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The Mining Charter was published in its current form in October, 2002 and provides for HDSA empowerment in the South African mining industry in accordance with the objectives of the MPRDA. The Charter Scorecard consists of a score sheet on which companies will monitor and record compliance with the Charter during the relevant five and ten year periods.
The Charter's stated objectives are to:
- promote equitable access to South Africa's mineral resources for all the people of South Africa (the Charter provides that HDSA participation in the mining industry should be increased on a willing-seller, willing-buyer basis, at fair market value);
expand opportunities for HDSAs, including women, to enter the mining and minerals industry and to benefit from South Africa's mineral resources;
- expand the skills base of HDSAs in order to serve the community;
- promote employment and advance the social and economic welfare of mining communities and areas supplying mining labour; and
- promote beneficiation of South Africa's mineral commodities beyond mining and processing, including the production of consumer products.
In addition, the Charter requires, among other things, that mining companies:
- offer every employee the opportunity to become functionally literate and numerate by the year 2005;
- prepare detailed plans for achieving 40 per cent. HDSA management and 10 per cent, participation by women in the mining industry, in each case within five years; and
- give HDSAs preferred supplier status and show a commitment to the progression of the procurement from HDSAs of capital goods, services and consumables over a three to five year time-frame.
As to the 15 per cent. (within five years) and 26 per cent. (Within ten years) HDSA ownership targets; ownership can comprise, active involvement through:
- HDSA companies (where HDSAs own at least 50 per cent plus one share of the company and have management control);
- Strategic joint ventures or partnerships (where HDSAs own at least 25 per cent, plus one vote and have joint management and control);
- Collective investment vehicles (the majority ownership of which is HDSA based), or
Passive involvement (particularly through broad-based vehicles such as employee stock option plans) where ownership is at any level but with no involvement in management.
The Charter envisages measuring progress against the HDSA ownership targets, including by:
- taking into account, among other things, attributable units of production controlled by HDSAs; and
- allowing flexibility by offsetting so that, for example, where HDSA participation exceeds any set target in one operation, the excess may be offset against shortfalls in another operation.
The Minister for Minerals and Energy may also take a flexible approach when considering a company's compliance with broader objectives under the Charter Scorecard, implying that overachievement in one area may offset underachievement in another.
There are nine elements to the Charter Scorecard. They are:
- Human Resources development
- Employment Equity
- Migrant Labour
- Mine Community and Rural development
- Housing and living conditions
- Procurement
- Ownership and joint ventures
- Beneficiation
- Reporting
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