Social Licence to Operate & Shared Value
Mining companies operating around the world face a range of challenges with respect to their relationships with host communities. At one end of the spectrum, this can take the form of low-level community activism amid a lack of community co-operation. At the other end it can take the form of violent protests and determined political opposition.
According to the International Council on Mining & Metals (ICMM), mining-related community conflicts have increased markedly over the last decade, making it an issue of increasing concern for mining operators.
Although Gold Fields’ current mining operations do not face material opposition from their host communities, there is no room for complacency. It takes substantial time, effort and resources to establish and maintain a social licence to operate and, once it is lost, it is very hard to regain. Furthermore, our ability to grow Gold Fields through the expansion of existing mines and the development of new projects will, to some degree, be determined by our ability to build strong relationships with communities in our areas of interest.
This means it is essential that we treat our host communities with respect, minimise our negative impacts and deliver tangible and ongoing benefits. The resources we have available to help us generate host community benefits are, however, becoming more limited. This is due to:
- Our transformation into a smaller, mid-tier miner
- The lower price of gold
We are therefore increasingly applying the Shared Value approach to promoting community development. This is based on the application of business strategies that deliver commercial and/or operational benefits to the Company, while also delivering benefits to our host communities at the same time. Our approach is focused on four key areas, each of which are described in detail in our Integrated Annual Report (2014)
- Preferential community employment
- Preferential community procurement
- Education and training
- Water security
Society and Community Charter
The evolution of our ‘DNA’ is reflected in our stakeholder charters. These establish a clear set of commitments to our employees, investors, host governments and communities, as well as clear benchmarks for our own performance.
Our Commitment to Society and Gold Fields’ Host Communities includes:
- To build strong relationships and trust: We build strong relationships with key stakeholders based on trust and open, honest and frequent engagement
- To create and share value: To ensure that we leave an enduring, positive legacy for the communities in which we operate, we work with our stakeholders (investors, employees, communities and governments) to create “Shared Value”
- To measure our actions and impact: We commit to put in place measures to gauge how we are performing against our commitments to create “Shared Value”, build strong relationships with our key stakeholders and reduce our impact on the environment
- To deliver against our commitments: We strive to reach a better understanding of all the relevant issues associated with our business, to co-create and deliver the right commitments to secure and maintain our Social Licence to Operate
Community Relations and Stakeholder Engagement
Proactive and frank stakeholder engagement plays a vital role in helping us maintain sustainable value creation, and identify our material issues. All of our stakeholder engagement activities are informed by the AA 1000 principles of:
Our engagement activities fall into two types:
- Direct engagement, including organised dialogues, roundtable discussions, one-to-one meetings, internal surveys and regular engagement with local communities at each operation and project
- Indirect engagement, including the use of external benchmarks and standards (such as the UN Global Compact) that are designed to reflect and address societal expectations
At an operational level, all our mines identify, prioritise and directly engage stakeholder groups that have the potential to affect their operational, sustainability or financial performance. This includes, amongst others, ongoing engagement of:
- Employees and their representatives by our human resources teams and general managers
- Local communities by our community relations teams and general managers
At a strategic level, our corporate and regional management teams implement an ongoing programme of direct and indirect engagement. This includes, amongst others, ongoing engagement of:
- In-country peer companies by our regional Executive Vice-Presidents (EVPs)
- Central government by our corporate affairs teams, legal teams, members of the Group Exco and regional EVPs
- Shareholders and potential investors by our investor relations team, CEO and CFO.
All relevant outcomes from our operational and strategic stakeholder engagement processes are integrated into our internal reporting processes, including in our quarterly regional board reports, sustainable development reports and other documents. In addition, they help inform the Enterprise Risk Management process, and so form a vital part of our risk management programme
Host communities are among our most important stakeholder groups and our relationships with them have a direct impact on the sustainability of our operations. We recently developed a Community Relations Handbook to guide employees in all operations in how best to deliver on our promise of shared value and strong relationships.
This handbook covers every aspect of the life of mine, from early exploration to post-closure. It is based on international good practice and the Company’s nine community relations standards, which are outlined below:
Gold Fields Community Policy reflects the ICMM’s Position Statement on Indigenous Peoples and this Policy is supported by our Community Relations Handbook and Society and Community Charter, as well as the Group Community Relations and Stakeholder Engagement Guideline.
- Standard 1: Build sustainable relationships with stakeholders
- Standard 2: Establish information, communication and engagement mechanisms that are effective, timely, transparent and culturally pertinent
- Standard 3: Properly manage conflicts from the beginning
- Standard 4: Contribute to the social and economic development of the host communities
- Standard 5: Management of social impacts
- Standard 6: Resettlement
- Standard 7: Acknowledging the rights and interests of Indigenous Peoples
- Standard 8: Artisanal and Small-Scale Mining
- Standard 9: Closure and Post-closure – highest standards until the end