PRESENTATION ONSUSTAINABLE DEVELOPMENT
ANDCORPORATE RESPONSIBILITY
ISSUES
29 April 2003 Anglo American
Presentation Team
Sir Mark Moody-Stuart – Chairman John Groom – Safety, Health and EnvironmentRussell King – Human Resources and Business DevelopmentNick Von Schirnding – Investor and Corporate AffairsEdward Bickham – External Affairs
Safety, Health & Environment
Dr John Groom
Global Mining Initiative• Mining, Minerals and Sustainable Development project• GMI Conference, Toronto• International Council on Mining and Metals
- Characterised by intensive engagement with stakeholders- Provided a solid basis for our participation at the Johannesburg World
Summit on Sustainable Development- Anglo American played a key role
International Council on Mining and Metals
• SD Charter– A commitment to 10 key principles– A commitment to be measured against them
• International engagement– Global Reporting Initiative– Community Engagement tools project with the World Bank– World Bank Extractive Industries Review– Extractive Industries Transparency Initiative
Report to Society
Scope now expanded to become an SD Report
• Business practices & performance• Workplace
– Safety– Occupational health– Human resources
• Environment• Society
– Community health– Social & community initiatives– Economic contribution
Benchmarked against the GRI core indicators
Environment• Risk based prioritising
– Tackling global issues: using local illustrations
• Energy and greenhouse gases– Much improved linkage to units of production– Climate change policy– Value-at-risk study completed
• ISO 14001 certification now covers 51% of turnover. The target is full certification by end of 2004.
Environment
• Water management– Still reporting in aggregate– Future focus will be on individual businesses where water
issues are a priority– For example, Lisheen, Namakwa Sands, Mantos Blancos
and Mondi Paper have innovative water-use strategies
Biodiversity• Clear strategy• Site biodiversity action plans to be developed
(where not already in place)– Link to environmental impact assessment and closure planning
• Corporate contributions to the global challenge– Kew Millenium Seedbank– Active partners in the ICMM/IUCN dialogue on mining and protected
areas– Key sponsor of the UNEP World Conservation Monitoring Centre in
Cambridge
Environmental Targets
Besides the management system targets(ISO14001 and FSC Certification), our business units are setting clear, quantifiable environmental targets that are of greatest relevance to their particular circumstances and their communities.
Many such specifics are listed on p. 51 of our report.
Technological Innovations• Process R&D and alternatives to traditional smelting
(HBMS zinc pressure leach)• Sulphate reducing bacteria for water treatment at
South African coal mines• Coal-bed methane recovery for use (Australia)• Energy efficient technologies• New smelting process will reduce Anglo Platinum
SO2 emissions by 55 000 tonnes/year by end of 2004• Fuel cell technology: joint venture with Johnson
Matthey
Legal Compliance• 281 incidents were reported involving the regulatory
authorities (336 in 2001)• Fines paid totalled $162,000 ($187 000 in 2001)
Verification• KPMG conducted their third review of our SHE
performance and reporting• Nine sites visited, and previous site visits reviewed• Methane emission reporting remains incomplete
Safety I
2000 2001 2002 20030.0
1.5
1.0
0.5
2.0
2.5
0.00
0.10
0.08
0.06
0.04
0.02
Lost time injury frequency rates (LTIFR)Fatal injury frequency rates (FIFR)
0.64
0.87
2.26
1.50
0.020
0.0330.031
Safety II• 127 000 employees: c.65 000 contractors in
managed operations• 47 fatal injuries – down by 33% from 2001• Lost-time injuries down by 42%• Introduction of Golden Rules• Safety performance an element of Executive and
Management remuneration
Much more remains to be done
Safety III• Challenging new targets set• Visible felt leadership• Training and the promotion of safe behaviour• The development of leading indicators• The fostering of a true safety culture• OTTO: Zero Tolerance, Target Zero• Our clear goal is to do business without
hurting people
Occupational Health• Developed integrated industrial hygiene/
occupational health management guidelines: roll-out commenced
• Performance audited against the guidelines will provide leading indicators
Human Resources
Russell King
Key Issues
• Decentralised business model but with strong corporate values
• Corporate role to advise and facilitate
• Sceptical about utility of data aggregation
Key Data• 127 000 employees in managed operations of which:
– Africa 85 000– Europe 30 000– The Americas 8 500– Australasia 3 500
• Contractors c. 65 000
• 2002 – no major industrial disputes
• Support freedom of association – 70% union membership
• Training – minimum 2.2% of total employment costs
Human Resources – Priority Challenges I
DIVERSITY
Ensuring equal opportunities throughout the organisation globally
Gender• c. 10% of employees are women• c. 15% in management roles
South Africa• Employment Equity• By 2008, 40% of managerial employees should be HDSAs (c. 22% in 2002)• Longstanding programmes to develop HDSA managers, including through
