Froneman says “naïve” criticism of executive pay will force companies to delist from JSE

Neal Froneman, CEO, Sibanye-Stillwater

GROWING hostility towards executive pay would drive essential skills into the private sector and even force companies to delist, said Neal Froneman, CEO of Sibanye-Stillwater.

“There’s a lot of naïvety about executive pay. People look at it emotionally and not technically,” Froneman said in an interview with Miningmx on May 12.

Sibanye-Stillwater has been criticised by unions for paying Froneman R300m at a time when they are locked in a three month strike with gold mining employees. Members of the National Union of Mineworkers and the Association of Mineworkers & Construction Union have demanded an increase in monthly wages of about R1,150 per entry-level employee.

Sibanye-Stillwater has offered an R850/month increase. It said this was its final offer after making five previous adjustments and paying back-pay to employees. Meeting union demands would add an unsustainable R1bn to annual fixed costs at the operations which were cash negative in Sibanye-Stillwater’s 2021 financial year, it argued.

Said Froneman: “This (controversy over executive remuneration) will drive companies to delist and become private because it’s unfair towards the executive and senior management teams that run these companies.

“The whole sentiment drives average performance and there are people in companies who are not average, and you will lose them to private industry,” he said. “I fully acknowledge the issue of inequality and poverty, but you don’t solve this by not rewarding performance. You solve it by creating jobs and economic growth, not by cutting salaries of executives.”

The bulk of Froneman’s pay related to share incentive schemes, announced in March just as the strike was kicking off.

“It’s not my job to defend my salary; that’s up to the board. But the one thing the executives have asked the board is that a greater proportion of their pay is related to performance,” he said.

“We have, as an executive, outperformed. We have tripled the number of people we employ; we have saved about 30,000 jobs in gold with assets that would have closed in five years. We have saved Lonmin: Lonmin pays for itself every four to six months,” he said. “We have created value from R15bn to R150bn (share price improvement since 2013). Yes, a portion of that is the commodity cycle, but we called that.”

Speaking off the record, a rated analyst told Miningmx that whilst executive pay was supported by shareholders, and shares were paid at a cost to them in terms of dilution, Froneman nonetheless lacked diplomacy for speaking out about the matter.

But the criticism against him has been intense. In telling Miningmx that Sibanye-Stillwater had the financial resources to sit out an extended strike at its gold mines – as it was effectively stemming losses – Froneman attracted the criticism of South African mines minister Gwede Mantashe.

He told Parliament last week that Sibanye-Stillwater ought to have its mining licence removed if it was refusing to mine – a claim the company told BusinessLive it would meet with legal action if formalised.


  1. POST EDITIED. Any analyst who “speaks off the record” about Froneman lacking diplomacy is spineless! Neal calls it like it is! He calls out corruption, Union stupidity and government failure. We need more guys like him!

  2. While I cannot argue against executive pay looking at what Neal and his team have done over the past years, I think one should communicate being fully aware of the sensitivity around this issue.

  3. If you compare Neal Froneman’s response to the professional manner Mark Cutifani and Anglo American handled the outrage over Cutifani’s 2019 remuneration, you realise money can’t buy tact and professionalism.
    But Froneman is correct, it is not up to him but up to Sibanye’s Board Chair (who received R3.3m in board fees in 2021), to defend his pay package.

    • Neal’s response is professional but it’s direct and calls out stupidity. It’s not how he says it as much what he’s saying you guys don’t like. The advice you’ve given your members is wrong and has cost everyone. If you can’t see that and are to proud to admit it then it’s a pity. There’s no outrage over Neal’s package, only politicising of it! Sibanye workers earn a lot more than a living wage. None of them put their hands in their pockets when capital is needed but they think they can be there when there are profits. Unions should become shareholders and might see life differently.

