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Sustainability report

Sustainable development issues are material to Assore’s business beyond the level of mere legal compliance, and sustainability strategy and management systems provide the group with the ability to respond to customer requirements, address stakeholder expectations and engage with the regulatory authorities. Assore also seeks to promote the sustainability of its business by taking an active role in shaping the development and performance of its business in the sectors in which it operates, as well as allowing management to anticipate and address current and future issues that may present opportunities or threats to the group’s business.

This sustainability report covers all of the entities in which the Assore group has an interest, other than portfolio investments, and distinguishes between Assmang’s operations and the AMT operations as defined in the “Scope and boundary”.

Sustainability management and reporting systems

The group’s sustainability risk management systems are based on the International Standards Organisation (ISO) suite of standards.

Certification to the internationally recognised OHSAS18001 occupational health and safety management standard has been achieved at all Assmang operations with the exception of Black Rock, which intends to seek certification in the first half of the coming financial year.

Measuring sustainability performance

The group reports on sustainability performance in accordance with Global Reporting Initiative (GRI) G3 indicators. A suite of reporting indicators has been selected on the basis of their materiality to the specific risk profile of the operations, and this report meets application level C of the GRI G3 Sustainability Reporting guidelines and the associated Metals and Minerals Sector supplement, details of which are available at www.assore.com.

More detail on the assurance of the sustainability data sets is included here.

In previous years, the group has focused on developing sustainability management systems that have facilitated the collection and reporting of credible and relevant data sets. This information is vital for informing and monitoring the effectiveness of the group’s sustainability initiatives and has also allowed the integration of non-financial risk considerations into the group’s business strategy. These systems are now yielding increasingly robust data sets that allow health, safety, environmental and sustainability considerations to inform decision-making on a systemic and ongoing basis.

The group’s sustainability reporting systems have now matured to a point where it is possible to establish quantifiable targets for sustainability performance. The area in which this is best advanced is in respect of energy management, where clear targets have been established for energy efficiency and emissions reduction at the smelters and have been linked to the Key Performance Indicators for operational staff and management.

Structure of the sustainability function

In both the Assmang and AMT structures, site-based environment, health and safety staff as well as corporate social responsibility (CSR) practitioners report directly to mine management. The sites are supported by corporate staff who are responsible for establishing group-wide policy and performance standards, facilitating internal and external reporting and auditing operational performance.

Within the Assore structure, the Senior Manager: Safety, Health, Environment, Risk & Quality reports directly to Assore’s Group Technical and Operations Director, and a similar structure exists within Assmang, with the Divisional SHEQ Manager reporting to the Chief Executive: ARM Ferrous, who carries the legal responsibilities for Assmang.

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Legal compliance

Legal compliance forms the foundation of the group’s environmental, health and safety policies and is the basis on which the group’s environmental, health and safety management systems have been developed.

Legal compliance is a minimum performance requirement for the group’s operations and is determined by a programme of ongoing internal and external reviews and audits against the requirements of the relevant legislation. As part of their ISO-based management systems, each operation maintains a site-specific legal register detailing the applicable legislation with which the operation needs to comply on an ongoing basis.

External auditing of legal compliance

All mining operations within the group have approved Environmental Management Programmes (EMPs), as required in terms of the Mineral and Petroleum Resources Development (MPRD) Act. In order to reflect the dynamic nature of the operations and changes to mining operations and infrastructure, these documents undergo periodic review and revision and are resubmitted to the Department of Mineral Resources (DMR) for authorisation.

Internal and external audits of the Assmang and the AMT operations confirm that, with one exception, all sites have been granted all permits, licences, authorisations and exemptions required to operate in compliance with the requirements of South African health, safety and environmental law. The single aspect of ongoing administrative non-conformance remains the issuing and updating of the integrated water licences for the AMT operations. All three mines have submitted applications, however, the processing of these applications, some of which were submitted as far back as 2006, has yet to be completed. Whilst they await the issuing of their new licences, these sites continue to operate under their old permit conditions and in accordance with the additional commitments made in their applications. Assore management continues to liaise with the Department of Water Affairs on a monthly basis to confirm that there are no outstanding queries or data requirements to impede the processing of these applications.

In May 2012, the biannual safety, Health and Environment (SHE) legal compliance audit of the AMT operations was conducted by Environmental Resource Management Southern Africa Proprietary Limited (ERM). In line with the integration of risk management processes across the Assore group, for the first time the ERM audit team was supplemented by an auditor appointed by Assore’s internal auditors, Sizwe Ntsaluba Gobodo (SNG).

The findings recorded by ERM did not indicate any material issues of health, safety or environmental risk. In almost all cases, corrective action was implemented within six weeks to close out the audit findings. The only area of uncertainty related to technical issues around tailings management, and a specialist study will be undertaken in the coming financial year to determine whether or not any remedial action is required.

Directors’ liability audits are conducted once every two years on the Assmang sites by a team of external auditors, with the most recent audits being conducted between March and May 2011, prior to the commencement of this reporting year. These audits confirmed that there has been a significant improvement in safety, health and environmental management on all Assmang sites since the previous round of audits, as illustrated by the marked reduction in material risks identified during the audits. Corrective action plans were drawn up to address each of the identified areas of risk, and in November 2011, Assmang’s Divisional SHEQ Manager conducted an assessment of the status of the corrective actions, the findings of which were reported back to the Assmang OpsCom, via the Chief Executive: ARM Ferrous.

Legal compliance status

No administrative penalties, fines or prosecutions were incurred by either Assmang or the AMT operations over the current financial year, nor was the group prosecuted for any anti-competitive behaviour or anti-trust or monopolistic practices. Similarly, neither Assore nor its operating divisions received any fines for noncompliance in respect of laws and regulations concerning the provision and use of products and services.

The year saw an increase in the number of section 54 and 55 notices served on the group’s operations by the Department of Mineral Resources (DMR) in terms of the Mine Health and Safety Act.

