Sustainability

Sustainability / Economic Value

Economic Value

Sustainabilty -overviewmain (1)

Transformation Philosophy

::REAL Transformation

  • We continue to engage with national and provincial government departments to align our broad-based socio-economic transformation objectives with those of government. Progress is guided by our REAL (relevant, empowering, actualised and lasting) transformation philosophy, the heart of all our social performance initiatives.
  • PPC is firmly committed to advancing black economic empowerment in South Africa, given the importance of meaningful mainstream economic participation by black people to meet the country’s socio-economic objectives.
  • After applications to convert our old-order mineral rights were submitted to the Department of Mineral Resources (DMR) in 2008, five-year social and labour plans were submitted for approval early in 2009. These plans embody our commitment to accelerating our broad-based socio-economic transformation process. While mining licences move through the process of being converted, we continues to engage with the department and to implement SLPs.

CSI

::Highlights

  • Significant increase in CSI expenditure
  • CSI strategy finalised for Botswana and Zimbabwe operations
  • Two income-generating projects implemented in the last two years now showing profits

::Challenges

  • Identifying appropriate projects that have the potential to become self-sustaining

In line with REAL Transformation Philosophy and the CSI tag line “Invest to Empower” PPC commits community and infrastructure development initiatives that are relevant and empowering to the beneficiaries they must also be sustainable. It is about playing a meaningful role in communities in which we have a footprint.

As we expand into the rest of Africa, the United Nations Millennium Development Goals act as guidelines for social development within the PPC Group. These drivers have agitated Local governments to respond with policies and legislation in order to achieve these goals, especially in Africa. Therefore, any social responsibility initiative will touch on these priority goals and take cognisance of policy and legislation requirements of any country.

To ensure long term sustainability, we believe in partnering with our CSI beneficiaries for at least three to five years. Being a good corporate citizen is not just about giving money; it is important that the beneficiaries are assisted in achieving financial independence and becoming productive members of the society and this takes time.

We believe that social responsibility is a smart and inevitable way for businesses, government and society to come together in a symbiotic relation to fill out gaps that aid development and prosperity, slowly but surely. The intent must be to give rather than take.

The socio-economic development mandate is a constant indicator against which PPC invests in its communities as well as in projects aligned with its philosophy of sustainability. The BBBEE Codes, the mining charter in South Africa, and the international Millennium Development Goals act as broad guidelines for social development. However, we strive to go beyond compliance with these protocols by boosting grassroots innovation and social upliftment. We believe financial independence must be the ultimate goal for all beneficiaries and, as such, we invest over three to five-year terms with a strong focus on education and developing skills that support sustainability.

During the year, PPC spent over R9,75 million (FY12: R7,4 million) on various socio-economic development projects in South Africa, Botswana and Zimbabwe.

We summarise some of our long-running projects and new initiatives below.

::Long-running projects

Time for Change

Time for Change – a home for abandoned, orphaned, vulnerable children, abused women and youth who have lived on the streets – continues to develop innovative ways for residents to generate income. Beyond sewing and baking, the centre has introduced a small business making shopping bags from old PPC cement bags, lined with shweshwe (indigo cloth that has become a South African hallmark). These are sold to the public, with PPC and universities as the main customers. To date, over 8 000 bags have been sold, generating much-needed income for the centre.

Forest Town School for Children with Disabilities – Rise Bakery, confectionery centre and the Breadbin

In 2006, the school established a dedicated training centre to offer its students work experience. PPC realised the potential of this programme and funded a fully fledged bakery in 2009. The success of the accredited bakery training has seen the range of products extended and marketed to the public. Post-school students become supervisors and are involved with training each new intake of 16-year-old learners. Known as Rise Bakery, students have made great progress, which has led to the second phase of training. In 2013, PPC provided funding to extend training to confectionery, with six individual workstations built and fully operational by May 2013. In addition, PPC funded the extension of the IT training centre workshop.

During the period, PPC also invested in a unique server, called Breadbin, a touch-screen system that provides all the materials needed for education, therapy and training, as well as learner projects and other resources. A post-school learnership student was trained to operate this system for the school and the work experience programme.

