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Our sustainability approach

Sustainability is one of BHP’s core values. It means putting health and safety first, being environmentally responsible, supporting the communities in which we operate and making a positive contribution to a sustainable future.

 
 

Chief Executive Officer's Review

Sustainability has long been hardwired into all the decisions we make, the actions our people take, and the processes adopted by our business across the globe.

Global shifts in investor, political and community sentiment amid the rapid pace of change inspired us to refresh our purpose and contribution to society. Our profits must have a purpose and a socially responsible purpose generates greater shareholder value.

Our updated purpose is: to bring people and resources together to build a better world. It acknowledges people as the driving force behind our ability to deliver sustainable and commercial outcomes.

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Andrew Mackenzie

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Annual Report 2019

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Economic Contribution Report 2019

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Case Studies

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Sustainability Report 2019

Sustainability Report 2019

 
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People, health and safety

Protecting the health and wellbeing of our workforce is vital to our business.

Our highest priority is the health and safety of those impacted by our operations, including our employees and contractors, and the communities in which we operate.

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Our people

Our global workforce is the foundation of our business.

Supporting the wellbeing of our global workforce and promoting an inclusive and diverse culture are vital for maintaining a competitive advantage.

We are committed to empowering our people to find safer, more creative and more efficient ways of working. We continue to develop a culture based on trust and collaboration and give our people more say, new capabilities and tools, and new avenues for technology and innovation to support BHP’s transformation.

Sustainability Report

Health

Our goal is to protect the health and wellbeing of our workforce from potential occupational injury, now and into the future, through the setting of clear requirements for our operations.

Sustainability Report 2019

We set minimum mandatory controls to identify and manage health risks for our employees and contractors. Our workplace health risks include occupational exposures to noise, silica, diesel particulate matter (DPM), coal mine dust, musculoskeletal stressors and mental health impacts. The effectiveness of our health controls is regularly reviewed and subjected to periodic audit to verify the controls are implemented and operating as designed.

We continue to monitor emerging health issues and trends through our membership of industry and professional associations, informal benchmarking, networking and participation in national and international conferences. We also monitor information from scientific journals, occupational health regulatory setting and advisory agencies.

Fatigue management supports the wellbeing of our people, including their mental and physical health. We have reviewed our fatigue management strategy to identify areas that require further focus.

Safety

Our highest priority is the safety of our operations, including our employees and contractors and the communities in which we operate. We achieve nothing if we do not do it safely.

In FY2019, we established new requirements for engaging and managing contractors. The contractor safety requirements were rolled out across BHP and assurance programs have been established to monitor and verify the implementation of the requirements.

To strengthen our safety leadership and culture, we are educating our people about chronic unease, that is, being mindful of the possibility of what could go wrong, and creating a culture where it is safe to speak up and report hazards and incidents.

One of the objectives of our global Field Leadership Program is to strengthen the reporting culture. We monitor reporting culture across all our operations and we coach and support our leaders to improve the quality of our field leadership activities with our employees and contractors.

We also introduced a new event management system for recording health, safety, environmental and community events. The system is designed to capture, analyse and track events in real time and will be implemented in FY2020.

Sustainability Report 2019

“To meet our sustainability challenges and stay at the forefront of change, we must continue to invest in a workforce that is genuinely inclusive and diverse because our people will move us towards a more sustainable and successful future.”

Andrew Mackenzie, Chief Executive Officer
Andrew Mackenzie

Also see

Annual Report 2019

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Economic Contribution Report 2019

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Case Studies

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Sustainability Report 2019

Sustainability Report 2019

 
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Society

We are committed to developing and strengthening relationships with communities based on respect, honesty and trust.

Our collaborative approach to building meaningful and sustainable partnerships lays the foundation for social value and delivers a positive contribution to the quality of life and resilience of communities where we have a presence.

Working with communities

We believe we are successful when we work in partnership with communities to achieve long-term social, environmental and economic outcomes.

To support this, we must consider social value in our decision-making and work with communities where we have a presence. Social value is the sum of our contribution to society underpinned by respectful and mutually beneficial partnerships, and working collectively to prioritise social, environmental and economic outcomes. Through this approach, we can create opportunities and address challenges that we cannot solve alone.

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Sustainability Report 2019

Engaging with communities

At the centre of our stakeholder engagement approach is an understanding that healthy and sustainable relationships are built on open, honest and mutually respectful dialogue. Our Code of Conduct and the Our Requirements for Communications, Community and External Engagement standard govern our actions in making a positive contribution to communities where we have a presence and minimising adverse impacts where these cannot be avoided.

