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  Risk management process

Risk management process

Gold Fields has a well-developed enterprise-wide risk management (EWRM) process, which has been in place for a number of years. The overriding purpose of EWRM is to assist the company in achieving its business and strategic objectives, namely to sweat our assets, secure our future and grow Gold Fields. EWRM also backs the company’s efforts to achieve the highest levels of corporate governance and full compliance with the requirements of the recently launched King III Code.

The EWRM process is divided in two key segments: operational and strategic risk management.

Diagram 1 below illustrates how the segments are integrated. The integration was initiated in the year under review to ensure that operational and strategic risks and their mitigating strategies are aligned, while also supporting the company’s strategic and business objectives.

Safety underpins our risk management process and the dictum of if we cannot mine safely, we will not mine forms the foundation of EWRM. The dictum finds practical implementation via the principles of stop, think, fix, verify and continue.

Diagram 1 also shows the various types of operational risk assessments conducted at our mines and service divisions. The process is in line with risk management frameworks such as SIMRAC (Safety in Mining Research Advisory Committee) in South Africa and the AS/NZS 4360 risk management standard in Australia. The universal framework used at Gold Fields is the ISO 31000 international guideline on risk management. ISO 31000 guides the essential integration between operational and strategic risk management.

A strategic risk management assessment starts at our mines and service divisions on a quarterly basis. The top risks are identifi ed, analysed and actioned by affi rming and strengthening existing mitigating actions and putting new ones in place, where appropriate.

The Gold Fields’ Executive Committee reviews the top risks biannually and develops mitigating strategies, which are presented at the Board’s Audit Committee’s risk meeting. The Audit Committee is a subcommittee of the Board of Directors and has been tasked with assisting the Board with its risk governance duties and responsibilities.

Gold Fields’ governance structure for risk management starts with line management and then fi lters up through the management structure. Ultimate responsibility rests with the Board and management, but the integral involvement of all line managers and the fact that management have taken ownership of the process helps to make risk management effective.

Diagram 1 Gold Fields’ risk management process