ESG Report 2021
Exxaro Resources Limited
Integrated report 2021
Our human capital is the centre of success of our business.
Attracting and retaining the right employees with the necessary skills for now and into the future remains challenging in a competitive market. To ensure that we have the right people, we invest in, upskill and offer our employees an attractive value proposition. This investment extends to potential future employees and the communities who provide labour to our operations. We are also mindful of the safety and health of our employees and host communities, and strive to achieve zero harm through collective responsibility, commitment and risk awareness.
We strive to positively impact our human capital through:
Material theme
Helping our people thrive
Matter
Our strategic response
Our impact on the SDGs
For a detailed overview of our human capital approach and performance, please see the social chapter in our ESG report.
Our people and partners have the capabilities, mindset, environment and passion to achieve our purpose, and we as a company can build on each other's creativity and experience. We have several measures to ensure we empower our people to create impact.
The board, supported by the SERC, has ultimate accountability for our people's health, safety, engagement and development. The executive head: human resources, supported by various management departments, is responsible for developing and implementing employee-related strategies.
The Central Transport Department team at our Matla BU
We have a robust people strategy forming the foundation of our employee engagement approach. Our people strategy is based on six pillars:
These pillars are underpinned by a commitment to a people-fit organisation, developing capabilities and to enable human resources through our purpose to power better lives in Africa and beyond.
The diversity and inclusion strategy is a key conduit for successful delivery of our business strategy as it enables us to positively grow and harness the diverse talent across our company. The delivery of the diversity and inclusion strategy is managed through a framework, which ensures adequate focus and momentum on key transformation milestones. Our commitment to diversity and inclusion aligns with our values and culture to achieve our purpose. To support this commitment, our diversity and inclusion policy was approved in 2021.
Our workforce comprises Exxaro's full-time employees and contractors as well as our renewable energy business workforce. As Cennergi's two operational sites are SPVs, their operational employees are hired by the contractors on site.
Exxaro
Employed 18 813 people (2020: 22 466) – 35.84% full-time employees and 64.14% contractors
Safety remains a top priority for us due to the nature of our operations. We have a moral and legal obligation to ensure that all employees return home unharmed at the end of each workday, and continuously monitor and improve our safety measures.
Safety is explicitly linked to our strategic objective: make our minerals and energy businesses thrive. To deliver on this, we have an effective safety strategy, supported by our response to safety incidents and reducing and eliminating safety-related risks.
Safety strategy
We are guided by our safety strategy in our efforts to achieve zero harm, focusing on five areas:
We review the strategy annually, and the focus areas have been reviewed and judged appropriate each year since their institution in 2009. We also review our safety targets every year based on prior performance, and apply stringent management protocols, programmes and systems.
We manage our safety through risk reduction and elimination interventions, incident analysis, benchmarking our performance against industry standards and training.
We are proud of our safety performance during the year; a true reflection of our commitment to our people's safety.
Five years fatality-free (as at 3 March 2022) Target: zero
One high-potential incident (HPI) (2020: three) Target: zero
LTIFR 0.08 (2020: 0.05) Target: less than 0.08
12 lost-time injuries (2020: nine)
The DMRE issued two section 54 notices (mining activity stopped) and two section 55 notices (mining in affected area stopped) (2020: three), which were resolved amicably
No safety-related grievances were raised against Exxaro in 2021
No fatalities at Cennergi's two windfarms and one lost-time injury at Amakhala Emoyeni
The leading causes of incidents and sources of safety risk have remained consistent from 2012 to 2021. These are trackless mobile machinery, fall of ground, energy and machine isolation, lifting and material handling, and poor risk awareness and discipline.
To focus attention on these high-risk and high-consequence areas, each cause is assigned to an executive team member. Executives publicly engage with stakeholders across our operations about the importance of care and caution in each instance.
The group performed well in comparison with industry averages.
We provide comprehensive training to address safety risks. In 2021, these included:
In pursuit of our zero harm vision, we launched our Khetha Ukuphepha campaign at our BU safety indabas in 2020. This campaign continues to communicate that zero harm is possible and remains the cornerstone of our zero-harm pledge.
In 2022, our aim is to encourage safety performance, record zero fatalities, zero HPIs and further reduce our LTIFR.
Employee health and wellness contributes significantly towards improving quality of life, employee morale, productivity and safety performance - all critical for productivity and sustainability in the mining industry.
We have several measures in place to ensure the health and wellness of our people and communities including, among others, our response to COVID-19, foregrounding mental health and consideration of the basic conditions of employment required by legislation. Our health and wellness strategy guides our approach to managing health and wellness throughout the business.
