BHP’s commitment to sustainability is defined by Our Charter and governed through the Our Requirements standards. These standards describe our mandatory minimum performance requirements and provide the foundation to develop and implement management systems at our operated assets. They are designed to help ensure we maintain and promote the long-term health of society and the natural environment in everything we do.
As a partner in the communities where we operate, we share stewardship of the environment, support local cultures and help drive economic development. We view our management of sustainability as core to our efforts to generate social value. To further ensure we consider social value in our business decision-making at every level of BHP, we are embedding requirements relating to social value into our annual business planning process for our operated assets.
Contributing to sustainable development
The United Nations Sustainable Development Goals (UNSDGs) aim to create a better, fairer and more sustainable world by 2030. The 17 SDGs address the global challenges society faces, including those related to poverty, inequality, climate change, conservation and economic growth. We can contribute to these broader goals through working in partnership with many different stakeholders, from global to local.
We recognise our business activities can create negative impacts and, therefore, sustainability must be integral to how we do business. The interconnectedness of the SDGs means that a positive contribution to one can have a multiplier effect, so we work to understand the linkages, manage and mitigate our impacts, and determine how we can make a positive contribution to those most relevant to our business and social value priorities.
We contribute towards the achievement of the SDGs through:
|Our work on inclusion and diversity. Refer to Inclusion and Diversity for more information on our approach and how we are tracking against our goal of achieving gender balance in our workforce by the end of CY2025. (SDGs5 and 8).||Our focus on water stewardship. Refer to our Water section for information on our approach to water management. (SDG 6).||Our work on marine and terrestrial biodiversity. Refer to our Biodiversity and Land section for information on our approach to biodiversity. (SDGs 14 and 15).|
|The taxes and royalties we pay to host governments, the direct and indirect employment opportunities we create and our supply chain. Refer to the Economic Contribution Report 2021 for more information. (SDG 8).||Our voluntary social investment. Refer to our Social Investment section for information on our social investment strategy and framework. (SDGs 3, 4 and11).||Our commitment to the Paris Agreement goals and action to reduce our operational emissions help to address emissions in our value chain, build resilience and enhance the global response to climate change. Refer to Value Chain Sustainability for information on our approach to value chain sustainability and Climate Change for our approach to climate change. (SDG 13).|
This approach allows us to work in partnerships with others to achieve mutually beneficial outcomes (SDG17).
Sustainability targets and performance
Through our public five-year sustainability targets we seek to improve our sustainability performance, transparency and accountability. To realise these targets, we embed sustainability performance measures in our business. For example, we have included Group-wide key performance indicators within the scorecards of our employees.
Our targets and longer term goals (also available in Spanish) help us achieve our intention to operate safely, manage water sustainably, reduce our adverse environmental impact, look after our people and contribute to improved quality of life and resilience in the communities where we operate.
These targets and goals were created in consultation with our people and key external stakeholders and were approved by the Board’s Sustainability Committee.
We believe achieving these targets and working towards our goals is fundamental to the success of our business and aligns with our commitments to the objectives of the Paris Agreement and the United Nations (UN) Sustainable Development Goals.
Our current five-year public sustainability targets conclude at the end of FY2022 and we have started working on the development of new targets. We have already set a climate change target to reduce operational greenhouse gas (GHG) emissions (Scope 1 and Scope 2 at our operated assets) by at least 30 per cent from FY2020 levels(1)
(1) FY2020 baseline will 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.
Our performance against our targets is mapped in the FY2021 sustainability performance table below.
Our FY2021 sustainability performance
Our material sustainability issues
Each year we identify the sustainability issues most material to our business and stakeholders. We also assess the economic, social, environmental and cultural impact of our activities.
We review a wide variety of internal and external sources, such as our Group Risks, issues raised at our Annual General Meetings and through industry associations, non-government organisations and media areas of focus, and BHP’s Our Requirements standards. We also consult with stakeholders, such as through the BHP Forum on Corporate Responsibility, via investor round tables and advisory groups and with internal and external stakeholders via surveys and focused discussions. Through these sources we aim to identify the issues of most concern to our stakeholders and critical to our business. The Board’s Sustainability Committee and the BHP Forum on Corporate Responsibility review our approach.
This assessment informs our sustainability strategies and helps to guide the depth of transparent coverage of key topics to be included in our Annual Report in line with the Global Reporting Initiative (GRI) Standards Reporting Principles.
The following material sustainability issues formed part of our materiality assessment in FY2021:
Of the issues listed above, the issues shown below were identified as the most material issues identified through our FY2021 materiality assessment. These issues are the areas of focus for our sustainability disclosures in our Annual Report 2021. Refer to the section reference in the below table for where our most material sustainability issues are covered in the Annual Report 2021.
We commit to several sustainability frameworks, standards and initiatives and disclose data according to their requirements. Our commitments inform and influence our sustainability approach.
