OUR GOVERNANCE AND MANAGEMENT APPROACH
our sustainable development management approach

Our commitment to sound safety, health, social
and environmental performance is reflected in
our structures and support functions at an
executive and operational level

Our management approach

At board level, sustainability issues are addressed through the social, ethics and transformation (SET) committee (established in 2012), and the health, safety and environment (HSE) committee (in place since 1988).

• The SET committee, chaired by Thandi Orleyn, an independent non-executive director, is responsible for the Group's activities relating to social and economic development, good corporate citizenship, the environment, health and public safety, consumer relationships, and labour and employment issues.
• The HSE committee, chaired by Alastair Macfarlane, an independent non-executive director, guides strategy, assesses the adequacy and appropriateness of HSE policies, standards and procedures, and reviews Group-wide performance on a quarterly basis. The committee also investigates and reviews all major incidences and fatalities that have occurred.
• The audit committee, chaired by Hugh Cameron, an independent non-executive director, oversees the appointment of the assurance provider for non-financial performance each year. The results of these are presented to the committee with the necessary recommendations and action. In future this will fall under the SET committee.

A more detailed review of the composition and activities of these board committees is provided in our integrated annual report.

At an executive level, sustainable development falls under the responsibility of the executive committee, which is responsible for reviewing performance in terms of the Group's non-financial indicators. Towards the latter part of the year a decision was taken to re-establish the Group Sustainable Development Forum, which will focus on medium to long-term strategic sustainability issues. In its new form, the forum is constituted by a multi-disciplinary team and its principal objectives are to:

• Identify material sustainability issues and risks that have an impact on the business and devise appropriate strategic responses to these risks
• Align strategic interventions to the global, national and industry agenda concerning sustainable development such as the World Business Council's Vision 2050, the South African National Development Plan and the Framework Agreement for a Sustainable Mining Industry
• Ensure compliance to relevant regulatory statutes in countries of operation such as South Africa's Mining Charter and Broad-Based Black Economic Empowerment Act, and Zimbabwe's National Indigenisation and Economic Empowerment Plan
• Ensure that the organisation maintains its social licence to operate in host countries by advancing social transformation and upliftment in affected communities

This Forum will lend support to the Exco which in turn supports the board's HSE committee, the SET committee, and the audit and risk committees. Sustainability objectives form part of the key performance indicators against which the performance of Implats' management and executives is measured and remunerated. Details on these KPIs and their implications for the executive are provided in our integrated annual report.

People management

The people management function is headed up by a dedicated Group executive reporting to the CEO. The scope of work includes remuneration, human resource development, talent management and employment equity.

Group policies and procedures on people management issues are established at corporate level and apply at our operations. Our policies and procedures are aimed at contributing to sound employee relations, attracting and retaining talent, and ensuring the continuous development of our employees, while at the same time offering opportunities for career progression with a particular emphasis within our South African operations on historically disadvantaged South Africans (HDSAs). Each operation has a transformation committee comprising representatives from management, unions and women, as well as various other stakeholder groups who contribute to overseeing and advancing transformation at each operation. The operational committees report to the Group SET committee. Our operations also have community Future Forums, at which issues of concern to local communities – such as employment opportunities, procurement, and health, safety and environmental performance – are discussed. Issues arising from these community forums are relayed to the operational committee and, ultimately, to the Exco. These are elevated to the SET committee on a quarterly basis and board, as required.

Managing health, safety and environmental (HSE) issues

Group and site-specific HSE policies, procedures and standards are in place to ensure that we comply with legislative requirements and support our vision of zero harm. Responsibility for implementing HSE policies and procedures rests with line management. All operations submit quarterly performance reports to the board-appointed HSE committee. Group and operational level HSE specialists support line management in implementing the strategy and in monitoring and managing performance. The Group H&S executive and Risk and Sustainability executive are members of Exco.

The Group's environmental team has close links with operational and project management and is involved in due diligence exercises undertaken in connection with acquisitions and the development of strategic initiatives. Implementation of our policies is enhanced by our commitment to maintaining ISO 14001 certification for our environmental management systems. Regular compliance audits are conducted at our operations by the Group's internal auditors, as well as by the external auditor. All of the Group's operations are now ISO 14001 certified.

In addition to the ISO 14001 certification, the refineries are signatories to Responsible Care® and retained their certification. Responsible Care® is the chemical industry's global voluntary initiative under which companies, through national associations, such as the Chemical and Allied Industries Association (CAIA) in South Africa, work together to continuously improve and communicate on their HSE performance.

Managing our investments in socio-economic development

The sustainable development department based at our Rustenburg operations manages our socio-economic development initiatives in our South African operations. A technical team is responsible for implementing the projects, working together with the stakeholder engagement department. The identification of community projects is an ongoing process based on a needs analysis, undertaken in consultation with stakeholder representatives from communities, local government and employees. The sustainable development project steering committee is responsible for reviewing the proposed projects after due diligence. Once approved by the project steering committee, the projects are recommended to the Group's executive committee, a multi-disciplinary executive-level management team that evaluates the merits of investing in each project.

In Zimbabwe, sustainable development initiatives are implemented and managed by the stakeholder engagement executive supported by technical personnel from the operations.

Each year an independent audit is conducted on selected social projects, based on the financial, legal and reputational risk as well as to determine impact, progress and potential remedial action where a project faces possible failure. A detailed summary of this can be found here of this report.

Managing contractors and suppliers

Implats suppliers span the entire value chain from exploration to final production of precious metals in the refining process. Our approach is to source all goods and services within the country of operation, and a greater emphasis is on local suppliers defined as tier 1, 2 and 3 based on their proximity to the operations in South Africa. Tier 1 suppliers are those from directly and indirectly impacted communities (Bafokeng Villages and Freedom Park in Rustenburg, and the Four-farms area in Burgersfort), tier 2 are within the local municipality around the operations and tier 3 are those within the bigger areas surrounding the local municipality. In Zimbabwe local suppliers are those that are within the country of operation. Local procurement is advanced through our enterprise development initiatives as described here of the report.

In response to concerns regarding contractor behaviour not reflecting our value systems, and to minimise any potential liability, last year we reviewed our contractor strategy. This strategy seeks to ensure that we have defined principles that will guide the engagement of reputable contractor companies with the right skills and value systems to undertake specific tasks that we are not able to do ourselves. All contractors and suppliers are appraised on our policies and business practices and are expected to, at a minimum, abide by these principles in their business conduct and practices at all our operations. The strategy has been structured into two phases. The first phase entails using our training and recruitment resources to ensure that all contracting employees are vetted and assessed according to our own internal standards. The second phase specifically interrogates each contracting company and the work they do for us. We have completed the detailed assessments with the assistance of an external specialist and will, over time, effect the required change. In the short term we are planning to insource all development mining, ventilation construction as well as sweeping and vamping services.

We will continue to focus our attention on suppliers' B-BBEE certificates and prompting suppliers well in advance of their expiry dates. Penalties on annual increases will continue to be levied on untransformed suppliers. During the year no services of suppliers were terminated.