“To enable us to attract, develop and retain skilled, motivated and committed employees, we seek to build and maintain relationships with our employees which are based on trust, mutual respect and credibility. To achieve our strategic objectives, we focus on ensuring that we have the necessary skills, culture and employees in place.”

2019 HUMAN CAPITAL HIGHLIGHTS AND CHALLENGES
Highlights

Barberton Mines successfully concluded a three-year wage agreement during September 2018 to provide certainty of earnings and sustainable productivity
Safety programmes, motivational talks and other safety initiatives have been well received by all our employees at Barberton Mines and Evander Mines, leading to a clear improvement in safety
Challenges
Ongoing community pressure and unrealistic employment expectations
Limited lower-level employee opportunities if they are not appropriately trained and provided with the requisite skills required to grow
Community unrest in areas surrounding our mining operations. This is a particular problem at Barberton Mines due to communities being located close to the mining operations
Looking Ahead
Continue to offer motivational talks and other initiatives aimed at safety improvement
Enabling safe operations through good leadership examples and effective line management strategies
Improve on training and talent management systems
Review of human resource policies to ensure that they are aligned to Mining Charter III

The board and remuneration committee mandated an independent remuneration expert to review the group’s remuneration policies, consult shareholders and recommend improvements, where necessary.

Why employees are material to Pan African Resources

Our people are fundamental to the sustainability of our business and long-term value creation in addition to being key enablers in the execution of our strategy. Our employees are key to our business success, which makes it imperative that they are part of an organisational culture that priorities safety, diversity, innovation and performance.

Employee profile

The group’s total staff compliment has declined to 3,641 people (2018: 4,840). The decline is attributable to the reduced number of contractors at our operations following the commissioning of Elikhulu in September 2018 and the cessation of large-scale underground operations at Evander Mines. The group’s staff turnover was 10.6% (2018: 8.6%) excluding retrenched employees demonstrating the stability of the group’s workforce. The employee relations environment has been stable over the past financial year with no authorised industrial action experienced at our operations.

Employment Diversity and Gender Equity

Pan African Resources promotes employment diversity and gender equality. We respect people from diverse backgrounds and promote a culture in which our employees feel valued, which, in turn, encourages our employees to contribute to the growth and sustainability of our company.

Pan African Resources acknowledges that delivering and contributing to genuine transformation is critical for the sustainability of our business, the communities in which we operate, and the country as a whole. We are committed to integrating real transformation throughout the group, as guided by the MPRDA, the Mining Charters and our SLPs.

The board has set the following target for its non-executive director representation:

  • 25% female
  • 40% HDSAs.

After year-end, we further strengthened the Pan African Resources board with the appointment of two new independent non-executive directors. We welcome Yvonne Themba and Charles Needham to the board. Yvonne Themba’s appointment improves our board gender and employment equity representation for the 2020 financial year. Subsequent to the appointment of the two new directors, our board comprises seven directors, of which two are female (29%) and three are HDSAs (43%).

Permanently employed females have marginally increased to 10.4% (2018: 9.7%).

Recent Mining Charter Developments

Mining Charter III seeks to strike a balance between improving transformation and ensuring the industry’s viability in a volatile environment. Regarding ownership, it differentiates between new and existing mining rights holders.

Existing rights holders can continue to have 26% black ownership for the duration of their rights, although increased HDSA ownership is required for licence renewals and transfers. These rights remain applicable even if a BBBEE shareholder withdraws its stake, which is often a contentious point following the industry’s legal battle over the ‘once empowered, always empowered’ principle.

Companies that applied for mining rights before the introduction of the 2018 Mining Charter require 26% black ownership and have five years to increase that percentage to 30%.

Following the successful restructuring agreements concluded in the prior year, Pan African Resources’ BBBEE ownership is calculated at 26%, comprising 21% in Pan African Resources SA Holdings Proprietary Limited and 5% from its on-mine employee ownership schemes. Refer to our website for our company structure. www.panafricanresources.com/about-overview/company-structure

Skills development and Training

Pan African Resources believes that ongoing and effective talent development is essential for its continued competitiveness, transformation and sustainable growth. Our skills development and training focuses on investing in our employees to ensure that we have the necessary skills to meet our strategic objectives and operational needs.

We deliver these skills through a combination of learnerships, bursaries, artisan training, Adult Basic Education and Training and other skills transfer initiatives provided to individuals in the appropriate demographic groups as defined in the amended Mining Charter III. The group spent USD1.0 million (2018: USD1.8 million) on human resources and development during the year. The spending decline results from lower employee numbers.

Anti-corruption and Anti-bribery

Pan African Resources has a zero-tolerance policy for bribery and corruption by employees, officers, directors, consultants or contractors, with even the appearance of impropriety deemed unacceptable.

We conduct internal audits of all of our business units and have robust internal financial controls and processes in place.

Looking ahead

During the year ahead, we will align our training and talent management systems to include a greater focus on human capital development to ensure that Pan African Resources’ employees and managers are able to progress their careers within the group.
We will continue to review our human resource policies to ensure that they are aligned to prevailing legislation and regulations.