Magadi Soda Company
LimitedBuilding long-term relationships with our
stakeholders

Sustainability Report 2005
1

Introduction

Magadi Soda Company has issued a Sustainability Report for 2004 covering its approach to corporate
sustainability and detailing the social responsibility, environment and economic contributions it has madeduring the year 2004. The circulation of the report was restricted to a targeted audience. The 2005 report
is an update of those areas covered in the 2004 report to incorporate similar contributions made in 2005.
In preparing the 2004 report, PricewaterhouseCoopers Limited advised Magadi Soda Company on therequirements of the sustainability reporting guidelines developed by Global Reporting Initiative (GRI) in
line with the company’s stakeholder engagement and analysis effort.
In this 2005 report, PricewaterhouseCoopers Limited has provided limited assurance guided by theInternational Standards on Assurance Engagements (ISAE) 3000 for the assurance of non-financial
information.
Environment and social responsibility data is subject to many more inherent limitations than financial
data given both their nature and the methods used for data determination, calculation or estimation.
Readers requiring further information may request the Company’s Managing Director in writing.

2

Highlights
With technical assistance from PricewaterhouseCoopers and ITDG-EA, Magadi Soda Company
management sought stakeholders views and concerns

We adhere to high environmental, health and safety standards

Magadi Soda Company has invested significantly in community projects including subsidised health,financing education and provision of water

We recently developed a Community Development Plan (CDP), a unique community development
initiative
Magadi Soda Company is a significant export earner with exports contributing about 1.6% of Kenya’s
export earnings
Magadi Soda Company has created employment for the local community
We support local entrepreneurs by building capacity through advice and knowledge transfer

Magadi Soda Company provides the Government of Kenya and other development partners includingNGOs with office space, accommodation and logistical support

3

Assurance Statement
Independent Assurance Report on the Magadi Soda
Company Limited Sustainability Report
1 January 2005 – 31 December 2005
To the Directors of Magadi Soda Company Limited
Introduction
Magadi Soda Company Limited has issued a Sustainability
Report 2005 (“the Report”) covering its approach to corporate
sustainability and detailing the social responsibility,
environment and economic contributions it has made during
2005. We have been asked to consider selected statements
made and data included in the Report.
It is important to read the statements and data in the context of
the reporting policies and limitations in the Report.
Environment and social responsibility data is subject to many
more inherent limitations than financial data given both theirnature and the methods used for data determination,
calculation or estimation.

We planned and performed our evidence gathering
procedures to obtain a basis for our conclusions inaccordance to the International Standard on Assurance
Engagements (ISAE) 3000 “Assurance Engagements
other than Audits or Reviews of Historical Information”,
approved by the IAASB. However, we have not
performed an audit according to International Standards
on Auditing. Accordingly, we do not express an audit
opinion.
Class of data

Specific items reviewed

Economic Data

cash valued added
statement
mass balance

Environmental Data
Social Data

total expenditure committed
to MSC’s community
investment which includes:
health

Our objectives

education

The objective of our procedures was to obtain limited
assurance whether:waterTransport• the selected statements and data in the Report aresupported by underlying evidence;• the information presented in the report relating to theselected statements and data are consistent with the findingsof our work.

Textual Claims

occupational health andsafetyCriteria for assurance
We have evaluated the subject matter against the following
criteria:• the guidelines prepared by the Global Reporting Initiative(GRI) in 2002 ; and• procedures by which data and information are preparedcollated and aggregated internally.
The board of directors of Magadi Soda Company Limited is
responsible for both the subject matter and the evaluation
criteria. Our responsibility is to report on the data and key
figures for economic, environmental social data as well as
specific textual claims in accordance with the International
Framework for Assurance Engagements, approved by theInternational Auditing and Assurance Standards Board(IAASB). The detailed subject matter of our review is
described in the table.

commitment to employee
training
management systems andpolicies; andOur work approach
Our procedures were limited to:• interviews with management and personnel in Human
Resources and Community Affairs, Finance, Magadi
Hospital, Production and Magadi Rail, involved inproviding information for inclusion in the Report in
relation to the selected statements and data;• examination on a test basis of documentary evidence
relating to the selected statements and data on which
we report; and• testing of the relevant sections of the Report relating to
the selected statements and data to check forconsistency with the findings of our work.

4Assurance Statement
Conclusion
Based on our work described in this report nothing
has come to our attention that causes us not tobelieve that:• the statements and data we reviewed aresupported by underlying evidence;• the information presented in the report relating to
the selected statements and data are consistent
with the findings of our work.
Our recommendations
From our work, we have provided the following
recommendation to the management, which has
been agreed:
In order to streamline the process and encourage
the line management ownership of the accuracy,
timelines and completeness of reporting, it isadvisable that:x your management team are trained on theimplication and implementation of GRI
Guidelines at MSC; andx templates are designed for data gathering inaccordance with the GRI Guidelines for monthlyuse.

PricewaterhouseCoopers Limited, Nairobi
30 August 2006

5

Table of Contents
Page
1.

Managing Director’s Statement

7

2.

Vision and Strategy

83Organisation Profile

10

4.

Stakeholder Engagement

125.

Corporate Governance

16

6.

Management Structure

17

7.

Management Systems and Policies

18

8.

Economic Impact

20

9.

Managing Our Environment

23

10.

Commitment to Health and Safety

24

Environmental Performance

25

Managing Our Social Impact

26

Better Health for the Community

27

Education – Empowering the Community

28

Water Provision

29

Engaging the Community

30

Employee Well-Being

31

Creating Business Opportunities

32

11.

Excellence and External Recognition

33

12.

Planning for the Future

34

13.

GRI Performance Indicators Chart

35

6

Managing Director’s Statement
Magadi Soda Company is Africa’s foremost
producer and exporter of Soda Ash and is amember of the Brunner Mond Group. We aresituated at Lake Magadi which is about 120 km
South West of Nairobi. As well as being a major
contributor to the economy of Kenya, we provide
a very high level of support to the local community.
We maintain the Magadi Township with all its
amenities, including water, a hospital and schools
for its more than 3000 inhabitants. Our social
responsibility program is an integral part of thebusiness planning process guided by theprinciples of sustainability, community
empowerment, capacity building throughpartnerships, and poverty eradication. The
program has been recognised four times by the
Kenya Institute of Management by awarding it the
Corporate Citizenship Award in the annual
Company of the Year Awards. In 2004, we wereawarded the Financial Management ExcellenceAward, produced the Professional Manager of theYear and were the first runner up in the overall
Best Company category.
Our vision is to be the world’s most respectedleader in unique value creation for our customers,
shareholders, the community and otherstakeholders. The pursuit of this vision is guided
by our mission to create prosperity through the
responsible use of Magadi’s natural resources.
At the heart of our continuing success is a team ofhighly competent and committed people whose
motivation is fuelled by unrelenting focus on our
vision and mission as well as targeted businessand personal growth. The behaviours of our teamreflect our core and shared values of integrity,
teamwork, diversity, partnership and innovation.
We thrive through a best in class program ofinvestment in the knowledge and skills of ourpeople.

