Strategy and Governance
We believe that corporate governance (how the Board of Directors oversees and governs our company) and our vision of Together, Creating Sustainable Value are essential to enhancing shareholder value and protecting our employees.
Our directors and officers
represent 10 nationalities, are 19% women, speak 6 languages between them and self-identify with more than 20 distinct cultures and ethnicities.
100% of our business
units were analyzed for risks related to corruption.
96% of our “online” employees
(i.e., employees with permanent access to a computer as part of their work responsibilities) completed our Anti-Bribery and Anti-Corruption course.
We announced the appointment of Matthew Coon Come to our Board of Directors in July. Mr. Coon Come was the Grand Chief of the Grand Council of the Crees (Eeyou Istche) and the Chairperson of the Cree Regional Authority, holding the position for over 20 years. He also served as National Chief of the Assembly of First Nations from 2000 to 2003. Mr. Coon Come is known nationally and internationally for his groundbreaking work in First Nations government and activism, effectively raising the standard of Indigenous rights in Canada. He has brought an incredible breadth of knowledge and experience to our Board, and we are extremely pleased that he has joined us.
In July, the Company also announced that, as part of a planned succession, Russell Ball, Executive Vice-President Chief Financial Officer and Corporate Development, would be leaving the organization. Jason Attew, was appointed to Executive Vice-President, Chief Financial Officer and Corporate Development effective October 26, 2017.
We completed the sale of Los Filos to Leagold, the Cerro Blanco Project to Bluestone Resources and the Camino Rojo Oxide Project to Orla.
We acquired Exeter Resource Corporation and closed the formation a 50/50 joint venture with Barrick Gold, where the newly formed entity, later named Norte Abierto, will develop the Cerro Casale and Caspiche deposits in the Maricunga District of Chile.
|Goal||Description||What to Expect in 2018|
Grow awareness and understanding about Ethics and Compliance topics.
96% completion in company-wide Anti-Corruption online training.
In-person training on Anti-Bribery and Anti-Corruption to key stakeholder groups throughout the organization – including third parties.
Active awareness presence with an average of two postings per quarter on Goldcorp’s intranet, referring employees to the Ethics and Compliance Program.
Execute Ethics and Compliance training strategy for both online and offline populations.
Strengthen our Workplace Respect program to further support our commitment to diversity and inclusion.
Review, update and rationalize our Ethics and Compliance policies.
Continuously improve on Anti-Bribery and Anti-Corruption Compliance.
Successful compliance with Canada’s Extractive Sector Transparency Measures Act (ESTMA).
Strengthening of continuous proactive detection/audit procedures over payments.
Strengthening of political exposure controls in employment candidates.
Extension of third party due diligence standards to procurement partner.
Implement automated detection/audit data analytic procedures.
Successfully comply with added ESTMA reporting requirements respecting Canadian Indigenous governments.
Update of our Anti-Bribery and Anti-Corruption Risk Assessment.
Promote “tone from the top”, ethical culture and site ethical leadership.
One-on-one ethical leadership sessions with functional leads at sites.
Followed-up or resolved 88% of the ethics-related cases/complaints during the year.
Ethics Committee meetings completely executed and facilitated throughout the year.
Strengthening of Ethics and Compliance team.
Support visibility of management’s “tone from the top” throughout the organization.
Drive efforts to further potentiate “tone at the middle” through ethical leadership coaching sessions.
Enhance sustainability performance through implementation of SEMS and compliance assurance.
Completion of baseline SEMS audits at all operating sites in 2017. The Sustainability Performance Index (SPI) was developed and launched. The SPI is a scorecard, reviewed monthly, that consists of practices and performance indicators in all four areas of sustainability: Safety & Health, Environment, Community Relations and Security.
Continue our internal assurance process to continually improve SEMS across all sites, tracking corrective action plans as part of the SPI, and evolving SEMS to the next level to match the company’s maturation process. Additionally, the SPI results are now a component of the corporate scorecard, formalizing the link between sustainability practices & performance to employee compensation. Each site’s objective will be to improve its overall score by at least 5%.
Implement centralized risk management tool to contain site and enterprise risks, controls and mitigating actions.
