This is Exxaro's third year of reporting in line with the TCFD recommendations. This reflects Exxaro's internalised and proactive approach to climate change and our ESG commitments. The table below provides an overview of our responses and links to relevant coverage in this report, our ESG report and other supporting documents available online. We published a separate Climate Change Response strategy and our climate change position statement in 2020. These provide additional detail on some areas of our response to climate change.
1The board's oversight of climate-related risks and opportunities
Climate change is an integral consideration and as such is embedded in our governance processes. The board takes ultimate responsibility and is supported by its sub-committees. The CEO and chairperson oversee climate-related risks and opportunities.
Governance (ESG report)
2Management's role in assessing and managing climate-related risks and opportunitiesp
Ultimate responsibility from a management perspective rests with the CEO. She is supported by the executive committee. A scenario analysis is applied to identify risks and opportunities by management teams, as stated in our Climate Change Response strategy.
Transitioning into a low-carbon business (ESG report)
3Climate-related risks and opportunities the organisation has identified over the short, medium and long term
Climate-related transitional risks include emerging regulation, legal/litigation, carbon pricing, market and reputational risks. Physical risks include extreme weather events, such as flooding and heat waves. Opportunities include investments in low-carbon minerals, growing the energy business, business resilience, energy self-generation, implementation of low-carbon technologies and strategic partnerships.
4The impact of climate-related risks and opportunities on the organisation's strategy and financial planning
Our Sustainable Growth and Impact strategy focuses on diversifying to low-carbon transition minerals and growing our energy business. Prudent financial planning and capital allocation is applied to ensure business resilience in a low-carbon world.
Transitioning into a low-carbon business (ESG report)
5The resilience of the organisation's strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario
We undertook a scenario analysis to understand our business resilience from a physical and transition risk perspective. Our strategy is designed to ensure our resilience to different climate scenarios, including 2°C or lower. Our strategy details how we are responding to risks and opportunities associated with the lowcarbon transition. Furthermore, our Climate Change Response strategy report and climate change position statement include information on this analysis.
Climate Change Response strategy report (investor tab under integrated reports 2020) and climate change position statement (sustainability tab)
6The organisation's processes for identifying and assessing climate-related risks
We take a proactive approach to identifying climate-related risks. The ERM framework considers climate risks and has an impact scale that is used to rate these risks.
Transitioning into a low-carbon business (ESG report), Climate Change Response strategy report (investor tab under integrated reports 2020) and climate change position statement (sustainability tab)
7The organisation's process for managing climate-related risks
Climate-related risks are managed within our ERM framework. The RBR committee, on behalf of the board, is responsible for regularly monitoring risks that will have an extreme impact on the group if they materialise. Extreme risks, together with their controls, are considered critical in the ever-changing environment in which we operate. These are continually monitored and reviewed in line with the risk appetite framework and combined assurance approach.
8How processes for identifying, assessing and managing climate-related risks are integrated into the organisation's overall risk management
Climate-related risks are integrated into overall risk management and factor as one of the top 20 risks facing the business.
9The metrics used by the organisation to assess climate-related risks and opportunities in line with its strategy and risk management
Climate risks and opportunities metrics are disclosed in the ESG report, ie carbon emissions, carbon intensity, fossil fuel revenue versus clean technology revenue.
Environment (ESG report) and remuneration report (ESG report)
10Disclose scope 1, scope 2, and, if appropriate, scope 3 GHG emissions, and the related risks
We report extensively on our scope 1, 2 and 3 emissions in our ESG and CDP reports.
GHG emissions (ESG report) and CDP report (www.cdp.net)
11The targets used by the organisation to manage climate-related risks and opportunities and performance against targets
We have committed to reducing our emissions by 40% by 2026 and being carbon neutral for our scope 1 and 2 emissions by 2050. We also have a carbon intensity reduction target (5% reduction compared to the previous year's carbon intensity).
Transitioning into a low-carbon business (ESG report)
Report Index
IR