THE South African mining sector, the government and labour face a period of "tough decisions and difficult conversations" to meet growing expectations about what the industry could and should deliver, against the need for it to remain globally competitive, outgoing Anglo American CEO Cynthia Carroll has said.
In her final interview in South Africa last week, Ms Carroll, who hands over leadership of the diversified resources company to AngloGold Ashanti CEO Mark Cutifani this week, said the country had tremendous potential, but much more had to be done to achieve it.
"We all need a foundation and a framework that is sustainable for the long term that ensures our competitiveness on a global basis," Ms Carroll said.
"We need that framework and we need to understand that the rules of the game are not changing and that they’ll support continued investment and continued competitiveness and employment.
"It will mean taking tough decisions and having difficult conversations with stakeholders. It will mean that we must be honest with each other," she said.
"Most importantly, it must be made clear among all stakeholders what is do-able, what is manageable to support the ambition of being the best in the industry or ensuring the industry’s sustainable competitiveness," she said. "It will require some very open dialogue and continued engagement. It will mean being very earnest with ourselves and everyone has to be a winner."
Chamber of Mines senior executive Roger Baxter said last week the level of engagement between the mining sector, the government and labour had risen in the forum, where the three parties discussed issues affecting the growth of the industry. "Everyone’s trying to engage a little bit more constructively than we have in the recent past."
The fatal shooting of 34 protesters by police near platinum miner Lonmin’s Marikana operations in August last year had spurred all parties to work harder to prevent a repeat of the tragedy that made headlines globally and tarnished South Africa’s image as a mining investment destination.
"Marikana is a tragedy and we never want to dream of having that again," Ms Carroll said. "We’ve got to be that much more aligned as partners to take on the challenges and to make sure that we’re doing the right things and thinking about communities for generations to come."
One of the key changes, apart from the safety drive she engendered in Anglo, particularly in South Africa, was fostering engagement and relationships with labour and the government.
"There was a very traditional way of doing things. Putting aside Anglo, I think it was true for the industry that sitting down with the government or labour, there wasn’t the history of doing that," Ms Carroll said.
"What I’ve worked to do is reach out and have these conversations," she said, adding that she had encouraged employees at all levels to be ambassadors for the company.
Ms Carroll came to Anglo in March 2007, with a background in aluminium and oil and gas.
She was given a mandate by the board to transform the company.
One of her first acts, which rocked the platinum market in June 2007, was to temporarily shut down Anglo American Platinum’s mines to address an appalling safety record.
Ms Carroll’s emphasis on safe mining operations has resulted in a 70% decline in fatalities since she joined Anglo and it is one of her most important achievements. This has been overshadowed to some extent by the continuing difficulties, cost overruns and delays at the multibillion-dollar Minas Rio iron-ore project in Brazil — her first big transaction.
Some analysts are hoping for a change in the Anglo portfolio with Mr Cutifani taking over as CEO, but as one analyst said when Ms Carroll resigned in October, Anglo’s strategy is set by the board and it could take "significant further pressure" from shareholders to force a deviation from that five-year-old strategy.
Some have been calling for Anglo to reduce its exposure to the risks associated with South Africa — a country that provides half the group’s earnings.
Mr Cutifani will be engaged in a full review of Anglo’s assets once he takes the helm.
Ms Carroll has been one of the few outspoken CEOs, not flinching from delivering stern public warnings about the perils of nationalising the mining sector, the effects of the power shortages in South Africa or concerns about proposed amendments to the country’s mineral laws that have sparked a chorus of criticism from mining lawyers. Far from damaging Anglo’s relationship with the government, it created a platform for open and frank discussion, she said.
"I believe what it did was build trust, respect and professionalism by being honest with each other by putting the cards on the table," she said.
Her first priority on leaving Anglo is spending time with her family, one of the motivations she gave when she announced last October she would be stepping down.
Beyond that, she has yet to decide what she will do or where to do it.
"I’m thinking about a number of options and opportunities. I’ve been in commodities nearly all my career and it’s a great place to be. I love this country and I believe so much in its capacity and capabilities and passion. There’s so much more upside here. I would like to do something that has South Africa in my future. I don’t know what that is."