“The Board has complete confidence in the ability of Gold Fields’ management team and its employees to continue dealing successfully with the ongoing impact of Covid-19”
Cheryl Carolus

DEAR STAKEHOLDERS

This past year has been a remarkable one for Gold Fields. Firstly, the outbreak of Covid-19 not only challenged our personal lives, but also business-as-usual across the regions where we operate. Secondly, despite the impact of the pandemic, Gold Fields had another year of impressive performance, with strong earnings, cash-flows and value creation for our stakeholders. Finally, 2020 was the last year that Nick Holland led the Company. He officially retired at the end of March. A memorable era in Gold Fields' history has come to an end, and we are embarking on a new chapter with the appointment of Chris Griffith as Chief Executive Officer (CEO) from April onwards.

In last year's report, I made initial reference to our management's proactive and comprehensive approach to mitigating the early impacts of Covid-19 on our people and operations. None of us could have foreseen that, a year later, the pandemic would still be with us. Tragically, 10 of Gold Fields' employees and contractors have lost their lives, as have many of our colleagues' relatives. On behalf of the Board, I want to express our heartfelt condolences to the families and friends of those who have succumbed to Covid-19, as well as to our colleagues who have lost their loved ones.

In this Integrated Annual Report (IAR), we report extensively on how our teams managed to, first and foremost, protect our employees and contractors, assist our host communities and governments in mitigating the pandemic's impact, and keep our mines and projects operating strongly and safely. The Board receives regular updates, via its Risk Committee, of the actions taken by the Company.

We expect that the pandemic will remain a reality for months to come, perhaps even years, and could impact our operational plans in yet unforeseen ways. The Board has requested the Group's management team to develop strategies on how we can assist in making vaccines available to our workforce, and, where appropriate, to families and communities, as well as prepare our people and business for this 'new normal'. As such, we are exploring ways of supporting our employees who, for example, are now permanently working from home or are struggling as a result of the continued impact of Covid-19. At an operational level, we will continue to test our people, provide them with the necessary equipment and information to protect themselves, and help them in any possible way we can if they contract Covid-19.

The Board has complete confidence in the ability of Gold Fields' management team and its workforce to continue dealing successfully with the ongoing impact of Covid-19. Our 2020 operational performance speaks for itself – despite the challenges and disruptions of the year, the Company delivered a strong set of results in 2020. The impact of Covid-19 was limited to approximately 3% of production (approximately 80koz) and, while our operations spent an additional US$30m to deal with the pandemic or donate to host governments, both costs and production were within revised market guidance.

The stable production and cost profile was supported by a record high gold price. Our financial results also benefited from the gold price, and included net cash-flow of US$631m and normalised earnings of US$879m – both more than double our performance in 2019. We reduced net debt by almost US$600m, placing our balance sheet in a very healthy position, and recorded a net debt:EBITDA ratio of 0.56x – the lowest it has been in almost a decade. Our shareholders received a total dividend of R4.80/share, three times that of 2019. They also saw their shares hit record highs in 2020, though this has since retreated in line with the decline in the gold price from its record levels of over US$2,050/oz in August last year.

In February 2020, our Board decided to go ahead with the US$860m Salares Norte project in Chile. Construction proceeded as planned during the year and is set for completion in Q1 2023. Salares Norte is the latest building block in the Company's reinvestment programme of the past three years, during which we also effectively built two new mines, Gruyere in Australia and the Damang Pit Cutback in Ghana. Both mines contributed meaningfully to the Group's cash-flow during 2020. I am also particularly pleased to report that South Deep again showed strong financial and operational improvements and contributed positive cash-flow during 2020.

Gold Fields continues to focus on maximising in-country and host community economic impact. The Group's value distribution to national economies amounted to US$2.85bn in 2020 compared with US$2.58bn in 2019. Of this, US$676m, 28% of the total, remained with our host communities. We achieved this by maximising the number of people we employ from our host communities, prioritising procurement from local enterprises and channelling our socio-economic development (SED) spend to these communities. Over the past five years, we have created over US$3.54bn in community value, which, we believe, presents a significant investment in the economic wellbeing of our host communities and the estimated 435,000 people who reside there.

At the same time, we need to ensure that our mining activities do not adversely impact the environment around our operations or denude the natural resources both our Group and host communities depend on. Pleasingly, we again recorded zero serious environmental incidents for the second year in a row – a good yardstick of our success in this area. Similarly, our high levels of water recycling or reuse limited our uptake of freshwater from our catchment areas, while our continued investment in renewables is one of the ways we limit our carbon emissions. During 2020, we successfully commissioned two renewable microgrids at Agnew and Granny Smith in Australia. Furthermore, now that we have received the relevant approvals from the government, South Deep will be the next operation in our portfolio to build a solar plant, which, once operational, expected in Q2 2022, will provide about 20% of the mine's electricity needs.

The most critical part of the Board's duties undoubtedly relates to the safety, health and development of the Company's workforce and the Board has always shared management's commitment to eliminate all fatalities and serious injuries at our operations. Over the years, we have seen noticeable progress in this area emanating from our significant and continued investment in safety culture, systems and leadership. Tragically, however, we again recorded a fatal incident in 2020, that of Abel Magajane, a shaft timberman at South Deep, as well as six serious injuries. We owe it to Abel and the many other miners who have lost their lives, that we reaffirm our commitment to achieving zero harm.

