Summary of findings and company response
Kumba Iron Ore states on its website that:
We are keenly focused on managing our environmental impacts, including preventing pollution, minimising our emissions, using water and other resources efficiently and ensuring legal compliance.1
The CER wrote to Kumba’s CEO on 27 September 2016, inviting the company to respond to the findings in Full Disclosure by 25 October 2016. Despite follow up correspondence from the CER, no response has been received to date.
Kumba is to be commended for the level of disclosure of its environmental impacts and non-compliances in its annual reports, which is higher than that of some of the other companies assessed for Full Disclosure. However, there are a number of serious issues identified in Kumba’s reports in insufficient detail to allow a proper assessment of environmental legal compliance and risk.
Kumba’s 2013 Sustainable Development Report refers to an MPRDA section 93 directive in relation to “a number of environmental non-compliance issues”, but these issues are not specified, nor is there any further mention of whether or not these non-compliances have been dealt with in this report or later reports.
Kumba’s 2014 and 2015 Sustainable Development Reports reference several “major non-conformances”. The description of the nature of these non-conformances is vague and does not provide stakeholders with sufficient information. In relation to these non-conformances Kumba states that “corrective action plans to prevent recurrence were implemented and shared with the respective auditors”. The “auditors” in relation to these “major non-conformances” are described as Bureau Veritas, DMR, PwC, and DEA. The DMR and the DEA are not “auditors” but government regulators. Corrective action “reported” to the DMR and the DEA presumably implies action required to correct findings of legal breaches, and this should be specified clearly.
It is concerning that Kumba’s operations appear to be so frequently in non-compliance with environmental laws, and that Kumba often provides minimal and vague information to its shareholders about the nature of these non-compliances. It is also concerning that so little information is provided about the rehabilitation of the Thabazimbi mine, which has had an extreme impact on the local environment.
The Department of Mineral Resources and the Department of Water and Sanitation are responsible for compliance monitoring and enforcement of environmental and water laws by mining companies. Unlike the Department of Environmental Affairs, thus far neither department has published any information on the findings of their inspections or on the enforcement action taken by their departments. This means that it is impossible to know whether or not the level of disclosure on environmental and water non-compliances by mining companies in their annual reports is accurate or complete.
- http://www.angloamericankumba.com/sustainability/environment.aspx (last accessed on 7 November 2016).