There has been an increase in the number of section 54 notices served on Assmang operations from four in 2011 to eight in 2012, resulting in 27 shifts lost in 2012 (2011: 10). The number of section 54 notices issued to the AMT operations remained stable, with one issued in each of 2012 and 2011.

The number of section 55 notices issued to Assmang operations increased over the reporting year from five in 2011 to 13 in 2012, and a corresponding increase was seen at the AMT operations, which were issued with four section 55 notices over the reporting period (2011: two).

The increased number of notices served reflects an increased drive towards compliance by the DMR combined with the application of higher standards in line with the tripartite commitment between the DMR, unions and mining companies in order to reduce fatalities.

No prohibition notices in terms of the Occupational Health and Safety Act (OHSA) were served at either of the two smelter operations by the Department of Labour during the financial year.

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Energy consumption and climate change

In response to growing consumer concern about climate change and pending national climate change legislation, the group has embarked on a process of understanding and responding to the risk that climate change poses to its business.

As an intensive energy user, energy consumption, and the resultant greenhouse gas emissions, are a material environmental issue for the Assmang and the AMT operations.

Energy consumption for the year under review

  Diesel Diesel Electricity Electricity
  use use used used
  2012 2011 2012 2011
Operation (‘000l) (‘000l) (kWh) (kWh)
Beeshoek 7 549 2 048 39 974 31 193
Khumani 37 838 27 535 158 561 101 078*
Black Rock 4 355 4 119 99 063 105 186
Cato Ridge Works 492 524 747 392 588 410
Dwarsrivier 1 402 1 429 47 604 40 523
Machadodorp Works 1 273 1 501 825 131 1 007 538
Rustenburg Minerals 2 776 2 642 9 649 4 092
Zeerust 1 648 1 993 2 952 1 821*
Wonderstone 167 212 1 904 2 147
* Note that the electricity consumption for Khumani and Zeerust in 2011 has been restated from that reported in the previous year.

The greatest percentage change in diesel consumption took place at Beeshoek, where the resumption of mining during 2012 resulted in a 269% increase in diesel consumption year-on-year. A 37% increase in diesel consumption was also recorded at Khumani, and reflects the ramping up of mining activity as a result of the Khumani Expansion Project and a resultant upscaling of the mining fleet.

Cato Ridge electricity consumption increased by 27% year-on year, which reflects a return to normal production after the switching out of Furnaces #1 and #2 for upgrade in December 2011, which had reduced electricity consumption in 2011. By contrast, electricity consumption at the Machadodorp smelter reduced by 18,1%, as a result of the switching out of Furnace 1 between March and June 2012 due to weak market demand for ferrochrome.

Corporate carbon footprint

Corporate carbon footprints (CCFs) have been annually calculated for the Assmang and Assore operations since 2009 and form the foundation of the group’s strategy for managing issues relating to energy efficiency and climate change.

As in previous years, the CCFs include sites, subsidiaries, operations and activities over which the group has operational control. Thus, greenhouse gases (GHGs) generated by activities associated with the group, but over which the group has no operational control, are not taken into account.

In line with the methodology laid down in the Greenhouse Gas Protocol – Corporate Standard, as well as ISO14064, GHG emissions are reported under three categories:

  • Scope 1: Direct GHG emissions which occur from sources that are owned or controlled by the company (eg emissions resulting from diesel consumption by mine vehicle fleets, consumption of reductants in furnaces and burning of liquid petroleum gas)
  • Scope 2: GHG emissions from the generation of purchased electricity consumed by the company. This is purchased from Eskom, whose power is predominantly generated by coal-fired power stations
  • Scope 3: GHG emissions that are a consequence of the company’s activities but occur from sources not owned or controlled by the company (eg product transportation and business travel)

The GHG emissions from the group operations for the year under review per scope are summarised in the table below:

  Scope 1 Scope 2 emissions
  tons CO2e* tons CO2e CO2e
Assmang 858 431 1 808 549 2 666 980
AMT operations 12 047 14 869 26 916
Assmang 573 055 1 426 879 1 999 934
AMT operations 12 891 8 174 21 065
*CO2 equivalent.

The breakdown of emissions on a site basis illustrates that, as in previous years, the most energy-intensive operations are the smelters at Cato Ridge and Machadodorp.

The bulk of GHG emissions generated by the group fall within Scope 2, which reflect electricity consumption by the smelters at Cato Ridge Works and Machadodorp. Scope 2 emissions by Assmang operations in 2012 totalled 2 666 980 tons CO2e, a 9,8% increase on the previous year, as a result of increased electricity consumption at the Cato Ridge Works and Khumani. Scope 1 emissions also increased markedly on Assmang operations during the reporting year, primarily due to higher diesel consumption at Khumani.

The AMT operations’ emissions profile has shifted fundamentally in 2012, with Scope 1 emissions now being exceeded by Scope 2 emissions. This has occurred as a result of the continued development of the Groenfontein and Zandspruit underground sections at Rustenburg Minerals, which consume proportionately more electricity than diesel.

In the financial year under review, submissions to the Carbon Disclosure Project (CDP) were made in respect of both the Assmang and the AMT operations.

Business risks associated with climate change

The group is in the process of integrating climate change considerations into its business strategy and risk management processes. The departure point for this process has been the identification of the business risks associated with climate change, which include changes to the legislative and fiscal environment in which we operate, as well as physical risks to infrastructure posed by possible shifts in prevailing weather patterns.

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Water management

Water management remains a critical issue for the group, whose operations are mainly located in water-scarce regions of South Africa that experience marked seasonal variations in rainfall.

Water consumption for the year under review

  2012 2011
Operation m3 m3
Beeshoek 6 190 014 4 611 620
Khumani 3 772 149 2 611 648
Black Rock 862 842 857 030
Cato Ridge Works 395 083 374 163
Dwarsrivier 129 990 362 522
Machadodorp Works 142 928 130 620
Rustenburg Minerals 247 666 286 202
Zeerust 233 710 222 550*
Wonderstone 1 267 1 137
*Restated from the figure reported in 2011 due to a transposition error.

