KENNETH FINLAY MEMORIAL LECTURE Leadership in safety – 18th September 2014

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DEFINING LEADERSHIP

“Leadership is the art of accomplishing more than the science of management says is possible.”

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DESERT STORM

Restructured the leadership and management model.

Focused on innovation and providing the tools necessary to deliver success.

Success was clearly defined in terms of strategic objectives and people……and most came home!!!

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A VISION FOR GLOBAL SAFETY AND SECURITY

“Imagine global security driven by collaboration — among agencies, government, the private sector and the public.” Admiral James Stavridis That's not just the distant hope of open-source fans, it's the vision of James Stavridis, a US Navy Admiral. Stavridis explains why security of the future should be built with bridges rather than walls.

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THE DIVERSIFIED MINER…

How we will win We will maintain a highly competitive mind-set, with innovation and outstanding delivery at the forefront of how we drive change. We will: • Develop resource and asset potential • Innovate with speed of implementation • Market products for full value • Rigorous capital allocation • Maintain external orientation • Leverage stakeholder relationships • Remove or manage unnecessary complexity

Critical core skills Delivery of our Ambition will be founded upon the development of critical core skills to ensure we improve our returns. We will: • Leverage exploration and technical expertise • Rapidly deploy innovation and best operating practices • Link technical to marketing value • Build on government, community and social

stakeholder relationships

Our ambition - what we want to achieve by when

The key elements of our strategy

What we must do to achieve our ambition

The KPIs we will use to measure our success

To double our 2014 operating profit by 2020

Where we will compete We will focus time and capital on a core of mining assets with material long-term value-creation potential. We will: • Embrace a diversified portfolio approach

- Participate across a range of commodities and regions

- Focus on positions where we can deliver consistent margins

- Have an upstream operational focus • Have a clear focus on achieving full potential with our

Priority 1 assets • Recognise and nurture Priority 2 asset potential

Portfolio Performance

Deliver Driving Value Focus the portfolio Develop core business processes

Create a high performance culture

HEALTH & SAFETY ENVIRONMENT SOCIO-ECONOMIC PEOPLE PRODUCTION COSTS FINANCIAL

RETURNS

People

Our core values guide our actions as we drive towards our ambition Integrity Accountability Safety Care and respect Collaboration Innovation

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THE DIVERSIFIED MINER… We have designed our work processes…

Set Operating

Master Schedule

Set Production Strategy

Set Service Strategy

Set Performance

Targets

Set Business

Expectations

Modify or Adapt the Business

Approve Work/Cost

Commitments Plan Work Schedule

Work Execute

Work Process

Performance

Measure Social

Process Performance

Measure Work

Management Performance

Measure Process

Performance

Analyse and Improve

Resourcing

Labour, Materials & Equipment

Operational Planning

Work Management

Feedback

Set Expenditure

Schedule

…to connect people with work through to accountabilities.

Results

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ORGANISATION MODEL – IT’S ABOUT PEOPLE…

“You can take my factories, burn up my buildings, but give me my people and I’ll build the business right back again.” Henry Ford

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ORGANISATION MODEL – CLARITY AROUND WORK

Moving Anglo American to the next level Purpose of the roles in the future

VII

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Before

To-Be

CEO

GMC

L3

III-I III-I

Shaping the global mining industry to the needs of society and developing strategies that will lead the organization to be successful in this new landscape (+20 years). Supports the shaping of the global entity while leading the strategy development across connected Business Units so the whole is greater than the sum of the parts (+10 years). Developing Group Function and Business Unit strategies and programs within context and with resources allocated from the centre, driving “practical change” (+5 years). Asset leaders (General Managers) or functional specialists that implement systems provided by Business Unit leaders to deliver target business outcomes (up to 5 years).

Schematic

Facility leaders (Production Manager) and support function that is responsible for planning and delivering targets within a given set of resource and practice constraints (1-2 years).

…“lifting” performance requires the Executive to understand the nature of work.

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ANGLO AMERICAN - A REPORT CARD…

Fatalities

Focus on achieving zero harm…

Safety

• Incident rate in H1 is best ever recorded for AA and last 12 months is also our best recorded performance

• The total recordable case frequency rate (TFCFR), at 0.74, continues to improve on record levels reported at the end of 2013

Health • The focus in health continues to be on

eliminating noise and respirable hazards at source and HIV/TB wellness programme participation

…is touching all areas of the business.

148 10 8 9

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77

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3

13

2014 2013 2012

15

2011

17

2010

15

2009

20 H2 H1

0.741.08

2.01

1.441.81

2009 2010 2011 2012 2013 2014

1.29

TRCFR(1)

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A FINAL MESSAGE Leadership is about authenticity and passion…

…And Justice For All. …and living your commitment to people.

If you don’t care people will not follow you.

If you are not prepared to be innovative you will

not achieve all possibilities.

If you do not have the courage you will not break

down the real barriers to change…in yourself.

THANK YOU