To build better and sustainable business, we haveembarked on a multi-million dollar investment in a
new plant that will deliver world class productquality and operating excellence.
We define our contribution to sustainable
development through our vision, mission andvalues. This has entailed an approach tosafeguard people, the environment andcollaborate with an array of stakeholders including
the government, customers and investing in thecommunity and new products.
Even though this is our first public Sustainability
Report, we are among the leading companies toissue a Sustainability Report in East Africa
covering environmental, economic and social
impact generated by our operations. This reportwhich covers activities and practices we haveundertaken in 2005, is based on the GRI
guidelines, and is focused on a rigorous
evaluation of the social, environmental andeconomic issues and opportunities associatedwith each of our key business processes. An
index that outlines our economic, social andenvironmental performance corresponding toapplicable GRI indicators is available forreference at the end of this report. As such, thisreport outlines our company sustainability mission
and strategy, stakeholder engagement approach,sustainability policies and management systems,
and sustainability performance.
This report will be shared with all our stakeholders
and feedback will be welcome so that we cancontinue to deliver our commitments to all of them.

James MathengeManaging Director

7

Our Vision and Strategy
OUR VISION“ To be the world’s mostrespected leader in unique value
creation for our customers,
shareholders, the communityand other stakeholders”

In line with this general strategy, our sustainability
initiatives have focused on economic,
environmental and social impact of the company.
To support the local community we have invested
significantly in the following areas:
z
z
z
z
z
z

The vision of Magadi Soda Company is “to be theworld’s most respected leader in unique value
creation for our customers, shareholders, thecommunity and other stakeholders.” The pursuitof this vision is guided by our mission to create
prosperity through the responsible use of
Magadi’s natural resources.
These two aspects in turn reflect our core andshared values of integrity, teamwork, diversity,
partnership and innovation that guide thebehaviour of our team. Our vision, mission andshared core values drive our approach tosafeguard people, the environment andcollaborate with an array of stakeholders including
the government, customers and the community
within which we operate.
Magadi Soda Company ’s commitment toimprovement remains constant. Nowhere is thiscommitment more prominent than in the areas ofcommunity investment, environmental diligenceand stakeholder engagement.

Education
Water
HealthInfrastructure (Rail and Road)
Micro Business Development
Employment

Though, we compiled our first sustainability reportin 2005, this will be the first time Magadi Soda
Company has publicly issued a Sustainability
Report on the basis of the Global Reporting
Initiative (GRI) 2002 guidelines. It is important toalso note that we have gone a step further toincorporate indicators provided under the Mining
and Metals Sector Supplement. This will ensurethat this report better reflects issues that affectour industry.
Report Scope and Boundaries
Magadi Soda Company ’s 2005 Sustainability
Report presents a review of the company's
economic, social and environmental impact andobligations for the period 1 January 2005 to 31
December 2005. However, to illustrate Magadi
Soda Company performance this report also
provides data from previous years. This reportapplies to the Kenya Magadi Soda Company
Limited operations only as they pertain to the
production of soda ash, salt and crushed refinedsoda.
For more information on this Magadi Soda
Company sustainability report contact:
James MathengeManaging Director
Magadi Soda Company Limited
E mail: jmathenge@magadisoda.co.ke
www.magadisoda.co.ke
8Organisation Profile
New Ash Plant
To enhance the company’s competitiveedge in the global market Magadi Soda
Company is expanding its operation in
Kenya by committing $131 million towards
an ultra modern soda ash processing plant.
The new plant is expected to improve theoverall purity of the product to above 99%.
It is expected that the new ash plant will be
operational 2006. To support thisexpansion we have hired 48 new
employees in the year 2005.

Premium Ash Plant Construction Work in Progress

9Organisation Profile
Historical Background
Magadi Soda Company was established in 1911
and became a wholly owned subsidiary ofBrunner Mond in 1924. In 1926 Brunner Mondmerged with three other chemical companies toform Imperial Chemical Industries (ICI). In 1991
Brunner Mond re-emerged by acquiring the UK
and Kenyan soda ash business operations fromICI. The soda ash activities of Akzo Nobel in the
Netherlands were later acquired in February 1998
to form what is now known as Brunner Mond
Group Limited. Tata Chemicals Ltd acquired
Brunner Mond Group in December 2005.

Our products
Soda Ash

Salt

2.4%

1.3%

CRS

96.2%

2005 Group Operations
High standards of environmental and safety
performance are at the heart of all our commercial
and manufacturing activities. We are also highlycommitted and strongly support the developmentof the services and needs of the community inwhich we operate.

Brunner Mond Group

Brunner Mond
UK

Brunner Mond
Netherlands

Brunner Mond
South Africa

Magadi Soda
Company

Our Products
Magadi Soda Company is a producer of sodium
carbonate (soda ash) and salt. We have acommitment to provide our customers with highquality products and excellent service. The
products we manufacture are key inputs inindustrial processes and are used to produce
many essential everyday items including glass,detergents in the leather and paper industries.
Standard Ash Production Plant

10

Our Market
Our Market
Our operations are diverse and we serve
customers in the following regions:z

Africa: Kenya, South Africa, Tanzania,
Nigeriaz

India Sub-Continent: India, Pakistan, Sri
Lanka, BangladeshzSouth East Asia: Thailand, Indonesia,
Malaysia, Philippines, Vietnamz

Middle East: Saudi Arabia, Kuwait, United
Arab Emirates, Yemen.
James Mathenge, Managing Director (withmicrophone) and Mike Odera, Director of Sales &Marketing at the Magadi Night of the ASEAN Glass
ConferenceMarket Breakdown by Region

IndianSubContinent46%

Africa20%

Nature of the Mined Resource
Lake Magadi is central to our production process.
Geographically the lake lies in the Great Rift Valley, about
120km south west of Nairobi at an altitude of 605m
(2,000feet) above sea level. Temperatures range from 29
degrees Celsius to 41 degrees Celsius giving a highevaporation rate of 3,500mm per year.

Middle East
3%

Asia (Far East)
31%

The lake consists of a deep crystalline bed of trona which
is a mixture of sodium sesquicarbonate, sodium chloride ,sodium salts, clays, and small amount of organic matter.
The trona deposit is up to 30 metres thick and the surfaceof the lake covers about 80sq.km. It is the sodium
sesquicarbonate which is processed into soda ash(commercial name for chemical sodium carbonate).

