Integrated Annual Review 2023

Integrated Annual Review 2023 Downloads

Minerals Council Integrated Annual Review 2023 [thumbnail]

Integrated Annual
Review 2023

Minerals Council Annual Financial Statements 2023 [thumbnail]

Annual Financial
Statements 2023

About

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In this section
  • About the Minerals Council
  • Our mission, purpose, vision and values
  • About this report
  • Key features: the South African mining industry in 2023
  • Key features: the Minerals Council in 2023

Key features: The South African mining industry in 2023

Our numbers show and tell the story: mining matters for South Africa

% contribution to nominal gross domestic product (GDP)

6.3%

(2022: 7.3%)

% contribution to nominal gross domestic product (GDP)

Company tax paid*

R89.9 billion

(2022: R73.6 billion)

Royalties paid**

R14.1 billion

(2022: R25.3 billion)

Total primary sales (current prices)

R792.3 billion

(2022: R883.5 billion)

Employee earnings

R178.8 billion

(2022: R163.9 billion)

Pay as you earn (PAYE) by mining employees*

R31.3 billion

(2022: R27.1 billion)

Mineral exports

R781.6 billion

(2022: R882.8 billion)

Value added tax (VAT) (net outflows)*

R37.2 billion

(2022: R28.9 billion)

Direct GDP contribution (current prices)

R440.8 billion

(2022: R483.3 billion)

RioTinto – Richards Bay Minerals

Employment

479,111

(2022: 469,353)

% contribution to nominal gross domestic product (GDP)

Royalties paid**

% contribution to nominal gross domestic product (GDP)
Sedibelo Platinum Mines – Pilansberg Platinum Mine
  • * 2023 refers to the 2022/23 financial year, 2022 to the 2021/22 financial year.
  • ** Based on National Treasury’s estimates as in the Statement of National Revenue, Expenditure and Borrowing from April 2023 to October 2023.
  • *** The figures for 2022 are not strictly comparable to what was used in the 2022 Integrated Annual Report due to data revisions since the publication of the report and/or because the final data for 2022 was not yet available at the time.

Leadership

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In this section
  • Message from the Minerals Council President, Nolitha Fakude
  • Our Board and approach to governance
  • Our leadership forums
  • Letter from our Chief Executive Officer (CEO), Mzila Mthenjane
  • Minerals Council leadership and core disciplines

Message from the Minerals Council President, Nolitha Fakude

“Mining continues to be a key contributor to the fiscus, which matters to all South Africans”
Nolitha Fakude [photo]

Nolitha Fakude
President

#MiningMatters

Mining in South Africa has, over the past three decades, increased its relevance and the positive impact it has on society, and it continues to be a critical industry within our economy.

Mining matters to South Africa. This is an industry that has made fundamental changes to the way it engages and shares the benefits of the nation’s mineral wealth.

As we mark 30 years of operating in a democratic dispensation since 1994, it is timely to consider the milestones the industry has achieved...

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Letter from our CEO, Mzila Mthenjane

“2023 was characterised by bold industry action in response to, and to drive, change”
Mzila Mthenjane [photo]

Mzila Mthenjane
Chief Executive Officer

#MiningMatters

#MiningMatters, because the lives of South Africans matter to us as leaders in the minerals and metals industry.

It is our enduring vision for mining to be significant in the economy and meaningful in the lives of employees and communities in South Africa. The significance of mining is evident in its GDP contribution and the catalyst it provides for investment. Mining is meaningful through its social impact; providing jobs, supporting local economic development and, going forward, enabling the just energy transition.

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Our context

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In this section
  • How mining contributes to South Africa
  • The Minerals Council’s contribution to South African mining
  • Our external environment in 2023
  • Our approach to managing risk
  • Our business model
  • Our stakeholders
  • Assessing materiality and our material issues
  • Mining and the UN SDGs

The Minerals Council’s contribution to South African mining

Snapshot of the year

1

January
  • Industry records its first fatality-free January and full calendar month without loss of life
  • Minerals Council notes with dismay the above-inflation electricity tariff increases granted to Eskom
  • Minerals Council warns that a social media campaign to stop coal exports will result in disrupted mining operations and potential job losses

2

February
  • Minerals Council represents members at Mining Indaba and shares its position on climate change
  • Minerals Council welcomes energy interventions in national budget speech

3

March
  • Minerals Council participates in the Prospectors & Developers Association of Canada (PDAC) Convention
  • Board approves the 2022 annual financial statements
  • Minerals Council participates (with several mining companies) in the World TB Day celebrations hosted by the Deputy President of South Africa

4

April
  • Minerals Council and PwC release ‘The state of digital transformation in the South African mining industry: Ten insights into 4IR 2023’
  • Minerals Council and its members in the Northern Cape welcome the completion of the first phase of the project to refurbish the Vaal Gamagara Water Supply Scheme

5

May
  • Minerals Council holds 133rd AGM and publishes Integrated Annual Review 2022
  • Minerals Council appoints Mzila Mthenjane as our new CEO
  • Minerals Council expresses concern that South Africa remains poorly rated as a mining investment jurisdiction in the latest Fraser Institute Survey

6

June
  • Minerals Council celebrates International Day of WiM
  • Minerals Council participates in the Junior Indaba
  • Review of the Minerals Council strategic plan
  • The Masoyise Health Programme (Masoyise), in collaboration with the MHSC and the Internal Labour Organization, hosts a seminar at the 11th SAAIDS Conference 2023