Our health and wellness strategy drives our continued management of health and wellness in the group. It emphasises a preventive and employee-driven approach, and aligns our health and wellness portfolios for a holistic and integrated management programme.
The strategy identifies occupational and non-occupational health risks and their causes, solutions to mitigate these risks, impacts of the risks on the business, and the best approach to ensure an environment that empowers employees to manage and protect their health.
We base our approach to health and wellness on three pillars: prevent, diagnose and manage.
Improved hygiene and safe workplace
Integrated healthcare and wellness management
Coordinated access to public and private healthcare
Employee-driven preventive healthcare
Occupational diseases: reported cases
Occupational health incident frequency cases
During the year, we achieved positive health and wellness outcomes. Among others, we successfully managed the impact of COVID-19 on our business, mitigated occupational and non-occupational diseases, rolled out an employee assistance programme and certificate of fitness, and made significant headway in foregrounding mental health issues. Unfortunately, we faced several challenges, including permits for our COVID-19 laboratory and employees' hesitancy regarding vaccines.
At Cennergi, the COVID-19 lockdowns implemented to protect our health brought about a level of wellness-related stress and a change in the way we work. Therefore, our 2021 focus was to support employee health and wellbeing through the new normal and counselling was made available. We also hosted a wellness day and promoted World Mental Health Day and Breast Cancer Awareness Month.
COVID-19 remained a significant health risk during the reporting period. Our response, in line with our health and wellness strategy, prioritised preventing, reducing and managing infections.
As at 31 December 2021, the group had 6 816 confirmed (310 active) cases and a recovery rate of 95%. The group has since achieved an 86% vaccination rate exceeding both the national target of 70% and mining industry target of 80%.
We remain committed to preventing further loss of life and implementing COVID-19 preventive measures in accordance with government regulations and recommendations.
We ran a series of initiatives to protect our employees' health during the pandemic, details of which can be found in our ESG report.
| COVID-19 statistics | Exxaro | Cennergi | Mining industry | South Africa |
| Cases | 6 797 | 19 | 62 519 | 3 603 856 |
|---|---|---|---|---|
| Cases as percentage of workforce | 47 | 21 | 13 | 6 |
| Current cases as at 31 December 2021 | 33 | 0 | 408 | 65 299 |
| Fatalities | 33 | 0 | 744 | 95 022 |
Ensuring our employees are actively engaged supports the best interests of our business, host communities, society and the environment. Engaged employees are productive and focused, which enhances safety and supports business stability. Engaging with our employees helps us understand their material needs and concerns to respond accordingly, maintain our employee value proposition as an employer of choice, and attract and retain key talent.
We believe that our success in delivering on our strategy lies in the strength of our culture and values. To ensure these are successfully embedded across the business, we have an effective employee relations strategy, supported by engagement structures, union recognition agreements and frameworks in place. We maintain sustainable human resource governance with a comprehensive suite of policies that cover employment, labour relations, occupational health and safety, training and education, among others.
Our employee engagement strategy guides our approach to managing employee needs and expectations so that we can maintain a healthy and productive workplace. Our digital tools such as LetsConnect further enable integrated, agile access to information and a personalised experience for our employees.
Our values guide our behaviour at Exxaro
These are underpinned by our culture
Our adaptable culture reflects our willingness to learn and improve as we strive towards achieving our strategy. We continue intensifying our employee engagement efforts to share critical information and changes. This includes feedback from our employees through our culture and engagement survey. We conduct the surveys to gain insight, track the efficacy and progress of organisational culture and establish relevant areas of improvement. The organisation further implements respective actions and initiatives to address the identified areas of improvement.
In 2021, the business implemented actions to ensure improvements in the key focus areas identified. These included the following:
Our approach to organised labour relations is defined by collaboration and constructive engagement. Union relationships are based on trust and integrity. Our employee relations strategy enables us to proactively maintain a healthy workplace through established engagement structures and dispute resolution mechanisms based on fairness.
Refer to the governance summary and the ESG report for more information on how we maintain legal, regulatory and compliance excellence as well as instil transparency, ethics and integrity.
We are committed to equal opportunity, irrespective of race, religion, gender, health status, sexual orientation or nationality. We believe that our strengthened potential is in our diversity and differences.