The Love of Christ Ministries (TLC)

The poultry-farming initiative at TLC – a home for abandoned babies – is generating income to supplement the centre’s running expenses.

In 2013, PPC funded an upgrade for the poultry facility, which will increase capacity and maintain the required standards. The centre has secured an anchor customer from the city, and if they can produce 1 000 chickens per month, they can make a significant profit.

The Thandulwazi Maths and Science Academy

Thandulwazi (isiZulu for “love of learning”) is well-placed to offer an educational programme that improves both the learning and teaching of core subjects (maths, physical science, life sciences, English and accounting). It also provides skills development workshops and a professional development programme for educators in Gauteng.

Field Band Foundation

This is a national organisation, which is also internationally recognised, teaching life skills through music and dance to the youth from age seven. It is a way of keeping learners socially engaged in legal and constructive activities.

PPC continues to support three bands – Grahamstown, Danielskuil and Cullinan.

African Leadership Academy

The academy seeks to transform the continent by developing and supporting future generations of African leaders. It currently brings together over 100 of the most promising 16 to 19-year-old leaders from more than 40 African nations for an innovative two-year programme designed to prepare each student for a lifetime of leadership.

PPC has to date supported five girls and one boy.

PPC staff participated in a range of initiatives during the year:

  • 140 PPC employees took part in the Kaya FM Mandela Day race
  • Annually, 20 to 25 employees participate in the Momentum 94.7 cycle challenge, raising funds for various causes
  • Head office staff raised R10 000 towards the R67 initiative for Mandela Day
  • Executives partnered with the CSI team by investing in food gardens and bakeries

PPC Express Outlets and cement donations. PPC donated over R500 000 worth of cement to various institutions and NGOs involved in building schools, libraries, orphanage homes and low-cost houses.

A significant proportion of this cement was supplied to entrepreneurs who qualified for a PPC Express Outlet, a PPC-branded container for storing cement.

As an income-generating initiative, two NGOs – SOS Village and Olivers’ House – qualified for PPC Express Outlets as they operate brick-making projects. Since March 2013, they have sold over 4 000 bags of cement.

::New initiatives in 2013

Below are some of our flagship initiatives:

MaLerato Bakery

PPC invested in a container bakery at MaLerato Home of Hope as an income-generating project. The bakery now employs three people from the community and generates income for the home.

Tumelo Home for Children with Disabilities

PPC invested in a permaculture garden for the home, which now has enough vegetables for its own use and sells surplus to the community. Further funding was provided to train beneficiaries in making their own manure and seedlings.

Christel House South Africa (CHSA)

CHSA projects address four primary risk factors afflicting families living in poverty – emotional and social challenges, acute and chronic stress factors, cognitive lags and health and safety issues.

PPC supported four pupils from grades 8 to 12 at R120 000 per year in 2013, and has doubled this number for the next financial year. The strategy is to use this special school as a source of future PPC bursary students.

Endangered Wildlife Trust (EWT) – Eco School Project

The EWT, with close to 40 years as a conservation leader, provides environmental education and environmental management to six rural schools and surrounding communities in Hammanskraal, by equipping learners and community members with the knowledge and skills to preserve and maintain their environment and develop an environmental ethos. Over 3 000 people benefit from this project.

Case study – Ikusasa School of Cooking

PPC contributed R150 000 towards the set-up of Ikusasa School of Cooking in Riebeeck West. Ikusasa, meaning “tomorrow” in isiZulu, will offer 10 students from impoverished families, children’s homes and disadvantaged schools an opportunity to participate in basic food preparation skills, leading to a City and Guilds of London qualification.

The Ikusasa School of Cooking was established in 2009 in Durban to give school leavers who are unable to attend regular culinary schools because of financial constraints the opportunity to earn an internationally recognised entry-level qualification. The culinary industry offers great opportunities to qualified, passionate people throughout the world.

The course is run over 10 months, finishing in December 2013. Students attend classes for three days every week and are required to undergo work-integrated learning under supervision in a local culinary outlet for another three days in each week.

Successful students are not required to pay any school fees; however, they are also not paid during their work-integrated learning periods.

