Implementation of the ICMM Sustainable Development Framework at AngloGold Ashanti

AngloGold Ashanti is a member of the International Council on Mining and Metals (ICMM) and has therefore implemented the ICMM Sustainable Development Framework, which includes the obligation to report on implementation of the 10 principles of the ICMM. The section below gives details of how these principles have been implemented at AngloGold Ashanti.

Principle 1

Limited assurance for this principle has been provided by Ernst & Young for 2010.

Implement and maintain ethical business practices and sound systems of corporate governance

Compliance with values and standards is integral to the way AngloGold Ashanti operates. In 2010, the company’s code of ethics was revised. The process of developing and implementing this code is covered in more detail in our group-level report Sustainable Gold.

In the area of corporate governance AngloGold Ashanti has implemented policies on:

• conflict of interest;
• insider trading;
• disclosure;
• delegation of authority; and
• political donations.

AngloGold Ashanti’s risk management system captures risks related to the area of ethics and corporate governance. AngloGold Ashanti’s employees are also guided by a clear set of values, which have been communicated to all employees and are consistently supported by surveys, company communication and corporate policies and guidelines.

In support of our governance structures and the implementation of these values, we have put in place a confidential reporting mechanism that provides a channel for the reporting of practices in conflict with the group’s business principles, that represent unlawful conduct or financial malpractice, or that endanger the public and the environment.

Through interactions with governments, industry bodies, organised labour and other stakeholders, AngloGold Ashanti aims to reinforce the need for equitable and appropriate regulation of the mining sector and to ensure that the sector can make a positive contribution towards sustainable development within the context of national government strategy.

AngloGold Ashanti is a member of the Extractive Industries Transparency Initiative (EITI). The company is fully committed to the support of this initiative and publishes all payments made to governments, whether or not the government concerned is a participant in the EITI.

For more information please see the Ethics and governance section of our group-level report Sustainable Gold.

The GRI performance indicator relevant to this principle is SO2.

Principle 2

Integrate sustainable development considerations within the corporate decision-making process

Company-wide policies and standards have been or are being put in place covering key sustainability issues in order to ensure that management has the tools to incorporate sustainability considerations into decision making at all levels. Sustainability risks and opportunities are captured in the company’s risk management system and are evaluated regularly by management and the board.

In AngloGold Ashanti’s management structure, sustainability considerations are represented at the level of the company’s executive committee by the executive vice president: business sustainability. Sustainability performance is reviewed quarterly by the safety, health and sustainable development committee of the board. The chairman of the audit committee of the board has also been appointed to this committee in order to ensure integration between the work of these two bodies.

For more information, see the section Ethics and governance in our group-level report Sustainable Gold.

The GRI performance indicators relevant to this principle are SO1 and MM10.

Principle 3

Limited assurance for this principle has been provided by Ernst & Young for 2010.

Uphold fundamental human rights and respect cultures, customs and values in dealings with employees and others who are affected by our activities

One of the company’s values is to treat others with dignity and respect. Respect for human rights and the dignity of others is a key principle in many of the policies and practices that are integral to the group’s sustainability efforts, including safety, health and wellness, ethics and governance, community and environmental management.

AngloGold Ashanti’s policies and procedures are being assessed against the framework on human rights and business that is being developed by the UN Special Representative, Professor John Ruggie. An initial gap analysis has been conducted and a scoping process for bringing AngloGold Ashanti’s policies into line with the UN framework has been approved.

In the area of security, AngloGold Ashanti seeks to safeguard human rights through implementation of the Voluntary Principles on Security and Human Rights (VPSHR). It reports annually under the VPSHR and makes these annual reports available on its website.

For more information see the section Human rights and business in our group-level report Sustainable Gold.

The GRI performance indicators relevant to this principle are LA4, HR1, HR4, HR5, HR6, HR7, HR8, MM6, MM7 and MM8.

Principle 4

Limited assurance for this principle has been provided by Ernst & Young for 2010.

Implement risk management strategies based on valid data and sound science

We operate a global risk management system through an ongoing programme of engagement with key regional and operating personnel, and functional discipline owners within the corporate and regional offices.

A risk management policy is in place, with associated standards and guidance relating to the identification, assessment, evaluation, response, reporting and monitoring of risks (threats and opportunities), to foster a risk-awareness culture within the business and inform business strategy.

Risks are ranked using a common methodology and are recorded in the group risk register. The methodology requires assessment of the potential impact on each of the values per risk. Risks are identified that have the potential to impact corporate and regional strategies, financial viability, delivery on business plans, and also specific objectives. Identified risks are assessed for materiality both in terms of stakeholder concerns and expectations, as well as the company’s pertinent business concerns.

A dedicated risk management team carries accountability for risk management processes under the oversight of the Risk and Information Integrity Committee of the board. The board, through this committee, reviews and approves the risk management strategy and policy as formulated by the executive directors and senior management. Management is accountable to the board and has established a system of internal controls to manage significant group risk. Where risks are assessed as being material, they are reviewed and reported to senior management, as well as the relevant board committees.

The GRI performance indicator relevant to this principle is EC2.

