Engaging with government and local communities
Our board and management are acutely mindful of our company’s place in the South African economy and society.We are committed to doing everything within our power and ambit to bring to reality the objectives of the National Development Plan of 2011 and to realise the inclusive, prosperous society which that plan envisages.
In discharging these responsibilities, we interact consistently and proactively with a broad range of stakeholders. These stakeholders include many individuals as well as the elected representatives of the communities in which we make, transport and sell our steel.
In the government sphere we communicate constantly with the executives of local and district municipalities, provincial and national government as well as the organs of these spheres of government. Government at all levels enforces compliance with environmental and other legislation and grants us the permits and licences we need to operate. Policies, including those relating to issues such as energy tariffs, carbon tax, environment, the regulation of imports and exports, and broad-based black economic empowerment, have a direct impact on our business.
Broad-based black economic empowerment (B-BBEE)
As with any company operating in South Africa, we need to embrace transformation and be able to clearly demonstrate that we are working affirmatively to change who we are and how we operate. Our board and management are united in approaching B-BBEE as an opportunity to incentivise our creation of broad-based social and human capital. By improving our empowerment credentials we support our customers, suppliers and employees and cement our various licenses to operate. Our mindset is that our B-BBEE performance is largely about people.
Since 2011 our B-BBEE score has placed us between Level 3 (in 2017) and Level 7 (2011 to 2013). In 2021 our self-assessed compliance deteriorated from Level 6 to Level 8.
This derived largely from our underperformance on two elements of the B-BBEE scorecard –supplier development and skills development. Post year-end, we self-assessed that we had achieved 56.3 points out of a total 118 points as measured by the generic scorecard.
We began the year with an extremely unfavourable financial outlook. For this reason budgets for skills development, enterprise and supplier development and the close management of supply chain were adjusted accordingly. Inevitably, this translated into B-BBEE underperformance. However, we are determined to use our much-improved financial performance in 2021 to remedy this underperformance. These interventions will begin lifting our score from 2023.
Systems to manage our environmental impact
ArcelorMittal South Africa is governed by the global ArcelorMittal environmental policy. The group has directed that all production facilities comply with ISO 14001, an internationally recognised standard for environmental management systems. During the year the group also launched the ArcelorMittal energy policy and energy management system. These cover every aspect of how the group purchases, uses and monitors energy, from technology upgrades to the integration of energy efficiency priorities into our equipment design. We also follow the principles of ArcelorMittal South Africa’s safety, health and environmental (SHE) policy, which is aligned with the group’s environmental policy.
Highlights on the environmental front during recent years include the completion of the new dust extraction unit at Vereeniging Works, the launch of the zero effluent discharge project at Newcastle Works and our ongoing engagement with various stakeholder groups on environmental issues.