While companies, shareholders and even stock exchanges globally are grappling with the fundamental purpose of the corporation, and the transition from shareholder primacy to stakeholder capitalism, this is a Rubicon SA CEOs, especially in mining, crossed many years ago.
For us, the fortunes of our companies — and by implication the fortunes of our shareholders, employees and neighbouring communities — are inextricably linked.
When Sibanye-Stillwater was established in 2013 the centrality of all stakeholders to what we do and the way we work was without question. We represent our commitment to our values and the way in which we conduct our business through the indigenous SA umdoni (water berry) tree: our values are the fundamental roots of our organisation, which provide a solid basis for the way we do business.
The trunk of the tree represents the material strength of the company through its people, and the canopy represents all our stakeholders, without which the tree would not be able to survive, let alone thrive. The tree’s seeds and fruits signify the benefits and value our success will bring to all stakeholders. The health of the tree has a direct bearing on the fruits it can deliver.
If there was ever a time that the nature and value of the interdependence between business and stakeholders was evident, it has been the last 18 months of the pandemic. The way in which the SA mining industry has navigated its way through the pandemic has been purposeful, going well beyond the “business of business”. This was not only evident in the way in which we were able to respond to the pandemic, implementing comprehensive workplace measures to safeguard employees as far as possible, but also in the way in which we materially contributed to the wellbeing of our employees, their families and communities affected by mining.
The mining industry’s eagerness to support the national vaccine rollout programme, using its established health-care capacity to employees, their families and communities, is just one example of the common interest between companies, our employees, the government and society.
If it means we need to deliver those services or create the capacity for them to be delivered, then that is what we must and will do
It certainly works both ways: mineral resources & energy minister Gwede Mantashe has worked collaboratively with the industry since his appointment, and this has intensified in the past two years. The decisions taken about 18 months ago, based on mutual trust, to enable the mining industry to return to work, have paid dividends to the national fiscus that are contributing to rebuilding the country and our economy, which has been weakened by Covid-19 and devastated by the events of recent weeks. In April the SA Revenue Service reported tax receipts for 2020 that were R38bn higher than estimated just two months earlier, primarily due to contributions from the mining industry.
It is a sad reality, not just in SA, that the credibility of business in the eyes of society often exceeds that of NGOs, governments and the media. A recent international survey showed this to be the case in 18 of the 27 countries polled. In some instances this has been because of a lack of capacity and resources of states themselves, but in many cases it is a matter of business leadership as a trusted partner in society.
That is the nub of what we need to demonstrate and deliver on as business: leadership. We as a company have no intention of usurping the role of the government. But we cannot sit back and wait for the government to deliver the services and outcomes we need to run our businesses, and that make lives better for the people we employ. If it means we need to deliver those services or create the capacity for them to be delivered, then that is what we must and will do.
Marikana tragedy
It may well affect our competitiveness in the short term, but if this approach to business aligns with our values it will create greater sustainable shared value beyond that. The tragedy of the commons, when individuals neglect the wellbeing of society in the pursuit of personal gain — often referred to in an economic or environmental sense — plays out in all aspects of environmental, social & governance (ESG) matters. Exploitation and imbalances in any one of these three key pillars undermines the other two.
To take this forward we need to collectively arrive at a vision for the future, one in which business and communities may thrive together. The two groups are interdependent. So, while in this anniversary week of the 2012 Marikana tragedy we must acknowledge and honour our past, we must also look forward and plan the future we wish to see for ourselves, our children and our grandchildren. A car cannot be navigated effectively through a sometimes bumpy and circuitous route by only looking in the rear-view mirror. Learning from past experiences makes us better drivers. But we need to look forward to go forward.
In moving forward all parties — whether it is the company, the state, employees or communities — need to bring their best selves to the party to contribute equally to a socioeconomic compact that uplifts lives and unlocks possibilities. And, to be clear, we as business are not the social partners in this equation — we are the economic partners providing social support. We rely on all the other stakeholders to be the social partners, providing economic support.
Through a new way of thinking we can change the trajectory of our country and company.
• Froneman is CEO of Sibanye-Stillwater.
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