The purpose of these periods is for students to build experience of a real industry work environment. Their working hours are set by the proprietor of the establishment and may mean working long and unusual hours at times.

The inaugural class of 2013 will graduate at the end of the year with an internationally recognised diploma, giving them the freedom to work anywhere in the world.

::CSI beyond South African borders

Botswana

With the CSI strategy now in place, PPC Cement and PPC Aggregates invested in two flagship projects – Molepole sewing project and Lady Khama Charity Trust

Zimbabwe

Most of Zimbabwe’s CSI expenditure was spent on education and welfare initiatives.

PPC Women’s Forum

The PPC Women’s Forum, whose vision is to attract, nurture and advance female talent to lead PPC, is setting the standard in transformation, empowerment and the upliftment of people, especially women in business and the communities in which we engage. The forum was launched in October 2011 to facilitate dialogue among women and create support networks drawn from skilled and experienced men and women in PPC. It has become a leading forum of its kind – not only for the women of PPC.

In 2013, the forum achieved a number of objectives and milestones, including:

  • Representation of women in the workforce up from 18,5% in 2011 to 21,7% in 2013
  • Close to 30% female representation at executive level
  • Rollout of the forum to all sites, including Botswana and Zimbabwe
  • Developing a pipeline of female leadership through mentorship, coaching and programmes for women in management
  • Recognised as 2013 Gender Mainstreaming champions PPC is a signatory to the UN Women Empowerment Principles and the forum is promoting implementation of the following principles:
  • Establishing high-level corporate leadership for gender equality
  • Promoting education, training and professional development for women
  • Ensuring the health, safety and well-being of all employees
  • Treating all women and men fairly at work – respect and support human rights and non-discrimination
  • Promoting equality through community initiatives

Through the forum, the women of PPC are developing their potential, and adding an invigorating dimension to the workplace.

Social and Labour Plan

Having achieved successful conversion of 9 out of 10 of our mining rights to new order mining rights, we remain committed to responsible and sustainable development of South Afirca’s mineral resources. We continue to engage government and local municipalities to identify meaningful and sustainable projects for the new 2013 – 2017 Social and Labour Plans and to comply with recommendations of the DMR to achieve 100% execution of our mining licences.

In line with regulation 46(C) (iv) of the Mineral and Petroleum Resources Development Act, 2002 (Act No. 28 of 2002) we support infrastructure and poverty eradication projects in line with the Integrated Development Plan of the municipalities in which we mine, as well as the major sending areas.

::Social and labour plan projects

In 2012, PPC completed a five-year cycle of social and labour plans in which we committed to investing R60 million over that period on local economic development (LED) projects in our communities. This involved 10 separate social and labour plans covering 28 projects in 12 communities, and partnering with municipalities in six provinces across the country. By the end of the period, we had spent R38 million of the planned R60 million (please refer to the five-year summary).

Social and labour plans are in addition to the group’s own corporate social investment (CSI) projects. PPC continues to engage with all its communities in identifying and implementing sustainable projects.

Our community investment areas remain focused on infrastructure development, poverty alleviation and job-creation projects. Key social and labour plan projects during the year are summarised below:

:: Atteridgeville Construction Incubator - completed

To date, PPC has invested over R5 million in developing a construction incubator in the Tshwane (Pretoria) municipal area of Atteridgeville. The incubator is aimed at improving the capacity of small-scale entrepreneurs through a dedicated training and capacity-building programme to improve competitiveness in the construction industry. Stakeholders include the City of Tshwane and the SEDA Construction incubator.

Business incubation has become one of the most viable mechanisms to develop previously disadvantaged small to medium enterprises in South Africa, and all stakeholders agree it is important for government to include private-sector partnerships, as this will underpin success.

In the review period, 32 emerging contractors were selected for a three-year training and mentorship initiative to improve their CIDB* grading by at least one level each year above their entry point on the national contractor development programme. Training includes the technical contractor development framework and business administration skills. The primary aim is to improve the capacity of emerging contractors to operate viable and competitive construction businesses.

