Corporate governance statement

In line with its corporate values, Rössing Uranium is committed to the responsible stewardship of natural resources. We aim to be a leader in environmental stewardship and to maintain our reputation as a responsible corporate citizen. This aim can only be realised if we understand and appreciate the natural resources which are located in the areas in which we operate and if we use them in a manner that minimises the mine’s impact even after mining operations have been terminated.

Rio Tinto Integrity and Compliance Programme

Rössing Uranium has adopted the Rio Tinto Integrity and compliance programme as set out in The way we work, which symbolises what we stand for as a business. It makes clear how we behave according to our values of safety, teamwork, respect, integrity, and excellence. The way we work applies to all employees as well as consultants, agents, contractors and suppliers.

The board of directors

The board of directors executes a mandate received from the shareholders. This mandate ensures that Rössing Uranium operates as a world-class, responsible company which has assembled an executive team to achieve specifc targets.

The board runs the company in accordance with the mandate outlined in Rössing Uranium’s Articles of Association, ensuring that stakeholder interests are balanced and receive due attention.

Rössing Uranium has a unitary board. Roles of the chairperson and managing director are separated and distinct, and the number and stature of directors serving on the board ensure that suffcient member independence stands behind the decision-making process. The board is comprised of members who possess a wide spectrum of skills, knowledge, independence, experience and diversity, which will best serve the interests of the company and its stakeholders.

The board held four meetings during the year under review, 2016. The members are listed in the table below.

 

Functions of the board

A board charter governs the functions of the board of directors, while the Nomination and Remuneration Committee monitors the board’s performance.

The board adopts corporate strategy, plans of action, major policies and monitors operational performance. Its duties include identifying risks to the company’s sustainability, monitoring risk management and internal controls. It also oversees compliance management, corporate governance, business plans and key performance indicators, which include nonfnancial criteria and annual budgets.

The board is also responsible for maintaining favourable and productive relationships with stakeholders. All directors bear full fduciary responsibility and are obliged to exercise care in all company matters commensurate with their ability and skills. The board meets quarterly and otherwise when circumstances require.

Board Audit and Risk Committee

The Board Audit and Risk Committee was established as a sub-committee of the board of directors and acts in accordance with an approved mandate under terms of reference and assists the board to fulfl its oversight responsibilities relating to:

  • the safeguarding of assets;
  • the operation of adequate systems and control processes;
  • the preparation of accurate fnancial reports and statements in compliance with all applicable legal requirements and accounting standards;
  • the preparation of accurate and reliable operational reports and statements, which are in compliance with all applicable legal requirements and operational standards;
  • Rössing Uranium’s compliance with all the relevant laws and regulations;
  • Rössing Uranium’s compliance with established policies and procedures; and
  • the effective implementation and compliance with the Rössing Uranium’s risk management process.

In performance of its duties, the Board Audit and Risk Committee maintains effective working relationships with the board of directors, management, internal and external auditors and other assurance providers, and is entitled to refer to the fndings of experts, which shall include internal and external auditors.

Nomination and Remuneration Committee

The Nomination and Remuneration Committee is appointed by the board of directors to assist in fulflling its responsibility to the company’s shareholders regarding the selection, nomination, performance, remuneration and succession of directors.

The Nomination and Remuneration Committee determines a remuneration structure for the board of directors and members of the sub-committees.

The remuneration rates are subjected to an annual review in February and any increases are submitted to the board of directors for presentation to the annual general meeting for shareholder approval.

The primary duties of the Nomination and Remuneration Committee are to:

  • identify qualifed individuals as potential members of the board of directors;
  • make recommendations to the board relating to the nomination and selection of directors;
  • review the results of performance assessments of board members;
  • ensure that appropriate procedures are used to assess the remuneration of the chairperson, vice chairperson, executive and non-executive directors, board committees and the board as a whole;
  • review the policy for executive remuneration and for the remuneration and benefts of individual executive directors;
  • review plans for the succession for board members; and
  • review reporting disclosures related to Nomination and Remuneration Committee activities to ensure these disclosures meet the board’s disclosure objectives and all relevant compliance requirements.