Read more on how we engage with communities

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Addressing social risks and impacts

Sustainability

We recognise our responsibility to contribute to and respect the health, safety and wellbeing of communities. BHP has a target of zero significant community events. Overseen by the Board’s Risk and Audit Committee, we identify, assess and manage significant community events using our global Risk Framework.

We are also conscious that we must facilitate and enable appropriate access to regular, open and honest dialogue, so that we understand the expectations, concerns and interests of stakeholders and incorporate these into our business plans. Aligned with the UN Guiding Principles on Business and Human Rights, all BHP assets are required to have local mechanisms in place to support engagement with the community, record complaints and grievances, and address these in a timely and culturally appropriate manner.

Read more about community concerns raised in FY2019

BHP Foundation

Many of the world’s most pressing social and environmental challenges need solutions at global and national levels. The BHP Foundation (Foundation), a US-based charitable organisation established and funded by BHP, has embarked on a bold and ambitious program to take on these issues and enhance the contribution the global resources sector can make to achieving many of the UN’s Sustainable Development Goals.

The Foundation has projects in 36 countries and works with more than 30 partner organisations that are leaders in their fields. Projects are selected based on their potential to forge new models for addressing complex issues and set new standards, and are designed to deliver measurable, effective and practical solutions for local impact. The Foundation also advocates on the global stage for the change it wants to see.

Learn more about the BHP Foundation

Sustainability

BHP Sustainable Communities

Sustainability

BHP Billiton Sustainable Communities (BSC), based in the United Kingdom, was established to partner with organisations to deliver large-scale, long-term social and environmental development projects. We continued to transition to a single BHP-funded charitable entity (the BHP Foundation) in FY2019, while BSC honoured its remaining project commitments.

Two of the three remaining BSC flagship programs were concluded during FY2019: the ANDA Project in Colombia and the ACDI/VOCA Project in Mozambique. The final program is due to be completed in FY2020, at which time BSC will commence winding up.

In FY2019, BSC provided US$764,590 to its sole remaining program, a five-year initiative with WaterAid©. This program works to improve the lives of thousands of people in Mozambique through access to equitable, inclusive and sustainable water, sanitation and hygiene services.

Supporting local economic growth

BHP proudly supports the growth of local businesses in the regions where we operate, through sourcing and promoting locally available products and services. Our assets develop local procurement plans that identify opportunities for local suppliers, including small businesses to deliver capacity building and employment creation initiatives. These initiatives are designed to be sustainable post BHP’s presence.

During FY2019, 14 per cent of our external expenditure was with local suppliers. An additional 82 per cent of our supply expenditure was located within the regions in which we operate. We contributed US$16 billion to more than 10,000 suppliers globally, of which US$2 billion supported local community suppliers where we operate. These figures remain comparable to previous years, although local spend was lower due to the sale of our Onshore US assets during FY2019.

Our expenditure with local suppliers in FY2019 was mostly in Trinidad and Tobago (57 per cent), the United States (31 per cent), Chile (14 per cent) and Australia (12 per cent). See the Regional community focus section for more information about our Local Buying Program in Australia.

Sustainability

Also see

Annual Report 2019

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Economic Contribution Report 2019

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Case Studies

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Sustainability Report 2019

Sustainability Report 2019

 
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Environmental stewardship

We focus on minimising and mitigating our impact on water, land, air quality and biodiversity, and working with stakeholders on effective solutions to complex environmental challenges.

Protecting the environment

Pressure on land and water resources is growing, amplified by climate change.

There is growing pressure on and competition for environmental resources, such as land, biodiversity, water and air and we acknowledge that the nature of our operations can have significant environmental impacts.

Climate change amplifies the sensitivities of our natural systems. Our operations and growth strategy depend on obtaining and maintaining the right to access these environmental resources.

The long-term health of our business depends on a sustainable natural environment. BHP’s approach to environmental stewardship is twofold – we aim to minimise the environmental impacts from our activities and work in partnership with others to contribute to a resilient environment.

Learn how we minimise our environmental impacts

Sustainability

Our environmental performance

Our progress against our five-year and longer term environmental targets for water and biodiversity, as well as other key environmental stewardship activities.