The biggest increases in water consumption on the Assmang operations have been reported at the iron ore mines, with Khumani and Beeshoek reporting year-on-year increases of 44% and 34% respectively. These increases reflect a ramping up of production on both mines, resulting from the development of the King Pit as part of the Khumani Expansion Project and the recommencement of mining at Beeshoek.

Over the reporting year, there has been a decrease of 64% in water consumption at Dwarsrivier due to the implementation of water recycling initiatives that have allowed dewatering discharge to be substituted for borehole water in order to meet process water requirements.

The group’s operations obtain their water from a combination of boreholes located on mine property and water purchased from water supply utilities such as Umgeni Water (which supplies the Cato Ridge Works) and Sedibeng Water, which supplies water from the Vaal-Gamagara Water Scheme to Khumani and Black Rock. Integrated Water Use Licences have been applied for by all sites (see legal section for more clarification on the status of these applications) and the amount of water abstracted by each site remains within the volumes stipulated by the Department of Water Affairs based on their resource allocation. No water is drawn from a source whose sustainability or dependent ecosystems are adversely affected by the extraction.

Ongoing monitoring of groundwater levels and water quality in accordance with water use licence conditions confirms that in no case is a water source significantly affected by withdrawal of water by any of the group’s mines or smelters.

During 2012, a major upgrade of the stormwater management system at the Cato Ridge Works was completed. This system has been designed to increase the recycling of stormwater – thus reducing the requirement for water purchase – and will also minimise pollution potential as a result of zero discharge to the surrounding environment. Substantial improvements in process water management were also achieved at Dwarsrivier during the year, where several existing process water dams have been relined and where the new tailings dam has been constructed with a plastic (HDPE) liner to minimise water seepage to the underlying aquifer.

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Waste generation

Mining and smelting operations produce a range of waste streams that require specialist management and disposal. As a result, financial provision for the rehabilitation of mine waste facilities such as tailings dams, waste rocks and slag dumps constitute a large proportion of the group’s closure provision (refer Mine closure and financial provisions).

No waste that is deemed hazardous in terms of the Basel Convention is imported, exported or transported over an international boundary by the group’s mines or smelters.

The most significant increases in mine waste generation over the reporting year resulted from substantially increased rates of waste rock generation at Dwarsrivier and Khumani (305% and 252% respectively).

The substantially increased rate of waste rock generation at Dwarsrivier reflects overburden removal required to prestrip the North Pit. Over the same period, tailings generation increased by 63%, reflecting increased volumes of ore through the plant. During the year, Dwarsrivier also completed the construction of a new, lined tailings disposal facility, which will be used to dispose of tailings arising from future production, as well as historical tailings reprocessed through the plant.

The increase in waste rock generation on the iron ore mines reflects the development of the King Pit as part of the Khumani Expansion Project, and the recommencement of mining at Beeshoek (whose production was restricted to stockpile reprocessing during the previous financial year). The increases in waste rock production have been mirrored by an increase in tailings generation resulting from increased throughput through the plants.

In line with the DMR’s stated objective of maximising the value realised from South Africa’s mineral endowment, the group continues actively to seek economic opportunities relating to the reprocessing of historic mine wastes and the sale of waste products. Thus, both Dwarsrivier and Zeerust have continued to reclaim and reprocess historic tailings during the past year.

Over the past year, Cato Ridge Works has made significant improvements in the way that slag from the smelter is managed. In May 2011, the first cell of the new lined slag facility was commissioned, which is used to dispose of processed slag that is deemed “unsellable” as aggregate. Now that the new facility is operational, no new slag will be placed on the old slag dump, allowing the old dump to be decommissioned and rehabilitated.

Waste generated by operations

Click the image to view an enlarged version

In parallel, Cato Ridge Works has continued substantially to reduce the volume of slag disposed of on site by reclaiming slag from the old slag dump which is sold as aggregate for infrastructure projects. In 2012, Cato Ridge Works sold a total of 951 123 tons of slag, more than double that sold in the previous year (2011: 414 900 tons). This is equivalent to about six years of slag production from the smelter, based on the total of 169 438 tons of new slag generated at the Cato Ridge Works in 2012. The progression of sales of slag is depicted as follows:

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Land management and mine closure

Land management

As a requirement of the National Environmental Management: Biodiversity Act, operations are required to develop and implement a Biodiversity Action Plan (BAP) to manage their impacts on site ecosystems. BAPs focus on identifying and implementing sustainable land management practices including the protection of vulnerable ecosystems and species, the control and eradication of alien and invasive species and veld fire management. These plans are also used to inform decisions on site rehabilitation and revegetation by identifying rehabilitation techniques and species that are compatible with both the natural ecosystem and sustainable post-closure land uses.

BAPs have been developed for all the group’s operations and confirm that no Red List species are present on the sites. The actions recommended in the BAPs have been integrated into the sites’ land use management procedures and include measures to conserve protected ecosystems and species present on the sites.

The table below summarises the areas of land disturbance at each operation at the end of the reporting year:

  Area Area
  currently currently
  disturbed disturbed
  2012 2011
Operation ha ha
Beeshoek 970 865
Khumani 1 680 658
Black Rock 1 441 1 441
Cato Ridge Works 80 50
Dwarsrivier 164 143
Machadodorp Works 142 19
Rustenburg Minerals 140 115
Zeerust 86 63
Wonderstone 34 30

The past year has seen relatively small increases in the area of land disturbance at the mining operations. The major exception has been at Khumani, where an additional 1 022 ha of land was disturbed during 2012, primarily as a result of the development of the King Pit. This development has more than doubled the disturbed footprint of the mine in the past year.

During the year, a contaminated land survey was undertaken at Machadodorp which identified the scale and extent of land impacted by the works. Thus, although no additional land was disturbed over the reporting year, the area of land disturbance reported for 2012 has been revised sharply upwards due to the identification of additional areas of contaminated land that will require remediation, as reflected by a doubling of the closure provision for the site.

The Cato Ridge Works also saw a significant increase in land disturbance during 2012. This was due to the completion of a number of major projects, including:

  • The completion of the stormwater management system to ensure that no discharge of water takes place from the site to the surrounding environment
  • The construction of a new, lined facility for slag disposal to safeguard the quality of water in the underlying aquifer
  • The construction of a new entrance to the site to ease traffic congestion.

Mine closure and financial provisions

Financial provision for mine closure and rehabilitation constitutes the single largest environmental liability for the group’s mines, with a total liability of R724 million (2011: R569 million) for Assmang operations and R16 million (2011: R17 million) for the AMT operations.

Financial provision for closure as at 30 June

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While mines are required to provide for the funding of environmental liabilities, either by cash deposited in environmental funds, or the issue of environmental guarantees, as set out above, provision for environmental obligations for the alloy operations are recognised in the financial statements.

Closure plans developed for the group mines inform the financial provision made for rehabilitation and closure, which is funded through a combination of contributions to environmental trust funds and bank guarantees. These closure provisions are reviewed, and, if needs be, revised, on an annual basis. Where possible, concurrent rehabilitation is undertaken in areas where mining and minerals processing has been completed. This allows the operations to test rehabilitation and revegetation techniques, the long-term sustainability of which can then be monitored, and also allows the operations to contain their “footprint” of disturbed land (and the associated financial provision for closure) to a minimum.

Despite there being no increase in land disturbance at Black Rock during 2012, the mine’s closure provision has increased by 69% year-on-year. This substantial increase in financial provision is a condition of the environmental authorisation issued for the Black Rock Expansion Project.

For a similar reason, Khumani’s closure provision increased only 2,5% year-on-year, although the area of land disturbance more than doubled over the same period. This is accounted for by the fact that closure provisioning has been calculated on the basis of the approved life of-mine plan, which saw a substantial increase in provisioning in the 2011 year (120%).

The Cato Ridge Works and Machadodorp smelters are classified as industrial (rather than mining) facilities, which are currently not required in terms of South African law to make financial provision for site closure or rehabilitation. Nonetheless, in line with its commitment to responsible environmental management across its sites, Assmang has decided that the smelters will calculate their closure liability and make financial provision for rehabilitation.

A contaminated land survey was completed at Machadodorp in 2012, and the sharp upward revision in the area of land disturbance that will need to be rehabilitated prior to closure has led to a 130% increase in the closure provision for the site.

Employee safety, occupational health and wellness

Assore is committed to achieving zero harm to its employees, either as a result of unsafe working conditions or occupational disease, and is working towards compliance with the 2013 milestones jointly established by the South African mining industry, the DMR and organised labour.

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This year again has seen a significant reduction in Lost Time Injuries (LTIs), with a total of 38 (2011: 56) being reported for the Assmang operations and a total of eight (2011: 10) LTIs were reported on the AMT operations. The Lost Time Injury Frequency Rate (LTIFR) has also continued to drop year-on-year with a rate of 0,29 (2011: 0,47) for Assmang operations and 0,9 (2011: 1,26) for the AMT operations.

Safety statistics

Operation 2012 2011 2012 2011
Beeshoek 1 0,17
Khumani 5 13 0,11 0,27
Black Rock 5 9 0,19 0,4
Cato Ridge Works 6 3 0,52 0,23
Dwarsrivier 20 22 0,76 1,26
Machadodorp Works 2 8 0,16 0,68
Assmang 38 56 0,29 0,47
Rustenburg Minerals 5 4 0,81 0,84
Zeerust 1 0,62
Wonderstone 2 6 1,75 4,86
AMT 8 10 0,9 1,26
LTIFR calculated on the basis of 200 000 hours.

During the year, Beeshoek passed the 2 000 000 fatality-free shifts milestone, and by the end of 2012, had gone 13 months without an LTI. Cato Ridge Works achieved 1 000 000 fatality-free shifts during the first quarter of the financial year and Dwarsrivier passed the same milestone in the second quarter.

On an equally positive note, Black Rock and Machadodorp Works ended the year with the lowest LTIFRs ever recorded for these operations (0,19 and 0,16 respectively).

During the reporting year, Black Rock’s safety achievement was recognised by the Northern Cape Mine Managers’ Association with awards for the safest underground mine and the most improved underground mine.

Whilst the overall improvement in safety performance across the group’s operations is encouraging and reflects the continued priority that management places on ensuring the safety of its employees, we continue to seek opportunities to further reduce the number of accidents and incidents. In particular, Dwarsrivier’s safety performance continues to remain disappointing, and improving safety on this mine has been identified as a priority area that will continue to be the focus of corporate and site management attention for the coming year.

In order to allow benchmarking of safety performance across the chrome sector, Dwarsrivier, Rustenburg Minerals and Zeerust submit annual safety statistics to the International Chrome Development Association’s (ICDA) Safety First initiative (refer “Product stewardship and advocacy”).


There were no fatalities on either the Assmang or the pit operations during the reporting year.

The findings of the inquiry convened by the Department of Labour into the fatal explosion that took place at the Cato Ridge Works on 24 February 2008, and which has been reported on in previous reporting periods, have still not been made available to the company. Thus, the final outcome in this matter is still awaited. The trust fund established to provide ex gratia assistance to the affected families has completed its work.

Notices served by regulatory authorities and shifts lost

      Shifts lost due to     Shifts lost due to
  Section 54 notices Section 54 notices Section 55 notices Section 55 notices
  2012 2011 2012 2011 2012 2011 2012 2011
Assmang 16 15* 50 37* 13 5 13
AMT operations 1 1 4 4 2
* Restated from the previous reporting period.
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Occupational health and wellbeing

Assore is committed to promoting the wellbeing of its employees, both through the minimisation and management of occupational health risks in the workplace and the support of programmes which encourage employee wellness and wellbeing.

