Full Disclosure

Anglo American Platinum Limited (Amplats) discloses information regarding its financial provision for environmental rehabilitation in its annual financial statements.

The information which is publicly available is:

1. The estimated figures for environmental rehabilitation obligations, and the funds and guarantees available to meet those obligations.
2. That “management estimates, with the assistance of independent experts, the Group’s expected total spend for the rehabilitation, management and remediation of negative environmental impacts at closure at the end of the lives of the mines and processing operations.”¹
3. The basic assumptions used in the calculation of the environmental rehabilitation provision, and the accounting treatment of the rehabilitation obligations.
4. That financial guarantees and the Platinum Producers’ Environmental Trust are the financial vehicles used to provide for future rehabilitation obligations.
5. One consolidated figure for financial provision for environmental rehabilitation in the annual financial statements.

While Amplats’ disclosures are in line with those of its peers, they do not, however, provide stakeholders with:

• clear, understandable, comparable information about the type and extent of environmental damage covered by these estimated liabilities;
• the methods and experts used to calculate the estimated liabilities;
• sufficient information to enable external verification that the estimated liabilities have been accurately calculated;
• clear, understandable explanations for why the estimates and funds set aside for financial provision for environmental rehabilitation fluctuate from year to year; and
• information about the way in which the funds set aside for rehabilitation are managed and protected.

In its response to the CER’s letter requesting further information and clarity, Amplats provided much more comprehensive information, including information about the in-house and independent experts who calculate rehabilitation costs, and the methodologies used for these calculations.

Amplats did not commit to making its assessments of financial provision public, simply stating that it would “comply with all its regulatory obligations to disclose” these.

The reason provided for not disclosing information at an operational level was to “ensure public reports are not too voluminous”.

Amplats’ consolidated figure for financial provision for environmental rehabilitation does not include provision for rehabilitation of operations which are part of joint ventures. It is unclear where stakeholders can find information on provision for joint ventures.

There is no information available about the management of the Platinum Producers’ Environmental Trust. Information that would assist stakeholders in assessing the level of protection afforded by this trust includes:

• the identity of its trustees and beneficiaries;
• the trust’s annual financial statements;
• how funds in the trust are accessed;
• how funds in the trust are aggregated between companies and operations;
• when funds from the trust have been accessed for rehabilitation and/or closure of any operations; and
• whether the funds are used for concurrent rehabilitation or reserved exclusively for the purposes of closure.