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Taking responsibility for our product

Harmony’s business is gold. We are engaged in the entire gold production process – exploration, mine development, mining, smelting and refining.

Gold production process:

1. Exploration

2. Mine construction and
development

3. Underground mining

3. Open cast mining

4. Refining

4. Rehabilitation

While we are able to refine our gold to a high degree of purity at our own plants, the doré bars (approximately 85% pure) are then further refined at Rand Refinery Limited to achieve the 99.99% purity required by the London Bullion Market Association. Refining of gold and silver for the PNG operations is undertaken by AGR Matthey, a partnership between the Western Australia Mint, the Australian Gold Alliance and Johnson Matthey (Australia), in Perth, Western Australia. Gold is transported by air and silver is shipped.

Gold is marketed and sold by Rand Refinery, on behalf of Harmony, to customers around the world. Typically most of the fine gold (around 98%) produced by Rand Refinery goes into gold bars, either 400 ounce good delivery bars (which are all exported), or kilo bars or smaller, which are almost all (99%) exported to India, Turkey, Italy and the Middle East, with the balance going into local jewellery manufacture. 1% of fine gold production goes into non-bar products like Krugerrands or jewellery semis, like grain and bangle washers.

According to the World Gold Council, around 70% of the annual demand for gold is from the jewellery industry, around 11% from the industrial sector (mainly for dentistry and electronics), with around 13% for investment (institutional and individual investors, in the form of bars and coins).

The gold produced by Harmony becomes the responsibility of the refineries who then on-sell it to users and intermediaries. Harmony is therefore not involved with the end-users (and therefore does not undertake any customer satisfaction surveys), or in providing product information or labelling.

Because of its precious and enduring qualities, gold is seldom wasted. The metal lends itself to recycling. It is estimated that at least 15% of annual gold consumption is recycled.

Gold as a metal is benign and there are few, if any, safety and health impacts associated with the final product. Harmony has not been exposed to any incidents of non-compliance with regulations or voluntary codes concerning safety and health impacts of gold, nor have there been any incidents or complaints of non-compliance with regulations and voluntary codes in respect of product labelling or service information. Harmony does not market its product directly and therefore GRI questions relating to marketing communications, customer privacy and compliance are not applicable.

While Harmony is not actively involved with the marketing of its product, gold, the company engages in investor relations activities, which includes the marketing of the company to current and potential investors. These activities are undertaken in line with legislation, regulations and listing requirements, and no complaints on this were received during the year.