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  Overview

 

Risk management

Overview

Business sustainability – in its true sense – is essentially about the effective and integrated management of our operational, sustainability and financial risks. Gold Fields has a welldeveloped and embedded Enterprise-Wide Risk Management (EWRM) process. As part of our integrated approach to business sustainability, our environmental,1 social, health and safety risks are fully integrated into the EWRM process.

The overriding purpose of EWRM is to help Gold Fields achieve its strategic objectives – to grow Gold Fields, to optimise its operations and to secure its future. It also supports our efforts to achieve the highest levels of corporate governance, as well as full compliance with the risk management requirements of South Africa’s King III Code.

The EWRM process is comprised of two integrated and well-aligned components: operational risk management and strategic risk management (see Figure 2.8). It is aligned with the ISO 31000 international standard on risk management, as well as the Committee of Sponsoring Organizations to the Treadway Commission, an independent organisation based in the United States dedicated to innovation in corporate governance. At an operational level, the EWRM process is aligned with South Africa’s Safety in Mines Research Advisory Committee (SIMRAC) and Australia’s AUS/NZS 4360 standard on risk management.

1 Including water-related risks and climate change risks

Continuous improvement of the EWRM

During C2010, we adopted a number of instruments aimed at further formalising our already well-embedded EWRM process. They are also aimed at ensuring full compliance with the risk management requirements of South Africa’s King III Code – and to support the full integration of ‘holistic’ risk management into our day-to-day business.

These instruments included:

  • A Risk Management Policy that has been in place since C2008 and which requires Gold Fields, amongst other things, to identify, assess and manage risks in an effective and efficient manner
  • A Risk Management Charter that defines, amongst other things, risk management governance, frameworks and assurance, as well as risk tolerance levels, risk appetite and key risk indicators
  • A 12-month Risk Management Plan that sets out the strategy to bring Gold Fields risk management processes to full maturity
  • An Enterprise Risk Management Guideline that describes, amongst other things, the risk management process, framework and methodology, as well as procedures for strategic risk registers

In future, we hope to examine the potential for the application of a similar system for the formal and objective identification and management of operational, sustainability and financial opportunities. If practicable, this will further enhance our ability to achieve true business sustainability and achieve our Vision.

“The informed investor assesses the quality of the company’s risk management and whether it considered the sustainability issues pertinent to its business”
King Code of Governance Principles for South Africa