Integrity – behaving ethically and respecting each other and the customs, cultures and laws wherever we operate – and responsibility – delivering on our commitments, demonstrating leadership, speaking up and challenging the status quo – are two of our core values. Strong governance, in combination with living our core values, is essential for earning the trust of all stakeholders, protecting our reputation and creating sustained value.
Our Code of Conduct (the “Code”) states our commitment to high ethical standards, corporate responsibility and integrity. Our Board of Directors updates, reviews and ratifies the Code and re-evaluates it at least every three years.
Six global policies state our intentions, aspirations and commitments across key aspects of our business:
- Health and Safety
- Operations and Resource Development
- Asset Value Protection
- Business Integrity
- Sustainability and Stakeholder Engagement
These policies are supported by nearly 100 global standards that set the minimum acceptable requirements for behaviors, decisions and performance. Together, the Code, policies and standards provide clear guidance on the behaviors Newmont employees and those engaged in activities on our behalf must demonstrate at all times.
A dedicated team – comprising full-time employees in our corporate office and site compliance managers in Ghana, Peru and Suriname – oversees our global ethics and compliance program. The site compliance managers participate in the review of certain transactions, provide training and outreach, and support other activities to encourage ethical behavior and prevent potential misconduct before it occurs. We also have regional ethics advocates, including one attorney in each region, supporting the program in addition to their other duties. Newmont’s executive leadership team (ELT) serves as the Ethics and Compliance Steering Committee and meets at least twice a year in that capacity.
We actively encourage employees to speak up and report any incidents where a possible Code of Conduct violation has occurred. Anyone – including contractors and community members – at any time can anonymously report a concern via the web or by phone using our third-party-run Ethics Solutions Tool. We also input into the Tool cases with a Code-related component that originated through other channels such as human resources or security. We also categorize any matters that have a human rights impact.
On a quarterly basis, our ELT and the Audit Committee of our Board of Directors receive a report on the volume, type and outcome of cases that have come into the Ethics Solutions Tool. Our investigations guideline requires that substantiated compliance issues lead to some form of action, which may include coaching, formal discipline or termination. Managers are reminded of substantiated outcomes at mid-year and year end so that they can be factored into performance appraisals, thereby potentially affecting remuneration.
We also maintain a broad training program that requires acknowledgment of the Code of Conduct by all employees; the completion of online courses on specific topics for employees with regular computer access at work and for employees in managerial and leadership roles; and in-person training available to all employees to address relevant Code-related issues.
Our internal audit function conducts an annual fraud risk assessment, which includes identifying, assessing and ranking, in terms of impact and likelihood, commercial and government corruption risks throughout our operations. Our stance against corruption is also rooted in our commitment as a founding member of the Partnering Against Corruption Initiative (PACI), a cross-industry collaborative effort to implement a global anti-corruption agenda.
Because public policy decisions can significantly impact the environment in which we operate, we participate in the legislative and political process and engage with governments and other stakeholders on policy issues such as energy and climate change, taxes and revenue transparency, species conservation and other areas of interest. This engagement is in strict accordance with all applicable laws, the Extractive Industry Transparency Initiative (EITI), Newmont’s Code of Conduct and applicable policies and standards.
Our Political Contributions Standard details the rules and processes for making political contributions or otherwise engaging in the legislative or political process. This standard states our commitment to report our political contributions to our Board of Directors on a semi-annual basis and annually on our website. We do not make political contributions outside the U.S.
Our internal audit group updated the fraud risk assessment and identified no risks related to corruption as significant or greater in terms of impact, with a probability of “likely” or greater.
Back in 2016, we publicly disclosed our investigation into certain business activities associated with the requirements of the U.S. Foreign Corrupt Practices Act and other applicable laws and regulations. As part of the investigation, we worked with the U.S. Department of Justice (DOJ) and U.S. Securities and Exchange Commission (SEC). In 2017, we received notifications from both the DOJ and SEC that they did not intend to recommend enforcement actions and were closing their inquiries into the matter.