educational bursaries c. 600
Human Resources – Priority Challenges II
• Talent Management– Key aspect of diversity agenda– Part of senior management performance contracts
• Performance Management and Development – Now cover about half of employees
• Employee Communication– Developing two-way dialogues
South African Challenges
Black Economic Empowerment
Nick Von Schirnding
South African Challenges
• Minerals Development & Petroleum Act
• Empowerment Charter– 15% equity or production ownership in 5 years– 26% equity or production ownership in 10 years
• Empowerment Scorecard– Ownership; beneficiation; procurement; employment equity; human
resources development; housing conditions and community development
• Money Bill - consultation
Anglo’s Black Economic Empowerment Commitment
0
500
1000
1500
2000
2500
1999 2000 2001 2002
ZAR Millions
• US$1.8 billion in BEE transactions completed
• Procurement expenditure of US$800 million from black-owned businesses
• Small business development– Currently invested in 20 companies; 1 000+ jobs– Khula Mining Fund
• Chairman’s Fund support for education
Social, Community andEconomic Issues
Edward Bickham
Human Rights• Strong commitment in ‘Good Citizenship’ Principles
– Support Universal Declaration– Commitment to make representations on behalf of employees and
communities
• Major issues in Zimbabwe
• Consideration of adherence to ‘Voluntary Principles on Security and Human Rights’
• Child labour
• Development of ‘best practice’ in relation to indigenous peoples
2002 - Controversies
• Zambia – withdrawal from KCM
• Colombia – Resettlement
• Congo – UN Special Panel
HIV/AIDS - I
Total ManagementCommitment
HIV/AIDS policyand strategydevelopment
Developing culturally appropriateprevention messages
Tackling socio-economicfactors
Establishing partnerships
Sustainingawarenessand education
1
2
3
45
Challengingdenial andstigma
Situating prevention in a communitycontext
67
8
9Linking care to prevention
Rigorous scientificreflection
HIV/AIDS - II• Voluntary counselling and testing
• ART initiative for employees (24% infection rate)
• Treatment protocols in place
• 30 sites now registered for ART
• Estimate 3 000 on treatment after 12 months
• Seeking to broaden coverage of ART
• Emphasis on community partnerships– Zimbabwe– Western Cape– KwaZuluNatal
Communities I - Objectives
• Engagement and consultation
• Enhance capacities / economic upliftment
• Improved management of socio-economic impacts
• Community projects to reflect local priorities
Communities II - Engagement• Community Engagement Plans – 3-year rolling:
– Consultation– Management of key issues– Complaints procedures– Contribution to local economy– Support for community projects– Resources and accountabilities
• Growth in Community Liaison Panels
• 2002 – Community Engagement Guidelines and ‘Good Neighbours’ publication
Communities III – Managing Impacts
• Social Impact Assessment for new projects
• Rapid Socio-Economic Assessment Methodology – pilot projects:– Mondi Forest, SA– Catalao, Brazil– German Creek, Australia
Communities IV – Economic Upliftment
• Indigenous management and local labour (eg, Skorpion)
• Creative use of procurement
• Income generation schemes
• Small business development model
Corporate Social Investment
• CSI expenditure US$28.8 million
• 0.9% of pre-tax profit• Priorities: education,
health and community development
• Chairman’s Fund leading social investment vehicle in South Africa
• ENGAGE campaign – employee volunteering
CSI Expenditure
0
5
10
15
20
25
30
35
1 2 3 4
$ m
illio
n
1999 2000 2001 2002
Distribution of Benefits Arising from Economic Activity During 2002 ($m)
Suppliers 8,730
Employees 2,796
Dividends 1,011
Company Tax 621
Interest 300
Economic Contribution
Taxes and Other Payments to Governments 2002
0100200300400500600700800900
Africa Europe North andSouth
America
Aust/Asia
$m
Managed companies Non-managed companies
Payments to Governments
Anglo American's Regional Economic Contribution 2002
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Africa Europe North and SouthAmerica
Australia / Asia
$m
Value added (non-managed)Value added (managed)Payments to suppliers, indirect taxes and royalties (non-managed)Payments to suppliers, indirect taxes and royalties (managed)
‘Good Citizenship’ – Assurance and Reporting
Business Principles
Supply Chain• contractors• suppliers• contract compliance
• Launch Briefings• Training• Integrate into management processes• Provision for whistle- blowing
Internal audit to carryout reviews on request
Operations’ AnnualLetter of Assurance
Divisional CEOsLetters of Assurance
Anglo Americanplc
‘Report toSociety’
KPMG Roll-outReview
Embedding ‘Good Citizenship’ Principles
• Integration into decision-making
• Development of Programmes– Communities– Employee communication– Business integrity– Human rights– Whistle-blowing– Complaints
• Supply Chain Issues
• Improvement of social KPIs
Reporting: What Next?
• Stakeholder round-tables on evolution of Report
• Progress towards more divisional and local reporting
• Examining greater use of web as medium for detailed reporting
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