The Board also seeks to further improve the diversity and inclusivity of the Company's workforce. While we made some progress – with around 20% of our workforce and 21% of leadership teams now female – we still have a way to go to truly reflect the demographics of the countries in which we operate. Our management team has developed a diversity and inclusion dashboard with several performance indicators, which are part of every manager's scorecard, against which we can benchmark our improvements over the coming years. The Board will be closely tracking the Company's performance in this regard.

With the rapid modernisation of our mines, we also need to ensure our workforce is appropriately skilled to meet the challenges of digitisation and automation. We are adapting training, skills development and recruitment policies accordingly to ensure our people can succeed in these new ways of working.

In recent years, managing environmental, social and governance (ESG) issues has become an increasingly critical consideration for our stakeholders – particularly investors. To date, Gold Fields has mostly relied on internal objectives to guide this ESG work; however, stakeholders expect that we report more publicly on progress in these areas. Together with management, the Board is developing a range of strategic ESG priorities, which we report on in this IAR. Before the end of the year, we will finalise and publish detailed targets for these priorities – ranging from safety to climate change, diversity and communities – for implementation by 2025.

Over the past few years, I have had the benefit of working with a consistent Board and Executive Committee (Exco) to govern, guide and manage the Company. This year, we saw some significant changes. At Board level, we accepted the resignation of Rick Menell, our Deputy Chairperson since 2015 and a director since 2008, with effect from 10 March 2021. Rick has been one of the most influential voices on the Board over this period and led the search for the new CEO this year. I want to thank Rick for his support and invaluable contribution.

We also accepted the resignation of Phuthi Mahanyele-Dabengwa due to her role as Naspers' CEO. With the appointment of Philisiwe Sibiya, we found an equally well qualified leader with solid business experience. We wish Phuthi well in her leadership role and welcome Philisiwe to the Board. As always, I want to extend my gratitude to my fellow directors for their support and experience in providing Gold Fields with valuable strategic and governance oversight.

At executive level, we bid farewell to Nick Holland after 24 years with the Company – first as Chief Financial Officer (CFO) and, from 2008, as CEO. Chris Griffith will assume the role of Gold Fields' CEO from 1 April 2021. On behalf of the Board, we are delighted to have attracted a leader of Chris' calibre. He has an extensive and successful leadership track record, amongst others, at Anglo American Platinum and Kumba Iron Ore, with many years' experience as part of Anglo American's global leadership teams. He has a strong track record of building and motivating successful teams to achieve corporate turnarounds and outstanding results. Chris is held in high regard for his strong ethical leadership and sound governance. We believe that under his leadership, Gold Fields will continue to grow, building on the solid foundation created by Nick, the leadership team and our entire workforce of 5,600 employees.

As Nick retires, he can certainly accept credit for a Company that has chartered its own course over the past decade, relying primarily on organic growth to become a global leader in mechanised and sustainable gold mining. As he set out to accomplish a few years ago, our portfolio of mines is now in a strong position to maintain production of 2.0Moz – 2.5Moz per year for the next 10 years without requiring expensive mergers or acquisitions.

More than just building a strong portfolio, Nick has established a Company that ensures its stakeholders share rightfully and meaningfully in the benefits of mining, while also delivering strong returns to the investors who have entrusted their capital to us. Gold Fields is an organisation with an unrelenting focus on the safety of its employees, its contractors and its communities. On his first day as CEO, Nick coined the phrase 'If we cannot mine safely, we will not mine'. We have lived by this sentiment since then, ensuring it has become a mantra within Gold Fields and, perhaps, Nick's most significant legacy.

Nick, you leave Gold Fields with the immense gratitude of the Board, your management colleagues and the Company's employees. You truly deserve all the accolades bestowed upon you, and we wish you a well-deserved retirement.

Cheryl Carolus

Chairperson

As the Company's highest governing body, the Board of Directors assumes ultimate responsibility for Gold Fields’ adherence to sound corporate governance standards. The Board ensures that all business decisions are made with reasonable care, skill and diligence to maximise value for key stakeholders. Our Board comprises a diverse group of directors with the relevant knowledge, expertise, technical experience and business acumen to govern ethically and with honesty, transparency, responsibility, authenticity and impartiality. Below, we list our Directors as at 31 December 2020.

NEW APPOINTMENTS SINCE 2020 YEAR-END

Exco has 12 members in total, comprising the Company’s principal officers and executive directors. More information can be found on our website at
www.goldfields.com/our-leadership.php

KEY DELIBERATIONS AND DECISIONS TAKEN BY THE BOARD IN 2020

Gold Fields Board

HOW BOARD GOVERNANCE ADDS VALUE

ENSURING WE DO BUSINESS ETHICALLY

THE STRUCTURES AND MECHANISMS USED TO DRIVE ETHICAL BUSINESS PRACTICE

The foundation of our business is based on strong ethics. Our Board and its committees are responsible for setting the ethical tone which, in turn, cultivates a culture of integrity and transparent reporting to our stakeholders. From this foundation, we build trust with our stakeholders, allowing us to strengthen our reputation and create sustainable value. We have numerous mechanisms in place to help to ensure we conduct our business ethically, adhere to compliance requirements and entrench good governance within the business.