The incubator has employed a full-time receptionist and a business development officer and is filling the branch mentor position. A full-time security company has also been deployed to the centre. The programme started on 1 October, and PPC will officially hand over the centre in November 2013 and exit the project.

* The Construction Industry Development Board is mandated by the government of South Africa to promote a regulatory and developmental framework that builds a local construction industry that delivers to globally competitive standards and is capable of supporting the country’s social and economic growth.

::Diepsloot waste buy-back centre – completed

Diepsloot is a densely populated Gauteng community, with over 7 000 households in formal and informal settlements. PPC Laezonia’s quarry is some 6 km from Diepsloot and sources labour mainly from that community. After the City of Johannesburg identified a serious shortage of waste management facilities in this community, a proposal to sustainably manage daily waste resulted in a buy-back centre that would address an inherent need in the community to turn waste into wealth. PPC Cement invested R3 million towards design, construction and operational equipment for the centre, while regional authorities will be responsible for its management and operation through a sub-contractor. The construction project was completed in July 2012, creating 60 temporary jobs, and the official handover was in November 2012.

A local NGO was selected to run the centre, which currently employs seven local community members permanently. It also assists around 100 members of the community to generate income by collecting and selling waste materials to the centre.

::Lutzville community centre – in progress

In line with the mining right for PPC’s Van Rhynsdorp Gypsum mine, which was granted in June 2012, PPC has committed R500 000 to support the socio-economic development plan of the Matzikama Municipality in Vredendal. PPC will participate in this collaborative project with the local municipality and businesses in the area.

The project entails building Thusong Centre, a multi-purpose resource centre, in Lutzville, to address the dire need of local communities to have a variety of services on one premises. Apart from addressing community needs, the project is directly aligned with some of the desired national outcomes adopted by government in 2010.

Near Vredendal and Van Rhynsdorp in the Western Cape, the Lutzville community is a source of labour for PPC’s Van Rhynsdorp operation. Construction began in July 2013 and is expected to be complete in December 2013, benefiting a population of over 5 000.

::Swartland waste water treatment works – in progress

Following a request from the Swartland Municipality, PPC Riebeeck is assisting with the upgrade of the overloaded Riebeeck Valley waste water treatment works, which will benefit a sizeable community. PPC will contribute R5 million over three years, starting in October 2013.

::Lessons learned in the first five-year cycle

Important lessons were learned in our first cycle of social and labour plans. Some projects were not completed while others had to be abandoned in the face of challenges outside our control including:

  • Unavailability of land for development
  • Community disagreements
  • Shifting priorities of municipalities
  • Lack of municipal capacity

In addition, some of our mining operations face significant challenges due to the prolonged and severe downturn in the building and construction industry. This constrains their ability to fund socio-economic development, which is a predetermined percentage of profits.

B-BBEE scorecard / preferential procurement

PPC supports preferential procurement as a driver for economic transformation and broad-based black economic empowerment (BBBEE). We are committed to working with our existing suppliers to transform their companies and their own suppliers, as well as sourcing products and services from new suppliers that embody the principles of transformation.

For the review period, total measured spend was R4,65 billion (2012: R3,5 billion) of which 89% (R4,1 billion) was BEE-recognised spend in terms of the dti Codes of good practice. PPC has consistently met the compliance target of 70%.

In terms of preferential spend against the mining charter, we met or exceeded all targets, except for multinational contributions. The DMR is formulating a model to implement multinationals’ 0,5% contribution to social development.

Spend category 2014 target % 2013 target % 2013 actual % 2012 actual %
Capital goods 40 30 30 23
Consumable goods 50 40 47 43
Services 70 60 60 61

BBBEE Certificate

Sidebarafricaicon2 (2) As the leading supplier of cement and related products in Southern Africa, PPC Ltd has nine manufacturing facilities and three milling depots in South Africa, Botswana and Zimbabwe that can produce around eight million tons of cement products each year. As part of its strategy and long-term plan to grow revenue by 40% outside of South Africa, PPC is expanding its operational footprint into the rest of Africa, including Algeria, Botswana, DRC, Ethiopia, Mozambique, Rwanda and Zimbabwe. PPC also produces aggregates metallurgical-grade lime, burnt dolomite and limestone.

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