I am pleased to present the RBR committee report for the year ended 31 December 2024. The committee focused on enhancing Exxaro's ability to achieve its strategy, reputation as a good corporate citizen, and resilience to adapt appropriately in a changing environment.
Peet Snyders
RBR committee chairperson
During the period under review, the committee consistently had six members, the majority of whom are independent non-executive directors.
The board is satisfied that the committee members have a suitably balanced blend of skills and experience to enable the RBR committee to discharge its mandated functions.
There were neither retirees nor additional members to the committee in 2024, ensuring continuity in furthering the strategic objectives. Following Ben Magara's appointment as CEO on 1 April 2025, he will step down as a committee member but has a standing invitation to all meetings.
Standing invitees to committee meetings include the CEO, FD, chief strategic resilience and governance officer, and group manager: risk. Other individuals, including members of management, external consultants and service providers are invited to attend the committee's meetings from time in consultation with the committee chairperson.
Refer to board of directors for members' qualifications and experience.
Gender and racial diversity
The committee held four scheduled meetings as determined by its terms of reference. The meeting attendance illustrates a high level of commitment from its members. The table below provides an overview of meeting attendance in 2024.
The committee is a board committee in terms of section 72 of the Companies Act, the company's MoI, and King IV.
The committee's primary role is to implement an effective policy and plan for risk management that will enhance the group's ability to achieve its strategic objectives and to ensure that risk disclosure is comprehensive, timely and relevant.
Risk management is effected by the board, management and other personnel. It is applied in strategy setting and across the group and is designed to identify potential events that may affect the organisation, manage risks to within its risk appetite, and provide reasonable assurance regarding the achievement of the organisation's objectives. Risk governance involves the structures and mechanisms within the organisation that guide the decision-making and implementation processes related to managing risks.
The committee is responsible for reviewing the ERM process, including key risks facing Exxaro and the responses to address these risks. It maintains a particular focus on:
Business resilience is the ability of an organisation to adapt to a changing environment to enable it to deliver its objectives, survive, and prosper. Risk, incident, crisis and business continuity management are the four key elements of business resilience. The committee's role is to oversee the appropriateness of Exxaro's crisis response plans and frameworks.
The committee's terms of reference are reviewed annually. The review took place in the first quarter of 2025 and the revised terms of reference were subsequently approved by the board. The review ensured the terms of reference remain aligned to relevant legislation, regulations and King IV.
There is no regulatory requirement to conduct an annual external independent performance assessment. However, King IV recommends regular performance evaluations for all board committees and, as such, we conduct independent assessments every third year in line with Exxaro's governance practices.
An internal evaluation of the committee's performance and effectiveness was conducted in January 2025. The evaluation aimed to identify and record areas needing strengthening or refinement while considering internal and external dynamics and factors that may positively or negatively impact the committee's ability to enhance its performance and effectiveness in these areas. The assessment concluded that the committee functions effectively.
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The committee tested the robustness of Exxaro's risk process and its effectiveness in identifying and assessing risks that would affect the company's ability to achieve its strategic objectives. Following the board strategy review in June 2024, the risk register was reassessed for alignment with the theme of positioning Exxaro to win. The key risk areas were themed in line with the strategic focus areas, and the energy business's strategic risk profile was included.
The committee is satisfied that the company's strategic risk profile is robust and reflects relevant risks that apply to Exxaro's industry peers. The committee is also satisfied that the Exxaro strategic risk profile reflects the group's material risks.
The committee reviewed and recommended to the board the group ERM framework. The purpose of the review was to:
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Ensure alignment with the current business objectives and operating context |
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Benchmark against key governance best practices |
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Update roles and responsibilities concerning the risk governance structure |
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Review key components within the framework, including the updated risk appetite framework and the new risk principle regarding the interconnectivity of risk |
Strategic policies guide operational policies. A revised group policy framework was developed and is being enhanced to serve as an overarching structure for the arrangement, development and review of the group's statements, frameworks, policies, procedures, standard operating procedures and guidelines.
An external maturity/benchmark assessment was conducted to assess the ability of the strategic resilience and governance department to provide effective risk and compliance management. The committee reviewed the results of the assessment and proposed action plan to deliver on the strategic resilience and governance strategy for effective risk and compliance management. A roadmap was created to attain a level four risk and compliance maturity by December 2025.
The committee considers Exxaro's sustainable impact targets and the KPI assessment report.
In 2024, an external service provider was appointed to conduct a water security risk assessment to understand the likelihood of Exxaro's operations, the environment and communities suffering due to physical climate change risks to their water management systems, ecosystems, and livelihoods. The project of commissioning the water treatment plant at Durnacol commenced at the end of October 2024.
