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Coal to the World, Growth to the Nation

2013Sustainability Report

Richards Bay Coal Terminal (Proprietary) Limited

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RBCT Sustainability Report 2013

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Coal to the world, growth to the nation

Contents

2 Company Profile

4 CEO Message

5 Our Commitment

10 Organisational Profile

13 RBCT Management

14 Legal/Risk and Compliance

16 Our People

25 Corporate Social Investment

29 Operational performance

31 Finance and Procurement

33 Health, Safety, Environment and Compliance

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Company Profile

Richards Bay Coal Terminal (RBCT) is the single largest export coal terminal in the world. Opening in 1976 with an original capacity of 12 million tons per annum, it has grown into an advanced 24-hour operation with a design capacity of 91 million tons per annum.

The terminal provides mining houses with a world-class logistic service to export coal efficiently to, amongst others, Asian and European Markets. Our throughput is directly impacted by the upstream logistic infrastructure and continues to move towards the terminal’s design capacity.

Positioned at one of the world’s deep sea ports, RBCT is able to handle large ships and subsequent large volumes. As such, it has gained a reputation for operating efficiently and reliably. The 276 hectare site currently boasts a quay 2, 2 kilometres long with six berths and four ship loaders, with stockyard capacity of 8,2 million tons. RBCT shares a strong co-operative relationship with South Africa’s national utility, Transnet, which provides the railway services linking the coal mines to the port, and the shipping coordination of more than 700 ships per annum. All operations and administrative functions are conducted in Richards Bay.

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Our Mission

Moving coal in a safe, cost effective and efficient manner safeguarding the environment and stakeholders.

Our Vision

Moving coal passionately through a world class Port Terminal.

Our Core Values

We will not engage in any unsafe activity•

We treat each other with respect and dignity•

We care for the wellbeing of employees•

We work to the best of our ability•

We are innovative and pro-active•

We care for the environment •

Our Slogan

Coal to the world, growth to the nation

Our Business

A safe, reliable and efficient coal logistics service.

History

1972

Transvaal Coal Owners Association awarded contract with Japanese steel mills for 27 Mt of coal over 10 years

1976, 01 April

Port of Richards Bay officially opened. Richards Bay Coal Terminal started exports with Phase 1 at a capacity of 12 million tons per annum (Mt/a)

1979

Phase II Expansion completed - RBCT expanded its exporting capacity from 12 Mt/a to 24 Mt/a

1984

Phase III Expansion completed - RBCT expanded its exporting capacity to 44 Mt/a

1991

Phase III Upgrade export capacity increased to 53 Mt/a

1995

Capacity enhancements exercise increased exporting capacity to 63 Mt/a

1999

Brownfields expansion increased exporting capacity to 72 Mt/a

2000 November

RBCT exported its one billionth ton of coal

2006 September

Phase V Expansion commences to increase terminal capacity to 91 million tons per annum.

2008

As of 1st January 2008, official design capacity of the terminal increased to 76 million tons per annum.

2010

As of 1st May 2010, design capacity of the terminal increased to 91 million tons per annum.

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A commitment to sustainable business practice is embodied in the Richards Bay Coal Terminal (RBCT) philosophy. We are of the firm belief that our proven ability to sustain our business during the past three decades is the positive result of our focus on our economic, environmental and social performances, which supports our strategic approach to business.

Through the improved Global Reporting Initiative (GRI) framework we believe that our reporting practices promote transparency, enhance the clarity and credibility of our communication with our stakeholders, facilitate comparisons across various organisations and address issues that concern stakeholders.

RBCT’s objective is to provide a safe, reliable and effective logistics service within the overriding priority of safety, health and environment and our people.

The vision is driven through the following key strategies:

Health, Safety, Environment, Risk and Compliance•

Organisational Health (People)•

Operational Efficiencies•

Stakeholder and Business Partner Engagement•

Health, Safety, Environment and Compliance (HSEC)

RBCT continues to comply with Occupational •Health and Safety and Environmental Management Systems of OHSAS 18001:2007 and ISO 14001:2004. During the re-certification audits of these systems conducted in May 2013, no major findings were recorded. This confirms RBCT’s relentless pursuit of HSEC excellence through a collective effort from all stakeholders.

The Lost Time Injury Frequency Rate improved •from 0.23 in 2012 to 0 in 2013, while the Minor Injury Frequency Rate improved from 1.08 to 1.02. The last time a zero LTIFR rate was achieved was in the year 2000. The continued focus on the COBRA observation process and increased engagement with all stakeholders contributed to the improvement in safety performance during 2013.

Greater emphasis is been placed on visible leadership with first aid injuries and minor injuries been the key focus area.

In respect of the Wellness Management, RBCT •focused on overall wellness of employees and contractors. The presence of an onsite Biokinetist working hand-in-hand with the Company Doctor and Clinic is aimed at improving the wellness of our employees and contractors, thereby ensuring a healthy and productive workforce. 82.7% of RBCT employees participated in the HIV awareness campaign and thus know their status. Following on from the KABP survey during 2012 RBCT strategically targeted HIV related education and other interventions during 2013.

With one of RBCT’s key priorities being environmental legal compliance, there were no major environmental incidents reported during the year and RBCT obtained its waste management licence during 2013. The attainment of a Water Use Licence is still the key outstanding environmental priority.

CEO Message

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Operational Performance

RBCT prides itself on being an efficiently run and reliable export coal terminal and is fully committed to being a center of excellence that consistently provides world-class service to all its users (coal exporters). This is also underpinned by making a meaningfully long lasting contribution to the lives of the people and communities within and around our operation.

Railings

Tonnage received increased by 3.3% 2013 and the Train System Time (TST) improved by 7%.

Exports

Exports continue to improve year on year, achieving 70.23 Mt in 2013. This performance is 2.8% better than in 2012. The improved shipping is attributed to improved and sustained railings for the year from TFR and the exports responding positively to this development.

RBCT People

Our people are the backbone to the success of our business. The key focus within the 2013 strategy of Organizational Health has been the fundamental driver behind the success achieved in the 2013 overall business performance.

RBCT embarked on a talent management strategy which is adding significant value to the organisation. The process embodies a nine box matrix and requires open and transparent discussions between managers and subordinates while at the same time incorporating the greater view of the larger organisation. Employees are provided with clear understanding of their performance while at the same time formulating individual development plans. At this time the process has been rolled out to the General Managers, Senior Managers, Middle Management and Supervisory staff. This also provides a key input into future succession planning which is part of the process.

In June this year Management together with Labour entered into a three year wage agreement. The negotiations were conducted in a very mature and transparent manner with a positive outcome to both employees and the business.

A key focus in 2013 has been on transparent and open lines of communication with our employees. This has been achieved through the Imbizo’s and various other forums with attention to pro-active communication on issues raised by employees with continuous feedback.

Mission Directed Work Teams (“MDWT”) continue to be the vehicle of choice for strategy alignment and performance management throughout the business.

Stakeholder Engagement

RBCT operates within a network of critical stakeholders who are pivotal to our success. Key operational relationships were enhanced with Transnet National Ports Authority, Transnet Freight Rail, Department of Mineral Affairs together with, KwaZulu-Natal Provincial and Local Governments.

RBCT is passionate about community development and partnerships. Our strategy is to foster collective and sustainable engagements with local communities to improve quality of education and poverty eradication. Our slogan Coal to the world, growth to the nation fits in well with our community development initiatives. During 2013, we donated R3.788 million to various worthy projects.

Finance

As we continue to focus on being a low cost terminal, the operating cost per ton for 2013 increased by 92 cents per ton, 9% increase 2012 and 11 cents per ton increase on budget (1% increase). There was a conscientious effort to restore stability to the maintenance environment to address identified challenges. The increased expenditure in 2013 is in line with the budgeted expectations. What is extremely encouraging is that spend in the right areas of the business is yielding the desired outcomes with operating efficiencies improving in all facets of the business.

Business process optimization, contract management and the efficient utilisation of all resources is a key focus area for 2014.

Nosipho Siwisa-Damasane

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Our Commitment

Our aim is to retain and improve on our status as a World Class coal export terminal that is investor friendly, maintains progressive local stakeholder partnerships and maintains employer of choice status. The manner in which we go about this objective is enshrined in the business strategy that encompasses corporate governance principles, improving operational safety performance, employee performance and growth, optimum business operations and sustainable community development initiatives.

The report provides an overview of how RBCT has executed its strategy and lived its core values.

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Engaging our Stakeholders

To be the Terminal of choice optimising stakeholder value continued to be our vision during 2013. Engaging our stakeholders forms an important part of the way in which we do business and is a cornerstone of our strategic commitment to sustainable development.

Open Day

In August 2013, RBCT hosted their first career expo in conjunction with their annual open day. Education institutions were invited to come and partner with RBCT to provide learners with valuable career and study information. The concept of incorporating a career expo reinforces how serious RBCT is about educating the youth, together with providing guidance and direction in order to enable them in making the correct career decisions.

Included in these open days is a plant tour which enables the learners to get a ‘hands on’ idea of what the different jobs entail and also of how a complex operation like RBCT works.

Schools from all over Zululand participated on two of the three days with the last day being reserved for RBCT employee dependents.

Pensioners Day

As a token of appreciation and a way for the company to express their gratitude to retired employees, RBCT hosts an annual Pensioner’s Lunch, where pensioners along with their spouses are invited to come and celebrate their much-appreciated loyalty and dedication towards the company. RBCT’s present achievements are a result of these employees’ commitment and hard work over the years. Pensioners are updated with any latest developments that are happening within the company (any new changes in senior management; new retirees; operational and safety performance).

