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Full Disclosure 2016

Summary of updated findings

AngloGold’s 2015 Sustainability Report states, in relation to penalties for non-compliance, that “there were no significant environmental fines in 2015” and that “these are defined as environmental fines above $100 000”.1

The South African environmental regulatory regime does not use a system of administrative penalties which enables the regulator to impose fines on companies in breach of environmental laws. Breaches are dealt with by way of compliance notices and directives, and as a last resort, criminal prosecution, which has relatively small maximum fines available. As a result, using financial penalties as an indication of materiality is ineffective in the context of environmental regulation, and can lead to very misleading disclosure practices in which serious potential liabilities are hidden by companies perpetrating the unlawful behaviour.

It is for this reason that the CER argued, in its submissions to the King Committee on the draft King IV Report™, that all breaches of environmental laws should be required disclosures by all organisations, regardless of whether they are considered by any particular governing body as “material” or whether they are repeated.

The final King IV Report™ includes the following requirement under Principle 13, “Compliance governance”:

Details of monitoring and compliance inspections by environmental regulators, findings of non-compliance with environmental laws, or criminal sanctions and prosecutions for such non-compliance should be disclosed.2

In future, companies like AngloGold will therefore be required to disclose far more detailed information about environmental non-compliance.

  1. AngloGold Ashanti Sustainability Report 2015, at p76.
  2. King IV Report™, p64, available for download at: (last accessed on 7 November 2016).