Principle 5

Limited assurance for this principle has been provided by Ernst & Young for 2010.

Seek continual improvement of our health and safety performance

AngloGold Ashanti is committed to continuously improving health and safety performance, within and beyond the workplace. We regard safety as our most important business priority. We are in the process of implementing the safety transformation project, which targets a step change in safety performance. Group-level targets on safety performance have been established and are well communicated throughout the group.

We subscribe to a definition of good health as a state of complete physical, social, mental and spiritual wellbeing and not merely the absence of ill health. We do not accept ill health as a natural consequence of our business. We also regard employee and community health as inseparable, and target integrated occupational and community health strategies where possible.

For more information see the sections Improving operational safety performance and Managing health issues in our group-level report Sustainable Gold.

The GRI performance indicators relevant to this principle are LA6, LA7 and LA8.

Principle 6

Seek continual improvement of our environmental performance

AngloGold Ashanti has put in place an integrated framework for the management of environmental and community affairs, setting out the vision for the company’s work in these areas, which is to:

• operate in a way which reflects our mission, vision, values and strategy, particularly as they relate to community and environmental performance;
• take community and environmental issues into account at all levels of decision making;
• respond to internal and external groups which have a vested interest in responsible business practice;
• manage community and environmental risk, meaning that we correctly identify the community and environmental risks associated with our business and put strategies and management plans in place to manage these risks proactively; and
• maintain and develop our social licence to operate.

Environmental management standards are developed as necessary. Operations are usually given two years to implement them. The Community and Environment Review Programme (CERP) audits site performance biennially against company standards.

For more information see the section Environmental and natural resource stewardship in the group-level report Sustainable Gold.

The GRI performance indicators relevant to this principle are EN1, EN3, EN8, EN16, EN28 and MM3.

Principle 7

Limited assurance for this principle has been provided by Ernst & Young for 2010.

Contribute to conservation of biodiversity and integrated approaches to land use planning

The company’s integrated environment and community policy states that ‘we will contribute to biodiversity protection in our areas of operation’. A Land Use Management Standard was finalised during 2009. This, together with the Land Acquisition Management Standard currently under consultation, sets a company-wide standard for land use, acquisition and planning.

A group management standard on biodiversity is currently under development, using ICMM’s Good Practice Guidance on Mining and Biodiversity and internal and external peer review. It will be finalised during 2011.

The GRI performance indicators relevant to this principle are EN11, EN12, EN23, MM1 and MM2.

Principle 8

Facilitate and encourage responsible product design, use, re-use, recycling and disposal of our products

Due to the high value of the product, gold is rarely disposed of and is usually recycled or held by end customers as a store of value. AngloGold Ashanti is engaged in a number of initiatives that promote product responsibility in gold:

• The International Council on Mining and Metals (ICMM), which seeks to make a contribution to ensuring the responsible production of the minerals and metals that society needs and to contribute to sustainable development. Many of the world’s major metals and mining companies are members of the ICMM.
• The Responsible Jewellery Council (RJC), which is an international, not-for-profit organisation bringing together over 270 companies across the jewellery supply chain. RJC members are committed to promoting responsible ethical, human rights, social and environmental practices in a transparent and accountable manner throughout the industry from mine to retail.
• The World Gold Council (WGC), which is a global gold marketing body funded by the world’s leading gold mining companies. The WGC is party to various product responsibility initiatives and is a member of both the ICMM and the RJC.

For more information, see the Product responsibility section in this report.

The GRI performance indicators relevant to this principle are EN26 and LA8.

Principle 9

Contribute to the social, economic and institutional development of the communities in which we operate

AngloGold Ashanti continues to invest substantially in host communities and labour-sending areas through our community investment programme. It is AngloGold Ashanti’s intention that the communities and societies in which the company operates be better off for us having been there. This is achieved through, among other things, the company’s socio-economic contribution in the host country, including economic value generation and distribution. Partnerships (public and private) can be a catalyst for achieving these goals. The scope of socio-economic contribution can vary considerably, depending on the nature of the site, on the levels of significance of its associated impacts, on the vulnerability of affected groups living within the areas of influence and on a mine’s stage of development. This approach to sustainability calls for the integration of community development and economic considerations into core business decision-making.

For details see the section ;AngloGold Ashanti and Communities in the group-based report Sustainable Gold.

The GRI performance indicators relevant to this principle are EC1, EC5, MM2, EC6, EC8 and LA10.

Principle 10

Implement effective and transparent engagement, communication and independently verified reporting arrangements with our stakeholders

AngloGold Ashanti is committed to reporting on an A+ basis against the Global Reporting Initiative standard and in a manner which is fully compliant with the ICMM Sustainable Development Framework. This implies external assurance of its sustainability reporting.

AngloGold Ashanti engages extensively with a range of stakeholders, driven by two major objectives, namely the need to consult with stakeholders on our activities throughout the life cycle of our operations; and the company’s wish to put in place mutually beneficial partnerships with the governments and societies in which we operate in order to contribute to a sustainable future for our host communities.

The GRI performance indicators relevant to this principle are EN11, SO5, SO7 and SO8.