11

Stakeholder Engagement
Stakeholders Identification and Engagement
Planning
In 2004, we contracted PricewaterhouseCoopers
and Intermediate Technology Development GroupEast Africa (ITDG- EA) to consult stakeholders andgive us feedback on how to improve stakeholder
engagement. Specifically, the survey by
PricewaterhouseCoopers analysed responses fromnumerous stakeholders and developed astakeholder communication plan to enhance ourrelationship with stakeholders. Also, out of thiseffort we strive to strategically address our
stakeholder needs. Further, a team from ITDG- EA
consulted locally and tailored the current
Community Development Plan (CDP). This plan
provides an overall framework and guidance to
Magadi Soda Company and other development
partners on the best approach to community
development.
The results from these two assignments provided
Magadi Soda Company independent judgment for
guidance on how to improve its stakeholder
engagement process. They also provided
stakeholders with forums to share comments,
opinions and even criticism of the company. As aresult key stakeholder issues and concerns wereidentified (see table overleaf).
In addition, we have a primary responsibility to ourinvestors and we seek to maximise shareholder
value over time. We recognise this can only beachieved if we consider our stakeholders concern
and ensure integrity and responsible behaviour inall our undertakings.
Magadi Soda Company business operations havetranslated to indirect economic, social andenvironmental impact. To mitigate the impact of
expansion the company, working with International
Finance Corporation (IFC) and Intermediate
Technology Development Group –East Africa
recently concluded a Community Development
plan to guide its community engagement andensure a more strategic and sustainable approach.

Working with the Community
We have developed an elaborate community
engagement forum titled SWOT. This has
facilitated dialogue and partnership with thecommunity. The SWOT is two-tier forum with aplenary session twice a year and a working
committee which meets monthly. The SWOT is
composed of:z

local councillors,z

District Officer (DO) Magadi,zchiefs of the four locations within thedivision,zrepresentative from each of the four groupranches,z

youth and women leaders,zMagadi Soda Company Management

z

NGOs

The terms of reference for this forum include:zcommunity development especially
implementation of the community support
activities;z

issues of mutual concern such as
contracting labour from the community;andzconflict resolution whenever it arises.

Our commitment to improve the level ofunderstanding and trust with all our stakeholders
is unwavering as we strive towards our primaryvision to be the world’s most respected leader inunique value creation for our customers,
shareholders, the community and otherstakeholders.

12Our Stakeholders
Stakeholder

Key Attributes

Employees

Provide essential human resources to Employment equity
Magadi Soda Company
Labour relations
Diverse cultural background
Human resources practices
Comprise of 365 permanent staff
Social impact and interaction withand178 contracted personnel inlocal community
December 2005.
Improved relations with contractors

Kenya Ports Authority (KPA)

Critical provider of port services

Customer relations

Facilitate the shipping of soda ash

Regulatory compliance

Magadi Soda Company single
biggest port user hence a major
contributor to KPA's revenue

Infrastructure support andmaintenanceFour group ranches

Representation in leadership forums

Pastoralists in orientation

Political influence

Low income and skill baseCommunity development and social
impactLocal community

Entrenched cultural values

Key Issues/ Concerns

Revenue generation

Employment opportunities andeconomic impact
Land rights
Security practices

Bankers

Lenders (including
IFC/EIB,FMO,Barclays)

Offer a range of banking services

Revenue streams

Advice on monetary policy andforeign exchange management

Customer relations

Financing the Premium Ash Project

Corporate governance

Strict funding requirement

Stakeholder engagement

Robust monitoring mechanism

Economic, environmental and social
impactCorporate governance

Magadi Soda Company reputation
Return on investment

13

Our Stakeholders
Stakeholder

Key Attributes

Key Issues/ Concerns

Suppliers

About 80% of the suppliers spend
goes to energy, freight andpackaging.

Contracts and relationship to Magadi
Soda Company

Magadi Soda Company financial
Monitored by Magadi Soda Company performanceto ensure timely delivery at
acceptable price and quality
Vary in size and country of origin
Kenya Railways Corporation (KRC) Enormous influence over railtransport in Kenya
Soon to be run under a concession

Contractual agreement with Magadi
Soda Company
Revenue generation

Magadi Soda Company accounts for Infrastructure support and
20% of the total tracking tonnage for maintenance
KRC

Non Governmental Organisations(NGO’s) and Community Based
Organisations (CBO’s)

Business guided by a negotiatedagreement that allows Magadi Soda
Company tracking rights and lease of
locomotives and wagons
Numerous players
Coordination of social development
initiatives
Focus ranging from healthcare,education, infrastructure and general Community development social
community development
supportCapacity to influence the community

Human rights
Economic, environmental and social
impactCustomers

Based in India, the Middle East andS.E Asia, Kenya, S Africa, Nigeria
Contractual agreements

Media

Trade union (Kenya Chemical andAllied Workers Union)

Diverse customer base
Substantial influence over otherstakeholders. Especially, thereputation of the company, and how
the public and other key stakeholders
perceive Magadi Soda Company

Stakeholder engagement
Timely and quality supplies
Acceptable pricing
Magadi Soda Company ongoing
financial performance
Current interest on social andeconomic impact
Land rights

Representatives of unionisable labour Labour relations according to theCollective Bargaining Agreement
Significant influence with workers(CBA)
Labour practices and decent work
conditions

14

Our Stakeholders
Stakeholder

Key Attributes

County Council

The Council has interest in the land in Revenue generation
which Magadi Soda Company
Compliance with local government
operateslegislation
Key beneficiary of Magadi Soda
Natural resource management
Company ’s operations
Magadi Soda Company social,Part of Magadi Soda Company
economic and environmental impact
engagement forums

National Environmental
Management Authority (NEMA

National environmental watchdog

Directorate Occupational Healthand Safety Services
Small Contractors

The environmental regulatory arm of
the Government of Kenya
Health and safety standards
monitoring arm of the government of
Kenya.
Integral part of Magadi Soda
Company business operations
Over 200 service providers
Small businesses that deliver
services such as, painting, cleaning,plumbing and general maintenance

Ministry of Transport

Ministry of Health

Key Issues/ Concerns

Compliance with environmental
regulations

Compliance with health and safety
standards
Health and safety
Adherence to legal requirements
Rates of payment by Magadi Soda
Company

Intense competition
Provides policy guidelines for thetransport sector

Magadi Soda Company contractor
evaluation, selection and performancerequirements
Magadi Soda Company contractual
agreement with KRC

Wields a lot of power and influence
over KRC and KPA

Infrastructure support to private sector
in Kenya especially

Provision of healthcare services

Rail concessioning process
Immunisation, infant and maternalmortality

Limited resources unable to meetcurrent demand for healthcare
services in Magadi

Delivery of adequate healthcare
services
Monitoring performance of healthcare
centres
Staffing the clinics in Kajiado
Coordination of healthcare services

15

Corporate Governance
Governance and Risk Management
Our commitment to corporate governanceprinciples begins at the highest leadership levels.
This is reflected in the composition of our Boardof Directors which comprises of 5 highly
experienced individuals. The Board meetsquarterly and is made up of 60% non-executive
directors and 40% executive directors.
In addition, compliance and control issues
affecting the organisation are delegated to the
Audit Committee. Assessment of theorganisation’s efficiency is conducted by theboard periodically via the audit committee which
reviews independent reports on the financial stateand controls established. The Board of Directors
has outsourced the internal audit function. This
has ensured that the internal audit function is
independent of the activities they audit andperforms with impartiality and proficiency. The
selection of the Board takes into accounteconomic, social and environmental issues aswell as their competence.
Director Name

For instance, the Board must consist of an
appointee from the Kenya Government whose remit
includes community issues. The Chairman is
appointed by the Shareholders. The Managing
Director is appointed by the Board. Currently the
Board has 2 Engineers, 2 Marketers and 1 Diplomat.
Two Directors are from Kajiado District.
Our aim is to manage risk and control our activities.
We do so in a manner that allows us to engage in
profitable business opportunities as well as avoid
and reduce risks that can cause loss, reputation
damage or business failure. Our risk management
approach strengthens our operational effectivenessand enhances business resilience. We have acompany wide risk assessment process that cuts
across all areas of exposure including finance,
manufacturing, human resources, marketing andsupply chain management. The process is regularly
audited/verified by PricewaterhouseCoopers who
perform regular periodic internal audits on agreed
priority areas.
RolePeter J K Haslehurst

Chairman – Executive – Audit Committee Member, also the Brunner Mond Group
Chairman. Has held the position since 2002.

