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| SUSTAINABLE DEVELOPMENTETHICS AND CORPORATE GOVERNANCE Gold Fields is committed to ethical and fair business dealings and promotes a corporate culture which is non-sectarian, non-political and which is socially and environmentally responsible. The company endorses the principles contained in the South African Code of Corporate Practices and Conduct as recommended in the second King Report (King II) and complies with its provisions. Gold Fields shares are listed on JSE Limited (the JSE) as a primary listing and the company is required to comply with the JSE Listings Requirements in respect of King II. The company’s shares also trade in the United States of America (USA) on the New York Stock Exchange (NYSE) and are registered with the United States Securities and Exchange Commission (SEC). As such, the company is subject to the disclosure and corporate governance requirements of the NYSE, in so far as these relate to foreign private issuers such as Gold Fields. The company also has a secondary listing on the NASDAQ Dubai Limited, the Euronext in Brussels, and the Swiss Exchange and is subject to the disclosure requirements of these exchanges. The company has implemented an ethics policy and has developed an ethics booklet, which summarise the salient principles of the policy for employees informing them of their responsibilities regarding ethical behaviour. The content of this ethics policy is included in our training programmes and most notably in our induction programmes that target all new employees and business partners. All employees are required to adhere to the requirements of the ethics policy. The Group has procured the services of an independent hotline service provider, to facilitate the confidential reporting of any code transgressions. No material transgression of our ethics policies has been reported during the period under review. In addition, no significant fines or non-monetary sanctions for non-compliance with legal requirements have been levelled against the company. Board of Directors The company’s articles of association provide that the company’s Board of Directors shall consist of a minimum of four directors and a maximum of 15 directors. The Board of Directors currently comprises one executive director and 12 non-executive directors. The office of the Chairman and that of the Chief Executive Officer (CEO) are separate from one another and are currently filled by an independent non-executive director, Mr AJ Wright, and an executive director, Mr NJ Holland, respectively. Mr RP Menell was appointed as a non-executive director on 8 October 2008. On 10 March 2009 Ms CA Carolus and Mr R Dañino were appointed as non-executive directors, while Mr AR Hill was appointed a non-executive director on 21 August 2009. The Gold Fields Board of Directors comprises a majority of non-executive directors of whom sufficient are independent of management so that shareholder interests (including minority interests) can be protected. Non-executive directors do not receive any remuneration from the company for their services as directors other than the fees and restricted shares, with a three year vesting period, as detailed in the Directors’ Report on pages 112 to 123 of this annual report. The Board of Directors reviews the status of its members on an ongoing basis and, based on its deliberations, considers the current complement of its 12 non-executive directors to be independent, as defined in the JSE Listings Requirements. Details of the directors and their status as executive or non-executive appear on pages 16 and 17 of this annual report. Board of Directors’ charter In accordance with the Board of Directors’ charter, the directors seek to promote the mission of the company, while upholding sound principles of corporate governance, the best interests of its communities, and its shareholders. The charter, which is available on the Gold Fields website (www.goldfields.co.za), articulates clearly and concisely the objectives and responsibilities of the Board of Directors. The Board of Directors discharges these responsibilities through a number of actions including:
Rotation of Directors In accordance with the company’s articles of association, one-third of the directors shall retire from office at each annual general meeting, with the first to retire being those appointed as additional members of the Board of Directors during the year, followed by the longest serving members. Retiring directors are free to make themselves available for re-election and may, as such, be re-elected at the annual general meeting at which they retire. Board of Directors meetings and attendance The Board of Directors is required to meet at least four times a year. The non-executive directors also use this opportunity to meet amongst themselves. The Board of Directors met on nine occasions, in person or telephonically, during the year under review. The record of attendance by members of the Board of Directors at such meetings is contained in the table below. Board of Directors committees The Board of Directors has established a number of standing committees composed entirely of non-executive directors. These committees comprise the Nominating and Governance Committee, the Audit Committee, the Remuneration Committee, the Safety, Health and Sustainable Development Committee, and the Capital Projects Control and Review Committee all of which operate in accordance with written terms of reference, which were approved by the Board of Directors and are available on the Group’s website (www.goldfields.co.za) or from the company’s secretarial office, on request. Each of the Board of Directors’ standing committees is chaired by an independent, non-executive director. Each committee is required to evaluate its own effectiveness and performance from time to time, with the Nominating and Governance Committee monitoring and reporting to the Board of Directors periodically on such performance and effectiveness. Each member is paid remuneration in addition to the annual fee payable to directors, which remuneration is recommended by a separate subcommittee chaired by the Chief Executive Officer and requires approval in advance by the shareholders at an annual general meeting of the company.