Occupational health screening

    Number     Number  
  Number of of cases   Number of of cases  
  audiometric referred for Number audiometric referred for Number
  surveillance audiometric of cases surveillance audiometric of cases
  tests diagnostic submitted for tests diagnostic submitted for
  performed testing compensation performed testing compensation
Operation 2012 2012 2012 2011 2011 2011
Beeshoek 2 996 5 1 1 534* 2* 5*
Khumani 8 884 9 11 9 061* 2* –*
Black Rock 4 566 3 2 3 678 3
Cato Ridge Works 2 550 5 3 622* 107*
Dwarsrivier 3 107 7 2 092 2 2
Machadodorp Works 957 4 1 1 070
Rustenburg Minerals 528 6 6 311 4 3
Zeerust 145 1 131
Wonderstone 108 1 128 1
* Restated from 2011 report.

Occupational health surveillance

In order to ensure that the specific occupational health risks associated with each of the operations are effectively monitored and managed, specialist occupational healthcare service providers are retained by each site to implement medical surveillance programmes in accordance with the requirements laid down in the Mine Health and Safety Act (MHSA) and the Occupational Health and Safety Act (OHSA).

The operations routinely conduct entry and exit medicals for all employees and contractors, as well as periodic medicals to comply with the occupational health surveillance requirements of the legislation.

In response to the changing risk profile of the Machadodorp Works resulting from the conversion of Furnace #5 from ferrochrome to ferromanganese production, a health baseline assessment of the entire workforce was undertaken prior to the introduction of manganese to the site. Assmang has also taken this opportunity to align the medical surveillance protocols between the two smelters in order to achieve consistency of approach, and the medical surveillance protocol at Black Rock Mine was also revised during the reporting year.

Noise induced hearing loss

As in previous years, noise induced hearing loss (NIHL) remains a major occupational health challenge for the Assmang and the AMT operations and existing hearing conservation programmes have been reviewed and revised with the intent of achieving the target of eliminating NIHL. A two-pronged approach has been developed to promote hearing conservation that includes both noise reduction strategies and improvement in occupational health surveillance and case management of individuals who have been referred for audiometric diagnostic testing.

In 2012, a total of 31 (2011: 116) cases were referred by Assmang for audiometric diagnostic testing and a total of eight (2011: five) cases were referred for follow up by the AMT operations. Of the cases referred for follow-up, 15 (2011: seven) cases from Assmang and six (2011: three) cases from AMT were submitted for compensation.

Employee wellness initiatives

Over the past year, the group has partnered with a range of organisations, including occupational health practitioners, medical aids and organised labour, to proactively manage employee wellness.

Proactive management of fatigue has been identified as a significant contributing factor to continued employee wellness and workplace safety, particularly for workers in underground operations. During the past year, Assmang has completed a fatigue management study at Black Rock in partnership with the University of the Witwatersrand and the CSIR, with the intention of developing a fatigue management protocol that can be implemented across the group.

In April 2012, AMT organised a Wellness Day at Rustenburg Minerals, which was open to employees from both the Rustenburg Minerals and Zeerust operations. This is the first event of this kind that has been organised on the AMT operations and attracted a staff turnout in excess of 75%. The encouragingly high turnout at the event is attributable to the involvement of NUM in planning this event, who demonstrated their commitment to proactive wellness management by encouraging their membership to attend this event. A similar Wellness Day will take place at Wonderstone early in the coming financial year.

A Wellness Conference was also held at Khumani in May 2012, and was the precursor of a TB Integration meeting that was held the following month and included involvement from the Department of Health.

HIV/Aids management

The management of HIV/Aids remains one of the greatest challenges to managing the wellness of any workforce in South Africa. In order to address this challenge, the Group HIV and Aids Coordinator has developed an HIV and Aids management guideline which informs corporate strategy, guides resourcing for disease management and outlines performance indicators to monitor the effectiveness of the programme. HIV and Aids coordinators have been appointed at all Assmang sites to implement the HIV and Aids management strategic plans, which are managed in conjunction with TB infection control programmes. On-site medical staff also partner with external agencies such as government and NGOs to extend HIV and Aids testing and disease management programmes into our host communities.

AMT’s first site-based Voluntary Counselling and Testing (VCT) campaign took place at Rustenburg Minerals in April 2012, with over 60% of those who participated in the Wellness Day electing to undergo VCT. A similar VCT programme is planned for Wonderstone early in the coming financial year.


Assmang actively promotes home ownership as a means of providing its employees with quality accommodation and contributing to their long-term financial security through the purchase of property. The group believes that home ownership promotes the health and wellbeing of our employees and their families and also contributes to the building of sustainable communities whose economic diversification will allow them to endure past the end of the life of the mine.

Housing strategies employed by mining companies in the past – such as the provision of accommodation in mine villages for the duration of employment and the payment of “living out” allowances – are ultimately unsustainable and have been linked to a range of undesirable social and industrial relations outcomes.

Assmang’s housing philosophy is based on the promotion of home ownership amongst all levels of employees in selected sustainable towns within a commutable distance of its mines.

Summary of progress against the Mining Charter housing requirements

The Mining Charter requires that mines must implement measures to improve the standard of housing and living conditions for mineworkers as follows:

  • Convert or upgrade hostels into family units by 2014;
  • Attain the occupancy rate of one person per room by 2014; or
  • Facilitate home ownership options for all mine employees in consultation with organised labour by 2014.

In response to the Mining Charter requirements and the shortfall of housing in the Northern Cape, Assmang created the Khumani Housing Development Company (KHDC) to develop additional residential property that is affordable for employees in all income bands. By the end of 2012, a total of 349 Assmang employees have become home owners as part of the housing scheme.

Where possible, these properties have been constructed with the input of local service providers and materials suppliers, thus creating jobs in the construction sector and making a significant additional contribution to the local economy. Efforts have also been made to incorporate environmental considerations into house design, such as the installation of solar water heaters to improve energy efficiency.

Many of the group’s employees are first-time home owners and would not necessarily qualify for mortgages if they were to apply to conventional financial institutions. To address this challenge, the mines provide employee housing subsidies to the individuals that become part of the housing model and also offer a discounted interest rate to fund the housing loan whilst employed by Assmang.

