Corporate Governance and Transnational Corporations Assignment

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Contents
QUESTION 1.............................................................................................................................2
1 INTRODUCTION..............................................................................................................2
2 THE MARIKANA MASSACRE: THE CAUSES OF AND EVENTS SURROUNDING
THE INCIDENT........................................................................................................................2
3 CRITICALLY ANALYSING THE PROPOSED JJ-LOMNIN ASSOCIATION
THROUGH THE LENS OF APPLICABLE INTERNATIONAL INSTRUMENTS................4
31 Relevance of International Law in the South African Legal System..............................4
3 3 ILO: Declaration on Fundamental Principles and Rights at Work and Multinational
Enterprises Declaration..............................................................................................................7
4 SOUTH AFRICAN LEGAL FRAMEWORKS AS THE MANDATORY GUIDING
TOOL FOR LONMIN’S CORPORATE SOCIALLY RESPONSIBLE BEHAVIOUR............8
41 The SA Constitution........................................................................................................8
42 The Companies Act.........................................................................................................8
43 King Code IV..................................................................................................................9
4 4 Mining Sector Specific Laws: MPRDA, its regulations and the 2002 Broad Based
Black Economic Empowerment Charter for the Mining Industry ('the 2002 Charter')...........10
45 Conclusion and Recommendations...............................................................................11
QUESTION 2...........................................................................................................................11
1 CENTRAL LEGAL ISSUES............................................................................................11
2 THE REGULATORY, MONITORY AND ENFORCEMENT MACHINERIES FOR
‘ETHICAL BEHAVIOUR’ OF CORPORATIONS IN SOUTH AFRICA...........................11
3 ASSESSING WHETHER IT IS ADVISABLE FOR LOMNIN TO APPOINT AN
EMPLOYEE TO ITS BOARD OF DIRECTORS OR TO ITS SEC.......................................12
4 RECOMMENDATIONS..................................................................................................13
Bibliography.............................................................................................................................14
Case Law..................................................................................................................................14
Legislation................................................................................................................................14
Soft Law...................................................................................................................................14
Books........................................................................................................................................14
Journal Articles.........................................................................................................................14
Internet Sources and Documents..............................................................................................14

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QUESTION 1

1 INTRODUCTION
This report will address several, central legal issues. The first issue relates to the implications
of various International legal instruments applicable on Multinational Enterprises (MNC’s)
like Joost’s Jalokivet Ltd (JJ), considering its proposed association with Lonmin. This issue
cannot be properly addressed without giving the contextual background of the Marikana
massacre, which comprises of killings of Lonmin’s employees (miners) who were demanding
a wage increase, arguing that there is an insufficiency of their earnings during those times
which fell short to cover their adequate standard of living and basic needs. As such this report
will be analysing whether, from the international legal framework standpoint, what are the
implications of JJ’s association with Lonmin. The second issue, will discuss the existing
South African legal framework which mandates companies (the rules being stringent to
mining companies like Lonmin) to act in a socially responsible manner, these instruments
include but not limited to the, SA Constitution,1 Companies Act of 2008,2 The Mineral and
Petroleum Resources Development Act 28 of 2002 (MPRDA),3 The Broad Based Black
Economic Empowerment Charter for the Mining Industry (the Amended Charter),4 and the
King Code of good corporate governance.5 This paper will conclude by recommending
whether in light of the existing legal and quasi-legal instruments, it is advisable for JJ to
associate itself with Lonmin, and if the answer is affirmative what are the measures it should
put in place to ensure that association promotes business growth and good reputation rather
than hinder or damage it.

2 THE MARIKANA MASSACRE: THE CAUSES OF AND EVENTS
SURROUNDING THE INCIDENT.

The Marikana massacre relates to the events that took place from the 12 August 2012 to 16
August 2021, which involved massive killings of approximately 34 miners and 78 were
injured.6 These employees were protesting for wage increase by Lonmin and were met with
brutal resistance from the South African Police Service (SAPS) which resulted to the deaths

1 The Constitution of the Republic of South Africa
2 Act of 2008.
3 Act 28 of 2002.
4 The 2002 Amended Charter.
5 King Code VI.
6 Ngcukaitobi “Strike Law, Structural Violence and Inequality in the Platinum Hills of Marikana” (2013) 34 ILJ
2013 836-858 837.