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Interview with Ben Magara, CEO and Director of Lonmin

Ben Magara, CEO and Director of Lonmin, the world’s third-largest platinum mining company, believes the key challenges facing mining companies over the next five years include defining community shared values, addressing and managing employee demands and the buffering of the impact of the current subdued market.

A British producer of platinum group metals operating in South Africa, Lonmin is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.

What business challenges do you believe mining companies will face over the next five years?

I feel the one of the biggest challenges facing mining companies is that of community shared values. Making every stakeholder feel and understand that mining is a net positive contributor to society is crucial. All stakeholders should be aware of the positive impact that mining has on civil society, but I don’t think the role it plays is appreciated enough.

But, because mining is so vital and necessary, I envision society having a more positive view on all aspects of it. For example, community unrest based on the perception that the value generated by all mining activities are not being shared could be alleviated by cultivating a better understanding and appreciation of the economic benefits of mining for all.

Secondly, the challenge of employee demands and a growing winner-takes-all mentality amongst all players remains a critical challenge facing mining companies today. Shareholders, customers, manufacturers, procurement officers, government, and employees all want to benefit. This winner-takes-all mindset is counterproductive. Employee demands for higher salaries and shareholders, not wishing to further divide capital, can perhaps be resolved by clarifying the definition of shared value. I believe the type of thought leadership demanded today should be based on the core principals of defining shared value with the result that all partners feel that mining is a net positive contributor to the well-being and prosperity of all.

From your perspective, who is shaping the reputation of mining companies today?

I can easily say that it is not mining companies. I believe this is a problem. Reputation is being shaped by civil society and employees who are striking to highlight their demands. 

What role do you think brand and reputation play in addressing public scrutiny and attracting the investor community? 

Your brand is your name, your identity; and reputation is a result of your actions and how they are perceived by others. No one sees your intentions, only your actions. I believe all you have in life is your name. What you choose to do with it is your choice. In this industry, a name, a brand, should reflect all that mining encompasses—both actions and intentions. In that way, I believe name and reputation are synonymous.

In relation to attracting the investor community and addressing public scrutiny, although investors are aware of the current challenges, in my experience investors have a keen interest in the representation of the management team. Investors tend to back good management teams. You’ll find these good management teams are positioned around the name and reputation of individuals within the team.

In your opinion, what role does brand and reputation play in attracting and retaining talent?

I believe your brand, your name, lives longer than your actions. When I moved to Lonmin, I had many talented employees wishing to follow me and join me at Lonmin. Considering all the challenges Lonmin has faced in the past, my name, and the relationships I had built with these employees, remained firm. Strong company values, founded on or reinforced by the aspirations of individual leaders, drive the attraction and retention of talent.

How important is it for mining companies to be perceived as strong corporate citizens?

I believe it is vitally important for mining companies to be perceived as strong and responsible corporate citizens as the mining environment is one that is immensely integrated. I believe however that this will take time and hard work to achieve.

Ben Magara, CEO and Director of Lonmin, has 22 years experience in the mining industry, having held various positions where he has demonstrated an exceptional operational track record as well as successfully engaged and worked with governments and local communities. Mr. Magara served as the Chief Executive Officer for Anglo Coal South Africa at Anglo Zimele Empowerment Initiative Ltd. He is well known in the mining industry for his innovative business initiatives covering safety, HIV and AIDS, as well as organizational culture change. He led the creation of Anglo Inyosi Coal, a Black Economic Empowerment company, resulting in the implementation of four new mines, including Isibonelo, Mafube, Zibulo, and New Largo Collieries. His broad experience includes life of mine planning, production, general management, project management, strategy and business development, restructuring, customer relations, exploration, finance, mergers and acquisitions, divestitures, joint ventures, and human resources. In addition, he has a successful record in community engagement, government relations, conflict resolution, organizational culture, and gaining support from a wide range of stakeholders.    

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