Sustainable development touches on every aspect of our business. Here, Jon Samuel, Head of Social Performance, outlines how we understand and enhance our positive impact on communities.
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1. BUSINESS IMPACTS ON DEVELOPMENT:
UNDERSTANDING & ENHANCING IMPACTS
JON SAMUEL, HEAD OF SOCIAL PERFORMANCE, ANGLO AMERICAN
10 JULY 2012
2. OUR FOOTPRINT
Key
Corporate and rep offices
E Exploration offices
Platinum
Diamonds
Copper
Nickel
Iron ore and Manganese
Metallurgical Coal
Thermal Coal
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3. DEVELOPMENT IMPACTS: CONTEXT AND BUSINESS CASE
• Ongoing pressure from governments to see greater developmental benefits
from mining
• Communities also understand that mining projects represent a unique
opportunity for socio-economic development gains, if managed properly
• More general lack of trust in, and appreciation of, role of big business
• Some of the ways countries have sought to enhance development outcomes
from mining and other sectors (eg nationalisation, high tax rates) have been
counter-productive and bad for investors
• Growing understanding that good governance of the sector combined with
responsible operators represents the best opportunity to secure
developmental benefits
• Governments, as resource owners, are therefore looking towards companies
that can support broader developmental objectives
• To enhance your impact you need to understand it
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4. WHAT ARE THE LOCAL DEVELOPMENT OPPORTUNITIES FROM
MINING?
INFRASTRUCTURE
DOWNSTREAM
PROCESSING JOBS / WAGES
(BENEFICIATION)
SOCIAL CAPACITY
INVESTMENT OPERATION BUILDING AND
TRAINING
SMALL BUSINESS
DEVELOPMENT PROCUREMENT
TAXATION
5. HOW DO WE MEASURE IMPACT?
• Activity across the mining lifecycle (typically 30 to 50 years per mine):
Exploration Planning Construction Operation Closure
Focused mostly Impacts Monitoring SEAT* Mine closure
on consultation assessed by against social studies, social planning
with local stage gate management investment toolbox, post-
stakeholders, requirements plans plus social KPIs, complaints closure
plus complaints and social investment and grievance monitoring
and grievance impact KPIs. Also procedures, com
procedures assessments complaints and munity
(typically as a grievance development
part of SEIA procedures peer reviews
processes)
• We also measure at country level for taxes, procurement, wages etc
*SEAT: Socio-Economic Assessment Toolbox. Freely available at www.angloamerican.com/seat 5
6. STAGE GATE REVIEWS DURING PROJECT DEVELOPMENT:
SETTING UP FOR SUCCESS
• All projects are reviewed at three stage gates:
– Concept (option generation phase)
– Pre-feasibility (option selection phase)
– Feasibility (final go / no go decision)
• Reviews cover all financial and technical
requirements, but also key social / community
issues:
– Identification and management of any
negative impacts
– Development of socio-economic
benefits, including local procurement, local
hire, enterprise development and social
investment
• Complements impact assessments required
under the permitting / regulatory regime
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7. CONSISTENT, GROUP-WIDE SOCIAL OUTPUT KPIs BEING
IMPLEMENTED ACROSS ANGLO AMERICAN
14 Categories of Programme: 32 Specific KPIs Covering:
1. Education and training • Facilities (or sites) built / improved /
2. Health and welfare maintained
3. Water and sanitation • Number of jobs (permanent / temp)
4. Capacity development • Numbers trained
5. Enterprise development and micro- • Number of beneficiaries for each type of
credit project
6. Alternative livelihoods • Number of businesses supported
7. Housing • Numbers of different kinds of projects
8. Other community development created or supported
9. Environment • Number of houses built / upgraded
10. Energy and climate change • Carbon impact
11. Sport, arts, culture and heritage • Power generated / saved
12. Disaster and emergency relief
• Habitats improved / protected
13. Other CSI or charitable giving
• Waste management
14. Employee matched giving
8. SEAT – WHAT IS IT?
• A socio-economic impact and management
planning process
• Existing Anglo American operations go
through the process every three years
• The foundation for social issues
management at our mines
• A collection of resources for community
professionals and other colleagues to use at
any time, including in
exploration, development and closure
• Ultimately... designed to help secure our
social licence to operate at new and existing
operations, and secure competitive
advantage
9. WHY DID ANGLO AMERICAN DEVELOP SEAT?
A way to
Improve
identify and
understanding
manage our
of social risks to
impacts at each
our business
operation
Address
community
concerns
SEAT’s
purpose
Manage
stakeholder
Build our perceptions by
capacity for transparency at
Meet local level
community international
engagement commitments
and
development
10. SEAT: STRUCTURE
Engagement throughout
Step 1 – Profile your
Step 6 – Develop a Step 7 – Prepare a
operation, including
social management SEAT report and feed
existing community
plan back to stakeholders
development initiatives
Step 2 – Profile and Step 5 – Deliver
engage with enhanced socio-
stakeholders economic benefits
Step 3 – Assess and Step 4 – Improve
prioritise impacts and social performance
issues management
12. COMMUNITY DEVELOPMENT PEER REVIEWS
• Site level assessment of community
development activities at site
• Brings in partner expertise, in
particular from CARE International
and Tshikululu Social Investments
• Cross-BU teams visit volunteer sites
to undertake holistic review of
community development activities
• Reports-back shared with site team
management and broader peer
group within Anglo American
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13. WHAT HAVE WE LEARNED FROM ASSESSING IMPACTS?
• Importance of a clear developmental
vision, owned by local communities
• Stakeholders are most concerned
about day-to-day livelihoods and
quality of life issues:
– Access to jobs and training
– Access to alternative livelihoods
– Access to supply chain opportunities
– Environmental impacts
– Quality of public services
– Transport issues
– Communication and transparency
– Housing
14. MOST EFFECTIVE MEANS TO SUPPORT LOCAL DEVELOPMENT
• Local procurement:
– Measure at national, provincial and
community level
– $13.8 bn of spend in 2011
– $1.13 bn from host communities, up
by $240 mn in 2011 due to growth
and local procurement initiatives
• Enterprise development
– 47,000 job supported in 2011
• Local recruitment
– 145,000 jobs in 2011
• Social investment ($129 mn in
2011), particularly when delivered
programmatically by NGOs
84% of procurement, wages and taxes (= $18.4 billion)
spent / paid in emerging markets
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15. CONCLUDING REMARKS
• Different audiences are interested in difference impacts, and that
leads to different measurement approaches being required
• In a large multinational, you need both aggregate and site-specific
indicators, and both quantitative and qualitative information
• Our work has led us to focus on the core business and enterprise
development as drivers of development outcomes
• Anglo American is seeking to improve tracking of key socio-economic
variables over the duration of a project, and also articulating
contributions at a national level in an engaging manner
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16. THANK YOU
SEAT v3 is freely available for download at:
www.angloamerican.com/seat