Average of the best scores achieved collectively by all companies for each one of the indicators under the thematic area
Average of the scores achieved by each one of the companies under this thematic area
Summary of results
Company performance on these basic issues is relatively high, with an average of 35% for this thematic area (the highest among all thematic areas) and a Collective Best Score of 77%, indicating that a score of this level is possible if companies adopt the good practices demonstrated by their peers. The strongest results are seen for commitments to prevent bribery and corruption – the vast majority of companies have made formal public commitments on this issue. In contrast, the weakest results relate to contracts disclosure; transparency of contracts is still very much the exception to the norm.
Leading practices in Business Conduct include, for example, the roll-out of a refresher training program for investigators of allegations made through a whistleblowing mechanism.
B.01 Business Ethics and Anti-Bribery and Corruption
The company commits to prevent all direct and indirect forms of bribery and corruption.
All companies have made a formal commitment to prevent bribery and corruption, and virtually all assign responsibilities for this commitment at the senior management or board-level. All companies also show some evidence that they have allocated financial or staffing resources (e.g., dedicated teams or training programmes) to implement this commitment.
Related Leading Practices
- Raising awareness on ethics
Raising awareness on ethics
Vale has developed innovative ways of disseminating its Code of Ethics and Conduct and its Anti-Corruption Policy and stimulating discussion of ethical issues. Since 2015 the company holds annual 'Action on Integrity' events across its operations, including screenings of videos developed to promote a reflection on ethics and integrity within the company. In addition, face-to-face training in anti-corruption is provided to employees working in 'high risk' positions (e.g. those responsible for government relations, donations, sponsorships, community investments, and acquisition of companies). Finally, the company periodically releases a photo-novel entitled 'Ethics on the Agenda', each time dealing with a specific ethical issue to be discussed among Vale's employees.
The company tracks, reviews and acts to improve its performance on anti-bribery and corruption.
Most companies publicly disclose some data on their performance in preventing and addressing bribery and corruption, but generally little information is disclosed on the nature of any incidents or the actions taken. Approximately half the companies can demonstrate to some extent that they conduct audits and reviews of the effectiveness of the measures taken. But only a handful of companies show evidence of taking corrective measures in response to these audits or reviews.
The company tracks, reviews and acts to improve the effectiveness of its whistleblowing mechanisms for reporting concerns about unethical behaviour.
Almost all companies show evidence of having whistleblowing mechanisms in place, however very few companies publicly disclose detailed tracking information, such as the number of cases raised, the issues covered, or actions taken in response. A few companies demonstrate they have undertaken effectiveness audits/reviews recently, though they disclose little information on their findings or resulting actions taken.
Related Leading Practices
- Improving whistleblowing mechanism
Improving whistleblowing mechanism
In 2020, following its review of the effectiveness of its whistleblowing mechanism, AngloGold Ashanti rolled out refresher training for investigators of allegations received through this mechanism. The training aimed to strengthen the whistleblowing investigations process and underline the need for investigators to conduct their work with the highest level of integrity.
B.02 Board and Senior Management Accountability and Diversity
The company has systems in place to hold individual board directors and senior managers accountable for responsible business conduct on ESG issues.
All companies can demonstrate they have taken specific measures (almost always through company-wide systems) to ensure that clear roles are defined for individual board directors or senior managers for responsible business conduct on ESG issues, and the majority assign responsibilities at both levels. Approximately half the companies can demonstrate to some degree that individual board directors and/or senior managers responsible for such performance are held accountable via documented measures (e.g. integration of ESG performance in remuneration). But only a handful of companies demonstrate that relevant competency requirements are in place for these accountable senior managers or board directors.
Related Leading Practices
- Integration of climate-change targets into senior executive remuneration
- Linking senior management’s remuneration to ESG performance
Integration of climate-change targets into senior executive remuneration
In 2017 Anglo American's Board approved the inclusion of two climate-change-related targets into the remuneration plan for the company's senior executives. These targets relate to an eight percent improvement in energy use and a 22 percent reduction in greenhouse gas emissions by 2020.
Linking senior management’s remuneration to ESG performance
Gold Fields bases its remuneration partly on the pay-for-performance philosophy that strikes a balance between overall business strategy of the company and actual performance. The company has developed a Balanced Scorecard with pillars on safe operational delivery, capital discipline, portfolio management, and license and reputation management. Senior management scorecards relate to corporate targets on improving safety performance, delivering economic benefits to host communities by providing procurement and employment opportunities, reducing freshwater withdrawal and recycling total water use and energy saving initiatives.
