Creating sustainable economic benefits
The African Mining Vision, adopted by African heads of state and government in February 2009 and endorsed by them in December 2011, calls for “a sustainable and well-governed mining sector that effectively garners and deploys resource rents and that is safe, healthy, gender and ethnically inclusive, environmentally friendly, socially responsible and appreciated by surrounding communities”. It also advocates “transparent, equitable and optimal exploitation of mineral resources to underpin broad-based sustainable growth and socioeconomic development”.
Although it was developed in respect of the mining industry in Africa, the vision outlined in this statement is globally relevant and reflects many aspects of our vision of responsible mining across the various continents on which we operate.
AngloGold Ashanti seeks to contribute to sustainable economic development in our regions of operation through:
- Direct contributions to regional and local development through community investment spend of $20.6m in 2011 (excluding joint ventures);
- Employment opportunities, including offering employment opportunities to local community members where possible;
- Equitable payments to government in respect of resources extracted, including direct and indirect taxation, dues and royalties; and
- Promoting objectives of transparency and good governance by publishing all payments made to government and through support for the Extractive Industries Transparency Initiative (EITI), a global standard for extractive companies to publish what they pay and for governments to disclose what they receive.
Our economic value-added statement, shown below, details value created and distributed in 2011, through employee salaries, community investment and current taxation.
Economic value-added statement
|US dollar million||%||2011||%||2010|
Economic value generated
|Gold sales and by-product income (1)||97||6,794||97||5,463|
|Royalties received (1)||1||79||–||8|
|Income from investments (2)||1||75||2||106|
|Total economic value generated||100||7,000||100||5,620|
Economic value distributed
|Operating costs (3)||36||2,519||41||2,289|
|Employee salaries, wages and other benefits||21||1,459||24||1,365|
|Payments to providers of capital||5||327||4||233|
|– Finance costs and unwinding of obligations||3||196||3||166|
|– Dividends (4)||2||131||1||67|
|Payments to governments|
|– Current taxation (5)||6||407||3||147|
|Community investment (6)||–||21||–||16|
|Total economic value distributed||68||4,733||72||4,050|
Economic value retained
- (1)In 2011, gold sales and royalties received, increased due to the higher gold price.
- (2)The 2010 year includes a profit on disposal of shares held in B2Gold Corporation.
- (3)Includes a loss on disposal of assets of $8m in 2011 (2010: $18m), and 2010 included a realised loss on non-hedge derivatives of $277m.
- (4)During the third quarter of 2011, the company changed its frequency of dividend payments to quarterly, rather than half yearly, resulting in a higher dividend for the year.
- (5)Payments to governments are for current taxes, which has increased as a result of tax losses utilised and higher earnings.
- (6)Community investment excludes equity-accounted joint ventures.
Payments to governments by country are shown in the chart alongside.
AngloGold Ashanti is a member of the EITI and is committed to supporting its objectives of fiscal transparency and governance. We share the EITI ethos that transparency and sound governance are essential in promoting sustainable economic development. We disclose all payments made to governments, whether or not the country concerned is an EITI member.
Of the countries in which AngloGold Ashanti operates, Mali and Ghana are compliant with the EITI and Guinea, Tanzania and the DRC are candidate members. We acknowledge the efforts made by these countries to comply with EITI requirements.
In our sustainable development framework, we have outlined our ambition to work with local communities and governments to define areas of mutual value creation. This will require us to understand the risks and drivers that will allow an operation to be successful, and invest in areas that address these risks and opportunities in a way that is relevant to the communities affected by that operation. In 2011 we began the process of incorporating this approach into regional sustainability strategies and developing businesses delivery targets in the area of community.
We invested substantially in communities in 2011, spending approximately $20.6m (excluding joint ventures) on various community projects globally (2010: $16.08m) and have put clear definitions of community investment in place at all operations.
Major projects undertaken in 2011 include:
- In the DRC, commissioning of a multi-million dollar project that includes the re-construction of a 4.2km road through Bunia, and repairing the Budana Hydropower Dam that provides electricity to the city of Bunia.
- In Colombia, a project aimed at building capacity in current and potential local suppliers. The initiative involves 50 local entrepreneurs who have received micro credits to support development of their businesses.