Anglo American plc · LSE:AAL
Anglo American — ESG Presentation (June 2006)
46 slides from Anglo American's sustainability presentation, Jun 5, 2006
Slide 1: Presentation on Anglo American's Sustainable Development Performance 2005/6
Presentation on Anglo American’s Sustainable Development Performance 2005/6 5 June 2006 1
Slide 2: Agenda
AGENDA 1. Strategic Overview Sir Mark Moody-Stuart 2. Financial Performance and Strategy Tony Trahar 3. Safety Tony Trahar 4. Integrating Sustainable Development Dorian Emmett 5. Energy and Climate Change Dorian Emmett 6. Environment Dorian Emmett 7. Human Resources Russell King 8. HIV/AIDS Russell
Slide 3: Strategic Issues
Strategic Issues • Safety • Climate change and energy efficiency • HIV/AIDS • Taxation/resource nationalism • Community Expectations • Business and Development 3
Slide 4: Governance
Governance Good Citizenship Business Principles – Board Safety, Health and Environment Policy - Safety and Sustainable Development Board Committee Detailed policies, guidelines, management systems and tools, (e.g. SEAT) • Supported by: – Letters of Assurance – KPMG External Assurance – ‘Speak-up’ Wh
Slide 5: Reporting and Recognition
Reporting and Recognition • 2005 Business in the Community International Award for contribution to MDGs in Africa • Included in Dow Jones Sustainability Index and Johannesburg Stock Exchange Sustainability Index • Winner 2005 ACCA award on sustainable reporting • Exhibition staged for President Mbek
Slide 6: Financial Headlines and Strategy, Safety, BRICs
Tony Trahar Chief Executive • Financial Headlines and Strategy • Safety • BRICs 6
Slide 7: Metal prices since Jan 2005 (indexed)
Metal prices since Jan 2005 (indexed) 340 320 300 280 260 240 220 200 180 160 140 120 100 80 05/01/05 05/05/05 05/09/05 05/01/06 05/05/06 Platinum Zinc Copper 7
Slide 8: Financial Summary
Financial Summary • Record underlying earnings $3.7 billion (+39%) • Significant cost pressures; partially offset by $730 million in savings • $6.7 billion approved project pipeline; c. $10 billion in additional potential projects • Special dividend $0.5 billion • Share buy-back $2 billion • Net deb
Slide 9: Strategy Overview
Strategy Overview Objective Status Reduce stake in AngloGold Ashanti Stake reduced to 41.8% - $1 billion raised; exit within 2-3 years Separate listing of Mondi Listing on LSE by late 2006/ early 07 Sale of Highveld Steel Offers under consideration Restructuring of Tongaat Hulett Hulett Aluminium to
Slide 10: Sharing of economic benefits - 2005
Sharing of economic benefits - 2005 10
Slide 11: Safety
Safety 2.5 0.10 2.0 0.08 Lost time injury 1.5 0.06 frequency rate (LTIFR) 1.0 0.04 Fatal injury frequency rate (FIFR) 0.5 0.02 Work-related fatal injury Lost-time injury 0.0 0.00 frequency rate 2004 2005 2004 2005 00 01 02 03 04 05 20 20 20 20 20 20 Platinum 24 24 1.45 2.07 Coal 2 6 0.44 0.48 Base M
Slide 12: Re-Energised, Re-Emphasised Safety Drive
Re-Energised, Re-Emphasised Safety Drive • Executive Training by DuPont • Newly articulated vision of Zero Harm • Principles – Zero mindset – Zero repeats – Follow simple, non-negotiable standards & rules • Peer Review • Management & Supervisor Training • Communications: “One Injury is One Too Many”
Slide 13: Zero Harm is Not a Pipe-Dream
Zero Harm is Not a Pipe-Dream We have major centres of excellence, and are learning from them too: • Anglo Base Metals division: 12 000 people: Training focus on over 1000 managers & supervisors – 19% drop in LTIFR and now over 20 months without a fatal injury • Goedehoop Colliery in SA: 1800 employ
Slide 14: BRICs
BRICs MARKETS • Brazil • China • Russia INVESTMENT COMPETITORS DESTINATIONS • India POTENTIAL PARTNERS 14
Slide 15: Integrating Sustainable Development, Energy and Climate Change, Environment
Dorian Emmett Head of Sustainable Development • Integrating Sustainable Development • Energy and Climate Change • Environment 15
Slide 16: Integration of SD into the Business
Integration of SD into the Business Drivers • Leadership and Good Citizenship: Our Business Principles • ICMM SD Framework and Principles • Integrated Risk Management Process • Performance Management - Operations / Divisions / Corporate • Assurance: “In accordance with” GRI, and our Reports To Socie