Continuing the approach we adopted in FY2020, in FY2021 we further integrated our sustainability reporting into the Annual Report 2021 to enable more effective reporting for our stakeholders and to capture the most material financial and non-financial information in one report. Instead of a standalone Sustainability Report, we continue to disclose our most material sustainability issues in the Annual Report and our sustainability management approaches on our website. Our sustainability performance data is included in the Sustainability – Performance data section of our Annual Report 2021 and in our online ESG Standards and Databook. Our Annual Reporting suite also includes our Modern Slavery Statement 2021 prepared in accordance with UK and Australian requirements and our Economic Contribution Report 2021. In FY2020, we also released our Climate Change Report, which presents BHP’s disclosures on climate change and has been developed in alignment with the recommendations of the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD). In FY2021, we published our Climate Transition Action Plan 2021, which covers the focus areas of the Climate Action 100+ Net-Zero Company Benchmark.
There is a growing number of sustainability standards we commit to voluntarily or as part of our memberships. In FY2021, we completed a number of self-assessments across different operated assets for the International Council on Mining and Metals Mining Principles and associated performance expectations. In October 2020, we signed letters of commitment to the CopperMark assurance process for our copper producing assets (Olympic Dam, Escondida and Spence) and completed self-assessments as part of this commitment.
Our sustainability disclosures are consistent with the principles, position statements and requirements of the following disclosure frameworks, standards and initiatives. Our response to them is below:
The Global Reporting Initiative (GRI) Standards are the first global standards for sustainability reporting. They feature a modular, interrelated structure, and represent the global best practice for reporting on a range of economic, environmental and social impacts.
Our sustainability disclosures, including our Annual Report and online content, have been prepared in accordance with the GRI Standards comprehensive-level option.
The Sustainability Accounting Standards Board (SASB) standards enable businesses around the world to identify and manage financially material sustainability risks (both threats and opportunities), and communicate them to investors.
Since FY2020, we have aligned our sustainability disclosures with the SASB Metals & Mining Standard.
The International Council on Mining and Metals (ICMM) is an international organisation dedicated to a safe, fair and sustainable mining and metals industry. Every ICMM company member adheres to ICMM’s Mining Principles.
In FY2020, we have aligned our sustainability disclosures with the new ICMM Performance Expectations and confirmed our commitment to the ICMM 10 Principles.
In FY2021, we completed a number of self-assessments across different operated assets for the ICMM Mining Principles and associated performance expectations.
Our water related Performance Data is disclosed by operated asset in accordance with the ICMM Standard: A Practical Guide to Consistent Water Reporting.
The Task Force on Climate-related Financial Disclosures (TCFD) recommendations are designed to solicit consistent, decision-useful, forward-looking information on the material financial impacts of climate-related threats and opportunities, including those related to the global transition to a low-carbon economy.
The UN Global Compact (UNGC) provides a universal language for corporate responsibility and provides a framework to guide all businesses regardless of size, complexity or location.
As signatories to the Ten Principles of the United Nations Global Compact (UNGC), our sustainability disclosures serve as our UNGC Communication on Progress on implementation of the principles and support for the UNGC’s broader development objectives.
The CEO Water Mandate is a UN Global Compact initiative that mobilises business leaders on water, sanitation, and the Sustainable Development Goals.
BHP is a CEO Water Mandate endorsing company for demonstrating its ongoing commitment to the initiative and its six commitment areas. Since 2019, BHP has included a description of action and investments undertaken in relation to the CEO Water Mandate in its annual Communication on Progress, available at this link.
The 2030 Agenda for Sustainable Development, adopted by all United Nations Member States in 2015, provides a shared blueprint for peace and prosperity for people and the planet, now and into the future. At its heart are the 17 Sustainable Development Goals (SDGs), which are an urgent call for action by all countries - developed and developing - in a global partnership.
Refer to our GRI Index to understand how we contribute towards the achievement of the SDGs.
The Extractive Industries Transparency Initiative is the global standard to promote the open and accountable management of oil, gas and mineral resources.
BHP has been a supporter of the Extractive Industries Transparency Initiative (EITI) since its inception in 2002.
CDP is a not-for-profit charity that runs the global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts.
BHP achieved a place on the CDP Climate Change A List in 2018 and a grade of 'A-' in 2019 and 'B' in 2020.
2021 CDP Submission - not graded
2020 CDP Submission - not graded
The Paris Agreement sets out a global framework to avoid dangerous climate change by limiting global warming to well below 2°C and pursuing efforts to limit it to 1.5°C. It also aims to strengthen countries’ ability to deal with the impacts of climate change and support them in their efforts.
The Paris Agreement is a landmark global climate change agreement, adopted at the Paris climate conference (COP21) in December 2015.
The Voluntary Principles Initiative (VPI) was created to promote implementation of the Principles. BHP is a member of the Initiative since 2004.