Implemented centralized risk management tool and updated risk matrix and assessment methodology to distinguish Impacts to Goldcorp and Impacts to Stakeholders and/or Receiving Environment.
Improve integration of risk management through:
Talking Strategy and Governance with David Garofalo, President and Chief Executive Officer
- Looking back on 2017, what were some of the main accomplishments and highlights for Goldcorp that come to mind?
2017 was an extremely eventful year for us. Our major achievement was Zero Fatalities. Every day we strive to ensure we are Safe Enough For Our Families. Through our focused efforts on safe work practices we have been able to drive down our All Injury Frequency Rate (AIFR) across the company. While these results are encouraging, we recognize that there’s still room for improvement and are continuously striving to further reduce our AIFR to ensure that no one gets hurt on the job.
We also completed our baseline evaluation of water use and expenditures for all our mines and processes as part of our Towards Zero Water (H2Zero) initiative. This gave us a much better understanding of how much water we use at our sites and how much human and physical energy is expended managing and moving water. It enabled us to take more informed and effective actions to reduce water use. Completing this study was a significant step towards getting us closer to a 100% reduction in water use, which will also help reduce our carbon footprint.
We are focused on measuring what matters, particularly monitoring and measuring the effectiveness of our various sustainability programs. Our Sustainability Excellence Management System (SEMS) provides us with a systemized, structured framework for monitoring the performance and effectiveness of our programs, so that we can confidently deliver on our commitments.
On the production side, we saw our restructuring efforts pay off in 2017. It was a pivotal year for us in this regard. For example, gold production exceeded 2.5 million ounces. Our 2017 corporate scorecard aligns with our strategic direction and is based on four broad performance categories: operational excellence, financial excellence, financial excellence, growth and leadership. What is more, our corporate scorecard was much improved over past years. These achievements show that our culture of operational excellence is reaping rewards, and we are more results-oriented than ever before.
- What were some of the challenges for Goldcorp in 2017 and what did the company learn from them?The magnitude of our water challenge came into focus in 2017 with the completion of our water baseline study. We are at the bottom of the mountain looking up, which is both daunting and exciting. Towards Zero Water (H2Zero) really is an ambitious objective, and we are committed to doing what it takes to get as close to zero water use as technology will allow us.
We also completed an employee opinion survey (EOS). Improving communication from the top of the company and career path movement for employees were two opportunities that were highlighted. We immediately began taking decisive action to address these issues. For example, we started posting more jobs internally and began interviewing more internal candidates for available positions. We launched the Future Leaders program which, along with succession planning, will support our goal of providing career opportunities for our employees.
There is a lot we can continue to do on the communications side to make sure our employees better understand our vision and goals. We’ve clarified our corporate values by summarizing them in three key points that underpin everything we do as a company: Be Safe, Be Productive and Be Responsible. We expect all our employees to internalize these values. It gives all of us at Goldcorp a foundation for our day-to-day conduct. We are continuing to work hard to build an engaging and inclusive corporate culture that everyone at Goldcorp can be proud of.
- Goldcorp has publicly committed to sustainable mining practices. What does this mean to Goldcorp, and how is Goldcorp ensuring sustainable mining practices are embedded throughout the company?
Sustainable mining has a number of facets. It entails not putting a strain on precious resources such as water and the environment. It involves making a meaningful economic and social contribution to the communities where we operate, and it encompasses being financially responsible by building a diversified portfolio of assets that provide employment opportunities and create value.
With regards to the environment, our Towards Zero Water (H2Zero) vision is helping us decrease our total environmental footprint by reducing water intake at our mines and minimizing our carbon footprint. The cornerstone of our Towards Zero Water (H2Zero) strategy is the EcoTails project, currently underway at Peñasquito and Éléonore, which could eliminate the need for conventional slurry tailings. In addition to reducing water consumption, EcoTails could allow for faster and more economical land reclamation. One of the exciting aspects of EcoTails is that once we have proven the technology, it has very broad application across the entire industry.
Sustainable mining also involves building meaningful relationships in the communities in which we operate. As a responsible company, we have an obligation to engage members of the communities in the areas in which we operate and share the benefits. Ways in which we can do this include employment opportunities, training, local procurement, forming mutually beneficial partnerships and contributing to social, educational or environmental programs. Building sustainable communities is all about providing opportunities for people to grow and prosper, and we are proud of the contribution we have made in expanding infrastructure, funding education and healthcare programs and providing clean drinking water in the areas in which we operate.
