ESG Report 2021
Exxaro Resources Limited
Integrated report 2021
Our business model depicts the capital inputs we need to conduct our activities and deliver our products.
In line with our purpose of powering better lives in Africa and beyond, we aim to manage and mitigate any negative impact we may have on the capitals and drive value creation overall.
The resources and relationships we rely on
NATURAL CAPITAL
HUMAN CAPITAL
SOCIAL AND RELATIONSHIP CAPITAL
MANUFACTURED CAPITAL
INTELLECTUAL CAPITAL
FINANCIAL CAPITALThe natural resources we rely on to run our business and create our products
The capital constraints and trade-offs we face
The people who manage our business and perform our operational activities
The capital constraints and trade-offs we face
The relationships that provide our social licence to operate
The physical mining, energy and property assets that enable us to deliver our products
The capital constraints and trade-offs we face
The unique combination of knowledge, experience, innovation and systems that differentiate Exxaro
The capital constraints and trade-offs we face
The financial assets that enable us to deliver on our strategy
The capital constraints and trade-offs we face
What we do
Our business activities align with our strategy of strengthening our resilience and ensuring we deliver sustainable value through a robust portfolio in a low-carbon economy.
* Inputs are measured at closing year-end balances for consistency.
Our purpose guides our activities, ensuring we continue providing critical resources that support South Africa's sustainable economic and social development in a way that will accelerate change and ultimately safeguard the value we create for our stakeholders over time. We are committed to making a deliberate positive impact through our physical outputs and the way we do business.
RESPONSIBLE MINING
RENEWABLE ENERGY
OPERATIONS
STRATEGISING FOR FUTURE RELEVANCE AND A JUST TRANSITION
DIVERSIFIED EQUITY INVESTMENTS
DELIVERING SUSTAINABLE IMPACT AND RESPONSIBLE PRACTICES
What we produce
42.5Mt product volumes
(2020: 47.4Mt)
724GWh wind energy
(2020: 727GWh)
R9 billion core equity-accounted income
(2020: R6.1 billion)
520t hazardous waste (2020: 1 511t)
995ktCO2e emissions (2020: 1 035ktCO2e)
We recognise that, although we strive to create value through our business activities and our Sustainable Growth and Impact strategy, we have a negative impact on some capitals.
We remain committed to negating these negative impacts while creating positive impacts beyond compliance using our recognised ESG, brand and culture.
Our business model does not operate in isolation. It impacts and is impacted by our:
NATURAL CAPITALHUMAN CAPITALSOCIAL AND RELATIONSHIP CAPITALMANUFACTURED CAPITALINTELLECTUAL CAPITALFINANCIAL CAPITAL
Despite a focused approach to environmental stewardship, we have an overall negative impact on the environment and thus erode natural capital. This is because we extract natural resources as part of our business activities and depend on these natural resources.
Carbon intensity: 13% increase
(2020: down 9%)
Water intensity: 9% increase
(2020: 38% increase)
Environmental incidents: zero level 3
(2020: zero level 3)
Valid mining rights: 100% (2020: 100%)
Stoppage directives: two (2020: three)
As part of ensuring we have the right people to drive us forward, we invest in, upskill and offer our employees an attractive value proposition, thereby increasing our overall human capital. This investment extends to potential future employees and the communities who provide labour to our operations.
We preserve the value of our human capital by being mindful of the safety and health of our employees and host communities, and striving to achieve zero harm through collective responsibility, commitment and risk awareness.
Employee and contractor fatalities: zero
(2020: zero)
Lost-time injury frequency rate (LTIFR):
0.08 (2020: 0.05)
Occupational health incident frequency rate
(OHIFR): 0.16 (2020: 0.19)
Scarce skills retention: 3.7% (on target)
We deliver value to our host communities through our impact at scale initiatives, SLP commitments, stakeholder engagements, attracting participation from black-owned suppliers and our commitment to the UNGC principles.
We are aware of the impact mining operations have on host communities, now and at the end of a mine's lifecycle. We aim to mitigate this by ensuring a just transition of our operations and our communities' long-term sustainability.
Community incidents: 14* (64% at Matla LoM project. (2020: three)
Top-quartile mining performer in ESG
Governance structure ESG analyst rating: 3.7 out of 5 (2020: 4.6)
BEE level 2 (2020: level 2)
* Incidents are protests that did not lead to production stoppage.
Our investment in our portfolio of quality assets to meet changing market demands increases our manufactured capital.
However, these investments decrease our financial capital and natural capital.
We continue increasing our competencies across mining and renewable energy. Our focus on business resilience, investments in innovation, digitalisation and technology - for example, our renewable energy risk and opportunity domain analysis (RRODA) tool/platform - increase intellectual capital.
Our collective knowledge, skills and resources positively impact human, social and relationship, and manufactured capital.
Core system availability: 99.55% (2020: 98.86%)
Cyberintrusions: Zero (2020: zero)
To ensure we positively impact financial capital and create value over time, we have a strong balance sheet and cash-generative coal business, a strategy that builds off our core purpose and capabilities, and a leadership team fully aligned with the need to create a carbon-resilient business. We deliver financial value and empower people to create impact and self-sustaining economic activity.
We invest and distribute our financial resources to support our strategy, increase efficiency, expand operations and maximise value.
Core EBITDA margin: 33% (2020: 25%)
Return on capital employed (ROCE): 45% (2020: 25%)
Core headline earnings per share (HEPS): 4 683 cents per share (2020: 2 973)
Market capitalisation: R53.4 billion (2020: R50 billion)
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