The Voluntary Principles on Security and Human Rights are an internationally recognised set of principles that guide companies on how to conduct their security operations while ensuring respect for human rights.
We are committed to respecting internationally recognised human rights as set out in the Voluntary Principles on Security and Human Rights
UN Guiding Principles on Business an Human Rights
The UN Guiding Principles on Business and Human Rights are a set of guidelines for States and companies to prevent, address and remedy human rights abuses or adverse impacts in business operations.
We are committed to operating in a manner consistent with the UN Guiding Principles on Business and Human Rights.
As a global company, we interact with a range of stakeholders. Our methods, frequency of engaging with and approach to listening to stakeholders are diverse and we use a range of formal and informal communication and engagement channels to understand the views of our stakeholders:
- Globally, we communicate and engage with external stakeholders via our Annual General Meetings, Group publications (including the Annual Report and other topic-specific reports), our website and our social media platforms, releases to the market and media, brand campaigns, analyst briefings, speeches and interviews with senior executives and investor round tables.
- At a regional and local level, each operated asset is required to plan, implement and document stakeholder engagement activities. This includes engagement via community forums, newsletters, reports, community perception surveys and consultation groups, implementing community complaint and grievance mechanisms, representation on specific industry association committees and initiatives, and engagement to develop social and environmental programs. We also engage on sustainability issues with a broader range of stakeholders, including local governments, non-government organisations (NGOs), schools and universities and others.
- Within our business, we engage with our people (employees and contractors) via tailored internal channels. These channels include our intranet, email and newsletters, town hall meetings and by inviting feedback and comment through Engagement and Perception Surveys. Key internal announcements and videos are made available in English and Spanish.
The following table provides an overview of our stakeholder groups, their range of interests and how we engage with them.
Sustainability governanceBHP’s Board oversees our sustainability approach. The Board’s Sustainability Committee has oversight of health, safety, environmental and community (HSEC) matters and assists the Board with governance and monitoring. Members of the Sustainability Committee are Non-executive Directors determined by the Board to have appropriate skills in HSEC matters.
The Sustainability Committee also oversees the adequacy of the systems and processes designed to identify and manage HSEC-related risks and overall HSEC, including human rights performance.
The Sustainability Committee guides the Remuneration Committee in setting HSEC-related scorecard targets and evaluating performance against those targets.
In addition, the Board’s Risk and Audit Committee assists the Board in overseeing the Group’s risk management systems.
BHP also seeks advice from external experts and forums on issues relating to sustainability as inputs into our policy development and decision-making processes. The BHP Forum on Corporate Responsibility is a key part of our governance approach and stakeholder engagement program. The Forum comprises independent civil society leaders in various fields of sustainability, who make an important contribution to our approach over a range of social and environmental issues and the development of our policies, strategies and standards. They provide insight into current and emerging issues, challenge our thinking and allow us to understand and consider the broader impacts of our actions.
How we manage sustainability risks
Under our Group-wide Risk Framework, our aim is to identify all risks (both threats and opportunities) associated with our business, including risks and potential impacts that relate to sustainability issues. This enables us to prioritise and manage the risks that matter most.
We classify all risks to which BHP is exposed using our Group Risk Architecture. This is a tool to identify, analyse, monitor and report risk, which provides a platform to understand and manage risks. Similar risks are considered together in categories, such as ‘People and Culture’, ‘Health and Safety’ and ‘Environment, Climate Change and Community’. Each category is then further comprised of groups of risks, which include ‘Occupational Safety’, ‘Human Rights’, ‘Climate Change ’ and other sustainability risks. This gives the Board and management visibility over the aggregate exposure to risks – including sustainability risks – on a Group-wide basis and supports performance monitoring and reporting against BHP’s risk appetite.
When we assess the materiality of a current risk, our Risk Framework requires us to consider all potential impacts, including to health and safety, the environment, communities, human rights and social value. This is designed to support the consideration of all potential impacts in risk assessments and means potential sustainability impacts are required to be considered in the context of all identified risks.
Risk management is embedded into work processes and critical business systems to help us develop a risk-informed approach to sustainability.
We set workplace health, safety, environment and community standards for our operated assets and work to enforce their application. Contractors working at our operated assets must comply with our standards and requirements, and we seek to ensure our suppliers, agents and service providers maintain business practices and workplace standards comparable to our own.
Our Internal Audit and Advisory team is responsible for providing independent and objective assurance over the control environment (governance, risk management and internal controls) to the Board and Executive Leadership Team.
Third-party assurance providers visit selected operated assets and evaluate our sustainability approach to ensure we accurately represent our commitments and actions.
We provide a broader discussion of our approach to risk management in our Annual Report.
Value Chain Sustainability
BHP made payments to more than 9,000 suppliers in FY2020, including those in our local communities, and is one of the world’s largest bulk vessel charterers.