Foskor has once again been named one of the best employers in the country. It offers unrivalled development schemes in both the professional and personal space and its ‘Foskorites’ are its most important asset.
There is no hiding from the fact that times have been tough for the South African (and international) mining industry. A global commodity price decline and a slow market in China have forced confidence down and resulted in sluggish market activity for almost all mineral resources and this caused difficulty for all large-scale miners. There has been mine closures, retrenchments, industrial action and all kinds of bad feeling created among employees, management and government.
But one company that has so far managed to navigate these challenging times with some success is Foskor. One of the world’s largest producers of phosphate and phosphoric acid, Foskor is a South African institute that was founded in 1951 by the IDC. It has customers all over the world and employs more than 1800 people.
These people are referred to by the company as ‘Foskorites’ and are all vital to operations.
Retiring CEO, Alfred Pitse said recently to Focus magazine: “My memories with all the wonderful people in the three divisions will stay with me forever because they are what makes Foskor tick.
“Foskor is strategic for the country. We have the responsibility of feeding the country, over and above the fact that we have to return value on investment for our shareholders.”
Foskor’s Mining Division in Phalaborwa mines phosphate rock (foskorite and pyroxenite), from which Foskor’s Acid Division in Richards Bay produces phosphoric acid and phosphate-based granular fertilisers. These are sold locally and internationally and are vital in boosting local phosphorus levels. Young plants are especially vulnerable to deficient phosphorus levels, but almost every plant needs it to maintain healthy growth.
Behind the production of phosphate rock and phosphoric acid are the Foskorites and the company’s commitment to them is something which cannot be questioned. Some mining companies have been heavily criticised for the way they treat their employees but Foskor was recently awarded by an independent HR specialist for the way that it develops its people.
INVESTING IN FOSKORITES
The Top Employers Institute is headquartered in Holland and has regional division all over the world. It certifies excellence in the conditions that employers create for their people and it recently commended Foskor for its HR policies, naming the company one of the Top Employers in SA for 2016 and saying: “Our comprehensive independent research revealed that Foskor provides exceptional employee conditions, nurtures and develops talent throughout all levels of the organisation and has demonstrated its leadership status in the HR environment, always striving to optimise its employment practices and to develop its employees.
“Certification is only awarded to the best employers around the world: companies that demonstrate the highest standards of employee offerings.”
Foskor has received this commendation on a number of occasions before and on receiving the certification for 2015, Sarah Luthuli, VP Corporate Affairs and Human Capital said: “Foskor values people. We see them as our main asset. As a result, their development is very key to us. We have a technical training centre where people are trained by others who have worked for Foskor and are now coaches and mentors and who assist with skills transfer. That helps in terms of sustainability of skills and of the business and also in long-term development especially of the young upcoming talent.
“We enrich employees by making funding available for both personal and professional development. For example, we’ve got development programs for all levels of employee. We’ve got supervisory development programs for lower levels and if a person wants guidance as to how to access it we make sure that we communicate through all our communication channels so that all employees are aware of what is available. We even have employee assistance programs for both personal and professional development.
“We hope to send the message that Foskor is a best company to work for. We value our people, we value the communities in which we operate and we value our environment.”
Pitse backed up this emphasis on people, telling Focus: “Foskor has a family culture. I see Foskor as my home away from home.”
POSITIVE FUTURE?
In terms of production, recent times have not been fantastic for Foskor who, despite having such a great record in HR, are now starting to feel the pinch in global commodity markets.
Foskor’s Chairman,Geoffrey Qhena explained more in last year’s annual report: “The external challenges experienced have largely been centred on the demand for our products, the resultant collapse of the selling prices for the major part of the financial year, and the introduction of new capacity were the major contributory factors.
“In relation to demand, India has been at the forefront, since they are the largest importer of fertiliser in the world and their reduction in demand has been severely felt. The main driver of this fall in demand has been influenced by the reduction of the subsidies to farmers by their governments. The farmers had to find alternatives, reduce the use of fertiliser, or extend the rotation of their crops to minimise the use of fertiliser. This reduction also impacted the prices of fertiliser, thus impacting the phosphoric acid prices as the major input. The uncertainty of the export approach by the countries with highest capacities does pose major imbalances and this has also resulted in the prices being depressed.
“Whilst we have been trying to contend with these factors, some countries in the Middle East, are positioning themselves to be major players by embarking on substantial capacity increase projects which will have the effect of defining a new base. The above mentioned factors have resulted in the profit margins being squeezed thus resulting in a different approach being taken where a cost based approach to pricing is being adopted,” he said.
Pitse reiterated these concerns, saying: “Our strategy, in response to the challenges we face, calls for improvement in efficiencies and throughput for creating operational excellence.
“Over the long term, there will be continued secular demand for phosphates. The industry will continue to grow at about 3% per annum. The market fundamentals are expected to improve. However, there will be a need for caution given the global dynamics of the business and events at a macroeconomic level in key markets such as India, Brazil and China.”
CFO, Theuns Koekemoer was slightly more positive, saying: “Despite continued tough market conditions, the company has begun to show positive momentum. The operating profit increased to R118 million from a loss of R72 million in 2013, primarily reflecting the growth in magnetite revenues and the impact of the weakening of the Rand against the US Dollar over the period.”
One things is for sure, as long as Foskor continues to invest in its people then it should be able to steer its way through the uncertainties that keep cropping up. Companies that have a broad, trusted, innovative partnerships with employees seem to be those that perform well and while that status has been threatened at Foskor it remains for now and will hopefully be solidified in the future.