Governance

We operate a decentralised business structure within a robust governance framework. Our approach is to devolve authority and accountability to operational management, who have the best skills and information to respond to business challenges and opportunities.

Our Sustainable Development (SD) Strategy, Policy and Standards are set by the Board and Executive Committee (EXCO) and align with international leading practice and standards. However, operational management determines how we achieve and maintain our SD Strategy and Standards. This approach:

• allows our operations to be more responsive to the local context
• encourages an innovative response to challenges
• empowers local management to be fully accountable to local stakeholders

Our auditing and assurance processes ensure that our Business Principles and Group SD Policy and Standards are being upheld, and encourage the sharing of good practice across the organisation.

Senior management oversight

The Board has ultimate responsibility for our Sustainable Development (SD) Policy and Framework globally. This responsibility is vested in the Board Health, Safety, Environment and Community (HSEC) Committee, chaired by Ian Strachan, an independent non-executive director. The Group Executive Committee is formally responsible for setting and implementing SD strategy, with the Board providing oversight of the Executive Committee’s performance.

The Board HSEC Committee meets quarterly to receive progress reports and updates from commodity businesses and to monitor material social, environmental and ethical issues and associated performance metrics. Committee members visit site operations regularly to gain a closer understanding of how the strategy is being implemented.

The Board receives quarterly reports of key SD performance indicators, critical and high potential risk incidents and the ongoing SD assurance programme results. Board members also receive independent briefings on social, ethical and environmental issues, and may consult with external experts at our expense.

Remuneration

We link remuneration to SD performance at all levels of our business. The Board Remuneration Committee examines the safety, financial and SD performance in reviewing and determining base pay, payments of annual bonuses and the awarding and vesting of long-term incentives for executive and senior management.

Variable remuneration depends on a bonus pool that is determined by overall company performance, measured by return on equity and net profit. Before the pool is finalised, the Board Remuneration Committee actively considers whether the pool is appropriate in light of the other key financial and non-financial drivers of future shareholder value, including health, safety, environmental and community performance.

We determine individual bonuses by assessing individual performance against SD, financial and operational performance targets, including:

• people development
• occupational health and safety
• environmental performance
• community engagement

For site managers, mine supervisors and other employees, between 50% to 80% of variable remuneration is tied to SD performance.