Updated and expanded: CER releases 2016 version of Full Disclosure: The Truth About Corporate Environmental Compliance in South Africa
November 16, 2016 at 12:00 pm
Cape Town, Wednesday, 16 November 2016. The Centre for Environmental Rights (CER) has launched its 2016 version of Full Disclosure: The Truth about Corporate Environmental Compliance in South Africa, adding 10 new listed companies with significant environmental impacts to its 2015 assessment, and providing updated information on the 20 companies reported on last year. The following key points are among those highlighted in the report:
- Four of ten new companies assessed in Full Disclosure 2016 have failed to adequately disclose findings of serious environmental violations in their annual reports (Glencore, South32, Kumba Iron Ore and Coal of Africa Limited).
- A third of companies assessed in Full Disclosure 2015 have improved reporting and disclosure on environmental compliance in their annual reports (AECI, DRDGOLD, Impala Platinum, PPC, Sappi and Sasol).
- CER proposals on environmental compliance reporting have been adopted in the King IV Report on Corporate GovernanceTM.
Tracey Davies, head of the CER’s Corporate Accountability & Transparency Programme, says: “Full Disclosure 2016 provides more evidence that some listed South African companies are exposing investors to potentially devastating risk by committing serious environmental violations and failing to disclose this adequately to shareholders. It also demonstrates that the lack of standard reporting requirements for environmental compliance is compromising sustainable and responsible investment.”
A company’s track record of compliance with environmental laws is one of the most important indicators of the environmental risk posed by its operations. Currently, each company is free to report on its compliance in any way it sees fit. This makes it extremely difficult for stakeholders to assess the environmental risks posed by a company’s operations, and to compare environmental compliance. As a result, these issues are often ignored.
King IV ReportTM
In South Africa, environmental regulators do not yet have the power to impose fines on companies for breaking environmental laws, regardless of the extent of the damage. For this reason, companies can, and often do, hide serious risks emanating from environmental violations.
Davies says: “The CER welcomes the inclusion of a new requirement in the King IV ReportTM that companies disclose details of environmental compliance inspections – and findings of non-compliance – by regulators. We proposed this requirement in the comments that we submitted on the draft King IV TM Report earlier this year. This is a significant step towards improving environmental compliance reporting, and will provide stakeholders with much more useful information with which to assess and compare environmental risks. In an effort to further bridge the gap between companies and investors, we will also be releasing guidelines for environmental reporting in early 2017.”
“Shareholders must insist on more honest disclosure of environmental violations and more consistent reporting. Globally, there is recognition that financial information alone is not adequate to support a holistic assessment of a company’s risk profile or its commitment to sustainable long-term growth. It is now time for South African investors to start taking seriously the impact that industry in this country has on our biodiversity, water resources, air quality and protected areas, and on our ability to reduce global warming and mitigate the impacts of climate change.”
About Full Disclosure
The CER launched Full Disclosure in September 2015. Full Disclosure 2015 and Full Disclosure 2016 present publicly available information from multiple sources in a single, easily accessible location to equip all stakeholders – particularly asset managers and institutional investors – with one source of credible information so that they can start asking the right questions.
Full Disclosure reviews information including government, NGO, community and media reports, as well as the companies’ own reporting. The companies assessed are:
- AECI Limited
- African Rainbow Minerals Limited
- Anglo American Platinum Limited
- Anglo American plc
- AngloGold Ashanti Limited
- ArcelorMittal South Africa Limited
- DRDGold Limited
- Exxaro Resources Limited
- Gold Fields Limited
- Harmony Gold Mining Company Limited
- Illovo Sugar Limited
- Impala Platinum Holdings Limited
- Lonmin plc
- Merafe Resources Limited
- Mondi Group
- Nampak Limited
- Pretoria Portland Cement Company Limited
- Sappi Limited
- Sasol Limited
- Tongaat Hulett Limited
- Coal of Africa Limited
- Glencore plc
- Kumba Iron Ore Limited
- Northam Platinum Limited
- Omnia Holdings Limited
- Royal Bafokeng Platinum Limited
- Sentula Mining Limited
- Sibanye Gold Limited
- South32 Limited
- Wescoal Holdings Limited
About the Centre for Environmental Rights
The Centre for Environmental Rights (CER) is a non-profit organisation of activist lawyers who help communities and civil society organisations in South Africa realise our Constitutional right to a healthy environment by advocating and litigating for environmental justice.
For comment, please contact Tracey Davies, head of the CER’s Corporate Accountability & Transparency Programme, on:
- Mobile: +27 (0)71 600 0383
- Office land line: +27 (0)21 447 1647
- Email: firstname.lastname@example.org
For any other enquiries, contact Annette Gibbs, CER Communications Manager, on:
- Mobile: +27 (0)82 467 1295
- Office land line: +27 (0)21 447 1647
- Email: email@example.com