After lunch, the pensioners do not go home empty handed as RBCT provides them with a nice gift to take home to their families.

The King Code of Corporate Practices and Conduct

RBCT recognises the need to conduct its business with integrity and in accordance with the highest standards of corporate practice. During the year under review, in all material respects RBCT applied the Code of Corporate Practices and Conduct espoused in the King III Report. RBCT continues to review all of its corporate practices so as to align with both the King III requirements as well as the Companies Act.

This report covers the activities of all our operations and achievements within our financial reporting period as at 31 December 2013. The report aims to provide, where possible, with detailed analysis, information that is of key importance to a broader set of stakeholders including, but not limited to, RBCT users, civil society institutions, employee and international communities.

RBCT continues to provide its shareholders and commercial users with a lean and efficient coal-transfer service and from operations, we report on imports (trains handled) and export (shipping) associated statistical information and milestones.

The people who work for RBCT are our greatest asset and this report will highlight RBCT performance, human capital analysis, employment, training, leadership development, risk, health, safety, environment, operational excellence, financial practices and stakeholder engagements.

The report compilation is informed by Global Reporting Initiatives (GRI) Guidelines to ensure and facilitate comparability with reports of other organizations. The strategy for using the Guidelines is to improve the company’s GRI reporting and to move beyond compliance.

The report excludes any information on how BEE companies can get an allocation in the 4 million tons Quattro programme. The allocation of the 4 Million tons is carried out by the Coal Industry Task Team (CITT) of which RBCT is a member together with Transnet, Department of Mineral Resources (DMR) and Junior Miners. The process is administered by the DMR.

RBCT produces a separate Annual Financial Report which does not form part of this report and is distributed to shareholders only.

Our website contains more details on RBCT operations, statistical data on our exports, our shareholder contact details, corporate social investment projects and RBCT contact details – www.rbct.co.za.

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Women’s Day Event

The ladies of RBCT were treated to a high tea in celebration of Women’s day 2013. At this function, the CEO, Nosipho Siwisa-Damasane, gave an inspiring message of motivation, determination and hope. Kate Bain, head of the IsiZulu Orphan project, addressed the ladies with a message about Women of purpose.

After the event, one lady was heard saying: “Once Nosipho has delivered a speech at an event, all I can say is WOW - she is just as down to earth and normal as I am; she has been through the same struggles as I have; made the same sacrifices as I have; but look where she is!” We value every piece of advice that she hands down to us.”

This event was certainly a reminder of how special our women are and the importance of their role within our homes, our churches, our communities as well as our organisation.

Corporate Social Investment

Through our corporate social investment in 2013, approximately R3.7 million was donated to various local community organisations to assist them in initiatives relating to community upliftment and development. Key areas of importance include HIV/AIDS, education, job creation and sports development.

Our partnership with organisations such as Business Against Crime, Zululand Chamber of Commerce & Industry, Business Woman’s Association and other community organisations is underpinned by our commitment to a better life for our employees and communities around us. In 2013 RBCT gave its female employees a boost by signing up as a corporate member of the Business Woman’s Association – this means that all the ladies at RBCT get membership and benefit from the networking and other opportunities this organization offers.

Tours

RBCT professionally hosted various clients and stakeholders from all over the world, thus showcasing the efficiency and reliability of the terminal.

Total Shareholder Tours for 2013 = 51

Reporting to our Stakeholders

RBCT actively seeks constructive engagement with all its stakeholders and subscribes to a philosophy of providing meaningful, transparent, understandable and timeous information.

We also believe that long-term relationships with our various stakeholders (employees, suppliers, shareholders and government) are founded on trust and mutual benefits are vital to our business success. These relationships are sustained through the company’s internal and external communication strategies.

Stakeholder Management

RBCT has implemented a strategic and proactive framework for developing and managing stakeholder relations. Identification of stakeholders that have a defined level of impact and synergy to our business have been categorised into the following:

Core stakeholders – essential to the survival of •RBCT;

Strategic stakeholders – vital to the organisation •and the threats and opportunities we face at RBCT; and

Environmental stakeholders – stakeholders within •our environment.

RBCT uses the RBCT’s guiding principles to manage stakeholder engagement:

Engagement that is mutually beneficial (growth);•

Relevant and/or appropriate engagement •(accountable, efficient);

Integrity (reliability); and•

Valuing relationships (trust)•

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Identification of RBCT Stakeholders

Internal stakeholders All employees, pensioners and contractors

Shareholders Commercial users, all shareholders, and Quattro members

Strategic Partners TFR, TNPA and IM&L

Industry Transport, mining and maritime sectors as well as CETOA

Government Local, provisional and national government

Media Local, community, regional, national and international media in forms of electronic, print and web based

Business Partners Suppliers and service providers

SCD Partners Neighbouring communities, education institutions

Influential groups RBCAA, ZCCI, BMF, BUSA, BWA, NAFCOC, environmental lobbyists and community leaders

Shareholder and Users as at 31 December 2013

Our shareholders are important to us. We keep them regularly updated on all financial activities and topical issues such as company strategy, company performance and engagement with stakeholders.

For a list of our current shareholders visit: www.rbct.co.za

Users Total

Shareholders 16

Long term commercial Users 2

Quattro users 17

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Organisational Profile

The Board

There are 16 non-executive directors, 2 independent non-executive directors, 1 executive director and 12 alternate directors. MS Teke was re-elected as the chairman of the Board for a further twelve month period with effect from 1 February 2013 to 31 January 2014.

Directorate and Administration

Directors Alternate directors Company secretary

MS Teke (Chairman) A du Toit

N Damasane (Ms) †

R Cohen

BM Dalton RJ Langford

Z Docrat RV Chetty

JH Dreyer MA Scharneck Registered office

N Baloyi GJ Marrian South Dunes

CM Ephron Richards Bay Harbour

D Haselau T Legodi (Ms)

GA Heale PO Box 56

MJ Houston RSE Alberts Richards Bay

C Botes (Ms) L Baxter (Ms) 3900

MR Walker M Steyn (Ms)

IA Swanepoel MDM Mgojo Auditors

HL Mkatshana SM Langa Deloitte & Touche

D Naidoo (Ms) PO Box 351

I Pitarque ** JAJ Loots Richards Bay

AJ Rogan 3900

A Hansen

XR Wagner W Sulaiman Registration no.

Executive † 1973/014256/07

* British ** Spanish

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Board purpose and function

The Board provides strategic direction to RBCT through its quarterly Board meetings and the delegation of authority to Board subcommittees and executive management. It reviews and directs the company’s strategic objectives and annual budget. The Board reviews and provides guidance on the performance of the company, i.e. those issues relating to the ‘triple bottom line’.

Board Committees To enable the Board to properly carry out its responsibilities and duties, certain of the responsibilities have been delegated to sub committees. Some of these committees are: Operations Committee (“OPCO”) Finance Committee (“FINCO”) Remunerations Committee (“REMCO”)

These committees do not diminish the Board’s overall responsibilities and the chairman of each committee reports and make recommendations to the Board at each Board meeting. The minutes of all committee meetings are submitted to all directors prior to Board meetings.

Operations Committee

This committee operates in terms of a mandate from the Board of Directors and an agreement between the shareholders. It deals with mutual matters relating to the operations of the Terminal in order to provide effective and efficient service to all RBCT users.

The following members form part of the Operations Committee:

Finance Committee

Certain members of management as well as external and internal audit representatives attended Finance Committee meetings as and when required.

Finance Committee functions include matters relating to finance, the Shareholders’ Agreement (governing relations between shareholders and the company), taxation and various administrative matters.

The audit committee functions of the Finance Committee include assisting the Board on issues of monitoring and control and the practice of good corporate governance. The committee also oversees the internal audit function. During 2013 it was approved to outsource the Internal audit function to Anglo Business Assurance Services (“ABAS”), whose mandate is to review the reliability and integrity of financial as well as operating information, systems of internal control and the safeguarding of RBCT’s assets as well as financial information.

The following members form part of the Finance Committee:

Members Alternates

GA Heale (Chairman) 3

N Cebekhulu (Ms) 4

J Ferreira 0

JC Fourie 2

JL Garrido 3 JAJ Loots

E Hannekom (Ms) 4

M Lamprecht 2

RJ Langford 0 V Chaithram

R Meyer 2

P Mohan 1

D Naidoo (Ms) 1

J Puth 1

C Potgieter 0

N Siwisa-Damamsane (Ms)

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PJ van Zyl 4 DA Barnard

NG Schneider

M van Niekerk 1

M Walker 1 I Coetzee (Ms)

MEMBERS ALTERNATES

N Siwisa-Damasane (Ms) (Chairman)

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A Bezuidenhout 6 H Viljoen (Ms)

N Burger (Ms) 4

RV Chetty 3 J Nxele

B Dalton 3 C Bonifacia (Ms)

V Deeplaul 6

PJ Digby 3 SJ Ferreira

VJ Dötterbeck (Ms) 3

M McDougall (Ms) 0

N McGeorge 6 A Pillay

KC McNeice 6

HL Mkatshana 0 M Lamprecht

A Moepadira 4 DP Power

DD Quaker 3 BD Peterson

M Steyn (Ms) 4

E Theron 3 S Mely (Ms)

GFT Warnasuriya 6

D Yiotopoulos 2 B Grigoratos

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Remuneration Committee

RBCT’s philosophy is to set remuneration at realistic levels in order to attract and retain the executive directors and general management needed to run RBCT successfully. A portion of executive directors and general management’s remuneration is structured so as to link corporate and individual performance.