      • MODERATED. It’s Arrogant like you Num V and Neal that truly make mining execs be hated! You would remember who goes underground, does the heavy work, gets infected with chronic illnesses due to years og being exposed to raw mining materials, you would remember who is who in the zoo.

  4. Why pay one person that much and not pay the same workers that make him successful a living wage

  5. 300 million is a disgrace, whichever way you look at it. Nobody can justify this type of earning in a third world country. It’s not correct that a board should defend a package. It’s up to the board to approve a suitable package before having to defend it. It’s scandalous and shameless. We don’t need more guys like him. We need more guys that pay workers a living wage.

    • Once again careful wording from the media. He is not the highest paid exec in the Sibanye group as people forget this is an international company not just a South African one, but the rest are foreigners so no one states anything, Also most of that is in dividends which he will never recieve if he fails to meet KPIs or leaves the company. He recieved only 24 million, while the New head of MTN with only 2 years of service recieved 84million but all is quiet. Also these mines not just Sibanye spend millions in the local communities who always demand more and more. So push and they will privatise or worse shutdown. The average salary for these workers is 12K + benefits. The Average for a security gaurd working a 12 hour shift with higher risk to his life is about 8K. Think there is manny people who right n ow with 40% unemloyment would happily have their jobs.

  6. Cuba is a disaster, Venezuela is a disaster, Zimbabwe is a disaster, Zambia is a disaster, the USSR has collapsed, when are these unions going to show some humility. You planned nothing, did nothing for future acquisitions and production. Just because Karl Marx says you are owed more doesn’t mean you planned and produced more, I’m fact you set the company and the country back three months. If you want company shares, negotiate, plan and then work for it.

  7. Those workers who go to the belly of the earth to extract Gold in harsh conditions where death strike frequently are not well remunerated. Where is the truth and fairness? Executives must consider their sweat and stop inhumane practices.

    • They work in dangerous conditions and everyone appreciates it. But the problem of INFLATION is a monetary problem. The government is printing too much money and there’s not enough competition in the economy. Electricity prices rise because there’s a shortage of electricity. Privatize Eskom and all the SOEs and we would see the same inflation rate as that experienced by the industrialized world, by the 1st world countries. 2% to 3% inflation. So you can’t blame a mine for petrol price increases, it’s the government that’s not making structural economic reforms as requested by the entire world’s business community.

      It’s not Neal or the management of Sibanye. They are doing their best to mine efficiently, productively, to combine knowledge and technology. The problem is the SOEs. Until you understand Economics, you breaking down the country by striking won’t help. It’s ALL in the hands of the government and the SOEs and the unions. They need to change, they need to adapt to the modern world. They need to introduce FREE MARKET COMPETITION in transport, warehousing, exports, electricity production, water, telecommunications, railways, the lowest import duties for mining machines and tools in the world! That’s how China and other countries mine. Not confrontationally. Don’t blame Sibanye, blame the government and the unions that are standing in the way of structural economic reforms as the Reserve Bank governor has requested. You can only bring down prices by introducing more competition, increasing production and international trade,.

  8. MODERATED. What does neal want to do with R28 000 000 basic salary and the rest of that moerse “incentive”. It is expected that the worker that actually does the hard labour must make ends meet with a measely R8000 in the current economic crisis. Its rediculous, its a slap in the workforces faces.

  9. The only one who is “naive” is he who thinks the People will tolerate such inequality forever… Enjoy your short-sighted excesses while you can. There is every likelihood that the real Revolution will be completed in his lifetime. That’s the thing about Capitalists…they are convinced that Money is the only worthwhile reward a Human can strive for.

  10. Once again a picture carefuly painted by media to get rating. This is not just R850 vs R1150 as no one has mentioned the incrase in the other benefits they recieve. Just the basic gross salary increase. In other article Neal called upon Union execs to expose their incomes, noticed that was cerfully ignored. This increase means 1 Million per month extra in fees from the workers to the Union, so Maybe they can forog their fees then the 850 + benefits would be enough.

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