African Rainbow Minerals : 2022 King IV Application Register (821.5

1

African Rainbow Minerals Limited (ARM or the company) supports the governance outcomes, principles and practices in the King IV Code as set out in the King IV Report on Corporate Governance for South Africa, 2016™1 (King IV), published on 1 November 2016 and effective for companies listed on the JSE Limited from 1 October 2017. ARM applies all the relevant principles of King IV.

Below we summarise the King IV principles implemented and our progress on achieving the practices and, ultimately, governance outcomes envisaged. Enhancements where required will be made over time, in line with our objective to continuously improve and entrench the highest standards of corporate governance.

Comment from sustainability assurance provider

“As part of our independent third-party assurance processes, IBIS ESG Consulting Africa (Pty) Ltd (IBIS ESG Consulting) conducted an assessment of ARM’s application of the 16 relevant principles contained in King IV, and found no concerns relative to ARM’s assertions that all 16 individual King IV principles have been applied, with reasonable evidence to support each assertion.”

Governance outcome: Ethical leadership

Leadership, ethics and corporate citizenship

The board2 should lead ARM’s board of directors exercises effective leadership. The board confirms its

ethically and effectively commitment to the highest standards of corporate governance; its charter and the code of conduct adopted by the board set the ethical foundation for how the company operates.

The code of conduct is designed to ensure the effective management of ethics and applies to directors, employees, contractors, suppliers and joint-venture partners. The board and its committees monitor compliance with this code, and monitor the directors individually and collectively in terms of cultivating and exhibiting integrity, competence, accountability, fairness and transparency in their leadership. They act ethically in discharging their responsibility to provide strategic direction and control of the company as provided for in the board charter and the company’s memorandum of incorporation. The board regularly monitors its own ethics and those of directors, which feeds into the annual board-evaluation process.

The board sets the strategic direction adopted by the company’s operations to support a sustainable business, and considers, inter alia, the company’s short- and long-term impact on the economy, society, environment and its stakeholders, the best interests of the company as well as risks and opportunities. The chief executive officer is responsible for executing the approved strategy, policy and plan; however, the board monitors execution by management and remains accountable for achieving strategic objectives and other positive outcomes, including the company’s performance, even where delegated to others.

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  2 The governing body of the company is the board of directors.

The board should govern the ethics of the company in a way that supports the establishment of an ethical culture

The board establishes an ethical culture. It ensures that the company applies the governance principles in King IV and, where required, continues to entrench and strengthen recommended practices through the group’s governance structures, systems and processes.

The board determines ARM’s values, which include the broader concepts of sustainability and our commitment to zero harm – to our employees, our host communities and the environment. Through the audit and risk committee, the board approves the company’s code of conduct, which integrates the principles of human rights, specifies ethical business conduct and allows no tolerance for discrimination, corruption or bribery. The code of conduct includes extensive anti-bribery and anti-corruption provisions as well as provisions on conflicts of interest.

Management has been delegated responsibility for implementing the code of conduct. The board, assisted by the social and ethics committee and audit and risk committee, exercises ongoing oversight of the management of ethics, monitoring the company’s activities in terms of ethics and ensuring our conduct supports our values.

The code of conduct guides interactions with all stakeholders and sets the framework to address the company’s key ethical risks. Our policies and programmes, including a whistleblower facility operated by an independent service provider, enable employees and other stakeholders to report confidentially and anonymously allegations of any unethical or risky behaviour and contribute to our strong ethical foundation.

The board should ensure that the company is and is seen to be a responsible corporate citizen

Through the code of conduct, the board is responsible for ensuring the company protects, enhances and contributes to the wellbeing of the economy, society and the natural environment.

Sustainability is an integral part of ARM’s business strategy through our values-driven focus on operational excellence and operating our assets safely, responsibly and efficiently. We believe that a responsible, sustainable approach to our business minimises potentially negative impacts and increases the industry’s positive contribution to communities and the country.