Slide 17: Integration of SD into the Business: Tools
Integration of SD into the Business Tools • Policies and guidelines –SHEC (Exploration) –SEAT –Community Engagement Plans –Biodiversity –Climate Change –Procurement –Product Stewardship –Closure –Resettlement • Peer Reviews – Safety, Biodiversity • Building SD and carbon costs into project assessmen
Slide 18: Integration of SD into the Business
Integration of SD into the Business Integrated planning for a mine – SD Zones of Influence Mining zone Conservation zone Minimal footprint for Set aside a maximum viable mining area for conservation of centre of endemism Socio-economic development zone Mining designed as a catalyst for building a so
Slide 19: Materials Stewardship
Materials Stewardship SUPPLY CHAIN: Engagement Guidelines REACH: Registration, Evaluation, Authorisation of Chemicals 19
Slide 20: Energy & Climate Change
Energy & Climate Change • Energy saving: targeting 15% by 2014 • GHG emissions reductions: – Biomass up from 18% to 22% of our energy supply – Reduced emissions associated with energy savings – Methane capture for energy generation • Carbon Trading: use market-based instruments to turn savings to ac
Slide 21: FutureGen
FutureGen Energy & Carbon Management Investing in technology – FutureGen 21
Slide 22: Monash Energy
Monash Energy Energy & Carbon Management Investing in technology - MONASH 22
Slide 23: Environment
Environment Other key environmental challenges include: • Water • Air Quality • Integrated Land Use Planning • Biodiversity Some illustrations: 23
Slide 24: Environmental Case Studies
Environmental Case Studies • Water: $47m to process mine water to community drinking water at Emalahleni • Tarmac’s Aquifa reservoir pavement technology • Mondi’s 1.2m hectares of forests FSC certified in partnership with WWF & Silver Taiga. Another 1.2m hectares to follow • Air quality: SO2 emissio
Slide 25: Environmental Headlines
Environmental Headlines • Over 88% ISO / 14001 certification – recent acquisitions have up to two years to comply • This is reflected in a levelling-off in the number of environmental incidents reported • No major incidents • 13 biodiversity action place peer reviews. A further 10 targeted for 2006
Slide 26: Transformation, Economic Empowerment, Human Resources, HIV/AIDS
Russell King Head of Human Resources and Business Development Transformation • Economic Empowerment • Human Resources • HIV/AIDS 26
Slide 27: Economic Empowerment
Economic Empowerment • Confident that we will meet, if not exceed, the requirements of the Mining Charter – HDSA ownership – Career Paths and Skills Development – Mine Communities and Labour – Migrant Labour 27
Slide 28: We have invested significantly in the transformation of South Africa
We have invested significantly in the transformation of South Africa – Between 1999 -2005 • Invested R145bn • R33bn BEE transactions • R28bn BEE procurement (up 51% in ’05) • Created 2000 SME jobs • Instrumental in forming largest BEE mining houses with market cap. of R37bn – BEE Transactions • Mond
Slide 29: We pride ourselves on having good people
We pride ourselves on having good people • 91% covered by a formal consultation process (80% in 2004) • 3.6% of total employment cost spent on training (3.8% in 2004) • 51% of employees have formal performance and development reviews (40% in 2004) • 7,000 trainees – more than doubled since 2002 29
Slide 30: Improving diversity
Improving diversity • Great progress on racial diversity in South Africa has: – Increased percentage of HDSAs in management from 37% to 40% – Increased number of HDSAs in senior management ranks - now 20% up from 14% in 2004 • Slower progress being made on gender but with pockets of excellence: – Co
Slide 31: Building a meritocracy is a key part of strategy
Building a meritocracy is a key part of strategy • Strong values underpin all we do – Ongoing reinforcement of our ‘Good Citizenship’ Business Principles • Clear standards for employee development and selection – WiWTTSiA competency framework – Formal talent management process – Formal group program
Slide 32: HIV/AIDS – An Ongoing Challenge
HIV/AIDS – An Ongoing Challenge • Strategy – Strong line management leadership – Prevention through education, condoms – Voluntary Counselling and Testing (VCT) – Care, support and treatment for HIV positive employees – Results focus – Community Partnerships – Business training on HIV/AIDS in China
Slide 33: HIV/AIDS – Key Data 2005
HIV/AIDS – Key Data 2005 Eastern and Southern Africa Number of Employees 121,113 VCT Uptake 2003 <10% Number of Employees who received VCT in 37,982 2004 21% 2005 2005 31% 2006 (Target) 50% Estimated number of HIV positive Employees 28,291 Number of Employees on HIV Disease Management Programmes 8,3
Slide 34: Antiretroviral Therapy
Antiretroviral Therapy • Approximately 3200 employees on ART at end April 2006 • Although this is 11% of estimated HIV +ve population, we believe that about 25% are in need of treatment now • A successful VCT drive will help us close the treatment gap • Those who start treatment before they get sick
Slide 35: ART - Economic Impact
ART - Economic Impact • Cost of providing ART in the first year is $194 per patient per month – Costs reducing over time due to economies of scale and declining drug prices • Cost of ART is more than covered by reduction in absenteeism and reduced health care costs – Savings from reduction in absent
Slide 36: Social and Community Programmes, Local Business Development, International Partnerships
Edward Bickham Head of External Affairs • Social and Community Programmes • Local Business Development • International Partnerships 36
Slide 37: Social Performance
Social Performance • Socio-Economic Assessment Toolbox (SEAT) • Community Engagement Plans • Local Business Development • Community Social Investment • Partnerships • Sustainable Livelihoods Initiatives 37
Slide 38: SEAT Implementation
SEAT Implementation • 33 assessments completed; 19 in the field • Implemented in 15 countries • Aimed at raising social performance and capacity building at mature operations • Seeking to track implementation of management commitments • Plan to publish review document in Q4 and to make methodology w
Slide 39: Siyaqhubeka Forests, South Africa
Siyaqhubeka Forests, South Africa Issues • Access to contract work for local people • Need to finalise local land claims • Addressing impacts of HIV/AIDS in labour force • Criminal activities/safety in plantations • Unemployment Management Responses • Inclusion of local labour requirements in contra
Slide 40: Chagres
Chagres Issues • Perceived lack of contribution to local economy • Lack of local employment • Concerns about environmental impact on agriculture • Concerns around environmental performance • Lack of communication • Change crop rotation policies on company owned land Management Responses • Identify p
Slide 41: Common emerging themes
Common emerging themes • Lack of trust on environmental and health issues • Dust and other environmental impacts • Transport issues • Access to jobs/transparency around recruitment practices • Supply chain opportunities • Balance/distribution of social investment • Rivalry between stakeholder groups
Slide 42: Learning from Experience – SEAT 2
Learning from Experience – SEAT 2 Tool F1 – SME Tool B6 – Development and Summary of Complementary Increasing Local Identified and Procurement for Issues and Sustainable Development Livelihoods Community Needs Tool F3 – Developing Creating New Human Business and Capital Employment Supporting Opportu
Slide 43: Local Business Development
Local Business Development Southern Africa • Anglo Zimele: invested in c.25-30 companies; supporting c. 2,000 jobs • Sustainable livelihoods initiatives in Anglo Coal, Anglo Platinum and Mondi Forests South America • Chile $3 million local business development facility • Venezuela: uniform making; t
Slide 44: Transparency
Transparency • Declaration of key lobbying activities • No political donations in 2005 • Extractive Industries Transparency Initiative 44
Slide 45: International Partnerships
International Partnerships • Global Business Coalition on HIV/AIDS • Voluntary Principles on Security and Human Rights • NEPAD Investment Climate Facility • Business Action for Africa 45
Slide 46: Questions
/S) ANGLO AMERICAN QUESTIONS