In accordance with these objectives, the Remuneration Committee annually reviews and evaluates the contribution of the executive director and members of the general management and determines their annual salary adjustments. For this purpose, where appropriate, it considers salary surveys compiled by independent organisations. No executive director or general manager is involved in any decisions as to his/her own remuneration.

The committee also determines the annual and long term performance bonus of the executive director while it confirms that of the general management as determined by the executive director.

The following members form part of the Renumeration Committee:

AJ Rogan (Chairman)

Z Docrat

JH Dreyer

MJ Houston

J-P Junqua Salanne

MS Teke

N Damasane

J Nzimande

Social and Ethics Committee

The Social and Ethics committee was established on 19 April 2012 and the roles and responsibilities were incorporated into those of the already established Remuneration Committee.

The responsibilities of the committee are as follows:

Monitoring the company’s activities with regard to 1. matters relating to:

• socialandeconomicdevelopmentincludingRBCT’s standing in terms of the goals and purposes of -

• the10principlessetoutintheUnitedNationsGlobal Compact Principles;

• therecommendationsoftheOrganisationforEconomic Co-operation and Development, regarding corruption;

• theEmploymentEquityAct;and

• theBroad-BasedBlackEconomicEmpowerment Act;

• goodcorporatecitizenship,includingthecompany’s - promotion of equality, prevention of unfair discrimination, reduction of corruption, contribution to development of the communities in which its activities are predominantly conducted or within which its products or services are predominantly marketed, and record of sponsorship, donations and charitable giving;

• theenvironment,healthandpublicsafety,including the impact of the company’s activities and of its products or services;

• consumerrelationships,includingthecompany’s advertising, public relations and compliance with consumer protection laws, and

• labourandemployment.

Monitor the company’s performance and 2. interaction with its stakeholders and ensure that this interaction is guided by the Constitution and Bill of Rights;

Determine clearly articulated ethical standards 3. and ensure that the company takes measures to achieve adherence to these in all aspects of the business, thus achieving a sustainable ethical corporate culture within the company; and

Provide effective leadership based on an ethical 4. foundation and ensure that the company is and is seen to be a responsible corporate citizen.

RBCT subscribes to the highest ethical standards and behaviour and requires total honesty and integrity from its employees at all times. A “Code of business conduct and ethics” has been approved by the Board of Directors and all employees are required

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RBCT Management

RBCT Senior Management as at 31 December 2013

Nosipho Siwisa-DamasaneCEO

Judith NzimandeGM: Human Resources

Jabu MdakiGM: Operations

Kubendren NaidooGM: Maintenance

Alan WallerGM: Finance

Zanele MthiyaneGM: HSEC

Casper MbuyaziGM: Legal, Risk & Compliance

Bill MurphyGM: Engineering

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Legal, Risk and ComplianceInternal Controls

The Directors recognise their responsibility for internal controls and the monitoring of their effectiveness. Ethical behavior, compliance with legislation and sound accounting practice, underpins the internal control process. In the current year we rolled out Intergrated Business Policy which deals, among other things, issues of ethics. We engaged the services of Anglo American Business Assurance Services (“ABAS”) to perform internal audit and risk management function in a co-sourced arrangement with RBCT. The audit focus is not only on financial processes but also on operational processes.

General management and Directors of RBCT consider that systems are properly designed to provide reasonable assurance that assets are safeguarded against material loss or unauthorized use and that the transactions are properly authorized and recorded. Nothing has come to the attention of the Directors to indicate a material breakdown in the functions of these systems during the year under review.

Risk Management

Risk Management previously reported to the Finance Division and this created potential conflict. Best practice dictates that Risk Management must be independent of finance. In the current year a new division was created, namely: Legal, Risk and Compliance and Risk Management now reports within this portfolio. The next challenge will be to split Internal Audit and Risk Management.

RBCT’s board of directors bears ultimate responsibility for the company’s risk management. Responsible for the total process, the board sets the risk strategy, which is based on the need to identify, assess, manage and monitor all known forms of risk, in liaison with the CEO and general management.

The management of risk and sustainability is inherently an operational function, with RBCT’s management team being accountable to the board for designing systems, implementing and monitoring the process of risk management and integrating this process into the day-to-day activities at RBCT.

The FINCO (through its audit committee function) seeks to ensure that there are adequate systems of internal control in place to mitigate significant risks faced by the company to an acceptable level. Systems are designed to manage, rather than eliminate, the risk of failure or to maximise opportunities to achieve business objectives.

Included in these systems is a regular programme of internal and external audits of various aspects of the business, such as legal compliance, projects, review of effectiveness of mitigating controls, human resources, health and safety, environment, emergency planning, business continuity and disaster recovery planning, and information management.

In addition to RBCT’s other compliance and enforcement activities, we recognise the need for a confidential reporting process to cover fraud and other risks. RBCT has a policy of zero tolerance on bribery and corruption. All employees and suppliers have been advised of our position concerning fraud and unfair business practice at RBCT and any instance of which can be confidentially reported to our secure tip off line “Whistleblowers” or the Risk Management department. RBCT staff subscribes to our Code of Conduct and are required to update the conflict of interest register should they have any potential conflict areas.

RBCT uses a number of business tools in the management of risk:

Whistleblowers is a secure tip off line which •employees, contractors, and all other stakeholders can use.

Anyone concerned that fraud and corruption •has been commitment may approach Risk Management directly to report their issues.

Declaration of interest annually or whenever there •is a change in the conflict of interest status of the employee.

A Code of Conduct booklet is issued to employees •annually.

Monthly audits are conducted by management to •identify risk areas

A risk register is kept in Cura and monitors risk •action items.

Through AON as an insurance broker, RBCT runs •an insurance program which covers Assets and Liabilities.

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We are in the process of intergrating our Disaster Recovery Plans

Aligned to the Global Reporting Initiative’s LA13 indicator, RBCT has standing committees that are assigned to manage, monitor and guide the organization in regard to good governance and ethical matters.

These committees are tasked to discuss matters related to their respective mandate and make decisions in compliance with RBCT values and business strategy.

Tender Committee

Terms of reference of the Committee is ensuring procurement activities are in compliance with RBCT procurement processes.

The Committee is comprised of:

General Manager Finance•

General Manager Operations•

General Manager Maintenance•

General Manager Engineering•

General Manager Human Resources•

General Manager HSEC•

General Manager Legal, Risk and Compliance•

By Invitation:

Supply Chain Manager•

Management Accountant•

Risk Committee

As part of risk management strategy, RBCT uses the Risk Committee as the final gate keeper of risk within the company. This committee consists of the CEO, General Managers and Risk Specialist.

Executive Safety, Health and Environment (SHE)

The executive SHE committee is the custodian of health, safety and environmental compliance in RBCT. The committee meets monthly to discuss, evaluate and make decisions pertaining to occupational health and safety. The committee comprises of 22 members, including the CEO and General Managers.

Corporate Social and Investment Committee

The Committee is responsible to execute RBCT’s corporate social investment initiates.

The 13-member strong committee is made up solely of RBCT employees.

African Coloured Indian WhiteMale Female Male Female Male Female Male Female

6 3 0 0 2 0 0 2

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Our People

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Recruitment and selection

Job creation and job security is important to the economy of our country. At the same breadth, sourcing of the right skill and the right time for RBCT operations is of paramount importance.

As at December 2013, RBCT had a total of 514 employees. The Greenfield projects in other regions in the country and in Africa saw RBCT losing key and strategic skills in the process. The company had to pull all the resources to ensure that we beef-up our recruitment and selection process to respond to the changing and competitive talent market. The efforts put in place enabled us to meet talent requirements in the company from two-pronged approaches; internal focus and external focus.

Internal focus enabled us to respond speedily to skills shortages while meeting terminal production targets. This approached further allowed us to create a motivational climate within our workforce. Our employees appreciated the approach and recognized that benefits associated with the approach.

This included but not limited to promotional opportunities and giving employees’ children learning and job opportunities. The latter became a blend of internal/external recruitment. The approach entailed growing our own timber.

A total of 18 Plant/Operations Trainees were employed to learn to operate RBCT machines and to be actively involved in core operations of the terminal. Once the Trainees attain specific competencies, they have the opportunity to be absorbed into vacant permanent positions.

In some instances, external recruitment was important to break to homogeneity of the workforce profile and in consideration of the employment equity commitments. However, extra caution was taken to ensure that sourcing of talent external should not derail milestones achieved by the internal focus.

Remuneration Philosophy

RBCT’s philosophy is to set remuneration at realistic levels in order to attract and retain the executive directors and general management needed to run RBCT successfully. A portion of executive directors and general management’s remuneration is structured so as to link corporate and individual performance.

In accordance with these objectives, the Remuneration Committee annually reviews and evaluates the contribution of the executive director and members of the general management and determines their annual salary adjustments. For this purpose, where appropriate, it considers salary surveys compiled by independent organisations. No executive director or general manager is involved in any decisions as to his/her own remuneration.

The committee also determines the annual and long term performance bonus of the executive director while it confirms that of the general management as determined by the executive director.

Employment Equity

A successful employment equity analysis was undertaken and areas of concerns were highlighted. Through the analysis, the Employment Equity Forum was able to conduct stocktaking exercise to determine progress made in ensuring that RBCT is representative of South Africa’s demographics. The table below depicts EEA submission for period ending 30 September 2013.

Occupational levels AM CM IM WM AF CF IF WF FNM FNF TOTAL

Top Management 0 0 0 0 1 0 0 0 0 0 1

Senior Management 1 0 1 2 2 0 0 0 0 0 6

Professionally qualified 24 2 14 18 10 0 1 3 0 0 72

Skilled level 73 5 18 26 28 0 6 11 0 0 167

Semi skilled 132 8 9 31 26 7 6 16 0 0 235

Defined skill level 12 0 2 3 12 1 0 2 0 0 32

Total permanent 242 15 44 80 79 8 13 32 0 0 513

Occupational levels

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RBCT Employment Equity Plan is well on track. The company has attained remarkable progress in applying its Employment Equity Plan. Representation at management level continues to improve.

Labour Turnover 2013

Workplace Diversity Management

RBCT is committed to promoting diversity and driving employment equity goals. Various initiatives are facilitated on an ongoing basis, to raise awareness and promote the diversity of our workforce.

In 2013 these included cultural, disability and gender diversity awareness initiatives.

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People Strategy

A Platform to give employees a voice

New Vision, Mission and Values

During 2013, RBCT employees had an input into the new Vision, Mission and Values. Voting was done and the results were announced.

The Imbizo’s also keep with the key focus of transparent and open lines of communication with employees. During 2013, RBCT held 4 Imbizo communication sessions at which attention was also paid to pro-active communication on issues raised by employees. Employees are also given the opportunity to ask questions and to raise any issues they may have.

At the September 2013 Imbizo, RBCT celebrated Heritage Day with employees dressing up in their traditional clothing and being served different traditional foods.

When asking employees for feedback on the Heritage Imbizo, they had this to say:

“This Imbizo in particular, revealed to employees how accommodating everybody is to the different cultures around them & that’s another reason why RBCT is the ideal company to work for”

“I really enjoyed the Imbizo. The good food and great company made the event a success”

Summing it up, the Corporate Affairs team said: ‘Our Imbizo’s create a sense of belonging. They not only unite employees, they also keep everybody abreast with the latest company developments’.

Performance and Talent Management

The previous Talent Management system that RBCT had implemented did not cover some of the company objectives, the employee was only rated by his/her manager based on performance, some of the employees felt that it could be improved. The general perception was that the system was not transparent and people who are successors were not aware or informed. Some employees only got to know that they were successors upon leaving company. As a result employees lost confidence in the talent management system/ process. The system was enhanced thereafter the 9 Box Matrix Model was introduced across the company.

VisionMoving coal passionately through a world class Port Terminal

MissionMoving coal in a safe, cost effective and efficient manner safeguarding the environment and stakeholders

ValuesWe will not engage in any unsafe activity•

We treat each other with respect and dignity•

We care for the wellbeing of our employees•

We work to the best of our ability•

We are innovative and pro-active•

We care for the environment •

Imbizo (Let’s keep talking)

The one important way to keep RBCT moving forward is to communicate and the Imbizo’s give the CEO as well as senior management a platform to share the company’s progress and to set milestones for the months ahead. More importantly, it gives everyone a better understanding of whether there are challenges to realising these aims and objectives.

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Achievement of the organisation strategic and operational objectives continued being supported by the 42 self- directed work teams that are embedded throughout the business areas. The respective teams are aligned on performance improvement areas with a focus on quality, cost, people, safety and speed business dimensions.

The Teams process is managed on the Mission Directed Work Teams` program principles. Various Teams held Open Forum sessions with an aim to review operational performance and prioritize focus areas. The team bonus system was revamped to ensure that all staff had a common view by using the organizational targets as the premise for payment rather than team achievement in their area of work only. The teams are required to map how they contribute to the values of the organization to ensure alignment in this area.

9 Box Matrix Model

The performance and potential matrix (9 box model) is one of the most widely used tools in succession planning and development. It can be a valuable tool for anyone who works in talent management. A “nine-box grid” is a matrix tool that is used to evaluate and plot a company’s talent pool, based on two factors, which most commonly are performance and potential. Typically on the horizontal axis is “performance” - measured by performance reviews. On the vertical axis is typically “potential” - referring to an individual’s potential to grow one or more levels in a managerial or professional capacity.

Nine-box grids are actively used during the talent review process. During this process a group of managers worked together to place individuals on the X-Y axis to help identify employees with the highest potential, who need development and coaching on performance improvement. It is also a very valuable tool to help calibrate compensation decisions.

Each of the nine boxes has a different set of actions associated with it. People who are very high-performers in their current role, but not “high-potential” yet, are possibly experts in their functional area and may or may not want to move into leadership.

Impact on Employees

The General Managers, DU Managers, DL Managers and the CU have undergone the training and there was active and full participation from employees. Three Talent forums were held and were received with enthusiasm by employees and it gave them a renewed sense of purpose.

Employees were pleased that they have a clear road map about their future and development at RBCT.

Majority of the employees felt that the process was objective and allowed the employees to have a chance to rating themselves. Other employees felt that the feedback they received will go a long way in assisting them to improve on gaps identified by the raters. One of the notable successors of the process is that a DU Manager was identified as a high performer in his previous role and was promoted to the General Manager.

360-Degree Assessment

During 2013, the D-lower Managers completed a 360 degree analysis with each leader getting a unique report on how they are seen by those they work with.

The DL Group’s combined profile results as conducted during 2013 (please refer to graph below)

From the averaged-out graph below one can •see an overall leadership effectiveness score of 8.0 out of 10. This is high average score, helped along by their high TRUST and BUILDING RELATIONSHIPS scores.

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The green lines indicate that as a group their Self-•assessments were the highest, followed by the assessments from their Peers. This suggests that the DL’s see the DL’s as an effective group in terms of leadership behaviours. They seem to support one another on this level, more than other levels.

There seems to be a mild risk in the B1 •(micromanaging, controlling and aggressive) category and a mild risk in the B3 category (people-pleasing, unassertive) and almost no risk in the B2 category (passive, sulking and uncommitted).

In general the superior rating is lower than the •self, peer and follower rating. Suggesting that while the DL’s may be meeting the expectations of their peers and followers, they are falling short in general of the expectations of the layer above.

It is important to note that these are findings •from the average score of the DL group and that individual reports are likely to look quite different.

The entire process is still continuing in 2014, and by the end of 2014, the GM’s, DU’s and DL’s will have a shared language and understanding of effective leadership behaviour.

Training and Development

The overall goal of training and development at RBCT is to ensure that RBCT permanent staff have the correct skills, knowledge, motivation and alignment to perform optimally in support of the company’s vision, mission, values and strategic/operational objectives.

Training and Development is primarily be carried out to meet the business needs of RBCT while, where necessary and possible, also addressing the wider skills development needs of the country.

Our focus is to facilitate continuous operational improvement through the development of intellectual capacity. Therefore it is our aim to provide everyone in RBCT with an environment in which they can flourish based on well-defined and developed competencies.

Our process offers employees clear purpose and roles that will develop knowledge, skills and attributes in a focused manner while providing clear objectives that are linked to the concept of reward for performance.

Training and development will be pursued on the basis of the following guidelines:

All training and development will be based on •the needs of the company, as well as wider stakeholder engagement, especially, at strategic levels, as established through a needs analysis.

Managers are responsible for the competency •levels of their staff in order to ensure adequate succession management in their departments.

All activities will aim at optimally satisfying the long •and short term needs of various competencies required by RBCT.

Training and development at RBCT is delivered through the most appropriate medium for the organisation in line with national requirements.

In order to maximise investment in our staff and training development programs, managers and staff who have attended training or development programs may be requested to provide mentorship and coaching where necessary.

Specific policies and programmes for skills management or for lifelong learning are designed to empower employees who aspire to be in management positions.

To achieve Operational Excellence, Superior People Performance becomes key to succeeding in a challenging business environment. As part of RBCT’s company-wide commitment to attract, develop and retain valuable talent, skills management programmes are in place in all divisions.

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Average Hours of Training for 2013

The average hours of training per year per employee by Occupational Category of employee as at the 31st December 2013 were:

Occ. Category

Occ. Cat. Text Total Hours per level

Number of Staff Trained

Average Hours per person per level

1000 Legislators, senior officials and managers 3 721 44 85

2000 Professionals 1 193 12 99

3000 Technicians and associate professionals 8 578 85 101

4000 Clerks 2 131 45 47

7000 Craft and related trades workers 17 048 87 196

8000 Plant and machine operators and assemblers 10 882 150 73

9000 Elementary occupations 13 170 60 220

Grand Total 56 723 483 117

Staff Development

RBCT’s career development strategies continued to focus on management development, supervisory and leadership development, the Employee Development Programme (EDP), operator training, technical and general skills development of employees. The implementation of the coaching and mentoring processes are on-going.

Management Development

During 2013 the focus was on developing the Senior Management Groups Leadership skills, Managers where required to attend the Management Assessment of Proficiency (MAP) assessments which gave them feedback on their strengths and weaknesses on twelve key competencies as well as on their communication styles. This followed by Feedback and the development of IDP’s, supported by a training session to try and address some on the areas. Frontline Managers completed a 360 degree process with feedback and training to come in 2014.

Management Development Programme (MDP)

RBCT continues to develop Management and Supervisory skills, through an intense Management Development Programme aimed at creating critical management capacity amongst our employees. The main aim is to bridge gaps in previous qualifications and to address those who do not have any formal qualification, in particular in management science. The Formal Programmes being the UNISA MDP and FMP programs, while Foundational Skills are laid through more hands-on SAQA accredited skills programs at the Supervisory and Management levels.

