Management Approach

Macro-Trends

The mining industry is recovering from a prolonged depression of weakened commodity prices. Despite the rise in inflation, efforts have been made to keep costs from rising; in some cases, costs have remained the same or are lower. External stakeholders continue to demand that companies demonstrate how they are managing risks and mitigating impacts. In addition, they expect more transparent disclosure on all business fronts, from operational performance, to executive compensation to community engagement. Around the globe, regulators continue to focus on the enforcement of anti-corruption legislation. Meanwhile, heightened attention is being placed on companies’ efforts to provide workplaces free from harassment and discrimination. Talent attraction and retention continues to be a challenge as the majority of the current mining workforce ages into retirement, but at the same time there is great opportunity. Employers must focus on retaining and maintaining top talent for effective and skilled management, and for succession planning of senior leadership positions.

Why Is This Important to Our Stakeholders?

Our stakeholders want us to demonstrate that we have the appropriate organizational structures and accountabilities in place to reduce risks. They want us to generate superior returns from high-quality assets, while being transparent in our reporting on performance, trends and outcomes.

Why Is This Important to Us?

Good governance is the foundation on which we build our responsible management and industry-leading results. We strive to provide our shareholders and other stakeholders with clear and concise disclosure about our policies, programs and performance.

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Our Strategy

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%. Our strategy is to build governance and accountability mechanisms that position our company to optimize results and safeguard long-term success. Strategic management appointments provide our leadership team the opportunity to manage events that could have reputational, financial, operational, environmental or community impacts. Our Sustainability Excellence Management System (SEMS) as well as our Enterprise Risk Management (ERM) framework help us better identify, manage and mitigate these impacts. We also perform ongoing risk assessments for the local and national geographical areas in which we work. These are multi-faceted assessments that take into consideration the environmental, social, political and economic risks of the countries in which we operate.

The Board of Directors and our Executive Management team recognize the importance of strong corporate governance to effectively manage our company and to protect employees and shareholders. Our approach to issues of corporate governance is designed to ensure that our business and affairs are conducted to enhance long-term shareholder value. Guidelines and requirements for ethical practices are incorporated into various SEMS standards. For more information on our policies, please visit this report’s section on our Corporate Policies.

We are a member of the Mining Association of Canada (MAC). Therefore, our four Canadian operations adhere to the principles of Towards Sustainable Mining (TSM), which is the MAC’s commitment to responsible mining. Established in 2004, TSM is a set of tools and indicators to drive performance and ensure that key mining risks are managed responsibly. Adhering to the principles of TSM demonstrate leadership by: engaging with communities, driving world-leading environmental practices and committing to the safety and health of employees and surrounding communities. The four Canadian operations are in various stages of site assessments and implementation verification. Additionally, the national mining association in Argentina (Cámara Argentina de Empresarios Mineros) agreed to adopt TSM; therefore, we are also working with the mining association to define the appropriate system in Argentina where our Cerro Negro mine is located.