Structure And Responsibilities

Our approach to sustainable development is characterised by the following key features:

The Sustainability Committee of the Board oversees health, safety, environment and community (HSEC) matters across the Group.
Business line management having responsibility and accountability for HSEC performance.
The HSEC function provides advice and guidance directly, as well as through a series of networks across the business.
Seeking input and insight from external experts through our Forum on Corporate Responsibility.
Clear links exist between remuneration and HSEC performance.

Sustainable Development Organisational Structure

At BHP Billiton, we believe there is a link between high-quality governance and business performance. The diagram below illustrates our organisational structure as it relates to sustainable development. This structure provides the mechanism for employees and contractors to provide feedback and proposals to our highest governance body, the BHP Billiton Board.

BHP Billiton Board

The role of the BHP Billiton Board is to represent the shareholders and to promote and protect the interests of the Company. It does so by governing the Group. The Board is appointed by the shareholders.

The Board will always have a majority of Directors who are non-executive and are judged by the Board to be independent on the basis that they demonstrate objective, unfettered and independent judgment and are free of material relationships with the Group and other entities and people that might influence such judgment.

The qualities for Directors of the Group are: unquestioned honesty and integrity; a proven track record of creating value for shareholders; time available to undertake the responsibilities; an ability to apply strategic thought to matters in issue; a preparedness to question, challenge and critique; and a willingness to understand and commit to the highest standards of governance for the Group.

The Board (with the assistance of the Nominations Committee) reviews the skills represented by Directors to ensure that the Board continues to have an appropriate composition and skills mix to achieve the Corporate Objective.

Sustainability Committee of the Board

The Company's peak sustainable development governance body is the Sustainability Committee, a subcommittee of the Board.

The role of the Sustainability Committee is to assist the Board in its oversight of:

HSEC risks.
The Group's compliance with applicable legal and regulatory requirements associated with HSEC matters.
The Group's performance in relation to HSEC matters.
The performance and leadership of the health, safety and environment function and the sustainable development function.
The Annual Sustainability Summary Report (PDF, 1.2MB).
The preparation of a report by the Committee for the Annual Report.

The Sustainability Committee of the Board meets as frequently as required, but not less than three times a year.

In addition to being skilled in health, safety, environment and community matters, members of the Sustainability Committee of the Board are required to participate in training and development activities to ensure they keep abreast of current thinking and leading practices in the core areas where the Committee focuses its work.

Forum on Corporate Responsibility

While not a governance body, the Forum on Corporate Responsibility brings together representatives of our senior management team, the leaders of several key non-government organisations and community opinion leaders to discuss and debate social and environmental matters relevant to the Company.

Forum members have an opportunity to provide advice and to challenge the views of our senior management on broad sustainable development issues of mutual interest. The Company is not bound by the advice of the Forum, and the Forum does not necessarily endorse the Company’s decisions. The Forum provides a means for direct and open dialogue about issues of interest to the wider community.

The Forum meets twice a year and is chaired by Marius Kloppers, BHP Billiton Chief Executive Officer.

Risk and Audit Committee of the Board

The purpose of the Risk and Audit Committee (RAC) is to assist the Board to fulfill its corporate governance and oversight responsibilities in relation to financial reporting, internal control structure, risk management systems and the internal and external audit functions. As required, the Sustainability Committee of the Board reports on Company HSEC risks to the RAC to assist it in its role of overseeing the management of Group risk. When considering risks, the RAC may request the Sustainability Committee to report back to it on a particular HSEC risk.

Global Ethics Panel

The Global Ethics Panel (GEP) assists the Chief Executive Officer (CEO) to meet the requirement in the Board Governance Document relating to the ethics and culture of the Group. The CEO is required to ensure that the culture of the Group does not develop in a way that condones dishonest conduct or lack of integrity, respect or dignity in relationships among those involved in or affected by the Group's activities.

The GEP promotes the effective implementation of our business conduct systems through the Code of Business Conduct and provides oversight of related communication activities and assurance processes. It also oversees the process for handling breaches of business conduct, assists business and functional leaders in assessing acceptable outcomes in cases where adjudication is required, and monitors and reports on emerging policy issues and compliance with the Code. Its role is formalised in the Global Ethics Panel Charter.

The GEP is chaired by Chief People Officer Karen Wood and includes internal and external representatives with knowledge and experience in contemporary aspects of ethics and culture relevant to the Group.

Executive Management

As specified in the Board Governance Document, our CEO holds delegated authority from the Board to achieve the Corporate Objective, save for those matters the Board has retained for its own decision-making. The Board Governance Document requires that we consider all risk factors that could affect the Group. In doing so, it specifies that the CEO will not allow decisions or actions to be taken without assessing their health, safety, and environmental consequences and the impact on the achievement of the Corporate Objective.

The CEO uses an Approvals Framework to delegate authority to committees and individual members of management. Notwithstanding those further delegations, the CEO remains accountable to the Board for the authority delegated to him.

The CEO has established the Group Management Committee to assist him in exercising his authority. He also draws on the work of other committees including the:

Group Management Committee – assists the CEO to increase the value of our business by achieving agreed operational outcomes.
Financial Risk Management Committee (FRMC) – monitors the Group’s financial risk management policies and exposures and approves financial transactions within the scope of its authority.
Investment Review Committee (IRC) – oversees the management approval processes for major investments, which are designed to ensure that investments are aligned to the Group’s agreed strategies and values, risks are identified and evaluated, investments are fully optimised to produce the maximum shareholder value within an acceptable risk framework, and appropriate risk management strategies are pursued.

Corporate HSEC

While the majority of HSEC staff are embedded in the CSGs, core HSEC governance functions are provided within the Corporate Centre.

A critical component of the HSEC governance function provided by Corporate is the HSEC audit program. This is specifically designed to ensure all operations within the Group work within the requirements of our Charter, Sustainable Development Policy and HSEC Management Standards.

HSEC Leadership Team

The HSEC Leadership Team is the peak functional group and includes Corporate representatives and HSEC functional heads from each CSG. The Team is chaired by the Vice President Health, Safety, Environment and Sustainability and sets the direction for the HSEC function, identifies priority issues, measures HSEC performance and provides input to the HSEC Functional Business Plans.