Sustainability
To achieve our environmental targets, we identify and implement on-ground improvement projects, investigate technologies to monitor and reduce potential environmental impacts, and collaborate with governments, communities and other industries to share information and promote collective action. While no significant environmental events occurred at any BHP operated assets in FY2019, activities are ongoing to address the significant environmental impacts of the tailings dam failure at our non-operated joint venture, Samarco, in November 2015.

Contributing to a resilient environment

We recognise that we have a broader role to play in contributing to environmental resilience. We achieve this through our Social Investment Framework and work with strategic partners and communities to invest in voluntary projects that contribute to the management of areas of national or international conservation significance.

Since 2011, we have committed more than US$75 million to biodiversity conservation through our alliance with Conservation International and other partners. We look for projects that can provide multiple benefits, improve water quality or quantity, nature-based solutions to climate change, local livelihoods or cultural benefits, as well as improve biodiversity conservation.

Our investments with Conservation International in the seven-year alliance, which started in 2011, included the Five Rivers Conservation Area in Tasmania, Australia; Valdivian Coastal Reserve in Chile; Alto Mayo in Peru; and the Kasigau Corridor in Kenya. Last year, we renewed our alliance, with the next phase of our partnership to focus on: financing natural solutions that address climate change and contribute to halting biodiversity loss; and developing the framework to support BHP’s efforts in evaluating and verifying the benefits of our actions on biodiversity – both operational and social investments.

With other partners, we progressed a number of environment-focused social investment programs in the last year. In the United States, our partnership with The Nature Conservancy in the Sustainable Rivers and Forests Initiative supports conservation and restoration in the Columbia Bottomlands region in Texas and five counties in Arkansas.

Sustainability

Also see

Annual Report 2019

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Economic Contribution Report 2019

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Case Studies

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Sustainability Report 2019

Sustainability Report 2019

 
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Climate change

Managing and minimising greenhouse gas emissions from our operations and from the use of our products.

We manage and minimise greenhouse gas emissions, build resilience of our portfolio to climate change risks, and work to build operational, community and ecosystem resilience to the physical impacts of climate change.

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Our climate change strategy

Reducing our operational greenhouse gas (GHG) emissions, investing in low emissions technologies, promoting product stewardship, managing climate-related risk and opportunity, and working with others to enhance the global policy and market response.

Climate change is a global challenge that requires collaboration. Resources companies such as BHP, our customers and governments must play their part to meet this challenge.

More information on each element of our strategy is available here

Yandi

Climate change is a priority governance issue

Responding to climate change is a priority governance and strategic issue for us. Our Board is actively engaged in the governance of climate change issues, supported by the Sustainability Committee. Management has primary responsibility for the design and implementation of our climate change strategy.

Reducing our operational emissions is a key performance indicator for our business and our performance against our targets (outlined below) is reflected in senior executive and leadership remuneration.

Western Australia Iron Ore

Operational emissions

As a major energy consumer, managing energy use, ensuring energy security and reducing GHG emissions at our operations are key components of our climate change strategy. We set targets in order to hold ourselves accountable for these goals and regularly review them as our strategy and circumstances change.

Sustainability

Operational emissions performance

Our combined Scope 1 and Scope 2 emissions (operational emissions) in FY2019 totalled 14.7 million tonnes of carbon dioxide equivalent (CO2-e), 3 per cent below our FY2017 target baseline(1). This decrease is primarily due to a change in the electricity emissions factor for Minerals Americas that resulted from the interconnection of Chile’s northern grid system, which is mainly fossil fuel-based, and southern grid system, which has a higher proportion of renewable energy.

Footnotes

(1) Calculated on a Continuing operations basis. The FY2017 baseline has been adjusted for the divestment of our Onshore US assets to ensure ongoing comparability of performance.
(a) Scope 1 and 2 emissions have been calculated on an operational control basis in accordance with the GHG Protocol Corporate Accounting and Reporting Standard. Comparisons of data over the period FY2015 to FY2016 should be made with consideration of the divestment of South32 during FY2015 (FY2015 data excludes emissions from South32 operations between the date of the divestment and 30 June 2015). Data over the period FY2017 to FY2019 is displayed with Onshore US emissions shown separately for comparability (12 months of emissions in FY2017 and FY2018, and four months of emissions  in FY2019 prior to divestment of this asset).
(b) Scope 1 refers to direct GHG emissions from operated assets.
(c) Scope 2 refers to indirect GHG emissions from the generation of purchased electricity and steam that is consumed by operated assets (calculated using the market-based method).
(d) FY2017 is the base year for our current five-year GHG emissions reduction target, which took effect from FY2018. The FY2017 baseline has been adjusted for the divestment of our Onshore US assets to ensure ongoing comparability of performance. The baseline will continue to be adjusted for any material acquisitions and divestments based on GHG emissions at the time of the transaction; carbon offsets will be used as required.