The objectives of our diversity and inclusion policy are that Exxaro:
Our policies and skills development enable us to meet our transformation objectives in support of the drive for the national imperative towards a non-racial and transformed society. Appropriate affirmative action measures and human resource development programmes support our transformation processes and cultural engagements. We have achieved our employment equity targets over the past five years. Our targets for 2019 to 2022 are aligned with the Mining Charter III promulgated in September 2018. Although we have shown positive progress in achieving our annual targets, there are key challenges in the representation of women at senior management level and persons with disabilities across the organisation. We aspire to measure our transformation profile against national economically active population statistics.
Cennergi continues to meet its job creation targets as in the implementation agreement with the DMRE. Employment equity performance for permanent employees is implemented and monitored according to a five-year employment equity plan and tracked by the Department of Employment and Labour.
In a year marked by initiatives aimed at promoting wellness, values of diversity and equity, and the strategic shift towards decarbonisation as a priority strategic goal, it was important for us to ensure that our culture supports, and is accentuated by those initiatives. In particular, the work done in the health and wellness space, and in terms of gender diversity and equity, provided opportunities for our culture to be embedded and foregrounded.
5 180 employees were represented by affiliated unions recognised by Exxaro, being NUM, Solidarity, AMCU, FAWU and NUMSA (2020: 5 119)
LetsConnect used to further embed our culture through regular communication to employees
Achieved an above-acceptable aggregated baseline score of 3.97 in the 2020 culture and engagement survey (against a benchmark of 3.70)
Average employee turnover rate was 3.7% due to death, resignation and dismissal (2020: 3.6%)
Level 2 BEE contributor
No cases of alleged discrimination or grievances were filed (2020: none)
Refer to the ESG report for more information about our employee engagement.
Our ability to deliver on business objectives and ensure business continuity depends entirely on our ability to attract, develop and retain people with the right skills profile aligned with our strategy.
Talent management encompasses a wide range of activities vital to business performance and continuity, including leadership and capability development, meeting compliance targets for sourcing individuals, and managing a sustainable and appropriate talent pipeline.
Through our talent management strategy, we ensure that the business has the right skills at the right time and in the right place, and that a leadership and specialist talent pipeline is developed for critical positions.
The strategy is evolving to support capability development of our workforce in delivering our strategy and by applying practices applicable to new ways of work. In line with the talent management strategy, connect2NEXT culture journey and demands of the COVID-19 pandemic, we focused on digitalising learning to enhance our talent offerings and used technology to give better access to learners.
Initiatives included:
These initiatives form the foundation of a new hybrid work environment, reducing standard times of learning interventions and thus creating more available productive hours.
Succession planning ensures workforce continuity by identifying and preparing suitable internal candidates for positions while ensuring a sustainable leadership pipeline for critical positions through talent mapping. The cluster health across D and E Paterson bands is satisfactory with 31% of the E Band and 26% of the D Band clusters having black employees that are immediately or medium-term ready for the next higher level position. Our robust annual succession planning cycle runs through talent reviews across BU and functional forums.
We are developing and implementing new learning and development interventions in our capability learning catalogue.
The strategic workforce planning division is responsible for workforce planning over the medium to long term. Its key focus is to use workforce planning market data to give input into talent sourcing and development strategies, and ensure that capability frameworks are created and aligned to the new growth strategy.
Since 2018, the division has worked closely with business leaders in coal operations to create opportunities that would drive early value creation for the coal business and help map out the roles that will transition in a digitalised environment. The result of this was a new capability catalogue aligned to the Digital@Exxaro strategy and a new learning platform.
We recently started engaging with stakeholders from our minerals and renewable energy businesses about their workforce requirements. Mapping competencies to new learning interventions will allow employees to reskill and upskill according to the business strategy.
Cennergi prioritises internal recruitment of high-potential people, where possible, to retain valuable talent and promote the growth of its management service expertise, and offers STI rewards to employees, based on individual and company performance.
We invested significantly in our people during the year through new learning and development initiatives. COVID-19 regulations restricted traditional learning, recruitment and selection for learnerships, PIT, bursars and internships. This ultimately affected our SLP commitments and targets. We were able to curb some of these adverse effects by offering virtual learning through the MyNexxt digital learning platform. It provides blended learning and e-learning instead of the traditional classroom method. Our assessment and recruitment processes were digitalised into interview guides, online interviews and online assessments. We continue investigating hybrid training models to provide flexibility while improving the employee value proposition for learning and development opportunities.
Spent R276 million on training
Contracted nine full-time people with disabilities
121 employees attended various leadership programmes
Enrolled 201 employees in management programmes
Invested R1.02 million in adult education and training
Supported 28 full-time bursars
85 PITs in the talent pipeline
54% of bursaries were awarded to full-time female students in engineering and mining disciplines
We spent R276 million or 5.8% of our payroll on training and development this year (2020: R227 million or 5.04%), including:
Women in mining
We proudly support active women in mining structures across our operations, in collaboration with transformation structures, that highlight and resolve issues affecting women in the workplace.