A senior biodiversity specialist was appointed as part of the operational effectiveness process. This specialist reports to the sustainable impact department in the integrated environmental management function. The role's purpose is to provide strategic and technical support regarding the management and improvement of biodiversity for current and future operations.
The four inactive sites with the highest safety and environmental risks were prioritised, and a budget was allocated in 2024 to address these risks.
During the year, Exxaro's Mafube mining complex was granted a renewed WUL which authorised the mine residue stockpile. The Matla mine WUL was issued by December 2024.
On 22 May 2024, Exxaro received the amended WUL for the Mokolo Crocodile Water Augmentation Project. This licence ensures that Grootegeluk's usage is aligned with the water services agreement between Exxaro, the DWS, and the Trans Caledon Tunnel Authority. The licence assists to ensure that Exxaro has adequate long-term water allocation and security.
The committee also discussed the rehabilitation strategy.
We apply predictive and proactive reporting in Exxaro's analysis and reporting.
Coal Resources and Reserves are estimated on an operational or project basis, in line with the SAMREC (2016) and SANS (10320):2020 edition codes for the South African assets, and the JORC code (2012) for the Australian coal property. Exxaro's annual estimation and reporting process is managed through Exxaro geosciences, LoM policies, and associated reporting and estimation procedures, which are reviewed annually and updated if required. The committee reviews and recommends the Coal Resource and Reserve statement annually.
Management provides in-depth reports to the committee on information management strategy, operational excellence, information management governance, the information management portfolio and enterprise architecture, information management risk management, and the enterprise resources planning journey.
Exxaro adopted the National Institute of Standards and Technology cybersecurity framework to guide its approach to cybersecurity risk to systems, people, assets, data, and capabilities. This framework is supported by the ISO 27001 standard, which was embraced to outline the controls and procedures needed to drive a robust cybersecurity programme.
Cybersecurity training is ongoing, and consequence management is enforced when users are in breach.
The ESG policy, developed by the ESG PMO, was reviewed by management as instructed by the executive committee and finalised during the fourth quarter of 2024.
The committee was briefed on the draft decarbonisation roadmap, which is undergoing an external peer review to ensure credibility, the feasibility of assumptions, gap analysis, risk management, and the correct application of decarbonisation roadmap development principles.
The committee was satisfied with an update on the implementation and enforcement of the insider dealing policy, which was recommended to the board.
The committee oversaw the directors' and officers' liability programme and reviewed the insurance renewal programme during the year. This included stress testing for worst case scenario by the International Mining Industry Underwriters.
The committee recommended the 2024 integrated report matters to the board for approval. The materiality review research process identified 24 material matters grouped into seven overarching themes. The identified material matters were consistent with the risk register.
The class action legal strategy was presented and discussed at the board meeting in November 2024.
The committee receives reports detailing the crime landscape, causative factors, and impact on the company and the country.
Exxaro's safety improvement initiatives monitored by and reported to the committee included the following:
| The sustainability summit held on 15 April 2024 aimed to bring together stakeholders to demonstrate Exxaro's commitment to our employees' health, safety and wellbeing. | Any HPI places Exxaro's strategic goal of zero fatalities at risk and impacts the achievement of zero harm. All HPIs are presented to the committee, investigated by management, and solutions are shared across the group for implementation and to test their effectiveness in eliminating repeat incidents. |
| As part of an initiative to empower Exxaro's health and safety representatives to be key safety, health and environmental drivers in their lines of work, the mines ran several training programmes, which included coaching and mentoring. | Leadership interventions included executive committee members communicating risk awareness messages to the broader workforce on the identified safety risks as part of demonstrating incredible leadership. |
| Key focus areas 2025 |
| Monitor the class action served on Exxaro in November 2023 and its impacts on the group as a responsible corporate citizen, as well as ensuring occupational disease preventive measures are well implemented |
| Oversee the implementation of the water management plan at all Exxaro mines, including closed mines, and review any mitigating plans such as the groundwater analysis model to address the impact of climate change on operations and water sources |
| Ensure effective plans are in place based on the impact of business disruption (plans are up to date and no significant incidents occurred that led to business disruption) |
| Ensure a strategic review of Exxaro’s mineral asset portfolio |
| Review Exxaro’s risk appetite |
| Review Exxaro’s key compliance risks related to licence to operate |
| Recommend appropriate predictive and proactive reporting and engagement with stakeholders (including the integrated report) based on key risks |
| Oversee the implementation of the revised governance of technology and information to ensure incorporation of technology and information risks to enable strategy delivery and ensure business resilience |
The committee is satisfied that it has discharged its responsibilities and fulfilled its mandate in accordance with its terms of reference, the Companies Act and King IV.
On behalf of the RBR committee
Peet Snyders
RBR committee chairperson
15 April 2025
IR