Housing developments to date

Due to the success of the initial phases of the Khumani housing project, it was decided to use the Kathu pilot project as the template for housing projects for the remainder of Assmang’s mines, and by the end of 2012, the following projects were currently under way:

  • Extension 3 – Kathu
    The Extension 3 development consists of 328 stands in the western part of Kathu. As at the end of 2012, 324 (2011: 244) houses have been constructed specifically for Khumani employees in this suburb of which 259 (2011: 191) were purchased by the employees and 65 are utilised as transit rental units.
  • Uitkoms – Kathu
    Uitkoms is a new housing development specifically for Assmang Khumani employees, which comprises 113 stands. As at end of 2012, 57 (2011: 39) houses had been built in this suburb specifically for Khumani employees of which 50 (2011: 32) were purchased by the employees and six are utilised as transit rental units.
  • Rooisand – Kathu
    KHC owns a further 822 residential stands and two undeveloped stands suitable for an additional 192 residential units in the Rooisand development to the eastern part of Kathu, adjacent to the N14. At the end of 2012, 25 (2011: nil) houses were completed in this suburb and in excess of 150 employees have expressed interest in buying houses in this suburb. As at end of June 2012, 348 houses were under construction and at various stages of completion in this suburb.
  • Kuruman
    KHC is in the process of providing services to land for Black Rock employees in Wrenchville, Kuruman, that is suitable for 260 residential stands and two smaller portions of land suitable for the development of an extra 31 residential stands. At the end of June 2012, 24 (2011: two) houses were completed, of which 15 had been purchased by Black Rock employees.
  • Mashishing (formerly Lydenburg)
    Khumani Housing Company is currently building 29 (2011: nil) houses in Mashishing (formerly Lydenburg), Mpumalanga for Dwarsrivier and owns serviced land suitable for another 47 units in Extension 70.

To entrench the skills and values required to foster sustainable and fully integrated communities, a comprehensive home owners’ education programme was designed for the project, and Assmang is committed to supporting continued communication and education in this regard.

Human resources and training

Employment equity

  manage- manage- Women Women
  ment ment in mining in mining
  2012 2011 2012 2011
Operation (%) (%) (%) (%)
Beeshoek 57 50 12 21
Khumani 92 60 4 3
Black Rock 57 47 4 5
Cato Ridge Works 28 70 8 9
Dwarsrivier 43 73 12 12
Machadodorp Works 50 63 12 17
Rustenburg Minerals 57 50 12* 21*
Zeerust 92 60 4* 3*
Wonderstone 57 47 4* 5*
Figures for the AMT operations reflect women employed in core mining functions.
Target for HDSA management is 40% by 2014.
Target for women in mining is 10% by 2014.

Employee training and development

Employee training and skills development is crucial to the group’s strategy of staff development, talent management and employee retention.

Payroll spend on training

During the year, both the Assmang and AMT sites achieved an increase in expenditure on training and exceeded the Mining Charter target for training expenditure which is specified as 5% of payroll by 2014.

  Proportion of Proportion of
  payroll spent payroll spent
  on training (%) on training (%)
  2012 2011
Assmang 9,3 8,0
AMT operations 5,3 4,9

Learnerships and bursaries

Assmang has shown a substantial increase in the number of learnerships and bursaries year-on-year in line with Mining Charter and Department of Trade and Industry scorecard commitments, with a 114% increase in the number of bursaries extended. The AMT operations also reported a 15% increase in the number of bursaries awarded over the same period.

  Learner-   Learner-  
  ships Bursaries ships Bursaries
  2012 2012 2011 2011
Assmang 107 219 98 99
AMT operations 4 38 4 33

The learnerships awarded by the group focus on the development of artisanal skills in disciplines such as diesel mechanics, fitters, electricians, boilermakers and instrument technicians which are in short supply. Bursaries are also extended to candidates studying engineering, surveying, metallurgy and geosciences.

The group supports capacity building at a tertiary level through its ongoing support of the Minerals Education Trust Fund (METF). The METF is a multilateral organisation that pools resources to support continued excellence in tertiary education and research, most notable through the provision of salary supplementation for academics in the fields of mining engineering, metallurgical engineering and geosciences.

Employee literacy

Ensuring functional literacy is a fundamental component of employee development, which not only enhances the skills and developmental potential of the group’s staff, but also their quality of life. Both Beeshoek and Khumani have recently achieved the corporate target of 100% literacy in the workforce.

  % of % of
  workforce workforce
  literate literate
Operation 2012 2011
Beeshoek 100 89
Khumani 98 95
Black Rock 88 84
Cato Ridge Works 90 95
Dwarsrivier 93 92
Machadodorp Works 100 82
Rustenburg Minerals 67 64
Zeerust 74 74
Wonderstone 81 79

Literacy levels improved during the year at all Assmang and AMT operations with the exception of Cato Ridge Works. All sites offer nationally accredited ABET courses, and uptake has been encouraging, particularly at Cato Ridge Works, in response to a literacy drive that took place during the year.

Labour relations

Recognition agreements have been concluded with three trade unions on the Assmang sites: the National Union of Mineworkers (NUM), National Union of Metal Workers of South Africa (NUMSA) and Solidarity. Of these unions, only NUMSA is represented on the smelters.

The only union present on the AMT operations is the NUM, which is represented in the permanent workforce at Rustenburg Minerals and Wonderstone and in the contractor workforce at Zeerust.

  % %
  membership membership
Union 2012 2011
NUM: Assmang 45 38
NUMSA: Assmang 20 22
Solidarity: Assmang 13 9
NUM: AMT operations 27 27

Union membership has increased significantly on the Assmang mines, with an 18% increase in NUM membership and a 44% increase in Solidarity membership. By contrast, union membership at the smelters declined slightly over the same period, whilst union membership at the AMT operations remained virtually unchanged over the period.

No strikes or lockouts took place on any of the AMT or Assmang operations during the reporting year.