1 Appointed 1 August 2008. 2 Appointed 8 October 2008. 3 Resigned 15 October 2008. 4 Appointed 10 March 2009. Nominating and Governance Committee The Nominating and Governance Committee is chaired by the chairman of the Group, Mr AJ Wright. It comprises independent non-executive directors, namely, Messrs K Ansah, R Dañino, RL Pennant-Rea and CI von Christierson. Its written terms of reference require this committee, inter alia, to:
The Nominating and Governance Committee met on five occasions during the year under review. The record of attendance by members at such meetings is contained in the table below.
1 Appointed 1 May 2009. Audit Committee The Audit Committee comprises independent non-executive directors, chaired by Mr JG Hopwood, while other members are Messrs RP Menell, DMJ Ncube, RL Pennant- Rea and Mrs GM Wilson. The committee is required to meet at least quarterly and to monitor and review:
All members of the Audit Committee are independent non-executive directors. The internal and external auditors have unrestricted access to the Audit Committee, the Audit Committee chairman and the chairman of the Board of Directors, ensuring that their independence is in no way impaired. The Group internal audit function is headed by the senior manager, internal audit. The Audit Committee determines the purpose, authority and responsibility of the internal audit function in an Internal Audit Charter, which charter has been approved by the Audit Committee. The Audit Committee has the authority to appoint and dismiss the head of the Group internal audit function. The Audit Committee is required to approve all significant non-audit relationships with the Group’s independent auditor. For the period under review, the Audit Committee has approved, and the Group’s independent auditor has performed non-audit services for accounting advice and taxation. In consideration for rendering these services, the Group has paid the independent auditor an amount of R4,3 million. The Audit Committee is responsible for the oversight of the work of the independent auditor, and the independent auditor reports directly to the Audit Committee. The Board of Directors believes that the members of the Audit Committee collectively possess the knowledge and experience to oversee and assess the performance of Gold Fields’ management and auditors, the quality of Gold Fields’ disclosure controls, the preparation and evaluation of Gold Fields’ financial statements and Gold Fields’ financial reporting. The Board of Directors also believes that the members of the Audit Committee collectively possess the understanding of audit committee functions necessary to diligently execute their responsibilities. The Audit Committee has adopted formal, written terms of reference that were approved by the Board of Directors. The Audit Committee is of the opinion that it has satisfied its responsibilities for the past financial year in compliance with such terms of reference. The Audit Committee is satisfied with the appropriateness of the CFO’s expertise and experience. In addition, the Audit Committee is satisfied that the external auditors are independent of the company. The Audit Committee met on six occasions during the year under review. The record of attendance by members at such meetings is contained in the table below.
1 Appointed 1 August 2008. 2Appointed 13 November 2008. Remuneration Committee The Remuneration Committee comprises independent non-executive directors, namely, Messrs CI von Christierson (chairman), JG Hopwood, DMJ Ncube, Mrs GM Wilson and Mr AJ Wright and is required to meet at least twice a year. The committee, which has adopted its own formal terms of reference, has established and reviews, on an ongoing basis, the Group’s remuneration philosophy, the terms and conditions of employment of executive directors and other executives, including a short-term performance-linked bonus scheme and a long-term share incentive scheme. The terms and conditions of employment of the executive director are contained in a written contract of employment. The remuneration particulars of the contract are contained on pages 117 and 118 of this annual report, with the Group’s maximum exposure being limited to two and a half years’ remuneration in the event of such executive director’s services being terminated as a result of a takeover or merger. The Remuneration Committee met on six occasions during the year under review. The record of attendance by members at such meetings is contained in the table below.
1 Appointed 1 May 2009. Safety, Health and Sustainable Development (SHSD) Committee The Safety, Health and Sustainable Development Committee (formerly known as the Safety, Health, Environment and Community Committee (SHEC)) comprises independent non-executive directors, namely, Messrs DN Murray (chairman), K Ansah, RP Menell, AJ Wright and Ms CA Carolus. The Group has during the year under review placed an increased emphasis on the non-financial value drivers of the business including but not restricted to stakeholders. The focus includes socio-economic issues such as community and individual development, employment equity, health and safety. As such, the SHSD Committee plays a pivotal role in assisting the Board of Directors in its oversight of the effectiveness of the Group’s environmental, health and safety programmes and keeping the Board of Directors informed in regard to the Group’s objectives, compliance with and maintenance of standards in these areas. The committee seeks also to minimise health, safety and mining related accidents within the Group, to ensure that the Group’s operations are in compliance with all environmental regulations, and has established a Group policy in respect of HIV/Aids and other health matters. This committee has adopted formal terms of reference and is required, in terms thereof, to meet at least twice a year. The SHSD Committee met on seven occasions during the year under review. The record of attendance by members at such meetings is contained in the table below.
