Exxaro Resources Limited
Environmental, social and governance report for the year ended 31 December 2025
Robust governance underpins value creation at Exxaro. Aligned with our theme, accelerating our strategy to become a diversified natural resources champion, we uphold strong governance practices to enable sustainable growth and maintain stakeholder confidence. This section highlights our commitment to responsible business practices that support strategic execution and future readiness.
Exxaro’s board provides ethical and effective leadership as the focal point of governance in the group. It holds ultimate accountability for performance and affairs, while balancing the legitimate interests of the group and our material stakeholders to deliver positive societal and environmental impact.
Our governance approach complies with national legislation, including the Companies Act, Financial Markets Act, JSE Listings Requirements, SAMREC Code and King IV.
King IV advances good governance through transparent leadership, sound decision making and a focus on sustainability. Sustainable development is an ethical and economic imperative that balances current economic and social needs with those of future generations. As a responsible corporate citizen, Exxaro integrates stakeholder needs and expectations through our Sustainable Growth and Impact strategy.
Our governance approach supports Exxaro’s Sustainable Growth and Impact strategy. We outline how our governance structures enables value creation in the short, medium and long term.
Our corporate governance reporting is structured under four King IV governance outcomes: ethical culture; performance and value creation; adequate and effective control; and trust, good reputation and legitimacy.
Exxaro’s corporate governance is guided by principles that help the board fulfil its responsibilities to the company, group and stakeholders. These principles support the achievement of King IV governance outcomes and enable ethical, effective and accountable leadership that advances Exxaro’s purpose of powering better lives in Africa and beyond.
In line with King IV’s recommendation to apply and explain good governance, we include our detailed King IV application register on our website as well as in our databook, setting out each principle with the steps taken, policies and processes.
Exxaro’s Sustainable Growth and Impact strategy requires robust governance to ensure disciplined capital allocation, long-term value creation and responsible stewardship of stakeholder interests.
Through active board oversight and clear decision-making frameworks, the group reshaped our portfolio by divesting from non-core assets while directing capital towards priority growth areas. These decisions reflect a governance approach that integrates strategic foresight, risk management and ESG considerations, repositioning Exxaro for resilience, sustainability and relevance in a transitioning economy.
Sustained value creation relies on addressing material social and environmental challenges. Accordingly, our strategy is reviewed annually and submitted to the board for approval.
Following a two-day strategy session (themed “positioning Exxaro to lead”) with the management team in June 2025, the board reaffirmed the Sustainable Growth and Impact strategy. The ESG framework continues to shape how this strategy is viewed and monitored.
The strategy development and review process follows a risk and opportunity assessment, including emerging risks and material sustainability issues. Our strategic performance management dashboard enables visibility of strategy execution. KPIs are cascaded from the board through sub-committees to facilitate strategic and timely discussions.
Read our ESG governance and risk for details about our ERM approach.
our integrated report includes detailed information about our top strategic risks for the year.
Shareholders were informed on 6 February 2025 of Dr Nombasa Tsengwa’s resignation, in terms of paragraph 6.71(b) of the JSE Listings Requirements. A targeted selection process resulted in the board appointing Ben Magara as incoming CEO, effective 1 April 2025. Ben stepped down as an independent non-executive director, succeeding the acting CEO, Riaan Koppeschaar, who continues as FD.
In August 2025, the CEO announced changes to the group management structure to support Exxaro’s growing and diversified portfolio, strengthen business stability and enhance agility, collaboration and responsive decision making. The new structure also enables accelerated execution of the Sustainable Growth and Impact strategy.
The new structure included three new appointments namely: executive head: coal, executive head: sustainability (designate) and executive head: commercial.
As part of our ongoing investor engagement initiatives, the chairman of Exxaro’s board, together with the chairs of the remuneration, RBR and investment committees held Exxaro’s 2025 governance roadshow from 29 to 30 September 2025, engaging investors in Cape Town and Johannesburg. This year’s roadshow included BlackRock, one of Exxaro’s offshore shareholders. At the time of the roadshow, the represented organisations had a cumulative holding of 79.76% in Exxaro shares.
Shareholder discussions focused on seven key themes, with remuneration, CEO/leader transition, strategy and capital allocation, and B-BBEE structure post-2027, leading the discussion.
Progress on Exxaro’s vertical and horizontal wage gaps was also discussed, along with the potential impact of the recently promulgated legislative disclosure requirements. The company is confident that work in this area is well advanced and will consider commencing disclosure on the wage gap.
As reported previously, a coal mine dust class action litigation was initiated against Exxaro on 23 November 2023. The action involves mineworkers who contracted pneumoconiosis caused by exposure to coal mine dust at various Exxaro mines and dependents of deceased mineworkers whose deaths are likely attributable to the disease.
Exxaro completed the Rule 35 discovery process for documents received from the claimants and appointed independent administrative, medical, occupational hygiene and legal experts to support the assessment. Exxaro is defending the certification application and will continue to act in accordance with legal advice.
Exxaro is committed to health and safety, and on the SERC’s recommendation, the board approved the revised health and safety policy. Management continues to identify health and safety risks and implement appropriate preventive measures, including medical surveillance programmes and occupational hygiene programmes, to reduce the risk of occupational health diseases across our operations.