 

Promoting product stewardship

While reducing our operational emissions is vital, emissions from our value chain (Scope 3 emissions) are significantly higher than those from our own operations.

We work with our customers, suppliers and other value chain participants to seek to influence emissions reductions across the life cycle of our products. As we work to develop an integrated product stewardship strategy in FY2020 we intend to look to identify additional opportunities to work with others in our value chain to influence emissions reductions.

We also intend to set public goals related to Scope 3 emissions.

Hay Point coal terminal in Australia

Accelerating the development of carbon capture and storage

We are working in partnership with others across our value chain to accelerate the development of technologies with the potential to reduce emissions from the processing and use of our products.

Carbon capture and storage (CCS) is a key low emissions technology with the potential to play a pivotal role in reducing emissions from industrial processes, such as steel production, as well as emissions from the power sector and from oil and gas production.

While we recognise progress is required in developing policy frameworks to support the wider deployment of this technology, our CCS investments and partnerships focus on mechanisms to reduce costs and accelerate development timeframes. Our investments include activities aimed at knowledge sharing from commercial-scale projects, development of sectoral deployment road maps and funding for research and development at leading universities and research institutes.

For example, in March 2019 we committed to invest US$6 million in Carbon Engineering Ltd to progress the development of a ground-breaking technology to reduce carbon emissions by accelerating the development of Direct Air Capture, which removes CO2 from the atmosphere. For more information, read our press release.

Read more.


Contributing to the global response

Climate change is a global challenge that requires collaboration. We prioritise working with others to enhance the global policy and market response.

Promoting market mechanisms to reduce global emissions

In addition to measures to reduce our emissions, we support the development of market mechanisms that reduce global GHG emissions through projects that generate carbon credits.

Our climate change strategy includes a focus on reducing emissions from deforestation through support for REDD+, the United Nations program that aims to reduce emissions from deforestation and forest degradation. For example, in partnership with the International Finance Corporation (IFC) and Conservation International (CI) we developed a first-of-its-kind US$152 million Forests Bond, issued by the IFC in 2016. We provide a price-support mechanism for the bond, which supports the Kasigau Corridor REDD project in Kenya. During FY2019, we purchased additional carbon credits from the Kasigau Corridor project.

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Supporting the development of effective climate and energy policy

Industry has a key role to play in supporting policy development. We engage with governments and other stakeholders to contribute to the development of an effective, long-term policy framework that can deliver a measured transition to a lower carbon economy.

Managing risk and opportunity

We recognise the physical and non-physical impacts of climate change may affect our assets, productivity, the markets in which we sell our products and the communities in which we operate.

Risks related to the physical impacts of climate change include acute risks resulting from increased severity of extreme weather events and chronic risks resulting from longer-term changes in climate patterns. Non-physical risks arise from a variety of policy, regulatory, legal, technological and market responses to the challenges posed by climate change and the transition to a lower carbon economy.

A broader discussion of our climate-related risk factors and risk management approach is provided in our Annual Report 2019

Environment

Engagement and disclosure

Our climate change strategy is supported by active engagement with our stakeholders, including investors, policymakers and non-governmental organisations, and with peer companies where appropriate.

We periodically hold one-on-one and group meetings with investors and their advisers to explain our approach to climate change. In FY2019, our climate-related investor engagement included meetings held in Australia, the United Kingdom, the Netherlands and the United States.

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Climate-related financial disclosures

BHP was one of the first companies to align our disclosures with the recommendations of the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD). We believe the TCFD recommendations represent an important step towards establishing a widely accepted framework for climate-related financial risk disclosure and we have been a firm supporter of this work. Our Vice President of Sustainability and Climate Change, Dr Fiona Wild, is a member of the Task Force.

We are committed to continuing to work with the TCFD and our peers in the resources sector to support the wider adoption of the TCFD recommendations and the development of more effective disclosure practices within the sector.

For details of our TCFD-aligned disclosures on climate-related financial risk, refer to the Annual Report 2019.

Read more about our climate change strategy here

Also see

Annual Report 2019

Discover more

Economic Contribution Report 2019

Discover more

Case Studies

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Sustainability Report 2019

Sustainability Report 2019

 
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