Employee Development Programme (EDP)

Having begun as a programme for staff from previously disadvantaged groups, this programme has developed into a company-wide program, taking employment equity requirements into account. The aim of the program is to develop the core competencies required by employees making the transition to management or supervisory positions. After completion of this programme, delegates present their projects to the General Managers and where possible these are implemented.

Bursaries

RBCT grants bursaries in various forms, Open Bursary Scheme, Closed Bursary Scheme (Study Grants) and Staff Education Assistance.

Open Bursary Scheme

RBCT grants bursaries to assist with sourcing and developing bright young talent in anticipation of meeting our future skills requirements and in key areas of the community.

We sponsor learners, in fields such as Engineering, Industrial Psychology, Finance, Education and Nursing.

Employment equity targets require at least 80% of bursaries to be awarded to previously disadvantaged persons; during 2013 RBCT achieved 98.31% in this area. To ensure that bursars succeed in their studies, individual progress is monitored and assistance is provided where required. During holidays, bursars work at RBCT where they are helped to grow their knowledge through practical application. This approach helps each bursar bridge the gap between education and the world of business.

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Closed Bursary Scheme

As an extension of the bursary system, each year RBCT offers 20 study grants to employees’ children who are registered to study at a recognised tertiary institution, 50% of which should be focused on continued education.

Education Assistance Programme

Employees have access to funding for part-time education through our Education Assistance Programme (EAP) where RBCT pays for tuition and employees are only required to repay should they not pass the courses. This encourages employees to improve their knowledge and work-related skills and to prepare them for the next step in their careers; 115 staff members participated in this scheme during 2013.

Apprenticeships and Traineeships

At RBCT we have an apprenticeship system registered with TETA (Transport Education and Training Authority); apprentices are registered with the MERSETA (Manufacturing, Engineering and Related SETA) via a Memorandum of Agreement (MOU) between the SETA’s. Bursars who have completed their Degrees and Diplomas are often given opportunities to gain the experience required.

In 2013, RBCT’s commitment was as follows:

Trainee Type No. Comment Bursar

Apprentices 17 Millwright Apprentices

Electronic Technician

2 Automation and Control

Industrial Engineering Technician

1 Experiential Exposure

Mechanical Engineer

2 Graduate Engineer Y

Electrical Engineer

1 Diploma Technician Y

ART/AIT Trainees 8 Current maintenance assistants identified for artisan development

Electrical Technician

1 Diploma Technician Y

Artisan Recognition Training/Artisan in Training (ART/AIT)

The Artisan Recognition and Artisan in Training program was introduced with potential Maintenance Assistants being selected for Artisan Training. These candidates were sent on the Apprenticeship modules with the aim to write Section 28 Trade tests in 2013, of these 7 wrote trade test in 2013 with one outstanding.

Technical Training Infrastructure

With RBCT technical training being outsourced, it was identified that staff have difficulty transferring the knowledge learnt into plant specific equipment. Taking this into consideration, RBCT created a Technical Training Workshop during 2013, a mini substation and PLC racks were completed to assist with Electrical Fault fining and a larger number of RBCT specific technical training programmes were run with the aim to improve the quality of Artisans and reduce down time, based on skills set identified by line managers.

This centre is aimed at improving and refreshing artisan skills for the company this means:

Better quality repairs•

Less downtime•

Lower costs•

More efficient equipment•

Less breakdowns•

Higher morale•

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Plant Operator Traineeships

RBCT also has a one year training program for plant operators to ensure succession is in place and operations are therefore not interrupted in the event of a resignation. RBCT has reviewed and implemented Key Operations Training Programs as part of our ongoing continuous improvement program.

Training Accreditation

In addition to being accredited with the MERSETA for on-site training of Millwrights and Boilermaker Apprentices, RBCT is also a fully accredited training provider with the TETA for Operations Training courses that include courses in Ship-loading, Bulldozing, Tipping, Stacking and Reclaiming, Shunting and Loco Operating.

All trainees who undergo this training can have their credits registered on the National Learner Record Database. During 2013 we worked with the QCTO to develop a qualification for Plant and Rail Operators; we will now strive to register this with the TETA in 2014.

Assessments on the programs above are done by accredited line assessors with a training assessor in attendance. The assessments are then internally moderated and are further moderated by the TETA on an annual basis. Each year RBCT’s assessments have been approved by the TETA with minor recommendations for improvement.

Industrial Relations

The most significant collective relationship contributing factor of 2013 to Company sustainability was undoubtedly the successful wage negotiations with SATAWU (South African Transport and Allied Workers’ Union).

The negotiations took place in good spirit and in the absence of any declaration of disputes or incidence of industrial action. The Wage Agreement is for a 3-year period until 30 June 2016, which negates the risk of annual wage-related labour unrest that has become a prominent feature in the South African labour climate. The absence of conflict generating wage negotiations during the period of the agreement should improve relationships and employee productivity.

RBCT sustainability was further enhanced by the change from the traditional 8 hour shift work system to a 12 hour shift work system, through less interference of continuous operations because of frequent shift exchanges. Exemption from the provisions of the Basic Conditions of Employment Act was granted by the Department of Labour, allowing RBCT to operate on the 12 hour shift work system, which otherwise would not have entitled us to do so. It is also the first time in the Company’s history that exemption of shift work conditions has been granted for a 2 year period. Previously it had been limited to 1 year periods only. The exemption allows the Company to pay normal wages for shift work performed on statutory Sundays and it allows that more than 45 normal working hours per week may be worked without having to pay overtime, where normal working time exceeds 45 hours per week.

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Corporate Social Investment

As part of our commitment of being a responsible corporate citizen, it is our policy to conduct business in a manner that is compatible with the economic, social and environmental needs of the communities in which we operate. RBCT’s corporate social investment strategy plays a constructive role in enhancing the quality of life in the communities within which our people live. Our aim is to promote the development of self-reliant communities and to facilitate sustainable community development programmes. Our initiatives primarily focus on education, health, HIV/AIDS, community skills upliftment, welfare, environment, community service and crime prevention.

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Our approach to Socio-Economic Development (SED) has moved towards a philosophy that is fully accountable and geared towards providing sustainable solutions to real needs identified in the community. The success of this philosophy hinges on the recognition that any social involvement should make a meaningful improvement to the lives of the people and communities that it is designed to benefit. Our employees also play a significant role through our SCD Committee, consisting of volunteers from all levels within the company, as well as union and employee representatives.

RBCT’s SCD Investment - Trees for Life

Last year, RBCT sponsored over 400 learners from the Dube and Esikhawini areas to participate in the Indigenous Trees for Life project which is run by the Wildlands Conservation Trust. The project is aimed at giving the poorest of the poor the opportunity to literally “grow” their way out of poverty.

Wildlands Conservation Trust provides basic training, initial resources required to grow indigenous trees and mentorship until the trees are ready to be sold or bartered for items such as foods clothes, bicycles, building materials and uniforms.

Our Communities matter to us Ntabeni Primary School

RBCT again renewed our commitment to Ntabeni Primary School by providing R500 000.00 towards the renovation of the school. The school has developed from its humble beginnings of lessons being conducted under a tree by a single teacher to a full-fledged primary school sporting 12 classrooms, electricity, an ablution block, walk ways, an admin block, concrete quad area and office equipment with 14 full-time staff members.

RBCT Communal Gardens: Communities doing things for themselves

Food security is a challenge for many households as a result of poverty deprivation and the Dube Village is one of the areas where children are experiencing hunger every day. This has been complicated by the high HIV prevalence rate in the area.

As a responsible corporate citizen RBCT has resolved to focus on agriculture as the platform from which to launch a campaign to fight poverty and build our economy. The emphasis is on communities doing things for themselves. Through this project, we wish to see communities eradicating poverty and malnutrition, making efforts towards economic development, and actually doing things for themselves. Agricultural development is at the heart of economic development.

Agricultural growth has a strong and positive impact on poverty, often significantly greater than that of other economic sectors. Food insecurity adversely affects all levels of social and economic life. With a large number of South Africans vulnerable to food insecurity, it is vital to address this situation for the current and future stability of the country.

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Amangwe Crèche

In 2013 RBCT once again committed R500 000 to Amangwe Village for support of the Ethembeni Care Centre and a fully equipped crèche catering for children affected by HIV/Aids. A flagship initiative of RBCT, the Crèche has grown since it first opened its doors to 16 orphaned and vulnerable children in January 2004 to 45 children in 2014.

RBCT Charity Relay Race

The RBCT Charity Relay Run is an annual charity event organised by RBCT with all proceeds raised from the entry fees and site bookings, going to deserving charities in the area. In 2013, the 29th running of this event saw an excess of R130 000 raised for local charities, who in turn, put these donations to good use in their respective operations in a range of interventions that have a far-reaching and positive impact in the local communities within which RBCT operates.

Ubhejane Swim

RBCT in partnership with the Fish Engle Swimming Club hosted the Ubhejane 100m Swim 4 Rhinos to raise funds for the fight against rhino poaching. The R40 000 raised on the day was donated to KZN Ezemvelo Wildlife. The threat to South Africa’s rhino poaching is a call to action for all those who treasure our heritage. Since its inception, RBCT has been committed to the environment as depicted by the pelican in our logo and we are proud with our contribution to protecting our environment. Rain and gale-force winds couldn’t stop determined swimmers from plunging into the water to raise much needed funds for anti-rhino poaching campaigns.

