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2016 Annual Results

By supporting local procurement everybody wins

Local procurement

By supporting local procurement everybody wins. Local businesses allow us to have a resilient supply chain and, by doing business with these entities, we help the communities they’re based in to grow.

We spent R4.4bn on suppliers in host communities

This equalled

21.8% of our discretionary spend

71.4% spend

was with HDSA-owned business, totalling R14389.28bn

What are the benefits?
To Kumba To the community
Improves efficiencies in our supply chain by bringing down logistics costs Contributes to job creation and skills development
Provides secure access to critical goods and services Improves local economic and social development
Often helps us obtain and maintain our social license to operate Helps to create sustainable small businesses

Working together

Local procurement plays a big role in our overall preferential procurement policies because it’s part of our commitment to contribute to our host communities and country. It’s important to us that this policy, like all our supplier policies, is mutually beneficial – it must suit the company and the community. We hold our local supplier to the same standards as our larger suppliers, and work with them to ensure they achieve acceptable governance standards. We also ensure that we offer opportunities to local suppliers throughout our process, from exploration to rehabilitation.

Our commitment to local procurement

Along with Anglo American plc, we have committed ourselves to:

  • Allocate appropriate resources to build internal capacity to enable local procurement
  • Clearly articulate the mutual benefits of local procurement and our standards and requirements of suppliers
  • Ensure that our payment terms accommodate SMMEs’ needs
  • Continue to support commercially viable local businesses
  • Continue to expect suppliers to work with us to improve procurement outcomes across our supply chain
  • Set targets for local procurement, and measure and report our progress
Real Mining. Real People. Real Difference.
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Kumba Iron Ore