The company tracks, reviews and acts to improve its gender balance at board and senior management levels.
Most companies track and publicly disclose some data on the number and/or percentage of the women’s representation at either the senior management or board level. However, very few companies demonstrate that they track that data over time and against targets. One-third of companies show evidence that they audit or review the effectiveness of their efforts to improve gender balance at senior management level. Hardly any companies provide evidence that they take responsive action based on the result of such reviews.
B.03 Contracts Disclosure
The company publicly discloses all the legal titles that grant it the rights to extract mineral resources on its mine sites.
About one-quarter of the companies disclose some of the legal titles (e.g. contracts, permits, licences, leases, conventions, agreements) that grant them the rights to extract mineral resources at their mine sites, with data only available for a very limited number of their mine sites. In the rare cases where legal titles are disclosed, they are usually available in full and on the webpages of the company or its subsidiary, although a number of them are redacted or omit annexes or amendments.
Related Leading Practices
- Contract disclosure
Rio Tinto makes publicly available, on its company website, the contracts for some of its operations. The company publishes copies of the original agreements and provides a summary table showing the term and party for each contract. Orano provides links on its company website to contracts, licences, permits and other agreements for some of its operations.
B.04 Tax Transparency
The company practices tax transparency in all its tax jurisdictions.
All companies publicly disclose information on at least some of their major subsidiaries and joint ventures, though less than half disclose all the tax jurisdictions where they have registered entities. A handful of companies demonstrate having a formal tax strategy and tax policies in place that include explicit mention of their approach to the use of low tax jurisdictions/tax havens. Although half of the companies disclose some information on tax benefits they have received in some of their tax jurisdictions, very few disclose comprehensive data on these tax benefits.
B.05 Beneficial Ownership
The company publicly discloses its ultimate beneficial owners.
Almost all companies disclose some information on beneficial ownership. But most of them only disclose the names of directors owning shares and the number of shares they hold – which often represents only a marginal portion of the total company ownership. Only two companies stand out: a partially state-owned company that discloses the names of all its other ultimate, non-state beneficial owners, and a fully-state-owned company that clearly documents how ownership is held and how control is exercised.
B.06 Payments to Producing Countries
The company publicly discloses all payments it makes to sub-national and national governments, providing disaggregated data on a project-level basis.
More than one-third of companies fully disclose all payments made to national and sub-national governments on a project-disaggregated and yearly basis. Most companies disclose aggregate payments to national governments, rather than on a project-disaggregated basis. Disclosure is often made through mandatory reporting requested by their home countries and/or payment-specific reports with yearly updates available on their corporate websites.
B.07 Lobbying Practices
Where applicable, the company publicly discloses its lobbying practices and positions in all jurisdictions.
Information on some lobbying practices and positions is available for more than half of the companies. In the vast majority of cases, the data is only provided by government sources, repositories and websites that document names and responsibilities of some of those involved in the companies’ lobbying activities, for the most part limited to the jurisdictions that are subject to legal requirements (e.g., the US, the EU or Canada). The information usually includes the issues on which companies engage (including, in a few cases, details on the outcomes sought), as well as the names of some of the public institutions or officials being engaged.
B.08 Responsible Contracting and Sourcing
The company has systems in place to identify and assess any human rights, labour and environmental risks associated with its suppliers and contractors.
While the vast majority of companies mention the existence of responsible sourcing approaches, only a handful of companies demonstrate they have formal systems in place to assess the human rights, labour and environmental issues associated with their suppliers and contractors. Other companies have set human rights, labour and/or environmental requirements for their current and potential suppliers and contractors but there is little evidence of pro-active due diligence on all such business partners based on these requirements.
Related Leading Practices
- Rigorous approach to responsible sourcing
Rigorous approach to responsible sourcing
Anglo American has developed a systematic approach to supporting responsible sourcing. The company's Responsible Sourcing Standard for Suppliers details performance expectations across six pillars (labour and human rights, health and safety, wellness, business integrity and ethics, environmental stewardship, and corporate citizenship). The procedure for selecting suppliers consists of three elements: (1) suppliers are required to complete a self-assessment questionnaire based on the standard; (2) on a sample basis, suppliers are required to conduct an independent responsible sourcing audit at operational facilities; and (3) in cases where the self-assessment or the third-party audit has identified non-compliances, suppliers are expected to develop a remediation plan with timeframes to close out these issues. In 2018 the Standard was updated to include the prevention of modern slavery and human trafficking, in line with the UK Modern Slavery Act.