Zamani Disabled People’s Organisation

As RBCT we pride ourselves with improvements and in 2013 we introduced Zamani Disabled People’s Organisation to our CSI programme. RBCT purchased a sewing machine to the value of R300 000.00, office furniture to the value of R45 000.00, kitchen furniture valued at R25 000.00, fencing at R98 000.00 and paving for R100 000.00. Zamani Disabled People’s Organisation is based in Esikhawini and caters for 35 disabled people who meet at the centre Monday to Friday to do craft work, attend ABET classes and obtain meals for the day.

Fantocy Creche

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From 2 crowded classrooms to a fully fledge crèche with 4 classrooms, a kitchen and the office. The community of Mandlanzini near Richards Bay Airport was overwhelmed by the confirmation that RBCT was funding the crèche with more than R500 000.00 to build four new classrooms and the administration block. The community came together and built two classrooms after identifying the need for the crèche in the area. It was very difficult for them to continue with building as most parents are unemployed and rely on child support grant until RBCT got involved in 2013. Today the crèche accommodates more than 65 children of which 50% don’t pay crèche fees.

RBCT Annual Standard Donations 2013

In 2013, seventeen charity organisations made their way to RBCT’s annual standard donations handover event. This is a very important event in RBCT’s calendar and an amount of R459 000.00 was ploughed back to community.

This event signifies how seriously RBCT takes the development of our people. These are donations we make every year to assist these charities in their efforts to uplift our surrounding communities in various ways. This is important to us as most of our employees are from these communities.

The charities were as follows:

Empangeni Child and Family Care •

Empangeni SPCA•

Life Line Zululand•

Sea Rescue•

Richards Bay Family Care •

Richards Bay SPCA•

SANCA Zululand•

Siyabonga Shelter•

SA Red Cross•

Thuthukani Special School•

Unizul Science Centre •

Zululand Hospice Association•

Zululand Mental Health Society •

UThungulu Community Foundation•

Pathway School for Autism•

Reaching Out (Against Women & Child abuse)•

Business Against Crime (BAC)•

Welfare and Community Service Support

A number of our employees are involved in various welfare and community organisations, giving up their time and sharing their expertise:

Inkanyezi Academy Saturday Classes

Through Inkanyezi Academy Saturday Classes, which is a project that is spear-headed and fully funded by Richards Bay Coal Terminal, dedicated RBCT as well as other local corporate employees volunteer their Saturday mornings tutoring Grade 12 students at Khula Senior Secondary School (Esikhawini). The main purpose for this project is to supplement and upgrade the pass rate for Maths, Science and Accounting amongst the students at Khula Senior Secondary School. In 2013 the school obtained 79% with one learner achieving 100% in both Maths and Science.

This project focuses on problem areas which would have been identified in the classroom during the week but due to time constraints not fully discussed. This learning opportunity affords learners a chance to interact with tutors who also share knowledge and insights on these subjects.

Employee Community Outreach

The SCD committee consists of volunteers from all levels within the company as well as union representatives. The committee members attend meetings bi-monthly to review applications. They also visit/monitor funded and potential projects where necessary.

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Operational Performance

Richards Bay Coal Terminal is a world class Port Terminal. As the vital link in the coal export chain, we work closely with our key partners Transnet Freight Rail (TFR), Transnet National Ports Authority (TNPA) and Coal Exporting Parties (CEPs). RBCT coal is railed by TFR, the only national rail operator. TNPA provides the marine services to berth and un-berth the vessels.

RBCT prides itself on being an efficient and reliable export terminal. RBCT’s efficiency is dependent on the different RBCT business functions and external partners working together. The joint effort of RBCT and our partners ensured that the performance targets are exceeded.

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Sustainable Development Performance

Railings

Tonnage received increased from 68.52 Mt in 2012 to 70.8Mt in 2013, the first time coal deliveries exceeded the 70 million mark.

The key performance indicators were also exceeded as Train Turnaround Time (TTT) reached a record of 03:08. An improved TTT contributes to reducing the cycle time of the trains and indirectly contributes to the rail capacity by making the wagons available to reload.

RBCT will continue working with Transnet Freight Rail (TFR) to improving rail efficiencies.

Exports

2013 exports improved from 68.34 to 70.2 Mt, which is the first time in the Terminal’s history that we reached and exceeded 70 million mark. Exports have continued to improve year on year.

The improved shipping is attributed to a corresponding effort from TFR through sustained railings to the terminal. The key performance indicator on the water side is Port Load Rate (PLR) and we achieved 1805 tons per hour against a target of 1 794 tons per hour.

Our Customers

RBCT’s customers are its terminal users, which includes shareholders, Quattro participants, and other commercial users. Engaging with them, through the Operations Committee, helps us to better understand their needs.

Customer information and confidentiality

RBCT takes appropriate steps to preserve confidential or market-sensitive information. Where deficiencies are identified within our systems or processes, actions are taken to remedy the situation.

RBCT Plant

Long term plant health is being ensured both at operational and strategic levels, by focusing on periodic inspection programs and refurbishment outages (Plant Life Extension Strategy).

Health, Safety, Environment and Compliance (HSEC)

Safety, health and the wellbeing of employees is a priority for RBCT, and continued to be the area of focus during 2013. In order to ensure ongoing compliance with the Occupational Health and Safety Act 85 of 1993, RBCT put some necessary structures in place. Employees and contractors are continuously informed of key safety issues, policies and procedures that affect their day-to-day jobs and other stakeholders in general. Health and safety training is provided on an ongoing basis. Environmental management is in accordance with ISO 14001 and the legislation which RBCT subscribes to.

RBCT’s HSEC Management systems are assessed against the requirements of OHSAS 18001:2007 and ISO 14001:2004. RBCT’s ongoing compliance with ISO 14001:2004 and OHSAS 18001:2007 and its effectiveness was confirmed during the surveillance audit conducted in May 2013, with 6 minor environmental and 3 minor health and safety findings being recorded. This is in-line with our continued commitment to maintaining excellence in HSEC management systems.

Tracking Our Performance

Goal Measure/ Target Status Comment

SAFETY

Maintain OHSAS 18001:2007 OHSAS 18001 certified Achieved Achieved

LTI free and fatality free year No fatality Achieved

LTIFR</=0.21 LTIFR</=0.21 Achieved LTIFR @ 0.00

MIFR</=0.97 MIFR</=0.97 Not Achieved MIFR@ 1.02

>97% on SHE audits >97% Achieved @ 98%

ENVIRONMENT

Maintain ISO 14001:2004 Certificate ISO 14001:2004 Certified Achieved Achieved

Zero environmental public complaints No public complaints received Achieved No environmental complaints

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Finance and Procurement

Finance

Cost control continued to be a significant focus area in 2013 with the key focus being on stabilising maintenance spends thereby ensuring reliability of plant and the operational efficiency and reliability. Reporting continues to be a focus area ensuring that users of financial information are able to make the correct decisions as and when required.. RBCT is committed to providing a cost competitive service to RBCT stakeholders.

Our lowest cost terminal strategy combined with continuous efficiency improvements will remain key elements of our overall approach to running the business in what can only be described as a tough economic environment.

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Our Economic Value Add

RBCT as a terminal generates a range of direct and indirect economic benefits for its employees, communities, suppliers and other key stakeholders and forms part of a value chain which is key in the development of South Africa’s mining and energy resources.

The collective industry including RBCT plays a significant role in the country’s socio-economic development. The terminal’s focus is on the sustainability of initiatives within the communities in which our employees reside with a strong focus on education, social welfare, job creation and sports development.

Promoting empowerment BBBEE

RBCT’s procurement policy is aligned with the Department of Trade and Industry’s Broad-based Black Economic Empowerment (BBBEE) Codes of Best Practice. The focus remains on encouraging suppliers to embrace the codes thereby assisting in the empowerment of our business partners.

Where possible, preference is given to local suppliers, with a number of suppliers in the small, medium enterprise category.

RBCT has actively driven BBBEE spend over the past 11 years with pleasing results. Ensuring compliance with the Codes, RBCT insists on suppliers providing approved verification certificates An extensive data base has been developed and SAP is customised to provide up to date and reliable statistics; the database also tracks the number of black women-controlled businesses that are suppliers and potential suppliers to RBCT.

RBCT’s preference is to transact with business partners who are accredited at level 4 or above so that 100% of procurement spend from these entities counts towards RBCT’s empowerment performance. RBCT encourages all non-accredited suppliers to strive to achieve a minimum of a level 4 certification.

Where commercial criteria are the same, preference is always given to the higher BBBEE rated supplier. However, RBCT does not pay a premium to empowered companies; price is a key determinant for business considerations. RBCT does however require long-term suppliers to indicate how they will improve their empowerment ratings within an agreed timeframe.

Standard procurement criteria:

RBCT strict quality requirements must be met at all •times

All goods and services must be at competitive •prices

All contractors are required to have a verified •scorecard

Service is a given•

All service providers are required to comply with •the terminal’s health, safety, and environmental standards

The graph below affirms the significant progress made by RBCT in procuring from empowered companies, thus contributing to economic transformation.

Nurturing the future through enterprise development

Enterprise development is one of the key focus areas for RBCT. Through RBCT, our shareholders have made four million tons of export capacity available to junior miners at a commercially attractive rate. This allocation is managed by the Department of Mineral Resources.

The significance of this is that junior miners can now access the export market through RBCT, making their operations more profitable and in many cases significantly more commercially viable.