The board, with the support of the social and ethics committee, oversees and monitors how ARM’s operations and activities affect its status as a responsible corporate citizen. As summarised in the integrated annual report, this is achieved through, inter alia, the board charter and code of conduct, which set the policy framework, and through specific operational and corporate office structures. These structures are more fully described in the risk section of the ESG report. This framework has been established to ensure human and financial resources

are employed effectively, and benefit communities.

Minerals Rainbow African

2022 register application TMIV King

Principle 5

The board should ensure that reports issued by the company enable stakeholders to make informed assessments of its performance, and its short-, medium- and long-term prospects

Reporting

The integrated annual report and supplementary reports provide a comprehensive review of ARM’s sustainability, including the group’s financial, economic, social, environmental and governance performance on matters material to its strategy and key stakeholders. Structured review processes to ensure the integrity of sustainability reporting have been established. Reporting is prepared in line with recognised guidelines that ensure compliance with legal requirements and relevance to stakeholders, including International Financial Reporting Standards (IFRS), King IV, the International Sustainability Standards Board (ISSB), GRI Standards and the sustainable development framework of the International Council on Mining and Metals (ICMM).

The board, through the audit and risk committee and other board committees, ensures the necessary controls are in place to verify and safeguard the integrity of the annual reports and any other disclosures. The audit and risk committee oversees the integrated reporting process and reviews the annual financial statements, which are externally audited. The social and ethics committee oversees the ESG reporting process, elements of which are independently assured, and the remuneration committee monitors remuneration reporting, which is reviewed by the company’s remuneration consultants.

The code of conduct includes ARM’s communication policy to ensure that timely, relevant and accurate information is provided to stakeholders. The company ensures that annual reports, including the annual financial statements, integrated annual report, ESG report and other information relevant to stakeholders are

Principle 6

The board should serve as the focal point and custodian of corporate governance in the company

Primary role and responsibilities of the board

The board ensures that the company applies the governance principles of King IV and, where required, continues to entrench and strengthen recommended practices through the group’s governance structures, systems and processes.

The board has an approved charter, which it reviews annually. This sets out its governance responsibilities.

The board, and any director or committee, may obtain independent, external professional advice at the company’s expense on matters within the scope of their duties. Directors may request documentation from and meet with management as required.

An appropriate governance framework and the necessary policies and processes are in place to ensure entities in ARM adhere to group requirements and minimum governance standards. The company’s governance framework and corporate

The board should comprise the appropriate balance of knowledge, skills, experience, diversity and independence for it to discharge its governance role and responsibilities

Composition

The independence of each director is categorised as defined in the Listings Requirements of the JSE Limited, taking into consideration King IV and other requirements outlined in the board charter. The board comprises a majority of independent non-executive directors. Annually, the board rigorously reviews the independence and performance of independent non-executive directors serving more than nine years, on the recommendation of the nomination committee.

To ensure a formal and transparent appointment process, any new appointment of a director is considered by the board as a whole, on the recommendation of the nomination committee. The selection process involves considering the existing balance of knowledge, skills and experience on the board and a continual process of assessing the needs of the company and the board’s effectiveness and ability for it to discharge its governance role and responsibilities objectively and effectively. Board members confirm their availability to perform their roles.

The nomination committee regularly considers the board composition, applying a broad definition of diversity. This includes considering the balance of skills, experience, independence, field of knowledge and knowledge of ARM as well as aspects of diversity, including gender, race, culture, the ages of directors, and other factors relevant to the board’s effectiveness.

The board has adopted a policy on promoting diversity and inclusion at board level, and discloses in the integrated annual report its progress towards targets in the policy. The process of identifying suitable candidates to be proposed for appointment considers diversity and inclusion. Directors are appointed in terms

of the company’s memorandum of incorporation.

Minerals Rainbow African

2022 register application TMIV King