Assore is aware that its ability to conduct its day-to-day business is influenced by its capacity to develop and maintain long-standing relationships with its stakeholders. Assore’s stakeholder engagement therefore aims to build new, and improve existing, relationships to establish mutually beneficial partnerships and to obtain support for the company’s activities.

A stakeholder engagement table, included below, details the stakeholders with whom we engaged over the past year, the mode of engagement and summarising the material issues pertinent to each stakeholder group.

Stakeholder   Material issues   Method of engagement
Shareholders and the investment community  
  • Profitability
  • Regulatory compliance
  • Financial and non-financial risk management
  • Outlook for the base metals/alloys market
  • Performance against targets
  • Long-term sustainability of the business
  Annual and six-monthly reports, SENS announcements, press statements
Industry associations
  • Chamber of Mines
  • Ferroalloy Producer Association
  • International Council on Metals & Mining
  • International Manganese Institute
  • International Chrome Development Agency
  • Energy Intensive Users Group
  • Worker safety
  • Occupational health
  • Environmental issues
  • Carbon-related issues (including carbon taxation)
  • Trends in national and international legislation
  • Logistics
  • Risks associated with land tenure and nationalisation
  Representation on the executive bodies of these associations, as well as task groups established in terms of their strategic work
Employees and organised labour
  • National Union of Mineworkers
  • National Union of Metalworkers of South Africa
  • Solidarity
  • Remuneration and benefits
  • Conditions of service
  • Job security
  • Career development (including training )
  • Accommodation
  • Worker safety
  • Occupational health
  • Transformation and employment equity
  Staff meetings at all levels, “toolbox talks”, inductions, health and safety meetings, internal publications, notice boards, union negotiations, career path planning
Host communities
  • Employment
  • Safety and health considerations
  • Preferential procurement
  • Small and medium enterprise development
  • Social upliftment
  • Land management
  • Mine closure and rehabilitation
  Public meetings, public participation process for environmental impact assessments, participation in local economic development initiatives, funding of corporate social responsibility initiatives
  • Product quality
  • Product pricing
  • Development of new products
  • Adherence to delivery schedules
  • GHG-related issues
  • Product stewardship
  • Compliance with REACH/GHS requirements for registration and product labelling
  Customer site visits, contract negotiations, quality management system, conference attendance. Use of customer feedback to influence annual report content
Joint-venture partners
  • African Rainbow Minerals
  • Sumitomo
  • Mampa Investment Holdings
  • Exxaro
  • Profitability
  • Regulatory compliance
  • Financial and non-financial risk management
  • Outlook for the base metals/alloys market
  • Performance against targets
  • Long-term sustainability of the business
  • Roles and responsibilities within the respective joint ventures
  Representation on the Assmang board and Excom, board meetings for individual Assore operations and active participation in industry associations
National, provincial and municipal government
  • Department of Mineral Resources
  • Department of Water Affairs
  • Department of Environmental Affairs
  • Department of Labour
  • Department of Trade and Industry
  • Receiver of Revenue
  • Regulatory compliance
  • Fulfilment of statutory reporting requirements
  • GHG-related issues
  • Land management
  • Mine closure (including adequate financial provision for rehabilitation)
  • Pollution prevention
  • Conservation of surface and groundwater resources
  • Employee health and safety
  • Workforce transformation and employment equity
  • Preferential procurement
  • Tax payment
  Statutory reporting, inspections by government representatives, permit applications, legal compliance audits, public participation process for environmental impact assessments, engagement on targeted issues
Parastatal service providers
  • Eskom
  • Transnet
  • Continuity of electricity supply
  • Power and freight tariffs
  • Availability of rail berths
  • Upgrade of port facilities
  • Negotiation of mutually beneficial contracts and service agreements
  Regular meetings held through established committees
Contractors and other service providers
  • Mining contractors
  • Transport companies
  • Construction contractors
  • Consultants
  • Healthcare providers
  • Shipping companies
  • Insurance companies
  • Procurement practices (including preferential procurement)
  • Terms and conditions of contracts (including penalties)
  • Regulatory compliance
  • Occupational health and safety
  • Environmental management
  Contract negotiations, tender processes, safety inductions, health and safety meetings, site inspections and audits, performance reviews, ISO certification
Non-governmental organisations
  • Groundwork
  • BenchMarks Foundation
  • Pollution prevention
  • Conservation of surface and groundwater resources
  • Employee health and safety
  Engagement through established open forums created for general engagement with host communities

Product stewardship and advocacy

As the company responsible for marketing the products produced by the Assmang and the AMT operations, Assore wholly-owned subsidiary, Ore & Metal, recognises its responsibility in promoting the sustainability of the business by taking an active role in shaping the development and performance of the sectors in which it operates. The group therefore encourages its employees to take an active role in industry associations that aim to promote the use and development of commodities which it produces, and to foster cooperation between companies in these industry sectors to address issues of common concern.

Involvement in industry associations

An Ore & Metal representative currently serves on the Occupational Health, Environment and Safety (OHES) Committee of the International Manganese Institute (IMnI). Ore & Metal also chairs the IMnI’s Regulatory Committee, on which it represents both the interests of the group and also of the South African manganese sector.

During the past financial year, IMnI has initiated a major Manganese Life Cycle Assessment (LCA) project which will consider the production of three manganese alloys: high carbon ferromanganese, refined ferromanganese and silicon manganese (which Assmang does not produce). This study will collate data from 17 sites located in seven countries and will provide participating companies with the ability to benchmark their environmental performance against industry peers, as well as identifying environmental “best practices” that can be shared across the sector.

The IMnI’s Occupational Health, Environment and Safety (OHES) workshop was held in South Africa in February 2012 and was co-funded by Assmang and BHP Billiton. This event focused on safeguarding worker health in the manganese sector and was attended by 39 delegates from five continents representing over a dozen manganese producers and service providers.

Ore & Metal also continues to serve on the Executive Committee of the ICDA and participates in ICDA’s Safety First reporting initiative, which provides member companies with the ability to benchmark its safety performance against its peers.