Titus T Naikuni

Deputy Chairman – Non-Executive – Audit Committee Member. Currently the Chief
Executive of Kenya Airways. Previously was the Magadi Soda Company
Managing Director. Has been a Director since 1993.

James G MathengeManaging Director – Executive – Joined the company and the Board in 2003 from
Caltex Oil Kenya where he was MD and Country Chairman.

Professor Bernard C Waruingi

Non-Executive – Audit Committee Member – Also Chairman of Capital Markets
Authority. Is appointed by the Government of Kenya in accordance with the Articles
of Association. Has been a Director since 1987 and has particular remit oncommunity issues.

Sir Graham S Burton

Non-Executive - Chairman Audit Committee – Has been in the Board since 2001.
Also in the Board of Control Risks. Served as UK High Commissioner in many
countries with last posting being Nigeria where he retired in 2000.

Nicholas H Fairclough and Michael N Kori

Joint Company Secretaries – Nicholas H Fairclough since 2000. Michael N Kori
joined the company in 1995 and is also the Director of Supply Chain responsible forthe legal affairs of the company.

16

Management Structure
Magadi Soda Company has internal systems inplace to record and monitor, financial, operational,
safety, health, and environmental management
information. Information management also
includes data on community involvement, as well
as systematic monitoring of unintended
community impacts and support in community
development. Although the Board of Directors areultimately responsible for Magadi Soda Company
performance, the following individuals areaccountable for the for oversight of Magadi Soda
Company operations on a day to day basis:z

Managing Director – James G Mathenge – In
addition to all other matters stated earlier, heis the senior person with direct responsibility
for safety, health and environment. Directs thePremium Ash Project;z

Director of Finance – Nicholas M Nyaga –joined the company in 1999. Responsible forthe coordination of both internal and externalfinancial auditors;z

Director of Human Resources - Sammy
Chepkwony – joined the company in 2003.
Responsible for the human resources,
community development policy and strategy.
Remit includes the Corporate Social
Responsibility;z

Director of Marketing and Sales – Michael F K
Odera – joined the company in 1979;
Responsible for the public relations policy andstrategy in addition to sales and marketing;z

Senior Medical Officer – Dr Sam Wendo –joined the company in 1989. Responsible forthe medical and health policy and strategy forthe employees, families and the local
community. Spear-heads the malaria andHIV/Aids policy and programs;z

Director Supply Chain – Michael N Kori joined
the company in 1995. Responsible for thelegal affairs of the company and directs theCompany’s supply chain function. Michael Kori
has since left the company at the time ofissuing this report; andz

Director of Manufacturing – Eliud Kayongo
joined the company in 1997. He deputises the
MD in his absence in addition to his
responsibilities. Responsible for strategy on
environmental impact from production related
activities.

Executive Management

James MathengeManaging Director

Michael F K
Odera
Director Marketing

Director of
Manufacturing
Eliud Kayongo

Chief Engineer
Renier Meyer

Director of
Supply Chain
Michael Kori

Director ofHR
Sammy
Chepkwony

Senior Medical
Officer
Sam Wendo

Director of
Finance
Nick Nyaga

Premium Ash
Project

GeneralManager RailFred Onzere

17

Management Systems and Policies
We have established several key policies tomitigate various operational risks:

Environmental Health and Safety Policy

Community Relations Policy
The company is committed to ensuring that thecommunity relations program is an integral part ofits business planning process. Objectives of thepolicy include a pledge to value and respecthuman rights, engage by listening, consideringand responding to ideas and concerns. It requires
frequent communication in an open, positive andtransparent way. It encourages appropriate
awareness, understanding and respect for thevalues of the local community. Where practicableand economically possible the company provides
assistance through equitable, community
orientated and sustainable projects to ensure thatcompany and community actions are consistent
with this policy.

Magadi Soda Company recognises that its
operations have environmental impact. This policy
therefore commits Magadi Soda Company toresponsible environmental management throughglobal standards and conformance to the legal
requirements. Performance objectives include:
continuous improvement; eliminate unacceptablerisks to the environment and health of ouremployees, customers and members of public;
reduce to a practicable minimum adverse effecton the environment; and consult regularly with
employees, regulatory authorities, the local
community and other relevant authorities. We
report our performance publicly.
Employment Policy on Casuals
The salient point in the policy is that Magadi Soda
Company has committed to employ members of
the local community in the salt garnering
operation and the ash plant, 100% and 75%
respectively. The company is an equal
opportunity employer.

Voluntary standards
Standard

Description

Date ofcertification/adoption

Quality management systems standards

Certified to ISO 9002 in 1998
adopted ISO 9001:2000 in
2002

Environmental management systems
ISO 14001

Magadi Soda Company stillworking on the certification

OHSAS 18001

Occupational Health and Safety Assurance Standards

Magadi Soda Company stillworking on the certification

British Safety Council

Magadi Soda Company was audited by the British Safety
Council and received the Five Star award on safety
standards

2003

ISO 9001:2000

Petroleum Institute of East Africa

PIEA carried out a waste management and safety
standards review and issued Magadi Soda Company acertificate of best practice.

2002

18

Management Systems and Policies
Energy Management Conservation Policyzminimise impact of HIV/AIDS;This policy indicates that to be competitive we are
required to have efficient and sustainable use ofenergy. The objectives of the policy are toachieve quantified energy saving and cost
reduction through improved utilisation of energy;
promote a culture of energy efficiency within all
business operations; undertake periodic
measurement and review of performance;
manage our business to achieve continuous
performance improvement; explore opportunities
for step change improvement through utilisation ofsustainable energy sources.

z

protect employees living with HIV/AIDS from
unfair discrimination;z

ensure HIVAIDS shall not constitute a reason
to refuse or preclude any person from
employment;z

ensure confidentiality regarding HIV/AIDS of
any employee or community member;z

reduce as far as reasonably possible thespread of HIV infection and manage theimpact of HIV/AIDS on employees.

