JOHANNESBURG (miningweekly.com) - Leaders from South Africa's top local and foreign companies have warned that the prevailing controversy around mining licences in South Africa had "undermined our country's reputation and standing" in the eyes of investors and "caused harm beyond the important sector of mining".

Business Leadership South Africa (BLSA) chairperson Bobby Godsell, himself a former mining executive, said that executives from 50 of the organisation's 80 member companies discussed that issue, along with concerns about threats to media freedom, at a council meeting on Tuesday.

Representatives of resources companies such as African Rainbow Minerals, Anglo American, Gold Fields, Lonmin and Sasol attended the meeting. The balance of the attendees were drawn from large companies as diverse as Absa and Standard Bank, to Media24, Eskom Bidvest and Nestle.

"We are not a body that normally deals with sectoral issues, and we are dealing with this issue . . . to say that real damage is being done to our economy and society in a broader way," Godsell said.

But Godsell also welcomed Minister Susan Shabangu's decision to initiate action against maladministration that had been found at the Department of Mineral Resources (DMR).

Shabangu also announced a six-month moratorium on new applications for prospecting licences, but upheld the DMR's controversial decision to award little known, but politically connected, empowerment company Imperial Crown Trading with a prospecting licence at Sishen, in the Northern Cape.

The BLSA said that the mining licence system required attention to facilitate a rebuilding of confidence.

"For an economy to work well, the rules have to be clear and certain, and consistently applied," Godsell argued.

"There seems to be a need for clarifying, simplifying and reducing administrative discretion in the mining-titled regime. There seems to be a need for that clarified law to be applied in an administratively consistent way and there is a very big case of conflicts that arise - and there will be conflicts - to be resolved expeditiously in the courts."

Shabangu also announced that a joint stakeholder task team had already identified a list of amendments to the Mineral and Petroleum Resources Development Act and that these will be submitted to Parliament for processing as soon as possible.

From September 1, information on the status of exploration and mining licences would also be accessible on the DMR's website, while the department created a new, integrated system of ‘licence-process-tracking', which Shabangu said would be ready for public access within the next six months.

Godsell said that, for its part, it hoped to finalise an "anticorruption code", which would offer a far tighter framework for business in defining corrupt practices that should be avoided. Aspects of this code might be used to bolster the new corporate governance code, King III.

"It takes two to tango," Godsell said, noting that the private sector should not be allowed to avoid or abuse regulations.

To subscribe to Mining Weekly's print magazine email subscriptions@creamermedia.co.za or buy now.