- In 2017, Goldcorp launched a five-year growth plan called the 20/20/20 plan. What is this plan? How did Goldcorp perform in 2017 with regards to this plan, and what’s in store for Goldcorp beyond 20/20/20?
In 2017, we launched a bold, five-year growth plan to increase our production by 20%, reduce our all-in sustaining costs by 20% and grow our reserves by 20%.
We intend to grow our production by 20% by optimizing the operations we built up over the last five years or so – such as the Éléonore mine in Quebec and the Cerro Negro mine in Argentina. We plan to bring these assets up to nameplate capacity by 2018. Investing in brownfield opportunities such as the Borden Project outside of Timmins is also a key component of our 20/20/20 plan. We also plan to invest about $300 million in the Coffee Project in the Yukon, a new geological district, which is expected to add about 200,000 ounces a year of production. We’re also focused on developing new opportunities through our NuevaUnión and Norte Abierto joint ventures in Chile.
A key part of our plan is to drive down all-in sustaining costs from $850 per ounce to about $700 per ounce. Part of this will be achieved through economies of scale as we grow our annual production from 2.5 million to 3 million ounces, with the remainder coming from operational efficiencies.
We saw great momentum in the first year of our 20/20/20 plan. Our all-in sustaining costs for 2017 were $824 per ounce, which was consistent with our midpoint guidance of $825 per ounce. We achieved nearly $200 million in efficiencies last year and are on track to deliver another $50 million in savings by mid-2018. One of our key objectives over the next four years is to grow our reserve base. We’ve made excellent progress in this area, having increased our reserves by 26% in 2017. Overall, we’re in a great position to comfortably deliver on our 20/20/20 plan.
In early 2017, we rolled out a new plan “Beyond 20/20,” which outlines our plans for organic growth through our next generation of mines. This includes new opportunities from our NuevaUnión and Norte Abierto joint ventures in Chile, the Century project in the Porcupine District, Red Lake mine’s Cochenour project and our Borden project. Combined, we believe these opportunities place us in a good position for meaningful future growth.
- What are some of the long-term goals for Goldcorp (i.e., five/ten years from now)?
Our overriding goal over the long-term is to grow the value of our business by sustaining production in the three to four million ounce range from a portfolio of six to eight mines. We’re focused on improving the quality and value of our business, rather than on chasing volumes. We haven’t been shy about rotating our portfolio and are pleased with the portfolio we’ve assembled over the last year and a half. We sold non-core assets that weren’t really going to move the needle in terms of improving our production base or driving economies of scale. We reinvested that capital into new opportunities in the Yukon and Chile, both of which have great production potential. We currently have a portfolio that we see as core to the business. And our focus over the next five to ten years will be on making our assets more efficient by increasing production, reducing costs and growing reserves.
On the sustainability front, we have developed a series of long-term sustainability goals through to 2021 and beyond. These goals will guide our efforts to build a more diverse and inclusive workforce, improve safety and health and continue to build positive relationships with local communities and Indigenous Peoples. The goals also cover environmental stewardship initiatives and improved standards for mine closure.
- Looking back on the last two years as CEO, how would you describe the journey Goldcorp has been on?
In the first year I was CEO, I had a strong focus on operations optimization, so as to ensure that, we could consistently achieve our objectives. We improved our operating discipline, divested of some assets, invested in cutting-edge technology to improve efficiencies and established a solid foundation from which we will be able to grow. We realized over a half billion dollars of proceeds from the sale of non-core assets and, as I mentioned earlier, deployed that capital into the Coffee project and into the Chilean Norte Abierto joint venture with Barrick. We think each has the potential to meet that District scale of 400,000 to 500,000 ounces of production per annum. We’re very focused on bringing forward our next generation of projects, which include the Century Project in the Porcupine District and NuevaUnión, our joint venture with Teck. So, it’s been a very busy, yet gratifying two years. We have a licence to grow from the market and are moving forward with our strategy to achieve long-term growth.
