Evaluating the Compliance of Mining Companies to the Development of Small Businesses in Sekhukhune District, South Africa

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Maria Matshidiso Kanjere and Phoko Peta (Turfloop Graduate School of Leadership, University of Limpopo, South Africa)

Understanding the compliance of mining companies to the Mineral and Resources Development Act, 2002 (Act No. 28 of 2002) has been a challenge because limited research has been conducted in that area, hence this research. The Act provides guidelines for mining companies to promote local and rural development by encouraging mines to procure services and goods from local small businesses. The study aims to understand the challenges experienced by mining companies in complying with the Mineral and Resources Development Act, 2002, which requires them to develop small businesses in Sekhukhune District, South Africa. The study was conducted in the selected mining companies in Sekhukhune District. The study employed the qualitative research methodology and interpretivism research paradigm. Data was collected through semi-structured interviews with representatives of the six mining companies and ten local owners of Small, Medium, and Micro Enterprises (SMMEs) to the point of information saturation. The purposeful selection of the study participants was based on the expertise and knowledge of the participants. The mining companies argue that their partial compliance to Mineral and Resources Development Act, 2002 is due to the lack of a clear collaboration strategy between the mines and local SMMEs. The challenge of lack of strategy results in uncontrived efforts, which do not significantly contribute to sustainable development of local ecosystems involved in the delivery of goods and services. Sustainable development of local SMMES should be at the centre of mining companies that operate in the Sekhukhune area. This will help in addressing the economic transformation agenda of the government. The study adds a differentiated dimension around challenges experienced by mining companies when contributing to the development of local SMMEs.