1 Appointed 13 November 2008. 2 Appointed 1 May 2009. Capital Projects Control and Review Committee On 1 May 2009, the Gold Fields Board established a subcommittee with the purpose of satisfying the Board that Gold Fields has used correct and efficient methodologies and has adequate controls in place in respect of new capital projects proposed by management in excess of R1.5 billion or US$200 million. This committee will be reviewing such projects from inception to completion and making such recommendations to management as it considers appropriate. The committee comprises independent non-executive directors, namely, Messrs RP Menell, (chairman), DN Murray, AR Hill (appointed on 21 August 2009), CI von Christierson and Mrs GM Wilson. The committee’s first meeting was held on Wednesday, 19 August 2009. Executive Committee The Gold Fields Executive Committee (Executive Committee) is not a subcommittee of the Board of Directors, but is primarily responsible for implementing the Board of Directors’ mandates. The Executive Committee meets regularly to review Group performance and develops Group strategy and policy proposals for consideration by the Board of Directors. During the year under review the Executive Committee was reorganised and strengthened to reflect the Group’s new regionalisation strategy and expanding global footprint. Each of the four regions is now headed up by an Executive Vice President who is also a member of the Executive Committee. Details of the members of the Executive Committee appear on pages 18 and 19 of this annual report. The Executive Committee has been mandated by the Board of Directors to assist in the execution of the Group’s disclosure obligations. A series of guidelines on disclosure have been disseminated throughout the Group. ‘Disclosure’ is an agenda item at each Executive Committee meeting and, in order to facilitate the fulfilment by the committee of this function, a disclosure co-ordinator has been appointed at each operation and in respect of each core discipline throughout the Group. Each operating subsidiary of the Group has established board of directors and management committee structures designed to ensure that the Group’s commitment to sound practices and standards of corporate governance is maintained on a Group-wide basis. The Group’s executive director serves on the board of directors of each operating subsidiary of the Group. Internal controls The Board of Directors has established and maintains internal controls and procedures, which are reviewed regularly for effectiveness. These controls and procedures are designed to manage, rather than eliminate, the risk of failure, and provide reasonable, but not absolute, assurance that there is an adequate system of internal control in place. Internal auditors monitor the operation of the internal control systems and report their findings and recommendations to the Audit Committee, the directors and management. Action is taken to address any deficiencies as and when they are identified. Nothing has come to the attention of the directors to indicate that any material breakdown in the functioning of these controls, procedures and systems has occurred during the year under review. Group Code of Ethics Directors and employees are bound to uphold the core values of honesty, transparency and integrity that underpin the Gold Fields Code of Ethics. Above all, this code requires all directors and employees to maintain the ethical standards set by the Group, inter alia, that its representatives conduct themselves with integrity, in accordance with all applicable laws and generally in a manner which is beyond reproach. The code of ethics also articulates the Group’s policy with regard to conflicts of interest, confidentiality, fair dealing, and the protection and proper use of Group assets. The code of ethics is available on the Group’s website (www.goldfields.co.za) and has been communicated throughout the Group. The code of ethics is also communicated to all new employees. The Board of Directors is committed to ensuring the consistent application of the code of ethics and is assisted in its responsibility for overseeing compliance therewith by the Audit Committee. Gold Fields has contracted the services of ‘Tip-offs Anonymous’, an independent hotline service provider, to facilitate the confidential reporting of code violations, fraud and other inappropriate behaviour. Employees found guilty of ethical breaches are disciplined in accordance with the Group’s disciplinary code and, should the breach also be a criminal act, it is the Group’s policy to pursue prosecution of the employee concerned. Insider trading The Group operates a closed period prior to the publication of its quarterly and year end financial results during which period employees, directors and officers of the Group may not deal in Gold Fields shares. This is also extended to any period when Gold Fields is trading under a cautionary announcement or when employees, directors and officers are in possession of unpublished price sensitive information. The company secretary keeps members of the Board of Directors and employees across the Group informed of all such periods.
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