Membership in industry and businessassociations
IPM-K Institute of Personnel Management
Kenya Institute of Purchasing and supply Managers(KIPSM)
Chartered Institute of Purchasing and Supplies (CIPS)
Institute of Certified Public Secretaries, Kenya [ICPS(K)]Kenya Institute of Management (KIM)
Kenya Association of Manufacturers (KAM)

Human Resources Policies
These are designed to and have been successfulin achieving a remarkable rise in employee
productivity and sustaining a stable andconducive industrial relations environment. The
policies cover the following areas: organisational
development; recruitment and separation;
employee relations; human resource
development; performance management; pay andbenefits.
Supplier Evaluation

Institute of Certified Public Accountants, Kenya [ICPA(K)]

Supplier Evaluation Selection Performance andAppraisal (SESPA) is a customised approach
used to vet new suppliers and ensure current
suppliers meet the set standards and covers:

Institute of Engineers of Kenya (IEK)z

the profile of supplier including organisational
structure;zfinancial capacity; andzregistration with the government and otherlicensing bodies.

Marketing Society of Kenya (MSK)

East African Association

East African Wildlife Society
HIV/AIDS Policy

The HIV/AIDS policy seeks to:z

promote an environment where HIV/AIDS is
acknowledged to avoid stigma;

Key measures used by the suppliers evaluationcommittee include corporate governancestructure and practice, social responsibility
practice and environmental due diligence.
19

Economic Impact
Turnover for 2005 increased by 19.32%
compared to the previous year. In this figure Soda
Ash accounted for a turn over of 97%, salt 2.3%
and Crushed Refined Soda 1.4%. The results forthe year show a profit before tax increase of
49.5% from the previous year.
Our growth in turnover was attributable to asignificant increase in soda ash prices as soda
ash sales volumes slightly increased from theprior year levels. The increase in prices was theresult of a worldwide supply/ demand shift thatstarted in 2004.
The company has committed US $ 131 million
towards a new plant and related infrastructure.
We are investing in a new plant, equipment andtechnology that will produce premium ash. In May
2004 we signed an agreement with theInternational Financial Corporation (IFC), theEuropean Investment Bank, and the Netherlands
Development Finance Corporation (FMO) underwhich they agreed to finance this project. The
turn-key project is already underway and the newplant is expected to be commissioned in thesecond half of 2006.
The new plant will have a far reaching multipliereffect through contractors and other providers of
products and services. It will sustain business
opportunities down the supply chain forbusinesses including the rail and port services
providers. This will impact positively on thenational GDP and foreign exchange earnings.

Payroll 2005
Kshs million
Remuneration

418.3

Provident Fund

17.5

Social Security

1.4

Total Payroll

437.2

Total Sum of Taxes
Kshs million
Rates and levies

13.4

Taxes

527.2

Total

540.6

Total spend on non-core business
infrastructure (Kshs million)
Township and clubs
33.8
Housing
29.7
Schools
8.9Road maintenance
15.2
Total

87.6

Magadi Soda Company is asignificant export earner20

Economic Impact
Distribution of Cash Value Added
Retained Earnings

Interest charges

Taxes

Administration

Employee Remuneration

24%
48%
6%
20%

2%

Goods, Materials & Services Purchased
45%

40%

35%

30%

25%

20%

15%

10%

5%

0%
HFO, Lubes/Cons & IDO

Electricity

Freight and Commissions

Delivery Cost/Port &Railage21

Economic Impact
Magadi Soda Company Corporate Social Responsibility Support direct & indirect Spending
Pattern (2004
SectorDescription of Support

Annual Cost (Ksh)

Education
University bursary scheme

440,000

Secondary School bursary scheme

1,022,500

Adult education teacher

122,452

Free Primary Education

67,000Magadi Bursary Fund

50,000Community Boarding Secondary School

6,006,689
Total

Water

Health7,708,641

Train community watering supply operations(opportunity cost of margins lost due to notdelivering product)

37,308,600

Subsidy & Bad Debts

17,837,000

Train Passenger Service (opportunity cost of
margins lost due to not delivering product)

25,156,656

Community Development Plan (with IFC)

2,683,997

Transport

Community Support

SWOT expenses

94,631126,000

Housing support for NGO’s
Total

2,904,628

Grand Total

90,915,525

22

Managing Our Environment
We have demonstrated over the years
commitment to environmental protection andsustainability. This includes having an openly
displayed policy as well as integrating
environmental considerations in overallmanagement systems and our operations. Our
Mission Statement “To create prosperity throughthe responsible use of Magadi’s natural
resources” means that our standards for best
environmental practice are visible, robust,
sustainable and subject to continuous review andrefinement. Our environmental standards meetinternational best practice as demonstrated by theavailability of Environmental Action Plan which
includes World Bank Standards. This is a living
document and is reviewed annually.

A Renewable Resource
The trona deposit in Lake Magadi is constantly
renewing itself by natural means. Rainfall in andaround the Rift Valley drains underground and isheated geothermally. The hot water dissolves
chemical compounds of sodium which occur inthe underground rock strata and the solution
comes to the surface in the form of hot, mildly
alkaline springs which can be found all around theedge of lake Magadi.
Magadi's high temperatures and long sunny days
cause the solution to concentrate by evaporation
eventually giving rise to more trona.

As part of our contribution to increase forest
cover, we have planted over three thousand trees
both in Magadi and at our Kajiado station. We
have created “green parks” in areas hitherto
believed to be too hostile for forestation. Treeplanting has become part of our annual activities.
Each year we hold the “Annual Clean Up &Environmental Day”. This event has been ongoingfor over a decade. For us in Magadi, we just don’t
comply with the legal requirements and otherinternational standards on environment. We go
beyond these to ensure we provide a healthierand cleaner environment for all.

Patterson Park in Magadi Township23Commitment to Health & Safety
Our commitment to Health and Safety is driven by
senior management and executed according topolicy by an established Safety Health &Environment (SHE) Committee chaired by the CEO.
This committee meets quarterly to review policies,
practice and their suitability for operations. The SHE
Committee has sub-technical committees withspecific terms of reference and mandates that deal
with assessments and benefits of specific initiatives.
These include the:zenergy conservation and management
committee; andzcreativity and innovation committee

The results of these proactive efforts are evident
from indicators such as no work related fatality since
operations started. The end of 2005 saw a 20%
overall improvement on safety over prior year withabove 1.7 million hours free of lost time injury.
Dangerous occurrences and reportable incidences
declined by a significant 17% compared to the year
2004.
Our Health and Safety program complies to the ILO
Code of Practice on Recording and Notification of
Occupational Accidents and Diseases and ourrelationship with the International FinanceCorporation ensures that these practices areannually audited to assess our compliance. This
includes verification of our established policy andhow it is implemented, the management andmeasurement systems in place, the effectiveness of
our preventive measures such as protective gear
and awareness training, and the recording of all
safety/occupational health incidents which arereported, investigated and corrected.

