Sustainability Strategy March 25, 2015

1

BARRICK GOLD CORPORATION

Group 13

Agenda

1. Introduction to Barrick Gold2. Scanning Tools3. SWOT Analysis4. Strategy Choices5. Redevelop Community Engagement

Procedure (Strategy Implementation) 6. Community Engagement Milestones

(Organizing for Action) 7. Evaluation & Control8. Closing Remarks9. Q&A

2

Introduction

Founded 1983 Publicly Traded (TSX:ABX, NYSE:ABX) One of the world’s largest gold miners 2013 – Produced 7.2 million ounces of

gold 2013 – Net Loss of $10.37 Billion 2014 – Reserves of 93 million (oz) gold Multinational Corporation – North and

South America, Africa, Oceanic Region, and Asia

3

Scanning

STEEP Analysissociocultural issues: community

expectations, social licenses

Industry Analysisoligopoly, high capital costs

Financial Analysis

4

Increasing debt financingDeteriorating cost managementPoor growth expectations

SWOT Analysis

Strengths:• Large gold reserves • 23% Energy sourced is

renewable• 6 New board members in the

last year• 5 Board members are on the

CSR Committee

Weaknesses:• Poor brand reputation• High debt (13.1 billion)• No Social License to operate

(anywhere)

Opportunities:• Demand for green technology• Expanding product range

(Concentric Diversification) • Relatively low industry

standards

Threats: • Social Licenses to operate are

becoming crucial for operations, also more challenging to get

• Increased regulations (Carbon Taxes, Mineral Taxes)

5

Strategy Choices 6

Redevelop CommunityEngagement Procedures

Stakeholder Relations Increase transparency, develop benchmarks &

indicators Operations

Download engagement decisions to local managers

Strategy/Senior Management/Governance Influence a learning organization culture

7

Community Engagement Plan Milestones

8

2015

• 100% Operations with engagement plans• Completed set of community engagement

indicators• Public disclosure of yearly grievances

2016

• Indicator score improvements 10%

2017

• Indicator score improvements 20%

Evaluation & Control9

1. Improved Dupont Ratio Dupont = Net Profit Margin x Asset Turnover x Equity

Multiplier

2. Increased Shareholder Value3. Improved Community Engagement Indicators4. Reduced Number of Grievances5. Decreased Cost of Victim Compensation

-60%

2017-30%

2016-15%

2015Baseline

Victim Compensation Costs

2014

Closing Remarks

High Debt

Social Failings

Poor Risk Management

Eco-Efficiency and reduced Costs

Social Success through new programs

Reduced risk through improved environmental and economic decisions

10

History Future

Questions & Answers 11

Why Dupont?12

Expanded version of Return on Equity Composed of:

Operational Efficiency Financial Leverage Asset Use Efficiency Ratio

NGO Partnerships?13

Former relationship with World Vision No info on current partnerships Bad reputation may be to blame

Why Barrick? 14

Room for improvement Dirty Industry Bad Press

Is this plan practical?15

Absolutely Capital Costs are not massive Time-consuming Could be challenging Long-process

What separates Barrick?16

Capital Size Reserves

What’s Acid Rock Drainage?17

Acidic water that is produced when minerals are exposed to oxygen

Can leach into the water and harm aquatic flora and fauna

Most metals are relatively rich in sulphide minerals

References18

Barrick Gold. (n.d.). Community [Photograph]. Retrieved from http://www.barrick.com/responsibility/community/default.aspx

Barrick Gold. (n.d.). Lagunas Norte [Photograph]. Retrieved from http://www.barrick.com/operations/peru/lagunas-norte/default.aspx

Barrick Gold. (n.d.). Unknown [Photograph]. Retrieved from http://www.barrick.com/files/history/barrick-history-13.jpg

Calabreese, D. (2015). Unknown [Photograph]. Retrieved from http://business.financialpost.com/2015/02/17/barrick-gold-corp-chairman-keeps-investors-guessing-on-miners-next-move-im-looking-into-a-black-hole/

Mining Facts. (n.d.). What is acid rock drainage? Retrieved from http://www.miningfacts.org/Environment/What-is-acid-rock-drainage/