MANY of South Africa’s top companies – including some rated as “best performers” on the Johannesburg Stock Exchange’s social responsibility index – frequently break environmental laws and often fail to disclose this to shareholders.
These include toxic spills, illegal disposal of hazardous waste, and pollution of water, soil and air.
This was the findings of a research report, Full Disclosure, released this week by non-profit organisation Centre for Environmental Rights, which researched how 20 JSE-listed entities had complied with environmental laws between 2008 and 2014.
While many of these blue chip companies had been “hailed as shining examples for their approach to managing environmental, social and governance factors”, findings were that many had not only failed to disclose breaches of the law to shareholders, but some had “actively misrepresented” their level of compliance with the law.
Tracey Davies, from the centre, said: “The JSE gives a list every year of the companies which are supposed to be taking corporate governance very seriously and are managing environmental impacts, so investors can be sure of what they are investing in.
“But the people at the JSE who compile the social responsibility index look at what the companies are telling them. At the very least companies which have broken environmental laws should not be on it,” Davies said.
The centre got its information about environmental law violations from information published by the authorities, such as the Department of Environment’s Green Scorpions, from reports to Parliament, reports from NGOs, affected communities and some from company reports.
The companies examined were AECI, African Rainbow Minerals, Anglo American, Anglo American Platinum, Anglo Gold Ashanti, Arcellor Mittal SA, DRD Gold, Exxaro, Goldfields, Harmony Gold, Illovo, Impala Platinum Mining, Lonmin, Merafe, Mondi, Nampak, PPC, Sappi, Sasol and Tongaat Hulett.
The nature and severity of environmental laws breached varied considerably from one company to another and included spillage and leakage of chemicals, discharging polluted water, transgressing hazardous waste regulations, polluting air and failure to carry out rehabilitation as legally required.
Davies said each company was given a month to respond to the centre’s findings. Of the 20, 17 have responded. Anglo American, AngloGold Ashanti, Illovo, Mondi, Tongaat Hulett, Sappi and Sasol gave detailed responses.
African Rainbow Minerals challenged the authority of the Centre for Environmental Rights to conduct the assessment.
Exxarro, Merafe and Harmony Gold did not respond.
“We were very impressed with Mondi, Illovo and Tongaat Hulett. The rest of the responses ranged from a brief ‘we do comply’ to detailed descriptions of their investments in mitigating environmental impacts,” Davies said.
Read full report, and the companies’ replies, on http://cer.org.za/full- disclosure.