Functions of the Committee will remain flexible so that it can react to changing conditions effectively and assure the board of directors and shareholders that the company can attract, remunerate and retain directors of the highest calibre.

Special-purpose vehicles

The company has established two special-purpose vehicles, namely the Rössing Foundation and the Rössing Environmental Rehabilitation Fund, which are managed independently of Rössing Uranium by their own trustees. Members of Rössing Uranium’s board are among these trustees.

Rössing Uranium established the Rössing Foundation in 1978 through a Deed of Trust to implement and facilitate its corporate social responsibility activities in communities of Namibia.

The trustees of the Rössing Environmental Rehabilitation Fund review the closure plans and trust funds to make provision for eventual closure and rehabilitation of the mine site.

The Corporate Governance Code for Namibia (NamCode)

Effective 1 January 2014, Rössing Uranium adopted the NamCode which is based on international best practices and the King Code of Governance for South Africa, 2009. The mine's corporate governance sometime deviates from the NamCode. These deviations are listed in the table below.

Financial statements

The directors are responsible for monitoring and approving the fnancial statements to ensure that they fairly represent the company’s affairs and its profts or losses at the end of each fnancial year. Independent auditors are responsible for expressing an opinion on the fairness with which these fnancial statements represent the company’s fnancial position.

Rössing Uranium’s management prepares the fnancial statements in accordance with the International Financial Reporting Standards and in a manner which the Namibian Companies Act (Namibian Companies Act (28) of 2004, amended 2011) requires.

Independent auditors found the company’s statements on appropriate accounting policies, applied consistently and supported by reasonable and prudent judgements and estimates.

 

Independence of external auditors

The independent auditors PricewaterhouseCoopers audited the Group’s annual fnancial statements. The company believes that the auditors have observed the highest professional ethics and has no reason to suspect that the frm has not acted independently of the company. The Board Audit and Risk Committee has confrmed the independence of the external auditors for the reporting period.

Company secretary

The company secretary, G D Labuschagne, is suitably qualifed and has access to the company’s resources to effectively execute her duties. She provides support and guidance to the board in matters relating to governance and compliance practices across the company.

All directors have unrestricted access to the company secretary.

Risk report

Risk management is a fundamental feature of the company’s business activities. The company keeps risk management at the centre of its activities and cultivates a culture in which risk management is embedded in the daily management of the business.

The board acknowledges its overall responsibility in the process of risk management as well as responsibility to review its effectiveness.

Executive management is accountable to the board for designing, implementing and monitoring the process of risk management, as well as for integrating it with the company’s day-to-day activities. To this end, the company has fully adopted and implemented the Rio Tinto Group risk policy and methodology.

Internal audit

The company’s internal audit function performs an independent-appraisal activity with the full cooperation of the board and management.

It has authority to independently determine the scope and extent of the business activity which is to be performed. Its objective is to assist executive management with the effective discharge of its responsibilities by examining and evaluating the company’s activities, resultant business risks and systems of internal control.

The mandate of the internal audit function requires it to bring any signifcant control weaknesses to the attention of management and the Board Audit and Risk Committee for remedial action.

The internal audit function is outsourced to KPMG. The internal audit reports functionally to the company’s Board Audit and Risk Committee and administratively to the company secretary.

Internal control

Internal control comprises methods and procedures that management has implemented to ensure:

  • compliance with policies, procedures, laws and regulations;
  • authorisation, by implementing the appropriate review and approval procedures;
  • reliability and accuracy of data and information (decision-making at Rössing Uranium needs to be grounded on accurate, timely, useful, reliable and relevant information);
  • effectiveness and effciency, which all operations at Rössing Uranium need to embody, using resources economically, while adding value to the economy. Rössing Uranium achieves this objective by continuously monitoring its goals and by embodying the credo, ‘that which is measured is controlled’; and
  • safeguarding of assets, which need to be protected from theft, misuse or use for fraudulent or destructive purposes.

The directors are responsible for maintaining an adequate system of internal control. It is understood that such a system reduces, but cannot entirely eliminate, the possibility of fraud or error.