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Petra Diamonds Limited Sustainability Report 201215STRATEGY AND GOVERNANCEStrategy and GovernanceDeveloping our approach continuedStakeholder engagementWe are committed to ensuring that all stakeholders are made aware of the Company's current and future operations and recognise the benefits which result from such operations. We are in the process of developing an overarching Stakeholder Engagement Policy in order to ensure consistent standards are applied across the Group.All of our operations have a defined Stakeholder Engagement Plan in place, which is supported by Community Development Programmes. This includes our exploration operations, as Petra Diamonds Botswana's policies on Communication and Consultation are clearly spelt out in its HSEC Policy Document. Site stakeholder engagement plans contain clearly defined processes for the identification of key stakeholders, the regular and effective communication with such stakeholders, as well as the mechanisms for stakeholders to raise complaints or grievances with the Company. We are committed to ongoing engagement and meet with a wide range of stakeholders on a regular basis.Stakeholders we engage with include:$ employees and trade unions;$ contractors;$ local communities and their representatives;$ local, regional and national Governments;$ regulators;$ suppliers;$ customers;$ joint-venture partners;$ non-Governmental organisations;$ shareholders;$ analysts; and$ the media.Issues raised during the stakeholder engagement process in FY 2012 included:$ unemployment in the region and local recruitment issues;$ poverty alleviation in the communities around the mines;$ mine closure and legacy issues;$ skills development programmes for employees; and$ lack of community health services in the area local to Finsch mine.We have taken steps to include these issues in the Company's programmes and community projects wherever possible and elevated matters to relevant Government departments and organisations where appropriate. All operations focus on engaging with local community representatives to report on the progress of projects, which can then be communicated back to the community.Policies and standardsPetra's policies on issues relating to sustainability operate at three distinct levels: strategic; group; and operational. Care is taken to ensure that these policies and related procedures are vertically as well as horizontally integrated. Although Petra has to date recorded a creditable sustainability performance, as evidenced by the information disclosed in the Sustainability Reports from our last three financial years, we are now undertaking a process to standardise the approach to key issues across our operations. We believe this process has the potential to improve performance by raising standards towards best practice and enabling the sharing of operational efficiencies.We are currently revising our Group Code of Ethical Conduct, which will set out Petra's expectations of employees in regards to areas such as appropriate conduct in the workplace and fraud prevention, as well as including new and revised recommendations on key areas such as human rights, whistle-blowing and anti-bribery policies. Once the new Code of Ethical Conduct is available, it will be made public on the Group's website.The revised Code of Ethical Conduct will become an intrinsic part of our employee/contractor induction and training on key ethical matters, and will complement the comprehensive anti-bribery policies and procedures that the Company is in the process of updating in FY 2013.During FY 2012 we developed and implemented a Group Environmental Policy and Strategy which covers all of our operations as well as a Health and Safety Strategy which covers our South African operations. In addition, we began the development of a Group Stakeholder Engagement Policy which we expect to roll out across our operations in due course.Petra complies with all relevant laws and regulations in the countries in which it operates and was not subject to any legal actions or fines during FY 2012.STRATEGICCode of Ethical Conduct - revised code under developmentStakeholder Engagement Policy - under developmentGROUPGroup Environment Strategy and Policy - in place Group Health and Safety strategy - in place Group Training and Development Policy - in placeOPERATIONALSite level Environment Management Plans - in placeSite-level Health and Safety plans - in placeSite level Stakeholder Engagement Plans - in placePOLICY HIERARCHY (INDICATIVE)

Petra Diamonds Limited Sustainability Report 201216STRATEGY AND GOVERNANCEStrategy and GovernanceDeveloping our approach continuedMaterial issuesUsing a combination of our risk management and stakeholder engagement process, as well as consultations with key Group and operational management responsible for issues relating to sustainability, we have defined the material sustainability issues facing Petra in FY 2012.MembershipsAt a Group level, various employees belong to professional bodies, as funded by the Company but aimed at personal development/exposure.In South Africa, Petra is a member of the South African Chamber of Mines. Petra's Group Human Resource Development Manager, Sheridan Rogers, is on the Board of the Mining Qualifications Authority and Petra has representation on the Mining Education Trust Fund (Petra only provides funding in line with member requirements).In Tanzania, Petra is a member of the Chamber of Mines and its sub-committees. Ignas Balyorguru, the Williamson Human Resources Manager, was appointed by the Minister for Labour, Economic and Social Development as a counsellor on the Labour, Economic and Social Council of Tanzania.Product stewardship and assuranceWe are committed to upholding the high value placed on diamonds, which are given to celebrate life's most special moments and are considered as prized possessions. We will only operate in countries which are members of the Kimberley Process and only sell diamonds that have been mined from Petra-owned operations, thereby providing assurance that 100% of our production is certified as 'conflict-free'. We monitor and manage each step in the diamond production process to the highest ethical standards: from exploration and mining, through to processing, sorting and finally marketing and sale. We are committed to a transparent and equitable sales process and are proud to offer the majority of our production for sale in Johannesburg, thereby contributing to beneficiation in Africa.During FY 2012, there were no incidents of non-compliance or complaints raised with regards to our sales and marketing processes.Client satisfactionPetra's marketing team maintains an open dialogue with all customers and customer satisfaction is considered its primary priority. Petra receives feedback from clients regarding production, assortments, market movements and pricing. Any feedback regarding production is noted and considered for the next production cycle. Petra has an open door policy with clients if they have any queries or concerns, and the Company always assists as far as possible. Confidentiality is of the utmost importance to Petra. When previewing production, each client is allocated a private viewing room and invoices are issued directly to the clients. No tender information is divulged about results or top buyers and other related matters.RESPONSIBLE MININGStakeholder engagementCommunity development Local procurementManagement of stakeholder expectationsLabour relationsEmployee development and retentionEmployee diversityResource usageEnvironmental stewardshipRehabilitation and restorationClimate changeRisk managementHuman rightsEthical conductProduct assuranceSecurityLegal complianceHealth and safety systemsSafety performanceOccupational healthCommunity healthGOVERNANCE AND ETHICSHEALTH AND SAFETYENVIRONMENTCOMMUNITYEMPLOYEES