Creating independence through enterprise
Zimele – Anglo American’s 25-year-old enterprise development initiative – is a catalyst for emerging black business and is making a tangible difference through the creation and development of small and medium-sized enterprises (SMEs) in mining communities across South Africa.
Many of these businesses operate in areas surrounding Thermal Coal’s Mpumalanga and Free State-based mines.
Over the past five years alone, it has created or sustained more than 30,000 non-mining jobs by providing loan finance of R921 million to 1,619 SMEs. Collectively, these generate an annual turnover of R4.5 billion.
The model – which combines financial support with mentorship – has been adopted by a number of local and global players. These include, Mondi,Sasol, Barloworld, the World Bank and United Nations Development Programme.
The initiative operates six funds:
Supply Chain Fund
This fund collaborates with our procurement department to identify and facilitate business opportunities for black-empowered SMEs. It assists in pairing up black entrepreneurs with businesses that seek to transform their ownership, and facilitates partnerships with black entrepreneurs who have viable business ideas and teams of people who can help make these a reality.
On a financial level, Zimele invests in businesses by means of minority equity and loan finance. This is supplemented with practical support and guidance in areas such as corporate governance, safety, health, environment, legal, accounting, company secretarial aspects and public relations. This incubator-style process allows the investee company to ‘stand on its own feet’, with the resultant effect being sustainable job creation and socio-economic development.
Anglo American SEFA Mining Fund
The fund is a joint initiative between Anglo American and the Small Enterprise Finance Agency (SEFA), a government-owned entity that promotes SME development.
It focuses on mining-related investments, and helps emerging black-owned mining operations to reap the benefits of commercially viable prospects. The barriers typically faced by aspirant miners includeubiquitous prospecting permits, a lack of access to development capital and a shortage of sound advice appropriate to the needs of emerging mining companies.
The fund assists such enterprises with equity and loan finance at prime interest rates, complemented by technical support during the high-risk exploration and pre-feasibility stages of projects. This brings them to commercially bankable positions at which point mining entrepreneurs can approach commercial lending institutions and raise finance for the commissioning of operations.Further to this; they have access to world-class technical, engineering and mining expertise contained within Anglo American’s core businesses.
Community Fund
The Community Fund has made a significant and tangible impact on the communities near our mines by supporting SMEs, facilitating entrepreneurial opportunities and subsequent job creation.
The fund assists entrepreneurs with seed and working capital through loan finance of up to R2 million per project at preferential interest rates, and works hand in glove with the six business hubs located close to our mines in their labour sending areas. These are situated in eMalahleni, Phola, Middelburg, Secunda, the Vaal, Bushbuckridge and Denilton.
Hub staff offers practical support to emerging business owners and aspiring entrepreneurs in the form of business plan assistance and management training and coaching. The hubs also offer telecommunications, Internet, printing and meeting facilities while giving entrepreneurs advice on the day-to-day running of their businesses.
Green Fund
This fund aims to make a real difference to South Africa’s environmental sustainability and economic growth, by empowering and encouraging entrepreneurs to operate in the green economy. It targets investment opportunities that specifically play a role in mitigating environmental risks and improving the long-term environmental welfare of communities. Initiatives that receive funding from the Green Fund could contribute to sustainable development by many means such as reducing carbon emissions, energy and water consumption, or improving waste and emissions management.
Its main priorities are to create jobs, promote sustainable development within the communities surrounding Anglo American’s operations, manage the green agenda, and ensure the transference of green skills. Loans of up to R10 million may be allocated to each investment and are accompanied by consistent and meaningful support.
Sebenza Fund
This fund will see Anglo American and the Development Bank of Southern Africa each channel R250 million into communities across the country, with special emphasis on areas identified as poverty nodes. Sebenza, which means ‘to work’ in isiZulu,expects to create 8,000 new, sustainable jobs and support 1,600 SMEs over the next three years by establishing 30 new hubs across South AfricaIt provides loans to existing businesses and start-up entrepreneurs at a preferential annual interest rate of 6%, with Zimele undertaking guarantees and ownership of assets until the loan is repaid. In line with the Zimele model, on-going mentorship and training will be available to all beneficiary companies.
Godisa Fund
Launched in February 2014, the fund is a tripartite agreement between Anglo American, Transnet and SEFA. The R165 million funds will foster transformation and the development of sustainable small and medium-sized enterprises by presenting emerging entrepreneurs with opportunities to participate in Transnet’s supply chain. Each partner has contributed R55 million to the fund to be managed by Zimele.
For further information and contact details, visit Zimele here