Our Health & Safety Policy Goals
100% Compliance by
all employees
In allOperations

Eliminate Hazards andProvide a Safe
Workplace

Minimize the use andRelease ofHazardous Materials

Adhere to all Legal
Provisions but also
Embrace the Spiritof the Regulations

Protect the Environment
by Involving
ourEmployees and
The Community

Implement an SHEManagement Systemin our Operations

Continuously Improve
our SHE
Efforts and Programs

24

Environmental Performance
Magadi Soda Company Rights for Production
EN23 Land rights for production activities or extractive use
Rights: to work the Magadi deposits (subject to Government’s right to extract minerals not affecting Magadi)
Covenants: Not to assign/ sublet without Government consent; Notification to Government of discovery other minerals
Royalty: Half yearly payments to Kenya Government for each ton of Soda and salt sold in the market
Obligatory housing and medical treatment for employees
Government has right to appoint a Director

Renewable Energy Use
EN17 Initiatives to use renewable energy sources and to increase energy efficiency
Solar energy at repeater stations
Solar energy use in Township for water heating

Water
EN5 Total water use
Process Water – 500,000 m3 per annum
Domestic Water – 100,000 m3 per annum
EN21 Annual withdrawals of ground and surface water
100% renewable

Waste
EN11 Total amount of waste by type and destination
Domestic waste – 40 Te per annum: landfill
Scrap metal – 5 Te per annum: sale & recycling
Other industrial waste – 10 Te per annum: landfill
Waste oil – 150 Te per annum: re-use
Waste soda ash/trona – 80,000 Te per annum: back to lake
Plastic Waste – 10 Te per annum: recycling

Environmental Expenditures
EN35 Total environmental expenditures
Environmental Improvements Projects = US$160,000
Dust Minimizations = US$100,000
Budgeted ISO14001/OHSAS18001 Implementation = US$52,000
Training =US$15,000

25

Managing Our Social Impact
Generally, Magadi division is sparsely populatedwith harsh climatic conditions except for the
agricultural zones of Nkuruman escarpment. The
predominant ethnic group is the Maasai, whose
economic mainstay is livestock rearing. This hasoften posed numerous challenges particularly
following periods of drought.

Social Indicators (2004)

It is within these severe conditions that theMaasai community exists alongside Magadi Soda
Company. Our social responsibility approachtargets to help the community to cope anddevelop socially. Ongoing interventions include;
provision of health services, water, promotion of
education, business and employment
opportunities, and working with partners tocomplement our involvement.

Total workforce

543

Permanent employees

365

Piece rate/Contract staff

178

Retirees

5

Terminations

0

Resignations

6% of employees covered by collective
bargaining agreements

71

New employees hired

54

Fatalities

0

Average hours of training per employee
per year:
Senior Management

32

Middle Management and professionals

32

Unionisable staff

24

Providing water for domestic use to local community members

26

Better Health for the Community
To support healthcare, we have dedicatedresources to well-equip Magadi Hospital which
serves both employees and the community. It is
the only hospital facility in the entire division andwe have found it mutually beneficial toaccommodate the community. Currently, the local
community comprises sixty per cent outpatientand ninety five per cent of inpatient service.
We continued to subsidise community healthcare
to the tune of over Ksh 17.8 million up from 14.75
million in 2004. Even after subsidising the cost for
the local community, most patients are still too
poor to afford services and we often provide these
services for free.
The spread of HIV/Aids has increased pressuresat the health facility. To meet rising medical needsof the community, Magadi Hospital works withother partners especially on preventive measures.

A joint action has emerged between Magadi
Soda Company and AMREF to support theclinic at Nkuruman. On occasions we haveprovided financial and material support. We
recently constructed a catering facility and awater intake point. This centre works closelywith Magadi Hospital and complicated cases
are referred to Magadi Hospital. We also
support the fight against Trachoma. We also
assist other local health centres by transporting
drugs and medicine from Kajiado Hospital byrail. In collaboration with the Ministry of Health
we provide immunization referrals and support
their preventive healthcare initiatives.
We have enlisted to support of the Rotary
Doctors, who are international specialists
whose association with Magadi Soda started in
October 1998. The Rotary Doctors, located andhoused in Magadi, operate through a “relay’system, where a doctor takes over from theircolleagues after six weeks of service.
They provide treatments, health education forcommunity members and refer cases that needfurther treatment to Magadi Hospital.

A community patient receiving treatment
at the Company hospital27

Education-Empowering the Community
In a region with diminishing means of livelihoods
skills come handy. We believe education has a far
reaching effect thus our commitment to support
three bursary schemes for the local community:
Kajiado District University and Tertiary
Bursaries Scheme

In order not to leave out the older generation, we
have supported adult literacy classes since May
2002. These classes have registered 65 adults.
This forum is useful in sensitizing the adultcommunity on HIV/AIDS, safety, work ethics andother issues.

Since 1990, we have supported bursaries
annually to university/tertiary students from
Kajiado District. However, out of the six, four ofthese benefiting students must come from Magadi
Division. The scholarship offered is for four years.
Vocational Trainings
Since 2000, 5 students have benefited from our
vocational training at a cost of three hundred
thousand Kenya shillings.
Magadi Division Bursary
In the last decade over 300 students havebenefited from this bursary. Annually this scheme
supports 20 students for four years up from 14 in
2004.
Sir Alexander Fleck Award Scheme
This scheme caters for excelling employee
children in both secondary and tertiary
institutions. It benefits 12 secondary and 3
university students annually.
We are also extensively involved in providing
infrastructure in conjunction with the government.
In fact all facilities in Magadi Secondary School,
Magadi Primary, Magadi Pre-school and Juniorschool are provided and maintained by thecompany. We also house government teachers
and issue grants to encourage better
performance. To other schools in the area wehave provided infrastructure support such as
constructing water points and providing ironsheets for classroom construction, especially forpre-schools.

Class in session at the company assisted boarding
secondary school – Patterson Memorial School,
Olkiramatian
Patterson Memorial Secondary School –Olkiramatian
The company has started a secondary mixedboarding school in the division. The boarding
school started in the year 2005 February andalready has two classes Form 1 & 2 with over 90
students. The company is commited to deliver
fully the school in partnership with otherstakeholders such as the Government, NGO andthe Community.
28

Water Provision
Being arid, water is an extremely scarce resource.
We have provided nine watering points at various
locations along the 35 kilometer pipeline from
Nkuruman escarpment to Magadi. We financed
the provision of piped water to the Ilparakuo
community located about 12 kilometers from
Magadi Township.
In total we supply the community with at least
50,000 litres of water daily. In addition, we
operate a rail tank supply along the MagadiKajiado route thrice a week and a road watersupply in Oldonyonyokie along the MagadiNairobi road daily. This has helped meet both
domestic and livestock needs but only within alimited geographic location.
We have also repaired two water tanks in Tiasilalfor community use as well as perform regular
maintenance of Olekaitoriori, Sampu and Tiasilalwater pipelines.
In a bid to provide water in Oldonyonyokie, we
partnered with HEART TEAM, an Americangroup, for dam construction in Oldonyonyokie.
During this venture we provided excavationequipment, personnel and technical support.

Providing Water for Community Along the RailThe Company is currently supporting Magadi –Oldonyonyokie water pipeline which will takewater from Magadi to Oldonyonyokie.

