The System for People is based on our organisational values and our aim to be a people-centred business.
Through the System for People, the group is implementing a structured, common approach for working together to support long-term business improvements and value creation.
AngloGold Ashanti is a significant employer in many of the countries in which it operates. The majority of the group’s employees (including contractors) are in South Africa (59%), followed by Ghana (11%), Brazil (7%) and Tanzania (5%). AngloGold Ashanti employed some 63,364 people globally at the end of 2009, including 49,908 employees and 13,456 contractors (2008: 50,206 employees and 12,689 contractors).
* Primarily centralised and corporate services
AngloGold Ashanti seeks to be a people-centred business which has taken significant steps in 2009 to ensure that it is positioned to address the challenge of engaging its workforce across the broad range of cultural and socio-economic contexts in which it operates.
Through its internal change programme ONE, AngloGold Ashanti is in the process of rolling out a people management system, the System for People, to provide a framework through which the business can address its need to develop a competent and engaged workforce – ensuring that it has ‘the right person in the right role at the right time’ and enabling each employee to reach their full potential. Through the System for People, the group is implementing a structured, common approach for working together to support long-term business improvements and value creation.
The System for People is based on AngloGold Ashanti’s organisational values and philosophy, and 10 managerial leadership practices, which define the criteria for interactive working relationships between managers and their subordinates. Six subsystems define effective and sustainable human resources management and managerial leadership systems, in areas such as talent pool development, recruitment, selection and induction and performance management.
The System for People aims to enable effective working relationships based on trust and a sustainable culture of accountability across all levels of the organisation. Central to the model is organisational design, which ensures that the structure of the organisation is the most effective and efficient to get work done and that the accountabilities of each employee are clearly defined.
In 2009 the design phase of the System for People was completed and roll out of the system began. This process will continue during 2010 and 2011. Accountability for implementation of the System for People rests with line management, supported by a small team at the company’s corporate office in Johannesburg, under the Executive Vice President: Human Resources. As part of the process of implementing the System for People and in order to ensure alignment and focus on delivering AngloGold Ashanti’s strategy, accountability for the development of human resource policy has been centralised at the company’s corporate office in Johannesburg.
Transformation and local labour legislation, including requirements for local employment, are key challenges for AngloGold Ashanti in some regions in which it operates. The System for People addresses these transformation needs explicitly by acknowledging that flexibility in the implementation of the system will be required in order to meet local needs.
AngloGold Ashanti’s values are intrinsically linked to our business strategies and aligned with every initiative undertaken throughout the company. The challenge for the business is to ensure that employees at all levels support these values through their actions and interactions with others. As part of the process of implementing this system, work started in 2009 on a survey to determine values-based behaviours and support a deeper understanding of our values across the organisation.
Within the area of people management, the following were identified as the most material issues during 2009:
This section presents the company’s approach on these issues in 2009 and an overview of the initiatives undertaken with respect to these during the year.
AngloGold Ashanti recognises the fundamental right of freedom of association of all employees and contractors, and adheres to collective bargaining agreements with due regard to the relevant legislation in the countries in which it operates. Relations with organised labour are founded on mutual respect, and wage negotiations are conducted in line with the company’s values. A high percentage of employees, almost 83%, are either members of a union or are catered for through collective bargaining agreements. Exceptions are the United States and Australia, where employees are not members of unions, but where a high degree of employee participation in wage discussions is encouraged.
Wage settlements are specific to each jurisdiction in which AngloGold Ashanti operates and the company’s approach is to ensure that agreements are fair but realistic, taking into account the local economic context and the impact of any settlement on the long-term viability of the business.
In 2009 wage settlements were reached without disruption to labour. In South Africa, a two-year wage settlement was reached in July. In Ghana and Guinea, settlements were reached without the loss of production, however, the negotiation processes were protracted and several months were required to reach agreement.
In response to the industrial relations environment and the sometimes volatile economic and political context in which the company operates in West Africa, an integrated strategy for collective bargaining is being implemented, with the aim of creating a framework within which the company and organised labour can improve their relationship and, through collective bargaining, agree on conditions of employment in an efficient and mutually beneficial manner. The approach is a holistic one, where issues relating to the political, economic and social environment are considered in the development of this strategy.
