Integrated Annual Review 2012 Annual Financial Report 2012 Mineral Resources and Mineral Reserves Regional overview  
 

3.2.4 ERM Combined Assurance

We formalised a Combined Assurance approach following the approval of the Audit Committee in November 2012.

The approach is based on the application of three levels of assurance on all our significant risks:

  • Level 1: Management self-assurance
  • Level 2: Internal assurance
  • Level 3: Independent assurance

Combined Assurance aims to:

  • Provide appropriate levels of assurance on all significant risks facing the Company
  • Demonstrate due diligence by management
  • Monitor the relationships between various assurance providers and their activities

By adopting this approach, we are doing everything reasonably practical to give the Board assurance that we are executing effective control measures to avoid and/or mitigate our risks – thereby ensuring the continuity and sustainability of all our operations.

The process is monitored by our risk, internal control and compliance functions. Recommendations are made to management for additional assurance where required or to identify areas where assurance is duplicated.

The Combined Assurance approach is formally reviewed every year as part of our annual risk management plan.

Figure 3.7: Mitigation strategies for top-10 risks (pre-unbundling)

Risks   Mitigation strategies    
 
Reintegration of the cultural transformation and internal safety engagement pillars into the Safe Production Management Strategy (p87)
Enhanced safety enforcement measures, including increased resourcing (p87)
Introduction of a Safety, Health and Environment Committee at South Deep, chaired by the CEO
Engineering-out of safety risks, including fall of ground hazards
Establishment of a seismic task team and upgrading of secondary support standards
   
 
Engineering-out of health risks, including tip filters, mist sprays, settling agents and enhanced dust measurement
Enhancement of personal protective equipment performance through our Respiratory Protection Programme
Detailed preparation to determine potential litigation and liability – including consolidation of historical data
   
 
Portfolio Review to optimise cash generation and investment payback
Acceleration of destress mining at South Deep to support production ramp-up targets
New, high impact and strongly incentivised ‘24/7/365’ operating model at South Deep and development of new training and maintenance facilities (p7982)
Stabilisation of production at Damang, through the upgrading of the processing plant and re-evaluation of existing Mineral Resource model
Consolidation and optimisation of owner-mining at our Australian and West African operations
   
 
Firm defence of the gold mining sector’s existing two-year Collective Wage Agreement – whilst bringing forward changes to job grades and entry level wages (p139)
Increased engagement with unions at regional and national levels
Strong emphasis on responsible security provision and the avoidance of violence (p140, 152)
Close engagement with mining peers, unions and government to establish a mutually acceptable labour negotiation framework for the next formal wage negotiation in 2013
Increased focus on enhanced, direct communication with our workforce
   
 
Submission of a new, enhanced ‘second round’ Social and Labour Plan (SLP) for South Deep, including accelerated distribution of funds from the South Deep Education and Community Trusts with greater involvement from relevant outside stakeholders (p147, 149)
Implementation of a comprehensive programme to upgrade accommodation, with a strong focus on the construction of family units, promotion of home ownership and dismantling of legacy hostel issues
Ongoing programmes addressing local procurement, broad-based transformation, training and skill development and enhanced community development programmes
Establishment of grass-roots Sustainable Development Forums and comprehensive stakeholder mapping/analysis in South Africa
   
 
Geographical diversification to broaden operational base and reduce overall risk (p96)
Enhanced political monitoring and government engagement (direct and indirect)
Establishment of Group-wide crisis management programme, including Corporate Crisis Management Support Team, Regional Incident Response Teams and Emergency Response Teams
   
 
Development of a new Community Handbook and community engagement tools by the Sustainable Development department to ensure consistent, best practice approach across all operations and projects (p148)
Delivery of shared value through our Socio-Economic Development contributions (p148)
Minimisation of negative environmental impacts – with a focus on water quality and availability under our new Water Strategy (p91)
Review of the Ruggie Framework and other human rights standards to analyse human rights performance at Gold Fields and ensure best practice
   
 
More transparent communication with host governments on the state of the industry, cost structures and future outlook, with a view to fostering a better understanding of the sector’s challenges and competitive position (p151)
Enhanced measurement/communication of our local economic shared value contributions (p141)
Ongoing and constructive engagement with host government on a bilateral and multilateral basis (p52, 150)
   
 
Prioritisation of cash generation with respect to both current production and future growth – including Gold Fields Portfolio Review and delivery of full run rate at South Deep (p34 – 35, p79 – 82)
Focus on leveraging the gold price for investors through the payment of strong dividends (p15 – 17)
Transparent measurement and communication of all-in costs using Notional Cash Expenditure (p17, 28, 30, 34)
   
 
Continuous business process re-engineering to maximise efficiency
Portfolio Review to improve cash flow generation
Increased geographical and currency diversification
Strict application of stage gate process to ensure future growth projects contribute to cash generation