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News • 13 Oct 2021



Corporations can lead the fight against waste and excess to tackle society’s biggest challenges, states Mzila Mthenjane, Executive Head - Stakeholder Affairs at Exxaro Resources

The undeniable evidence of climate change, increasing gap between the rich and poor and widespread socio-economic disparities have placed an immense responsibility on the private sector to do more in addressing society’s greatest challenges.

The public, civil society, investor community and governments are demanding that large companies demonstrate tangible commitments to an evolving operating context and approach to transitioning towards a secure and more sustainable world.

To achieve this goal of a more just and fair society, so clearly set out by the United Nations’ Sustainable Development Goals (UNSDGs), it is essential to commit to a Just Transition – a vision-led, unifying and place-based set of principles, processes and practices that build economic and political power to shift from an extractive economy to a regenerative economy.

This Just Transition means approaching production and consumption cycles holistically and waste-free. It must be just and equitable at redressing past harms and creating new relationships of power for the future through reparations.

Investors, asset managers and financial institutions are increasingly demanding that companies disclose their climate-related financial risks and opportunities. These disclosures allow more effective valuations of risk exposure and empower markets to reward sustainable business models.

Sustainable development related to addressing issues presented by climate change - is no longer a nice to have, but it has become a market force that has to be adhered to. It is good business to be environmentally sustainable.

Addressing the impact of climate change remains one of the world’s most complex and pressing challenges. Climate change, especially in sub-Saharan countries, negatively affects society’s ability to eradicate poverty, create sustainable jobs and mitigate the physical impact.

It erodes opportunities to fulfil the ambitions of the UNSDGs. Business must recognise its role and collective responsibility to participate in the transition to a low-carbon world and greening the energy system to reduce emissions while supporting prosperous and safe communities.

In partnership with governments, business must take a lead on these critical issues as a key facilitator of the transition. Social dialogue and collaboration will be key and together with trade unions and civil society groups among others, government and business must collaborate in their planning to create policies that strive towards zero emissions and an economic development model.

This transformation is not only about phasing out polluting sectors, but also about creating and driving new jobs, new industries, new skills, new investment and a more equal and resilient economy.

Exxaro is embracing this new paradigm and increasingly responsive to climate change risks and opportunities as we transition towards a low-carbon world. Our Sustainable Growth and Impact Strategy aims to transform our company in a systematic and integrated manner into a diversified company.

We are transitioning from a coal-based to a diversified renewable energy and minerals business that will thrive in a low-carbon future. This vision encouraged our investment of R1.5 billion to develop two wind farms in the Eastern Cape, which today deliver 239 megawatts (MW) of reliable and clean power to the national grid. We expect revenue contribution from our renewable energy business to grow over time as we increase our investment in this sector.

These kinds of sustainable investments are one example of the kind of impact big business can have in providing clean and reliable energy in support of a low-carbon world and future livelihoods.

Our Climate Change Response Strategy is also based on this Just Transition principle which equally considers social, environmental and financial sustainability within our society. The transition to a low-carbon business envisages social inclusion that will make our business resilient to the transitional and physical risks of climate change, sustaining and creating employment opportunities and increasing the adaptive capacity of communities relying on our operations.

Environmental sustainability is but one pillar – even more important is that business places people at the centre of its contributions to society. It’s essential that business believes in the power and potential of people and to place communities at the heart of its decisions by investing in economic and social sustainability programmes.

Business has the capability and resources to become a positive force for social change and effect economic empowerment in the communities in which we operate. By investing in various community projects, social cohesion and enterprise and supplier development (ESD) initiatives, business can have a sustainable impact that not only creates employment but improves the quality of life for our suppliers, employees, and communities. For example, to support the government’s vaccine drive, we vaccinated over 50% of our employees and contractors to date and in July we registered two of our mines as accredited vaccination sites to enhance health care vaccination capacity within out host communities.

In the past six months our local procurement spending reached R458-million of which about 10% was spent on 256 local black owned SMMEs. We provided ESD funding of R105 million to seven SMMEs, while also prioritising non-financial support such as funding specialist training and bursaries. We spent a total of R25 million on schools, building an enterprise and supplier development hub and water infrastructure projects through our Social and Labour Plans (SLP), in both Mpumalanga and the Waterberg. About 1 500 community members will benefit from services to be provided from these projects and 151 jobs were created during the construction period. These outcomes are examples of the impact that just one company can have when it puts shared value at the heart of its operations – these interventions are the foundations for a pathway to the Just Transition.

Sustainable development is only possible with the active engagement of the world of work. Governments, employers and workers are not passive bystanders, but rather agents of change. It is within our reach and our power to develop new ways of working that safeguard the environment, society and the commitment to ethical and transparent governance.

Along with creating a sustainable today, we need to eradicate poverty and promote social justice by fostering sustainable enterprises and creating decent work for all.

We are all responsible as a collective – all public and private sector organisations and civil society – and we are duty-bound to take care of the environment in every way possible. We can no longer ignore the Just Transition if we are to meaningfully reduce poverty and inequality.