supports a number of projects that do not necessarily fall within its SLP parameters but are considered to be worthy causes.

Compliance with aspects of the Mining Charter relating to LED, and the management of LED-related issues, are the responsibility of the corporate human resources and transformation manager, under the guidance of the social, ethics and human resource committee, and are reviewed by the board.

ADDRESSING COMMUNITY NEEDS

Northam’s community development programme is focused on contributing to the social upliftment of communities surrounding its operations and those within major labour-sending areas. The programme aims to empower these groups economically in a sustainable manner.

A total of R3.0 million was spent on CSI and LED across the group in F2013 (F2012: R2.8 million).

ZONDEREINDE

Zondereinde is located in a region that is relatively sparsely populated and in a province with low levels of economic activity. Agriculture, mining and tourism form the basis of the economic activity in the region. Disbursement priorities have been guided by the Zondereinde SLP and the operation’s CSI committee, which is tasked with identifying development priorities in the areas surrounding the mine.

The CSI committee comprises three members of management, together with one representative from each of the organised employee representative bodies. It meets on a monthly basis to identify, prioritise and allocate resources towards sustainable projects.

The mine engages with three priority municipalities: the local municipality of Thabazimbi, and the two labour-sending municipalities of Moses Kotane and OR Tambo. The company engages with these entities on a regular basis through both formal and informal meetings, with consultations on approach, strategy and priorities in specific areas conducted quarterly. During the year, the primary priorities identified included addressing unemployment and inadequate infrastructure.

Zondereinde also has long-standing relationships with the following key stakeholders:

• neighbouring farmers;
• informal settlements;
• the towns of Northam and Thabazimbi; and
• other mining company communities in the area.

Local employment

Local employment remains a key issue in the communities surrounding Zondereinde, with local communities having unrealistic expectations regarding employment opportunities and the availability of resources. The mine works closely with local municipalities, which supply the mine with a database of unemployed individuals in the area. Zondereinde makes use of this database in its recruitment of local candidates. Monthly meetings are held between Zondereinde mine’s recruitment team and municipal officials to manage both this process and the expectations of the individuals concerned.

In this regard, Northam has prioritised key economic areas to be developed through the contributions of small businesses and local entrepreneurs. These include environment and waste management, agriculture and construction. The company hopes that the SMME development will stimulate local economic activity, limiting the dependence of communities on the mining industry and creating a strong economic future after operations have ceased.

The following community infrastructures have been undertaken:

• infrastructure has been provided for informal traders in the Thabazimbi municipality;
• 51 start-up enterprises have been established and provided with financial support in the OR Tambo municipal area; and
• an informal agreement has been entered into with the Thabazimbi and Moses Kotane municipalities to assist with recruitment opportunities for new entrants into the industry when possible (the database, which prioritises families with the most desperate need, is managed by the Mayor’s office).

INFRASTRUCTURE DEVELOPMENT

Zondereinde mine, in conjunction with Anglo Platinum, the Thabazimbi municipality, and the Waterberg district municipality, has embarked on a project to build and develop a new sewerage system in the town of Northam.

Northam and Anglo Platinum intend to develop some 9 000 houses in Northam town, 3 207 of which will be in the De Put development, within the next three years. As the sewerage system currently in place does not have the capacity to service the Northam community and the new housing development, the construction of a new sewerage system is necessary. The De Put property currently has 2 500 stands and 36 bulk or high-density stands. These have been sold to Anglo Platinum as the project is deemed too large for Northam to develop alone, though Northam will share in the costs on a pro rata basis.

Northam contributed an additional R5 million to this project in F2013 (F2012: R5 million).

Zondereinde also contributed some R595 835 to the maintenance of infrastructure in the Northam area during the 2013 financial year.

BOOYSENDAL

Booysendal is located in a region with little existing economic activity. As at Zondereinde, agriculture and forestry, mining and tourism are the region’s primary economic activities but to a much more limited extent. Stakeholder identification and engagement at Booysendal are complicated by the scale, proximity and needs of local communities, and by historic interests in landholdings.

