ZIMPLATS Holdings Limited (ZHL) increased its expenditure on environmental rehabilitation by 28,37% to about US$26 million during its financial year ended June 30, 2022, upping its commitment to climate change.
Environmental rehabilitation entails bringing a destroyed or deteriorating environment back to better conditions and a robust ecosystem.
As investor interest in Zimbabwe’s mining sector rises, mining companies are increasingly under more pressure to make provisions in their budget to support environmental projects.
ZHL, one such miner, has started to include environmental, social, and governance otherwise known as ESG into its reporting having spent US$20,25 million in its full year ended June 30, 2021 on environmental rehabilitation. ESG standards have become a key part of securing investment for firms.
As per its website, Zimplats is the leading mining company in Zimbabwe specialising in platinum group metals such as platinum, palladium, rhodium, iridium, ruthenium, and osmium.
“The Group’s mining and processing activities are subject to various laws and regulations governing the protection of the environment. The Group recognises management’s best estimate for asset retirement obligations in the period in which they are incurred. Actual costs incurred in future periods can differ materially from the estimates,” ZHL said, in its recent 2022 Integrated Annual Report for the year ended June 30, 2022.
“Additionally, future changes to environmental laws and regulations, life-of-mine estimates and discount rates can affect the carrying amount of this provision. Estimated long-term environmental provisions, comprising pollution control, rehabilitation and mine closure, are based on the Group’s environmental policy taking into account current technological, environmental and regulatory requirements.”
ZHL said estimates were determined by independent environmental specialists in accordance with environmental regulations and the provisions for future rehabilitation costs had been determined, based on calculations that require the use of estimates.
“The pre-tax discount rate used was 7,5% (2021: 7,3%) at the time of calculation. The net present value of current rehabilitation estimates is based on the assumption of a long-term real inflation rate of 3.8% (2021: 2,0%),” ZHL said.
“At 30 June 2022, if the discount rate had decreased by 2% with all other variables held constant, the present value of the current rehabilitation estimate would have been US$33,7 million. At June 30, 2022, if the discount rate had increased by 2% with all other variables held constant, the present value of the current rehabilitation estimate would have been US$22,1 million.”
An important part of Zimplats’ policy is adhering to the relevant environmental obligations.
The Company was still in compliance with and follows all applicable environmental laws and rules as at the end of the reporting period.
Throughout FY2022, Zimplats maintained all necessary environmental licenses, permits, and agreements.
Currently, ZHL has several environmental licences including the environmental impacts assessment, effluent and waste disposal, air emission, hazardous substances, radiation, and water permits and agreements.
“A certified EMS (Environmental Management System) is the foundation and framework of our environmental thrust within the context of ESG compliance,” ZHL said.
“The following are the key highlights with respect to the implementation of the EMS: Zimplats retained ISO 14001:2015 certification with no major non-conformities being recorded during the FY2022 external audit, No significant environmental incidents were recorded in FY2022, Internal audits and management reviews are conducted regularly to ensure continual improvement of the environmental management system.”
ZHL said it would strive to maintain ISO 14001:2015 certification and continual improvement of our environmental management performance
“Zimplats will utilise the upgraded SHEQ information management system (IsoMetrix) in the management of all ESG issues,” ZHL said.
At the end of the reporting period, ZHL had assets worth US$2,42 billion and had US$6,83 to every dollar of debt showing it was in a liquid position to continue with its environmental obligations.
ZHL said the United Nations Sustainable Development Goals (SDGs) continued to guide them and form the framework for the development of systems to manage potential and actual environmental impacts associated with our mining and processing operations.
“Attainment of the SDGs is the most viable route towards achieving sustainable development as a global community,” ZHL said.
“The Company has fully subscribed to and adopted the following environmentally related SDGs in our approach towards proactively managing environmental issues within our operations: SDG 6 — Clean water and sanitation, SDG 7 — Affordable and clean energy, SDG 12 – Responsible consumption and production, SDG 13 — Climate action and SDG 15 — Life on land.”
The report comes amid the 2022 United Nations Climate Change Conference or Conference of the Parties of the UNFCCC, more commonly referred to as COP27 which started on the 6th of this month and ended today (Friday).
According to the United Nations Global Compact (UNGC) global survey of 14 000 people in 14 countries, there are fears that as the climate crisis worsens business is not trusted to do what is necessary to respond.
UNGC is a voluntary agreement between the UN and corporations and firms to support the adoption of sustainable and socially responsible business practices and to report on their progress.
“We have less than 10 years left to shift the world onto a 1,5C trajectory, reduce global inequalities and achieve the substance of the SDG Agenda.
“Our changing climate means, more than ever, that we are running out of time,” UNGC Assistant secretary-general and CEO Sanda Ojiambo, in a statement made at COP27.
“It really is now or never for the private sector to turn their bold commitments into tangible solutions to protect our planet and our collective future. The UN Global Compact looks forward to continuing our work with businesses all over the world to accelerate our transition to net-zero.”
The Africa Business Leaders’ Climate Statement, which outlines important commitments businesses can make to inspire climate action, was presented at COP27 by more than 50 prominent CEOs from across the African continent who are members of the Africa Business Leaders Coalition.
The statement was signed by the chief executive officers and chairpersons of 56 African companies, from a diverse range of sectors, representing more than US$140 billion in revenue and over 700 000 employees across 50 African countries.
“We hear the alarming warnings of the scientific community and understand that although Africa has contributed the least to creating the climate crisis, its people, its ecosystems, its economies, and its cultural heritage are among the most vulnerable and least prepared to adapt — largely due to insufficient support from international partners,” part of the statement read.
“Climate action is integral to addressing key issues facing Africa, such as food insecurity, forced displacement, water scarcity, and new diseases, all being exacerbated by climate impacts. Africa cannot act alone.
“We call on Governments of wealthy industrialised nations — the main greenhouse gas emitters — and international financiers to act urgently to mobilise adequate resources and funding, build back trust by fulfilling commitments, and to support Africa adapt and build resilience to avoid the enormous cost of inaction.”
The business leaders recognised the unique opportunity before them to unite and take action to unlock Africa’s sustainability advantage, with the support of the international community and African Governments. – (Newsday)