The four million tons that is made available is in an environment where export allocation throughout all South African based facilities is significantly constrained through infrastructural challenges; this opportunity afforded to junior miners by RBCT’s shareholders is therefore a direct enterprise development initiative.

RBCT continues to strive to develop self-sufficient business partners, however this is an ongoing challenge because of the nature of the terminal’s operational and maintenance spend which is predominantly on specialised high quality engineering items.

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Health, Safety, Environment and compliance

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Management and compliance

RBCT recognizes that by its very nature, the movement of coal can and will have an impact on the environment. RBCT’s coal logistics activities are conducted within the framework of ISO 14001:2004 and a site specific Environmental Management Program. Compliance with ISO 14001:2004 is audited annually and recertified every 3 years. Protection of the environment and compliance to environmental legislation remains paramount to RBCT. In 2013, the ISO 14001 surveillance audit was a success, with 6 minor findings. This is in line with RBCT’s commitment to maintaining excellence in environmental management systems. RBCT seeks to comply with, and remains committed to environmental legislation, regulations and permits that govern its operation. RBCT has prevention strategies which, together with ongoing mitigation measures, are aimed at reducing and mitigating the impact of its activities on the environment.

Responsibility for environmental management at RBCT rests with Senior Management, supported by the Environmental Specialist and HSEC Officer. Operations and Maintenance departments also play a vital role in the management of environment.

Monthly Executive HSEC meetings address and discuss issues relating to environment, safety and health risks within RBCT and external affected parties.

During the year, no major environmental incidents and no environmental complaints were reported. Stringent environmental monitoring and site cleaning services can be attributed to the good environmental performance during the year. The Environmental Systems Upgrade project to harness all process water to prevent pollution of the harbor and to recycle water was commissioned in 2009. An analysis carried out in 2013 shows that potable water consumption has been reduced by approximately 37.2% compared to 2012. A serious drive towards conservation of energy was also maintained during the year. Significant savings have been realized. Energy saving programmes continue, the goal being to achieve the site’s objective for reducing energy consumption by up to 15% by 2015.

RBCT is firmly committed to protecting the environment and resource conservation. RBCT has assessed the environmental impacts of our operation and has an Environmental Aspects and Impacts Register in place. Controls have been put in place to reduce the negative impact of our business onto the environment.

Currently, our primary environmental focus areas are:

Air quality management, •

Reducing the impact of coal transport on the •environment,

Controlling the water quality of our storm water •and process water discharges into Richards Bay Harbour and surrounding waterways,

Reducing our fresh water usage.•

Energy efficiency•

Compliance and permits

During the year 2013, RBCT received the following environmental permits and licenses:

Waste License

Although not yet finalised, good progress has been made to date with the application of the following licenses Water Use Licence as required by the National Water Act 36 of 1998;

RBCT’s contractors and suppliers are required to comply with RBCT’s HSEC Policy, copies of which are conspicuously displayed onsite. The HSEC induction process highlights key environmental aspects that all stakeholders should consider and work towards mitigation or total elimination of the impacts thereof.

Primary impacts

RBCT’s primary environmental concerns are:

Resource and energy use•

Water usage and management•

Dust (air pollution)•

Waste Management•

Resource and energy use

RBCT’s energy is sourced from electricity, diesel and petrol. Electrical energy is supplied by Eskom through the uMhlathuze Municipality. Moving conveyor belts, stackers & stacker reclaimers, shiploaders, locomotives, dozers and vehicles are main consumers of electricity, diesel and petrol. During 2013, there was improvement in energy consumption compared to 2012. The focus in 2014 will be in finding sustainable ways to improve on diesel and electricity consumption.

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RBCT signed the Energy Accord in 2006, and agreed to reduce energy levels by 15% by 2015. RBCT has thus far performed excellently with petrol, but still below target with diesel and electricity. RBCT’s focus is therefore on improving efficiencies in the use of diesel and electricity. Year on year improvement on energy efficiency is being realized.

RBCT’s carbon footprint improved over the years, and there have not been any financial implications for RBCT due to our activities.

Water usage and management

The Integrated Waste and Water Management •Plan (IWWMP) is central to the application process for a Water Use Licence with the Department of Water Affairs. The main objectives of the IWWMP are to:

Provide technical and management related •information to underpin the application for water use licence.

Update RBCT’s water balance;•

Identify (qualify and quantify) water and waste •related impacts from RBCT’s activities;

Comply with Regulation 704 of the National Water •Act 36 of 1998

Storm water and water collected from the coal stockpiles does not go directly into the marine environment, instead it is drained into settling ponds, where contaminants are separated from the water before it can be pumped into the ESUP dam. RBCT uses this recycled water for suppression of dust, mostly from coal stockpiles.

As a result of use of this recycled water, the overall consumption of potable water over the past 3 years decreased significantly by more than 75% since the commissioning of the ESUP dams in 2008. Potable water is now only used for domestic purposes.

136.41 megaliters were used in 2013 compared to 217.22 used in 2012.

Potable Water Usage

The quality of the recycled water is continuously monitored and treated to minimize the pollution of ground and groundwater which may result from reuse of this water.

Sewerage effluent parameters of the final effluent have in the past 12 months met the requirement of the National Water Act, 1998.

The quality of our underground water is monitored quarterly through borehole sampling to ensure no adverse pollution of the underground water. The results are sent to an independent laboratory for analysis and all samples were within legal limits in the past year. We are currently conducting a geohydrological survey to monitor sulphate content of the underground water.

Dust (air pollution)

Dust management is a priority at RBCT. Dust fallout rates recorded during 2013 have averaged well below 0.6g/m2 (the maximum allowable level).

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RBCT currently uses dust-aside as dust suppressant on dirt roads around the stockpiles. Dust-aside is a water-based binding agent that forms a layer on the road surface to suppress dust. The stockpiles are sprinkled with water through rain guns located around the stockpiles to further reduce dust.

Water-truck is sprinkling dust-A-side on the dusty road in-between the coal stockpiles.

Rain guns in action spraying coal stockpiles to suppress dust to low levels.

The two PM10 monitoring stations installed on the south and north perimeters of RBCT to further improve dust monitoring on our site have shown that RBCT complies to NEM: AQA.

Waste Management

The management of waste remains one of RBCT’s most important environmental challenges.

In 2013 RBCT obtained Waste License 59 of 2008, RBCT improved its waste management programmes by improving its waste audits and implementing sustainable plans. The implementation of a comprehensive waste management strategy aims to reduce the amount of waste being consigned to local dumpsites.

A greater awareness for the need for recycling practices is being achieved.

RBCT’s waste streams are, but not limited to the following:

Used oil•

Oil contaminated waste•

Clinic waste•

Sewerage effluent•

Settling pond effluent•

Electronic waste•

Paper•

Rubber•

The generated waste is measured on a monthly basis and targets have been set to reduce the quantities. Some waste is recycled and some disposed of in environmentally responsible manner.

Biodiversity

RBCT facility is situated within the Port of Richards Bay in the uMhlatuze Local Municipality which has a warm to hot and humid subtropical climate, with warm moist summers. The 276ha facility is completely transformed from its once natural state; however, maintained vegetated and landscaped areas do exist within the site boundary.

Eight specimens of Hibiscus tiliaceus (Lagoon Hibiscus) are available at RBCT on the South of Phase 3. These trees are listed as protected indigenous plants in terms of The KwaZulu-Natal Nature Conservation Management Amendment Act, 1999 (No. 5 of 1999). These species were planted for landscaping purposes. 2750 Casuarina equisetifolia (Coastal Beefwood) exist in the eastern parts of this Phase 3, planted for wind diversion.

Protected Podocarpus falcatus (Outeniqua Yellowwood)

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Three specimen of Bersama lucens (Glossy White Ash) are available onsite. This tree is listed as a protected indigenous plant in terms of the KwaZulu-Natal Nature Conservation Management Amendment Act, 1999 (No. 5 of 1999). Included in the landscaped gardens are species that are protected by Provincial and/or National legislation which include 2 specimens of Podocarpus falcatus (Outeniqua Yellowwood) to the north of the control tower, Aloe, Encephalartos (Cycads), Hibiscus tiliaceus (Lagoon Hibiscus) and Eugenia capensis (Dune Myrtle).

In the northern side of RBCT, there occurs a species-rich wetland dominated by relatively short herbs reflecting the variation of species. Amongst the many interesting components of this assemblage is tropical sedge, Pycreus unioloides, possibly the best standing in this region nowadays. White and black mangroves are also found on this wetland where water is fresher and plenty. The black mangroves are >17m in height, making these amongst the taller to be found along the KZN Coasts.

Dolphins are regularly seen alongside the coal quay and a flourishing marine reserve exists on RBCT’s doorstep – home to pelicans, flamingos, fish eagles, waders, crabs and a host of other bird and marine life. An area within this reserve has been identified as a possible National Heritage Site, bearing testimony to the health of the surrounding natural environment.

On annual basis, RBCT partners with Department of Agriculture and Environmental Affairs to commemorate specific days such as environmental week and water week. Employees and their families are always encouraged to participate in our annual coastal clean-up programme which is very popular with employees.

RBCT’s activities have not impacted the biodiversity within RBCT and surrounding areas. In order to manage and mitigate impacts on diversity, the following plans were implemented:

Alien Invasive Vegetation Management Plan •

Indigenous Planting Plan •

Sustainable health and safety performance

RBCT’s HSEC policy sets out our commitment to eliminating illnesses, injuries and fatalities from our business. RBCT maintains comprehensive HSEC management system which is fully aligned to OHSAS 18001:2007.