Northam recognises that there are communities in the area which may have a historical affiliation with the land it has under management at Booysendal. For this reason, the company has undertaken extensive surveys to identify any historical artefacts or archaeological and grave sites which may have significance. Such sites have been fenced off, and are carefully protected and preserved.

The human resources manager at Booysendal is responsible for the oversight of community engagement in the area. A stakeholder engagement policy has been developed and several forums have been set up in the Greater Tubatse local municipality, within which Booysendal operates.

The forums include:

• The Booysendal community forum. In terms of the operation’s stakeholder engagement policy 13 families/communities have been identified and are represented on the community forum. Management is also represented on the forum, the constituents of the forum have regular access to the site, and are provided with the opportunities to discuss training and job opportunities with management and to visit any ancestral or traditional sites;
• The local chiefs’ forum, specifically arranged for chiefs within a 50km radius of the mine; and
• A stakeholder engagement forum for all interested stakeholders, including, but not limited to, local municipalities, the DMR, provincial government, and other community and youth forums.

These forums all meet as required, with the exception of the Booysendal Community Forum which meets once a month. These structures provide a channel for Booysendal to facilitate the flow of meaningful benefits to communities, to keep abreast of concerns amongst community members and to address these issues timeously. This is in addition to the needs identified in local municipal IDPs.

The company has conducted a roadshow within the Greater Tubatse local municipality to assess the needs of its individuals and households, particularly those who have claim to grave sites in these areas.

During the 2013 financial year, the following issues were raised by community members and addressed accordingly:

• The creation of employment opportunities: as far as possible, Booysendal strives to recruit locally to the benefit of its surrounding communities.
• The establishment of training opportunities: Booysendal makes mine learnerships available to members of the local community, which develop their skills level and improve their chances of securing permanent employment.
• The securing of tenders: Booysendal’s procurement policy makes provision for the inclusion of local companies on its vendor list.

During the construction phase specifically, mine management representatives engaged with a significant number of these entities. Booysendal has since established a database of local suppliers which are employed on an ad hoc basis. A vendor list is also currently in the process of being collated.

LOCAL EMPLOYMENT

The allocation of jobs in an area with exceptionally low employment levels remains a particular concern for Booysendal, and is likely to remain so for some time to come. There appears to be widespread expectation amongst community members that mining operations will alleviate the situation, providing employment for all. Not only will it be difficult for a single operation to have a significant impact, but the nature of the orebodies and type of mining (trackless) undertaken at Booysendal is not very labour-intensive. It is unlikely that the mine will ever be able to meet the expectations and needs of everyone in the surrounding communities.

The company continues to communicate its position in this regard and seeks to address this issue in its SLP. The operation’s management has also developed a dynamic database to be used in the sourcing and recruitment of future employees.

LOCAL PROCUREMENT

Guided by its compliance with the Mining Charter, Booysendal is fully committed to giving preference to local businesses in the communities surrounding its operations. Northam’s procurement policy also gives local BEE companies preferred supplier status.

Booysendal’s SLP has been developed and LED projects have been identified.

LAND CLAIMS AND INVASIONS

Prior to the commissioning of the Booysendal concentrator earlier this calendar year, progress on the mine had been delayed owing to illegal land invasions on one of the company’s properties where Eskom contractors were being hampered from completing the installation of a powerline to the mine. Following an appeal to the courts, and the company’s numerous meetings with the land invaders, the powerline was eventually completed and the plant was successfully commissioned.

Several threats were levelled against the mine during the year. The emergence of a number of other individuals and communities, with exaggerated expectations of the offering that mining companies can make, has on occasion led to conflict and violent attacks in this area.

CORPORATE SOCIAL INVESTMENT AND
LOCAL ECONOMIC DEVELOPMENT

The following CSI and LED projects were supported by Zondereinde and Booysendal during the year:

Northam’s CSI priorities for F2014 include:

• the identification of an agricultural, environmental, waste management and construction project;
• the building of three additional classrooms at Deo Gloria Primary School;
• the continued support of the computer centres; and
• the relaunching of the Life Community Centre as the Entrepreneurial Support Centre with partners that include the Department of Labour and the Small Enterprise Development Agency.