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Report from the independent assuror

Introduction

We have been appointed by Northam Platinum Limited (Northam Platinum) to conduct an independent assurance engagement in accordance with AA1000AS on selected information related to Northam Platinum’s sustainable development report for the financial year ended June 2012.

Scope and subject matter

The identified subject matter in the assurance scope and levels of assurance as agreed with Northam Platinum are as follows:

  1. Global Reporting Initiative (GRI) G3 application: Northam Platinum’s self-declared B+ level of GRI-G3.1 application under Report scope and boundary;
  2. AA1000 AccountAbility Principles: Northam Platinum’s adherence to the AA1000 AccountAbility Principles of Inclusivity, Materiality and Responsiveness; and
  3. Selected Performance Indicators (KPIs) as follows:

ENVIRONMENTAL PERFORMANCE

HEALTH AND SAFETY PERFORMANCE

LABOUR PERFORMANCE

Summary of work performed

STANDARDS AND CRITERIA USED

We performed our work in accordance with the AccountAbility AA1000 Assurance Standard (AS) 2008 Type 2 requirements. We used the following assessment criteria when undertaking our work: AA1000 AccountAbility Principles Standard (APS) 2008, Northam Platinum’s Sustainable Development Data Reporting Guidelines and the GRI-G3.1 application level criteria.

Level of Assurance and engagement limitations

We planned and performed our work to obtain all the information and explanations that we believe were necessary to provide a basis for our assurance conclusions as to whether the reported information set out in ’Our Brief’ was free from material misstatement at a moderate assurance level as per AA1000 AS 2008.

The evidence gathering procedures for moderate assurance are more restricted than for high assurance and therefore less assurance is obtained with moderate assurance than for high assurance as per AA1000 AS 2008.

The reliability of the reported information and data is subject to inherent uncertainty, given the available methods for determining, calculating or estimating the underlying information. It is important to understand our assurance conclusions in this context.

Our work

A multi-disciplinary team of sustainability and assurance specialists with experience in Northam Platinum’s industry sector performed work at corporate level and at its operating location. Our assurance activities included:

  • Face-to-face interviews to understand and test the processes in place for reporting on the AA1000 Principles and the KPIs, and the underlying data management systems;
  • Site visit to Northam Platinum’s Zondereinde operation, which involved testing, on a sample basis, the measurement, collection, aggregation and reporting processes in place;
  • Reporting our assurance findings to management as they arose to provide them with the opportunity to correct them prior to finalisation of our work; and
  • Reviewing the presentation of information relevant to the scope of our work in the Report to ensure consistency with our findings.

Respective responsibilities and ERM’s independence

Northam Platinum is responsible for preparing the report and for the collection and presentation of information within it. ERM’s responsibility is to express our assurance conclusions on the agreed brief.

ERM maintains strict policies related to conflict of interest and we have confirmed our independence to Northam Platinum in delivering our assurance engagement.

Our assurance conclusions

In our opinion, based on the work undertaken as described above, we conclude that nothing has come to our attention causing us to believe that the information selected for this assurance engagement has not been prepared in accordance with the defined reporting criteria in all material respects:

  • Northam Platinum’s self-declared B+ level of GRI-G3 application under Report scope and boundary;
  • Northam Platinum’s adherence to the AA1000 Principles of Inclusivity, Materiality and Responsiveness; and
  • The selected KPIs as presented throughout the Report.

Our key observations and recommendations

Based on our work set out above, and without affecting our conclusions, our key observations and recommendations for improvement are:

IN RELATION TO THE INCLUSIVITY PRINCIPLE

Northam Platinum engages a wide range of stakeholders at corporate and operational level through its community and stakeholder forums.

IN RELATION TO THE MATERIALITY PRINCIPLE

Northam Platinum has applied due process in determining and reporting on its material issues in a transparent and balanced manner.

IN RELATION TO THE RESPONSIVENESS PRINCIPLE

Northam Platinum responds to stakeholders through a dedicated public relations company that also reports on stakeholder responses to key decision makers at board level on a regular basis.

In relation to the selected Performance Indicators

Following on Northam Platinum’s recent progress on sustainability reporting, we recommend that Northam Platinum implement more stringent management review controls to identify reporting errors timeously throughout the reporting chain.

The formal documenting of underlying assumptions and calculations should be improved and maintained as an audit trail supporting the reported information.

Environmental Resources Management Limited (ERM)

Massimo Bettanin

Johannesburg, 28 September 2012

ERM a licenced AA1000 Assurance Provider [logo]

ERM is an independent global provider of environmental, social and corporate responsibility consulting and assurance services.

Our assurance statement provides no assurance on the maintenance and integrity of the website, including controls used to maintain this, and in particular whether any changes may have occurred to the information since it was first published. These matters are the responsibility of Northam Platinum and no control procedures can provide absolute assurance in this area.

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