‘Clean up your act’

As stakeholder engagements go, the Sasol AGM was more Communist Party of China plenary session than folksy Berkshire Hathaway AGM hosted by Warren Buffett.

The cavernous basement at the Sandton Convention Centre didn’t help. It had been hired in anticipation of large numbers of Sasol BEE shareholders attending. Not many did, so the room echoed and rattled. What also didn’t help was the nine dark-suited directors staring down on the shareholders from their lofty stage setting, doing a modestly good impression of Xi Jinping and his cohorts.

Adding to the them-and-us atmosphere was that the lighting was focused on the nine directors and the rest of the room was in semi-darkness.

It didn’t help that chairman Mandla Gantsho started by telling shareholders he would limit the number of questions from the floor. This would have been an appalling PR gaffe — but not a contravention of the Companies Act. Given the eye-watering fees that even the nonexecutive directors on this board are paid, devoting a few hours to shareholder concerns should have been comfortably accommodated. As it happened, Gantsho didn’t follow through on his threat, but the gizmos given to the shareholders for voting and asking questions went on the blink after just 2½ hours, leaving many questions unasked.

Of course, it’s doubtful anything would have helped to warm the frosty atmosphere that pervaded the dark room on that scorching November morning. Unlike the tens of thousands who pitch up to the annual Berkshire Hathaway jamboree to celebrate Buffett’s genius, many of the people who had come to this year’s Sasol AGM were not there to celebrate. Instead, they were there to tell the directors of SA’S second-biggest polluter they’d had enough of the life-threatening air and water they have to live with; they were there to implore the directors to start acting on the public commitments the board has made about reining in its destructive environmental impact. “Sasol is dedicated to minimising the environmental impact of its operations globally, while delivering greater social impact,” says the group’s latest environmental sustainability report.

The report’s puffery is presumably used in the “behind-closeddoors engagement” with powerful institutional shareholders to convince them that their multibillionrand investments in Sasol do not fly in the face of their commitment to the UN principles for responsible investment.

To its credit, Sasol doesn’t attempt to hide the fact that a key strategy in mitigating the risks relating to compliance with the government’s environmental obligations seems a lot like lobbying.

“Sasol relies on seeking extended compliance time frames through postponement applications. This enables the execution of our committed roadmaps,” its sustainability report says, though it provides no details of the targets on the road ahead.

There was no sign of the institutions at the AGM. They had sent in their proxies ahead of the meeting, providing overwhelming support for all the resolutions with the exception of the remuneration resolution. On this, 21.4% voted against the policy.

Without the activist shareholders who had travelled from Sasolaffected communities across SA and Mozambique, the AGM would have confirmed Sasol’s vision of itself: “To be a leading integrated global chemical and energy company, proudly rooted in our SA heritage, delivering superior value to our stakeholders.” Sasol says its values include ensuring that safety, health and environment is a top priority. But during the AGM the community-based shareholders described a reality very different from that vision.

Tracey Davies of Just Share, a shareholder activism and responsible investment organisation, told the FM that for years representatives of the communities had waited to see improvements in Sasol’s environmental impacts. But it