Ensuring the safety of our employees and contractors in the workplace is of paramount importance. We aim to conduct our operations with ‘zero injuries’ to our employees and contractors, and believe that all work-related illnesses and injuries are preventable.

In accordance with our commitment to preventing accidents, occupational illnesses and environmental pollution, we aim to:

Appropriately identify risks and manage hazards;•

Comply with applicable national, provincial and •local safety, health laws;

Apply internationally recognized standards, codes •and other requirements applicable to RBCT;

Set, monitor and continuously review safety and •health objectives and targets at every level of the organization;

Effectively communicate with, and involve, all our •key stakeholders on our safety, and health policy;

Effectively report, investigate and respond to •incidents, ensuring appropriate emergency response and crisis management;

Continuously striving to improve our safety, health •and environmental performance;

Provide adequate resources for the achievement of •the SHE policy objectives and targets.

Safety

The safety of employees remained a priority for RBCT during 2013. RBCT falls under the jurisdiction of the Occupational Health and Safety Act 85 (1993). The necessary structures and practices are in place to ensure compliance to this legal framework. Employees and contractors are well informed of the safety issues, policies and procedures that affect their jobs and those of other employees and contractors, as well as the community in general. All employees on site receive regular safety and health training and are issued with protective equipment where hazards cannot be totally eliminated.

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Health and Safety training conducted during the year:

Behaviour Based Safety (COBRA)•

Occupational Health and Safety Act 85 of 1993•

Risk and impact assessment•

Basic Fire •

Basic First Aid•

OHSAS 18001•

ICAM investigation methodology •

General Health and Safety Training•

SHE Representatives training •

We ensure that every hazardous task undertaken in our workplace has a safe system of work identified and that our employees and contractors have tools and equipment that are fit for purpose and well maintained.

RBCT uses a risk-management system to identify, assess and eliminate or control safety risks. When an unsafe condition is identified or when a safety incident occurs, it is investigated immediately and action is taken to eliminate the risks involved. Safety auditing occurs regularly across our business to improve safety standards and practices. In addition, safety performance, initiatives and issues are regularly communicated to all of our stakeholders.

Safety Performance

RBCT is proud to report that we continued to make a significant improvement in safety. Our quest to create and sustain injury-free work environments for our employees and contractors continued during 2013.

Safety performance improved considerably over the previous year. There were no fatalities at RBCT during the year and the lost time injury frequency rate (LTIFR) for the year was at 0.00 per million man-hours worked. This is a 100 % improvement from the LTIFR of 0.21 recorded in 2012. The minor injury frequency rate for the year was 1.02 per million man-hours worked. The primary causes of injuries remain those associated with hand injuries. Risk assessments and behaviour based safety form part of RBCT’s efforts to reduce these and other incidents.

We continued to make progress on our safety culture, and engagement of all stakeholders has been identified as key to achieving HSEC excellence. Formal joint health and safety committees, comprising management, the workforce, contractors and unions meet regularly ensuring consultation with all relevant stakeholders concerning all matters relating to occupational health and safety in the workplace.

In 2014, we will redouble our safety efforts with a goal to achieve to maintain the LTIFR at zero, and further minimise MIFR by at least 5%.

We focused our safety efforts on Behaviour Based Safety process, uniquely named Change of Behaviour Reduces Accidents (COBRA) at RBCT, which has delivered some good results in improving our safety performance. With all 514 employees and 600 contractors trained on COBRA and being active observers, the effort going forward is to embed COBRA to ensure quality observations are submitted and that the identified barriers contributing to at-risk behaviours are removed.

A great deal of time was spent training contractors on COBRA, risk assessments and reviewing the adequacy of their safety programmes. The result has been great improvement of our contractors in HSEC compliance.

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2013 HSEC Objectives

Objective Target Results (including contractors)

Maintain OHSAS 18001 Certification OHSAS 18001 No major findings 3 minor findings

Maintain ISO 14001 Certification ISO 14001 No major findings 6 minor findings

Fatality free year Fatality Nil Fatality

Maintain LTIFR </= 0.21 LTIFR </= 0.21 0.00

Maintain MIFR </= 0.97 MIFR </= 0.97 1.02

NCR’s closed out on time 95% NCR’s closed out on time 100%

COBRA Observations conducted 95% COBRA observations conducted 100%

No external environmental complaints Nil external environmental complaint 0

Asiphephe – Let’s be safe

Emphasising the value of ‘We will not engage in any activity if it is unsafe’, the Asiphephe – Let’s be Safe games is a new safety initiative, implemented in 2013, aimed at realising the commitment of Zero Harm to all RBCT Employees and Contractors.

The philosophy behind these games:

Safety alignment,•

Safety will power,•

Collaboration across •departmental/sectional boundaries,

Unlocking of safe ideas,•

Employee involvement and sustainability of •progress made in instilling safety standards at RBCT

Varying messages and activities in the RBCT safety awareness efforts is the best way to

keep us focused on how important making wise decisions about safety really is and the Asiphephe games is a fun and action-orientated way to help us all get involved in ‘thinking safety’ and remembering safety critical information.

Asiphephe is a game where RBCT MDWT teams will compete against each other on safety topics.

How the games work:

Team representatives will be given study material a few days before the competition and will be asked questions relating to the study material. At the end of each game, the team that gets the highest number of points will be the winner of the session.

Occupational Health and Hygiene

The wellbeing of our employees and contractors in the workplace and the community is critical to the success of our business. RBCT is committed to achieving zero work-related illnesses through identifying, assessing and controlling occupational health hazards.

An Occupational Health Medical Practitioner works on a part-time basis visiting our site twice a week; and four full-time Occupational Health Nurses are available to cover two shifts. Comprehensive health risk assessment is done every two years to help us improve on our medical surveillance programme.

During 2013, RBCT has put a number of occupational health strategies in place, including:

Biggest loser competition – all employees are •encouraged to adopt a healthy lifestyle by exercising, eating healthy. A healthy workforce is a happy workforce.

A continuing occupational hygiene program for •monitoring stressors in the workplace i.e. noise, gravimetric dust and silica, ergonomic, illumination, vibration, diesel, Belt splicing and welding fumes , thermal stress.

Development of a plan to reduce the above based •on recommendations from the occupational hygienist;

Hearing conservation programme.•

Dust and Silica programme.•

Medical surveillance programme.•

Back care programme.•

Continuous health and hygiene awareness training •conducted during the annual HSEC induction and monthly health topics.

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Serious injuries/illnesses are referred to the local hospitals. Medical surveillance medicals are conducted on-site.

Wellness Week has become an annual event in RBCT. It is always held during the last week of August. An ongoing extensive in-house Wellness and disease management programme is given at the Health Care Centre which includes:

HIV Counselling and Testing (HCT)•

Integrated Health and Wellness services with a •24 hour psychological counselling. The service provider concentrates mainly of four pillars of wellness popular known as ‘four pack’ i.e. Emotional, Legal, Physical and Financial.

Biokineticist – He addresses all the ergonomic •related issues in RBCT. The Biokineticist runs the rehabilitation program of employees recovering from different conditions i.e. stroke, muscular skeletal injuries etc.

The Careways group consults employees with different issues ranging from emotional, financial and physical wellness.

Primary Healthcare

Chronic disease monitoring (diabetes, •hypertension, gout, high cholesterol etc.)

Treatment of minor ailments 24 hours (colds, •diarrhoea, headaches etc.)

We have a visiting Dietician who manages •our employees who are on the Biggest Loser programme and chronic disease monitoring.

HIV Counselling and Testing

HIV& AIDS remains a significant risk to South Africa. RBCT recognizes that the management of HIV & Aids is an integral part of its approach to ensuring the well-being of its employees. The company aims to maintain and continually improve its HIV&AIDS Management programmes. In 2013, the company’s drive was on ensuring that employees know their HIV status by undergoing HCT (HIV counselling and testing). We are happy to report that as at the end of December 2013, 85 % of RBCT employees had undergone HCT and know their status. This was made possible through:

Ongoing awareness campaigns at team levels;•

Annual testing campaigns through wellness week •and World Aids day;

Promotion of a stigma-free culture in which testing •is ‘normal’;

Guaranteed confidentiality by the Clinic personnel;•

Offering of routine testing during any medical •consultations at RBCT Clinic.

RBCT is targeting 100% of employees to know their status by the end of 2015.

Coal Dust and Silica

Coal dust and silica levels at RBCT are kept at a minimal. RBCT has taken reasonable steps to ensure dust and silica exposures to employees and contractors are kept at a minimum. Dust and silica monitoring takes place biannually, and where dust levels are found to be high, measures to minimize dust are applied.

Noise

Hearing loss may result from long-term exposure to high noise levels. RBCT conducts baseline, periodic, transfer and exit audiometric examinations. Noise is generally treated at source, and where noise cannot be eliminated, signage is posted to remind employees and contractors to wear their hearing protection. All personnel working in noisy areas are provided with hearing protection equipment.

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To share your views or comments, contact:

Corporate Affairs Department

Richards Bay Coal Terminal (Pty) Limited

South Dunes

Richards Bay Harbour

P O Box 56, Richards Bay 3900

Tel: 035 904 4911

Email: [email protected]

Visit our website: www.rbct.co.za

Documents

Sustainability Report · National Ports Authority, Transnet Freight Rail, Department of Mineral Affairs together with, KwaZulu- ... business and is a cornerstone of our strategic