What is Goldcorp doing that will change the way mining is approached, conducted and perceived in the future?
Virtually every area of mining is undergoing a technological seismic shift, and we’re leading the way in the adoption of innovative technology. We are commercializing three groundbreaking innovations that promise to change the face of mining in the 21st century:
- EcoTails – We are testing EcoTails technology to drive down water usage, streamline waste management and reduce our carbon footprint. Essentially, we want to get the mining industry out of tailings, which are inherently risky. Developing and commercializing this technology will greatly enhance the mining industry’s social licence to operate.
- Waste to Ore – Our waste to ore demonstration plant is now running at Porcupine mines. This plant uses sensor technology to determine which rocks have a higher probability of mineralization. An air knife then separates the individual rocks with grade from the remaining waste rock. This eliminates 20–30% waste coming up from going through the mill processes, lowering operational costs, reducing energy use and minimizing the footprint of waste products.
- IBM Watson – Goldcorp is using IBM Watson to help uncover new exploration opportunities at Red Lake Gold Mines. Watson is significantly speeding up our ability to analyze information and test hypotheses. We are using Artificial Intelligence to identify new patterns in the data, highlighting areas for further investigation by geologists. In an industry that has been traditionally slow at adapting to new technologies, Watson has the potential to revolutionize exploration in mining.
- With Goldcorp's focus on innovation, what does this mean for employees, jobs and benefits for local communities? How will Goldcorp ensure that an increase in innovation won't mean a decrease in jobs and benefits for local communities?
Great question. Some people fear that jobs will decrease as innovation increases. I do not believe this will happen. I believe that by using new technology to reduce costs at our operations, we will be able to do more. New technology will help make our mines safer and more economic. By deploying technology to improve efficiencies and drive down costs, we’re making more reserves economic, so marginal deposits will now come into play.
New models of operation will require new skills and training. This will entail retraining miners to operate new machinery and new technology or to work alongside and support automated systems. New processes, procedures and technologies bring with them new employment opportunities, which is very exciting for the current and future workforce.
- Recognizing that mining is a male-dominated industry, what is Goldcorp doing to increase diversity and inclusion throughout all areas of the business?
Currently about one-tenth of our staff is female. This statistic hasn’t really moved in the past ten years.
It’s not just gender diversity that we need to focus on. We need to look at inclusion more broadly. We need to be a reflection of the societies in which we operate. This will require better recruitment practices at the entry level. Our internally run mining schools have started to attract more females to roles such as mine operators and the trades. We also make a concerted effort at all our operations to hire locally in order to create a workforce that truly reflects the makeup of the communities around them. This is a key component of our long-term sustainability strategy.
Creating leaders of tomorrow in the mining industry starts at the grassroots. Future leaders have to come up through the ranks and learn the business from the bottom up, so it’s important to focus on inclusion and diversity in the recruitment process.
A good example is Sophie Bergeron, Mine General Manager at Éléonore. If you look at her history as a mining engineer, mine captain, project manager, etc., she was the most qualified person for the job. She worked her way up through the company and earned her stripes. She demonstrated a fundamental understanding of the industry throughout her career, which led to her eventually achieving a senior management position.
We need to recruit and retain a diverse group of people early in their careers who are willing to learn the ropes. That’s how you build a diverse and inclusive workforce.
- What kind of company do you see Goldcorp becoming in 20 years?
My vision for Goldcorp over the next 20 years is that we will have grown a talent management system that will have cultivated long-term employees who will have decades’-long careers with us. We already have systemized talent management and succession programs. We are focusing on internal promotions for key positions. While other companies poach talent, we develop talent. Essentially, we’re working to build a company our employees are proud to work at so that we can continue to attract the best and brightest at all levels of the organization.
We’re building a culture of continuous improvement at Goldcorp and are recognized as a leader in innovation. As part of this process, we are cultivating a generation of leaders with the skills and foresight to continue to build and operate a sustainable portfolio of assets that provide value to our employees, partners, shareholders and communities.
In the communities in which we operate, we want to have a positive and lasting impact spanning generations. We want to elevate the opportunities available that improve standards of living and ensure that the business infrastructure we’ve developed continues in our communities long after we’re gone. That is the responsible thing to do today and in the future.