We empower female employees who make up 26% of our workforce (2020: 24%). We grow this talent pipeline through our PIT programme, which enrolled 41% female candidates in 2021 (2020: 38%).
In 2021, 54% of bursaries were awarded to full-time female students in engineering and mining disciplines at universities in South Africa (2020: 39%).
Our learnership and internship feeder schemes in 2021 comprised 51% women (2020: 40%).
Exxaro is recognised as a leader in gender empowerment as we understand the barriers women face in the mining industry. Our initiatives include:
We focus strongly on employment equity plans to increase the number of African females in our feeder schemes and talent pipeline. We sponsored 23 African females in a technical and vocational education and training college to improve opportunities for access to formal learnerships such as artisan training.
In 2021, we had 56% African females with full-time bursaries, 41% PITs, and 51% learners and interns.
Refer to the ESG report for details of our skills development and training initiatives.
CEO designate, Nombasa Tsengwa (in pink) with some of Exxaro's women in mining in 2019
Human rights are the basic rights and freedoms that protect us all. They are based on dignity, fairness, equality and respect. These rights empower and enable employees to speak up and challenge unfairness within the workplace and other stakeholders to hold Exxaro accountable for the impact of its operations should we infringe on these rights.
We recognise that our operations could negatively impact human rights. We are committed to:
We are implementing a human rights framework. We will be reviewing and updating policies to align with the UNGC guiding principles on business and human rights and the Organisation for Economic Co-operation and Development policies, among others. We are also developing a monitoring and evaluation tool to continuously track our progress in compliance.
Cennergi's human rights approach is guided by human resources policies, code of conduct, South African legislation and the company's commitment to the International Finance Corporation (IFC) PS2: Labour and Working Conditions.
Our ESG report and annual UNGC communication on progress are available on our website and provide further detail on topics discussed below.
Exxaro has a labour and human rights policy that documents the company's position and intent concerning the protection of the human rights of employees and people within the company's sphere of influence in the communities in which it operates.
We reviewed human rights policies to ensure alignment with the Constitution of the country and compliance with labour laws
We continue observing employees' rights to freedom of association – 5 180 (76.9%) of our 6 745 employees are unionised
We comply with all International Labour Organization codes
Proof of our commitment and human rights-related successes include:
We featured in the July 2021 Vigeo Eiris ranking of the 100 best emerging market performers for our approach and ongoing dedication to social responsibility
We ranked third in the Transparency and Corporate Reporting: South Africa 2020 Report among 100 South African companies under scrutiny for transparency and implementation of anti-corruption programmes
We also fulfilled our annual obligations as an active signatory to the UNGC since 2007
We do not tolerate or condone child labour and forced or compulsory labour, and we are aligned with the Basic Conditions of Employment Act and the Constitution of South Africa in this regard.
Our induction programmes educate employees about human rights and our position against discrimination. We train our security personnel in human rights aspects relevant to each operation. We also conduct refresher courses that include human rights issues.
Our policies and structures that prevent discrimination, harassment and racism protect employees' human rights. Our diversity and inclusion strategy aligns Exxaro with the South African Constitution and other legislation, the National Gender Policy Framework and the UN Convention on the Elimination of all Forms of Discrimination against Women.
To align and strengthen our human rights protection mechanisms, we engage with the Minerals Council, which has a guiding framework for the mining industry, and the UNGC. To inform the framework and obtain insights on effective human rights practices, we conducted a due diligence review of our human rights performance in 2021. The review included:
Once the framework is completed, it will allow us to specify formal remedies to address human rights complaints and grievances.
The Exxaro ethics hotline aims to enhance an honest work ethic, and provide employees and third parties with a mechanism to bring any unethical business practices to management's attention. It is an essential line of defence, providing a flow of information that promotes business sustainability by helping to identify and rectify problems before they become more prominent, more costly or damage our reputation. The hotline operates 24 hours a day, 365 days a year. Our independent forensic department receives regular analysis and launches objective investigations, which are tabled at regular management ethics committee meetings.
We encourage open and honest communication between employees and supervisors. Exxaro's employment contracts advise employees of their rights to lodge a grievance if they are dissatisfied, and we have a grievance procedure. Anyone who feels that their rights have been infringed has a right to lodge a grievance without fear of victimisation.
No human rights-related grievances were lodged against Exxaro in 2021.
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