7

July
  • Minerals Council welcomes the appointment of nine new members to the Transnet board chaired by Andile Sangqu
  • Member CEOs share learnings on FOG fatalities at the monthly hour of learning meetings

8

August
  • Minerals Council hosts the 6th National Day of Health and Safety in Mining
  • Minerals Council President delivers a paper at the inaugural African Critical Minerals Summit

9

September
  • Minerals Council participates in a MIASA event
  • Minerals Council CEO presents paper at the Africa Down Under Conference on mining being an enabler to a low carbon future

10

October
  • Minerals Council ICMM meeting in London
  • Minerals Council CEO participates in a panel at the Joburg Indaba on reviving mining and exploration in South Africa

11

November
  • Minerals Council publishes Facts and Figures Pocketbook 2023
  • Minerals Council notes the release of the medium term budget
  • Board approves the revised Minerals Council strategy
  • B4SA briefs Minerals Council on government and organised business partnerships to deliver meaningful economic growth

12

December
  • Minerals Council mourns the loss of life in tragic accident at Impala Platinum
  • Minerals Council mobilises its members to contribute funds towards the NLCC to pay for expertise to assist Transnet with critical reforms and operational improvement

How mining contributes to South Africa

Global macroeconomic context
Easing in global manufacturing momentum a drag on South African mining production [graph]
Global macroeconomic context
Headline CPI in the US and Eurozone heading back to target [graph]
Mixed bag for South African export commodity prices in 2023
Key South African commodity prices (measured in Rand) diverged in 2023 [graph]
Despite improvement in Q4, mining GDP underperformed again in 2023
Mining GDP (in real terms) underperformed again in 2023 [graph]
Despite improvement in Q4, mining GDP underperformed again in 2023
Mineral sales posted first calendar year decline since 2015 [graph]
Profitability taking strain
Mining profitability worse than the rest of South Africa’s economy [graph]
Fixed investment focused on sustaining operations
Mining exploration activity remained depressed in 2023 [graph]
Mining export volumes curtailed by Transnet rail problems
Iron ore and coal export losses: 2021-2023 [graph]
Mining employment defies poor operating environment
Change in formal non-agricultural employment [graph]
Input cost pressures ease, but remain elevated
Mining input costs back at the long-term trend in 2023 [graph]

For the information in this section, the Minerals Council relies on various primary data sources, including Stats SA, the DMRE, the South African Reserve Bank (SARB), the World Bank and the United States Geological Survey.

OUR STRATEGY

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In this section
  • Delivering on our strategy
  • Strategic goal 1
  • Strategic goal 2
  • Strategic goal 3
  • Strategic goal 4
Strategic goal 1 [heading]
Drive the development of a shared vision for a globally competitive mining industry that is a significant contributor to South Africa’s economy and supported by all stakeholders.

Our objectives:

Objective 1.1

Lead the industry agenda for structural change, ethical leadership and good governance to arrest the decline and stabilise volume output to position the industry for growth, through partnerships for business advocacy and impact.

Objective 1.2

Build and promote a positive image and reputation of the mining industry and deploy the Minerals Council brand for a reimagined mining industry integral to growth and development.

Objective 1.3

Successfully alleviate and prevent the negative impacts of mining legacy issues (viz. migrant labour, poor living conditions, social wage, acid mine drainage, derelict and ownerless mines, mine rehabilitation, outstanding payments of compensation for OLDs and pension funds) in collaboration with stakeholders.

Objective 1.4

Promote RD&I to modernise the mining sector through adoption of relevant technology applications.

Strategic goal 2 [heading]
Advocate and lobby for a policy, infrastructure and social environment that is conducive to investment and growth of the industry and maximises the benefit for the country from its mineral endowment.

Our objectives:

Objective 2.1

Engage government (and other stakeholders) on relevant policies, legislation and regulations to create an enabling environment that is stable, competitive and predictable to promote and facilitate mining investment and growth.

Objective 2.2

Partner with government, regulators, SOEs, labour and communities to resolve infrastructure challenges (electricity supply and prices, rail, ports and water); social development in mining communities (housing, schools, clinics); and crime (as it affects mining through illegal mining, product theft, theft of mining supplies, criminal syndicates).

Strategic goal 3 [heading]
Communicate progress and impact of aggregate EESG performance and adoption of leading practices.

Our objectives:

Objective 3.1

Lead initiatives to fast track mining’s progress to zero harm.

Objective 3.2

Lead the development of a vision of what good transformation looks like in collaboration with stakeholders, including the design of a practical, workable and enforceable instrument to facilitate further industry transformation.

Objective 3.3

Promote consolidated and cumulative member ESG performance.

Strategic goal 4 [heading]
Ensure continuous improvement of the effectiveness and service of the Minerals Council to members.

Our objectives:

Objective 4.1

Conduct regular (at least once per annum) reviews of the strategy and performance against the strategic objectives.

Objective 4.2

Broaden the Minerals Council’s membership to include emerging miners and ensure their voice on the Board.

Objective 4.3

Proactive risk response management system, aligned with the strategic objectives, to manage mining industry risks and take advantage of opportunities.

Objective 4.4

Design and implement an effective Human Resources Development strategy to attract, develop and retain a professional team aligned to our strategic goals.