Summary of findings and company response
Exxaro has professed the following commitment to environmental performance:
Exxaro has a moral and legal obligation to ensure responsible and sound environmental management performances. Over and above obligation, however, Exxaro strives to go beyond regulatory compliance in order to enhance its sustainability objectives.1
The findings in Full Disclosure cast doubt on this assertion.
Exxaro does not make particularly detailed information on its environmental non-compliances available to its shareholders. However, what information is included in Exxaro’s annual reports reveals a pattern of serious breaches of environmental laws, in particular in relation to water use. This is confirmed by other publicly available information about the company’s operations.
In 2012 alone, Exxaro reported 6 separate instances in which it was issued with a fine, directive or compliance notice by the Department of Water Affairs.
Also in 2012, the Department of Water Affairs laid criminal charges against Exxaro’s Glisa mine for contraventions of the National Water Act. This is not mentioned in Exxaro’s company reports.
Despite having committed breaches of environmental laws serious enough to warrant fines, directives, compliance notices and criminal charges, Exxaro nevertheless appeared on the JSE SRI Index for 2011 and 2012, and was listed as a “Best Performer” in 2011.
The CER wrote to Exxaro’s CEO on 21 July 2015, inviting the company to respond to the findings in Full Disclosure by 18 August 2015. No response has been received to date.
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. Thus far, unlike the Department of Environmental Affairs, neither department has published any information on its compliance monitoring and enforcement action. This means that it is impossible to know whether or not the level of disclosure on environmental non-compliances by mining companies in their annual reports is accurate or complete.
For more information please see Enforcing the Law: the challenges undermining environmental compliance monitoring and enforcement in South Africa.
- http://www.exxaro.com/index.php/sustainability/managing-environmental-issues/ (last accessed on 7 August 2015).