Ore & Metal is also an active member of the Iron Platform, which is a forum of iron ore producers who engage on issues of common interest. On a national level, Assmang is active within the Ferroalloys Producers Association (FAPA) where it holds the deputy as chairmanship and is also represented on the Environmental Technical and Logistics committees. Assmang is also active within the Ferroalloys Producers Association (FAPA) where it holds the deputy chairmanship and is represented on the Environmental Technical and Logistics committees.

Product registration and stewardship

Over the reporting year, the Material Safety Data Sheets for all products have been reviewed and revised to ensure compliance with the requirements of the Global Harmonised System of Classification and Labelling of Chemical (GHS), which has been implemented through South African National Standard SANS 10234:2008.

Materials characterisation, in terms of both chemical and mineralogical composition, is an essential component of both REACH (per Regulation EC1907/2006 of the European Parliament) and GHS hazard classification. In order to be able to provide accurate information on which product classification can be based, Ore & Metal is participating in a programme of manganese ore characterisation which is being coordinated by IMnI, and is also taking part in a study into respirable crystalline silica in iron ores that is being organised by the Iron Platform.

Corporate social responsibility initiatives

Assore recognises that it has a commitment to social upliftment in the communities within which it operates, and seeks to respond to the challenges of livelihood support and diversification of economic opportunity in a manner that is appropriate for the different socio-economic and geographical settings of our operations.

In terms of the MPRD Act, each of the group mines is required to have an approved Social and Labour Plan (SLP). The SLP outlines a range of social and economic development initiatives that the mine commits to funding and implementing in order to achieve upliftment of host communities. The requirement for companies to contribute towards CSR initiatives in the broader community is also stipulated in the Department of Trade and Industry Codes of Good Practice guidelines, which apply irrespective of sector, and are thus relevant to the smelter operations.

In order to align government and private sector development socio-economic development initiatives, an SLP must be consistent with the Integrated Development Plan that has been developed by local government so that the mine’s initiatives can be effectively coordinated with those of local, regional and district municipalities. Adherence to the SLP is a condition of the Mining Licence and progress in implementing these projects is reported to the Department of Mineral Resources on an annual basis and audited regularly by the department.

Although the smelters do not fall under the MPRDA – and are therefore not required to have an SLP – Assmang has adopted a groupwide CSR strategy that equally applies to the Cato Ridge and Machadodorp Works.

Funding of CSR

In order to prevent confusion in terminology, the group has drawn the distinction between Local Economic Development (LED) projects that are committed to by the mines in the respective SLPs, and Corporate Social Investment (CSI) projects, which are undertaken by the group above and beyond the SLP commitments.

CSR expenditure

  LED spend CSI spend Total CSR spend LED spend CSI spend Total CSR spend
  2012 2012 2012 2011 2011 2011
  (R million) (R million) (R million) (R million) (R million) (R million)
Assmang 66 17 83 38 14 52
AMT operations 0,4 0,8 1,2 0,8 0,6 1,4

In the reporting year, Assmang operations spent a total of R83 million (2011: R52 million) on CSR initiatives, a year-on-year increase of 60%.

CSR project selection

The CSI strategy distinguishes between CSI, which is focused on livelihood support, and enterprise development, which is intended to bring about economic growth and diversification.

A critical element of the CSI strategy has been the development of a robust set of project selection criteria, which guide transparent and consistent decision-making across the group’s operations. Projects which are considered for funding are assessed in terms of their:

  • alignment with the strategic focus areas (education and health, enterprise development and infrastructure);
  • operational feasibility, including the presence of a market for the goods/services produced, availability of inputs and labour, regulation, and favourable environmental and infrastructure conditions to enable project delivery; and
  • social impact and enterprise value, as determined by their long-term sustainability and likely return on investment.

Flagship project: Teach South Africa

Assmang has recognised education as a strategic focus area for CSR initiatives because of the importance of education in growing and developing both the South African economy and broader society. In support of this educational focus, Assmang has adopted TEACH South Africa as its flagship CSI project.

There is strong evidence that learners from disadvantaged backgrounds can achieve at a comparable level to learners from wealthier backgrounds, given access to quality education. TEACH South Africa was founded by the South African business community as a means of improving both the quality and impact of education by deploying highly skilled and motivated recent university graduates as additional teaching resources in the classroom. The organisation seeks to place new graduates from technical, business and language disciplines in some of South Africa’s most disadvantaged schools for a period of two years to provide teaching assistance to the existing staff and also to serve as role models and mentors to learners.

Assmang has partnered with Teach South Africa to place 26 TEACH ambassadors at 13 schools in KwaZulu-Natal, Mpumalanga, Limpopo and the Northern Cape for an initial period of two years. The schools selected for this initial programme are ones with which Assmang has previously been involved, usually through the funding of infrastructure upgrade and expansion programmes. The ambassadors will focus primarily on Grade 10 to 12 learners, with particular emphasis on developing English, Maths and Science competencies which are critical for learners’ future employability.

CSR initiatives in the AMT operations

AMT’s approach to CSI is shaped by the needs of the projects already committed to as part of its operations’ SLPs, which focus on education and the support of a range of small business development initiatives, including brickmaking, poultry farming and vegetable gardens.

Stakeholder feedback supports the view that the focus on uplifting educational infrastructure in the host communities of the AMT operations remains the most meaningful intervention that can be made. In particular, emphasis is placed on early learning, which is an aspect of education that is particularly weak in the group’s host communities.

The support of crèches in disadvantaged communities is key to the group’s strategy of promoting the school readiness of children which will allow them to capitalise on the educational opportunities offered by the schools that we support. In this regard, the support for the Cami Makgophe Crèche at Rustenburg Minerals and the Rainbow Crèche at Wonderstone has been continued and strengthened.

At the same time we recognise that there is a pressing need to assist those who have already passed through the educational system but are poorly equipped to seek employment outside of their immediate social setting. Rustenburg Minerals has therefore initiated a programme whereby young adults from the host community are assisted in compiling professional curriculum vitae, mentored in ways in which to identify and engage prospective employers, as well as receive training in respect of general economic literacy.