Providing Water for the Community
at Ilparakuo

29

Engaging the Community
The SWOT process has become the forum for
dialogue between the company and thecommunity. A key objective of this forum is to findlong-term and sustainable solutions to community
needs within this process.
The larger SWOT comprises of about 40
community leaders who meet twice a year. The
SWOT comprises all Chiefs, Councilors, Group
Ranch Representatives, Women, Youth and otherrepresentatives
Within this process is a small select committeethat meets once every month to plan, initiate andcoordinate development activities. It reports to thebigger team twice a year.
The SWOT Committee has further set up
taskforces to deliver on specific activities that
include:z

the establishment of the Secondary
School;z

medical care;z

EcoTourism;zemployment opportunities; andzrailway transport.

Partnering for Progress
The Company has spearheaded the developmentof a Community Development Plan. The
Community Development Plan has become aframework which brings together a number ofstakeholders – NGOs, the government and thecommunity in their operations in Magadi Division.
The Community Development Plan has got thefull blessings of the government’s sub DCC. The
main aim is to pool resources and hasten social
development in Magadi division. The partnershipapproach prevents duplication as each partnerhas projects within their specialised area. This
ensures that funds and other inputs are usedwisely to maximise the gains to the local
community.
We appreciate the fact that NGO’s are in touchwith community needs, can solicit for funding andhave capacity to facilitate community
development. We therefore support NGO’s by
providing office space.

To better coordinate our efforts in the community,
Magadi Soda a Community Development Office inMarch 2002 currently headed by a Community
Development Manager.

Peter Haslehurst, Company Chairman meeting
the Senior Chief, Magadi and other community
leaders
30

Employee Well-Being
Engaging Our Employees

Employee Development and Support

Our employment policy has a preference for
locals in casual jobs recruitment. Seventy five percent of casual workers at the soda ash plant and100 per cent at the salt plant have to be locals.
However, at all times we recruit on merit andability.

The well-being of our employees involves active
development of their careers and overall
professional lives. We have established various
programs and policies to manage the lifecycle
professional development stages of ouremployees as described below.

Our policies and practices prohibit any forms of
discrimination in the conduct of our business. This
includes non-discrimination policies and practices
on human rights, as well as freedom of
association and movement.

Employee Training Programs

Employees are free to join unions and indeed
seventy percent have opted to join the Kenya
Chemical and Allied Workers Union with whom
we have a collective bargaining agreement. We
also have internal channels which we engage our
employees on a continuous basis. These allow for
direct communication to elicit feedback andcollectively address issues and concerns raised.

Induction
Management development
Overseas exposure
Safety training
New plant specificUser training – IT
Management trainees
Apprentices
Fire drills
HIV/AIDS peer training & awareness sessions

Leadership Development Programs
Forums used include:

Coach and develop for results
Drive performance
Inspire loyalty and trust
Manage work
Partner with and across teams
Leadership and personal empowerment
Select talentz

Board Barazas: (an open forum between
Board members and employees involving
formal speeches followed by informal
question & answer sessions);zbi -monthly works council meetings;zmonthly Work Group Meetings;

Managing Career Endingsz

Total Productive Manufacturing (TPM)
sessions (meetings between performance
improvement employee teams fromvarious work areas);

Succession planningzcoaching and counseling sessions;zmanagement meetings; andzprint and electronic media (newsletters, email, intranet, ideas/ suggestion box
system, notice boards).

Ample noticePre-retirement counselling, tours, training
Retirement celebrations and gifts
Exit interviews
100% relocation expenses

31Creating Business Opportunities
Our objective is to reduce dependency andensure that the community is self sustaining. To
achieve this we promote entrepreneurship. Thisrequires building of entrepreneurship skills andresources to ensure that the community takes
charge of its development initiatives and not todepend entirely on the company.
In order to enhance entrepreneurship amongst
the local community, our policy spells out market
stalls allocation in the Township to be 40% local
community, 40% others and 20% employees. The
stalls are filled as they become vacant to attainthis set target. We have also created a
Multistakeholder Businesses Review Committee
which will review these stalls. The committee
comprises of local leaders and MSC employees.
We have further contracted out cleaning servicesof the offices and Magadi Township to the local
community. Together with the local community weare also exploring other business opportunities
such as in tourism and diversification of
livelihoods by introducing bee keeping and posho
mills for women groups. The Township cleaning
has been awarded to Magadi Multipurpose Cooperative Society Limited. This is a community
cooperative currently with over 400 members.
Other groups such as Nasaru Women Group andShompole Agencies have been given contracts inoffice cleaning and hospital cleaning respectively.
Case Study
Magadi Multi-Purpose Cooperative Society
This a community based Co-operative Society forthe local community within Magadi Division. The
formation of the Cooperative is in a bid to uplift
the living standards of the local community as
detailed in the established vision and mission
statements.

MissionThe society’s mission is to reinforce community
effort for poverty alleviation, by enhancing
entrepreneurship development, accountability andtransparency, and promoting sustainable use ofnatural resources for the benefit of the Magadi
community.
Projects Undertaken
In April 2004 the cooperative society managed tosecure a two year ‘Township Cleaning’ Contract
with Magadi Soda Co. By June 2004, theorganisation had received maintenance andrepairs jobs within the civil engineering section i.e.
masonry, carpentry & joinery, plumbing, andpainting. The cooperative also supplies building
sand both to Magadi Soda Co. & Larsen &Tourbo, a contractor constructing the Magadi
Soda’s new plant. In addition the cooperative also
provides unskilled labour to Magadi Soda &Larsen & Tourbo. After being in operation for 9
months it made profit and paid out 100%
dividends to members. Members are increasing
their shares and when enough is raised thesociety will be in position to expand beyond
Magadi.
Other small businesses ventures set out to beundertaken include:z

A “simu ya jamii” community pay phoneservicez

A car washz

The sales of livestock and livestock
products.

VisionThe society’s vision is to see a community that is
equipped with entrepreneurship skills thatreinforce their livelihood security and utilization ofavailable resources for the betterment of thesociety.

32

Excellence & External Recognition
Awards for Excellence Programs
We are proud and honored to be recognised byothers for our professional and community
support efforts. The recognition we receive is anendorsement to our employees that their efforts
are indeed steps in the right direction to improve
the lives of not only ourselves but also ourcommunity.
A sample of initiatives that have been recognisedby various institutions for being a good corporate
citizen are highlighted. Some of these include:z

The Company of the Year Awards(COYA) which we won in 2000, 2002,
2003, 2004 & 2005;z

Good environmental practices from thePetroleum Institute of East Africa (PIEA);z

The 2004 Gold Award from Total Kenya
for the ECO Challenge on Environmental
Conservation programme;z

The 5 Star Safety Award from the British
Safety Council as a result of exemplary
performance in a safety audit; andz

Magadi Town has also been recognised
as the cleanest township in Kenya,courtesy of Magadi Soda Company
support.