To further integrate integrity into the business, in 2017 we completed a third-party assessment that evaluated the effectiveness of our global ethics program, our Code, policies, standards and Ethics Solutions Tool, and identified gaps and other opportunities for improvement. One of the outcomes from the assessment is a process that will require our leaders across the business to certify on a quarterly basis that:
- Their respective region maintained effective controls for all aspects of their operations, including exploration activities; and
- They are not personally aware of any interaction or payment by Newmont, or on Newmont’s behalf (e.g., by a contractor), that would violate our Code of Conduct, policies, standards or applicable laws.
To prepare for the first certification at the conclusion of the first quarter of 2018, our ethics and compliance team worked with leaders in the regions to identify relevant transactions, controls and data and ensure systems are in place. The new certification process has been incorporated into our updated Anti-Corruption Standard.
|Total substantiated cases||105||114||102||165||134|
|Total matters addressed||224||237||246||402||352|
- Allegations of misconduct or inappropriate behavior: 60%
- Concerns about corruption (including conflicts of interest and government issues): 24%
- Inquiries: 11%
- Environmental, health and safety: 5%
|Allegations of misconduct and inappropriate behavior||60%|
|Concerns about corruption (including conflicts of interest and government issues)||24%|
|Environmental, health and safety||5%|
Other efforts to enhance our governance practices in keeping with our principles and stakeholders’ expectations included:
- We improved our management of commercial and government corruption risk throughout the lifecycle of our supplier relationships through the development of our Supplier Risk Management program.
- In April, our Board approved updates to our Code of Conduct to include an introduction by Noreen Doyle, our Board Chair, and President and Chief Executive Officer Gary Goldberg. The updated Code also included slight revisions to reflect the expansion of the global ethics and compliance team to include the site compliance managers in Ghana, Peru and Suriname.
- We expanded our ethics training to make available to all employees at least one hour of in-person training relevant to their region. Our online training for those with a work-issued computer and email account focused on conflicts of interest and a respectful workplace. Managers were also required to complete an online training course called “Ethical Leadership: Managing with Integrity.” Of the employee population eligible for online training, participation remained steady compared to the previous year, with 99 percent of managers at operating sites completing the training.
- To reinforce the importance of working with integrity, Newmont President and CEO Gary Goldberg sent quarterly communications to company leaders on ethics and compliance matters, sharing actual cases involving Code violations, outcomes and lessons learned as well as success stories in which employees clearly demonstrated the Company’s values. His messages were supported by monthly presentations from the ethics and compliance team.
- We further embedded a culture of integrity into our personnel management practices by including conversations about our company values during performance evaluations and annual goal-setting meetings. We also added to the hiring process candidate questionnaires that ask about conflicts of interest.
In 2017, a total of 410 new issues were captured in our Ethics Solutions Tool, and 20 cases were open at the beginning of the year. By year end, 352 of those matters were closed and 78 remained open. Of the cases closed, 62 percent (218) were not substantiated.
Of the cases investigated, the vast majority (59 percent) arose from allegations of misconduct or inappropriate behavior that often involved issues between employees and their managers. Around 24 percent of the cases arose from internal and external concerns about corruption (including conflicts of interest commercial and government issues), 11 percent were inquiries, and 5 percent were about environmental, health or safety allegations.
Of the 38 percent (134) that were substantiated, 22 percent (30) resulted in a recommended change of business process, and 74 percent (99) resulted in human resources or management actions. These actions included 49 employees being counseled on their actions or behavior, 25 receiving disciplinary action and 25 resigning or being terminated. As of early 2018, five cases were still being reviewed by management to decide the final outcome. Cases were closed on average in 37 days.
Newmont’s U.S. political contributions totaled $67,900 in 2017, a significant decrease from 2016 reflecting the fact that 2017 was an off-year election cycle in which neither a presidential election nor mid-term election took place.
We will continue our diligent focus on key elements of our ethics and compliance program including demonstrating integrity leadership throughout the business; a global training program backed by robust online training and strong engagements for all employees; and a commitment to prompt, thorough and fair investigations. Key areas of opportunity include maturing the organization so that every employee demonstrates integrity in their approach to their work, and on continuing to improve our controls.