CAPE TOWN (miningweekly.com) – South Africa’s mining industry will not be bullied and beaten into submission and all stakeholders have a role to play to improve the South African situation, Chamber of Mines (CoM) VP and Sibanye Gold CEO Neal Froneman said on Tuesday.

Speaking assertively at the Investing in African Mining Indaba, Froneman held out the carrot of working with government, labour and communities to build a successful mining industry from which all stakeholders would benefit optimally, but also the stick, by making it clear to government that the industry was intent on doing the right thing even if it meant resorting to legal action.

Reinforcing CoM president Mike Teke’s call on mining to denounce its apartheid past, Froneman simultaneously made the point that the mining industry’s problems could only be corrected by the joint collective action of all stakeholders, without any occupying the centre, with all having equal roundtable status.

Without such stakeholder realignment, he warned that mining would not be able to move forward.

Using the Zambesi Protocol as a guiding light and the research findings of the Fraser Institute as what can best be described as a 'barometer of badness', all stakeholders had a role to play to improve the South African situation.

Starting with business, Froneman said it needed to commit to investing in growth and sustainability in the appropriate economic environment, the absence of which was making commitment difficult.

Why the Fraser Institute rated South Africa so lowly as an investment destination was the result of the negative impact of its regulatory framework.

In reference to the promise by Mineral Resources Minister Mosebenzi Zwane of legislative reform by mid-year, Froneman commented: “Supposedly we’ll see these things finalised in May and June, but I certainly won’t hold my breath.”

To commit to long-term capital, mining needed to know the cost of doing business and government had to provide clear policy plus support.

There had to be partnership with the private sector to promote investment growth, through fairness, incentivisation and a favourable tax regime.

Froneman criticised the continual loading on to business of “a per cent here and another per cent there", which was raising the cost base and, actually, the ability to meaningfully transform, by plunging operations into marginal positions.

LABOUR ISSUES
“In terms of labour militancy, I don’t think you can get worse than South Africa’s and I hope labour takes note,” said Froneman, who urged organised labour to promote member interests instead of political interests and to avoid damaging industrial action.

Labour needed to recognise that by partnering, all stakeholders would benefit.

Employees also had a role as key influencers of business and “we really need to win their hearts and minds and we do try”.

Froneman would like to see employees being prepared to take some of the pain in tough times and benefiting like shareholders do, in fair proportion, in good times.

Communities were other very important stakeholders, with the Fraser Institute showing the difficulties that mining companies have globally in dealing with communities, with Froneman explaining that fair, well-thought-out engagement from and with communities could be considered a competitive advantage.

He drew attention to incidences where vested interests leveraged communities to get contracts, which was not in the interest of the broader community, and for the need for communities to understand mining’s cycles and the times when there is no money to invest in communities.

Sibanye’s core purpose is to ensure that the mining it does creates superior value for all its stakeholders and not just shareholders and ensuring community development is sustained after mining ceases.

He drew attention to the firm manner in which the mining industry had rallied and aligned in the last few years.

“You have seen the chamber take the right stand. We will not be bullied or beaten into submission. We have to do the rights things and if it results in legal action, then so be it,” Froneman added.