Magadi Soda Company Managing
Director, James Mathenge (right)
receiving Company of the year Award
from the Vice President of Kenya,
Moody Awori

33

Planning for the Future
From March to November 2004, the International
Finance Corporation (IFC) and Magadi Soda
Company undertook a review of its community
development programs. This exercise wasundertaken utilising a multi-stakeholder approachwith input from the government, NGO’s and thecommunity. Past initiatives implemented wereconsidered and evaluated for their impact. This
exercise yielded renewed effort and support formonitoring and evaluation to measure impacts,
and we developed a sustainability plan and roadmap for future development under the auspices ofa CDP secretariat.

A Secretariat has already been put up with thesupport of Magadi Soda and other partners suchas Practical Action and the Royal Danish
Embassy.

The overall objective of the CDP is to contributetowards sustainable improvement in the
livelihoods of the Maasai community living in
Magadi Division. This objective will in be
implemented through focus on three areas todevelop specific initiatives. These focus areas
along with their key outputs are summarized.
CDP Focus Area

Development of Governance

Access to Services

Natural Resource Development

Envisioned Outputs

1. The CDP is planned and implemented on a rolling basis with resources secured froma range of partners including the government, private and civil sectors;
2. Cross-section of local stakeholders competent in participatory development planning,project planning, monitoring, reporting and ongoing evaluation techniques;
3. Strengthen the consultation and stakeholder engagement arrangements;
4. Ensure that community based organisations are operational and effective

1. Develop alternative and sustainable solutions to service provision;
2. Enhance existing services to ensure they are robust;
3. Develop and operationalize new services.

1. Develop sustainable approaches to the development, utilisation and management of
pastoral land;
2. Establish sustainable farming solutions in Nguruman and Pakase;
3. Diversify and strengthen community natural resource-based enterprises.

34

GRI Performance Indicators Chart
INDICATOR NUMBER & DESCRIPTION

PAGE(S)

Vision and Strategy
Statement of the organisation’s vision and strategy regarding
sustainable development

6

1.2 Statement from the CEO describing key elements of the report5

2.1 Name of reporting organisation

5, 6

2.2 Major products and/or services, including brands if appropriate

8

2.3 Operational structure of the organisation

8

1.1

Profile2.4

Report Scope

Description of major divisions, operating companies, subsidiaries
and joint ventures

8

2.5 Countries in which the organisation’s operations are located

8, 9

2.6 Nature of ownership; legal form

8

2.7 Nature of markets served

9

2.8 Scale of the reporting organisation

7

2.9

List of stakeholders, key attributes of each and relationship to thereporting organisation

2.10

Contact person(s) for the report, including e-mail and web
addresses

2.11 Reporting period

2.13

Boundaries of report (countries/regions, products, services etc.)
and any specific limitations

2.14 Significant changes in size, structure, ownership

11-13

6

6

6

7
35

GRI Performance Indicators Chart
INDICATOR NUMBER & DESCRIPTION
Report Profile

2.18 Criteria/definitions used in accounting for costs/benefits
2.20

Policy and internal practices to enhance accuracy, completenessand reliability

PAGE(S)
10
10Governance Structure and Management Systems
Structure andGovernance

Stakeholder
Engagement

3.1 Governance structure of the organisation

14

3.2

Percentage of the Board of Directors (Supervisory Board) that are
independent/ non-executive directors

14

3.3

Process for determining the expertise Board members need to
guide strategic direction

14

3.4

Board-level processes for overseeing economic/
environmental/social risks and opportunities

3.5

Linkages between executive compensation and achievement of
non-financial goals

3.6

Organisational structure/responsibilities for oversight,
implementation and audit of relevant policies

15-17

3.7

Mission/values/codes of conduct/principles and status of
implementation

6

3.8

Mechanisms for shareholders to provide recommendations to
Board of Management10

3.9 Basis for identification and selection of major stakeholders

3.10

Approaches to stakeholder consultation in terms of frequency of
consultations by type

15-17

14

10

10

3.11 Type of information generated by stakeholder consultations

11-13

3.12 Use of information resulting from stakeholder engagements

1036

GRI Performance Indicators Chart
INDICATOR NUMBER & DESCRIPTION
Overarching
Policies
andManagement
Systems

PAGE(S)

3.13

Explanation of how the precautionary principle is addressed by theorganisation’s policies

14

3.14

Subscription to externally developed/ voluntary charters/principles/
initiatives

16-17

3.15 Principal industry and business association membership

17

Policies/ systems for supply chain management and productstewardship17

3.17 Approach to managing indirect impacts resulting from activities

10

3.18 Major decisions regarding locations or changes of operations

7

3.19 Programme and procedures for improvement programme/ actions

10

3.16

3.20

Status of certification of environmental, labour, social
accountability management systems

16

Economic Performance Indicators
EC2

Geographical breakdown of key markets

9

EC3

Goods, materials and services purchased

19

EC5

Total payroll and benefits broken down by country/region

18

EC7

Retained earnings

19

EC8

Total sum of taxes per geographical region

18

EC10

Donations to community/civil society, broken down in terms of
cash/in-kind

18, 2037

GRI Performance Indicators Chart
INDICATOR NUMBER & DESCRIPTION

PAGE(S)

Environmental Performance Indicators

Water

EN5

Total water use

23

EN17

Initiatives for renewable energy

23

Biodiversity EN23

Rights for production activities

23

Waste

EN11

Total amount of waste by type and destination

23

Overall

EN35

Total environmental expenditures by type23

38

GRI Performance Indicators Chart
INDICATOR NUMBER & DESCRIPTION

PAGE(S)

Social Performance Indicators, Labour Practices and Decent Work
Employment

LA1

Geographical breakdown of workforce, where possible byregion/country/status

24

LA2

Net employment creation and average turnover segmented per
region/country24

LA12 Employee benefits beyond legally mandated
Labour/Management
Relations

LA3

Percentage of employees represented by independent trade union
per region/country

LA13 Provision for formal representation

29

24

29

LA4

Policy and procedure on information, consultation with employees(e.g. restructuring)

LA5

Practices on recording/notification of occupational
accidents/diseases (relation to ILO)

LA6

Description of formal joint H&S committees/ proportion of
workforce represented in committees

22

LA7

Standard injury, lost day and absent rates and work-related
fatalities

22

LA8

Description of policies or programmes (for the workplace andbeyond) on HIV/AIDS

17

Training and
Education

LA9 Average hours of training per year per category of employee

24

Diversity andOpportunity

LA10 Description of equal opportunities policies or programmes

29

LA17 Policy and programmes for skills management/life learning

29

Health and
SafetyHuman Rights

HR2

Evidence of consideration of human rights(investment/procurements/suppliers/contractors)

29

16, 22

17

39

GRI Performance Indicators Chart
INDICATOR NUMBER & DESCRIPTION
Freedom of
Association

Indigenous
RightsCommunity

PAGE(S)

HR5

Description of policies on freedom of Collective Bargaining
association and programmes

HR12

Description of policies, guidelines, and procedures to address theneeds of indigenous people.

16, 30

HR13

Description of jointly managed community grievancemechanisms/authority

16, 28

HR14

Share of operating revenues from the area of operations that are
redistributed to local communities

SO1

Description of policy on community impact, programmes andmonitoring systems and results

SO4 Awards for social, ethical, environmental performance29

20

16, 30, 32

3140