A pro-active approach to labour relations, integrated with other management initiatives, has been adopted at AngloGold Ashanti’s operations in Argentina, where the uncertain political and economic climate has the potential to affect relations between the various labour groups and between management and employees. Frequent dialogue with union leaders at local, provincial and national level has taken place during the year. The climate among employees is also monitored, and management communicates proactively with employees to ensure that they are well informed about their conditions of employment.
At a group level, in an undertaking to promote internationally accepted labour relations and human resource practices at AngloGold Ashanti’s operations around the world, a global agreement was signed between the International Federation of Chemical, Energy, Mine and General Workers’ unions (ICEM) and the company. The agreement sets out the commitment of both parties to respect and advance the principles and values of internationally-accepted labour relations and human resource practice, including the relevant ILO conventions and the principles of GRI and the UNGC. Its objective is to enhance principles or practices established by local regulation and collective bargaining processes at operations managed directly by AngloGold Ashanti. Provision is also made in the agreement for ongoing dialogue between the company and the ICEM at corporate level.
In order to ensure that AngloGold Ashanti delivers on its vision of sustainable mining, we need to respond proactively to transformation and localisation needs in the regions in which we operate. These include employment equity requirements in the South African context, and the need to recruit, develop and retain local managers in many of the countries in which AngloGold Ashanti operates on the rest of the African continent.
To ensure focus and leadership on this issue within the business, a transformation steering committee was established in 2008, comprising relevant company executives and senior managers and chaired by the chief executive officer. Oversight of this area of the company’s activity is through the Transformation and Human Resources Development Committee of the board, which was established at the end of 2008. Supporting structures are addressed in the System for People, which takes full account of local transformation and legislative requirements.
In South Africa, the employment of Historically Disadvantaged South Africans (HDSAs) is promoted and regulated by legislation, specifically the Employment Equity Act, the Minerals and Petroleum Resources Development Act (MPRDA) and the Mining Charter.
The Mining Charter, which came into effect in 2004, set a target for 2009 of 40% representation of HDSAs (defined as all black people and white women) in management, and 10% representation of women in the workforce. As at the submission date of our employment equity report at end July 2009, representation stood at 39.5% and 11% women. The Department of Labour of South Africa has reviewed the company’s compliance with the Employment Equity Act and has made certain recommendations to the company, which have now been incorporated into the company’s five-year Employment Equity Plan, ending in July 2014. The company’s five-year Employment Equity Plan was approved by the Department of Labour in December 2009.
The Mining Charter was due to be reviewed in 2009. However this review has been delayed and only preparatory activities were undertaken during the year. The review will be led by the Department of Mineral Resources (DMR) in South Africa which engages with the mining industry mainly through the industry’s representative body, the Chamber of Mines. AngloGold Ashanti is an active member of the Chamber of Mines structures dealing with the review process, and Mark Cutifani, AngloGold Ashanti’s chief executive officer, serves as deputy president of the Chamber.
In Tanzania, Ghana and Guinea, localisation plans and programmes are in place to limit the placement of expatriate employees and to ensure the training, development and placement of local employees.
In Ghana, for example, we are working on the following plans to achieve our objectives of localisation:
The mining industry experienced an unprecedented boom and related skills shortage from 2006 to late 2008. During this period, the retention of key technical skills was a significant challenge for the company. With the global financial crisis, this pressure eased considerably in those areas which had been most affected. Total turnover, at 9.7%, was in line with the 10% target set by the company. Turnover amongst female employees was low across the group at 0.4% in 2009 (2008: 0.5%).
Despite relatively low turnover levels, the development and retention of skills in certain disciplines remains a concern for AngloGold Ashanti. Without critical skills, business efficiency and productivity is diminished and future growth can be compromised. By addressing issues such as education and training, talent pool development and recruitment and selection in a holistic framework, the System for People provides the framework for structuring an appropriate response to skills development and retention in each operating region.
Measures which have been introduced to diminish the risk to the business of skills shortages and to position the company to better manage skills shortages in future include: