Enterprise Risk Management
The nature of our business and the competitive environment in which we operate requires some level of risk-taking in order to achieve our strategic objectives and create growth and shareholder value. The corporate Enterprise Risk Management (ERM) team has developed and implemented a company-specific framework to effectively deal with uncertainty and associated risks.
|A well-operated ERM framework enables us to:|
|Protect existing value and assets|
|Deliver projects on time and on budget|
|Adapt to the changing environment
and minimize financial, reputational
and legal impacts
|Meet internal and external commitments|
|Inform strategic decision-making,
prioritize activities and allocate
|Improve organizational efficiencies
and maximize opportunities with
The primary focus of the ERM process is the identification and assessment of significant risks and the implementation of suitable risk responses. The process includes bottom-up risk identification and assessment from operations, regional business units and corporate functions; application of standardized risk assessment criteria in terms of likelihood and consequence; as well as development of mitigation strategies.
On a quarterly basis, significant risk information from these and other sources is consolidated and reviewed by Regional Risk Committees, which involves an assessment and discussion of operational and external risks. External risks emerging from environmental, social, political and economic issues where we operate are identified through a country-level risk assessment process. All risks are revisited and updated regularly to ensure that the previous risk assessment is still appropriate and the risk impact and likelihoods have not changed.
Significant risks are consolidated and reviewed with Senior Management and then reported to the Board on a quarterly basis to ensure that appropriate action is taken.
In 2015, we implemented and strengthened a number of risk management processes throughout the company. Key highlights include:
- Facilitated, participated and/or provided guidance in multiple risk workshops to support decision-making of key capital investments and operational decisions
- Completed tailings risk assessments at all operating sites
- Initiated Social Risk Assessment process as part of the CSR Strategic Planning Process
The Precautionary Principle
The precautionary principle states that when an activity raises threats of harm to the environment or human health, precautionary measures should be taken, even if some cause-and-effect relationships are not fully established scientifically.
We adopt a risk-based approach to business development. New projects (and upgrades, modifications or expansions of existing operations) undergo an assessment of potential environmental and social impact prior to implementation. For new projects, this is usually in the form of an impact assessment, in which the existing (baseline) conditions are described, the proposed project is outlined, potential impacts (both positive and negative) are identified, and modifications and controls are identified to minimize potentially adverse impacts.
Provision is made in the assessment process for public consultation and input. We are committed to engaging in consultations with potentially affected host communities prior to making significant development decisions, regardless of any legal requirement to do so. For upgrades, modifications or expansions of existing operations, the level of assessment is commensurate with the potential impacts of the proposed change.