CEO Message
– David Pathe, President and Chief Executive Officer
Our corporate purpose is to be a low-cost nickel producer that creates sustainable prosperity for all stakeholders. Fulfilling this promise increasingly requires that we take environmental, social and governance considerations into account when developing and implementing our strategies.
Indeed, in 2019 the trend towards increased scrutiny on mining companies and mining practices continued following a horrific tailings dam incident and a request initiated by the Church of England Pensions Board for increased levels of disclosure from our industry.
Given our liquidity constraints, the ongoing volatility of prices for the commodities we produce and the unique geopolitical challenges we increasingly face, ensuring that we remain committed to sustainable mining, diversity and inclusion, and the environment requires a delicate balance.
Against this backdrop, our efforts in 2019 were encouraging, particularly for a company of our size and breadth of operations. Building on this performance will be key – and critical – to our long-term success.
2019 Performance
Our commitment to employee health and safety was reflected in a number of key metrics. Most notably, our safety performance continued to be peer-leading over a three-year period. During this time, we reduced our Lost Time Incident Frequency Rate (LTIFR) by 76%.
In 2019, Sherritt’s LTIFR decreased to 0.07, while its Total Recordable Incident Frequency Rate (TRIFR) increased to 0.47 per 200,000 work hours. The rise in TRIFR was due primarily to an increase in hand-related injuries. In response, we implemented new standards, launched safety campaigns and took steps to improve safety systems. Our experience in 2019 reminds us that we cannot rest on the progress we have made in recent years and that promoting employee health and safety is, in fact, a never-ending journey.
Similarly, our commitment to the environment was also reflected in a number of key metrics. Chief among them, we experienced zero high-severity environmental incidents in 2019. Additionally, we maintained Scope 1 greenhouse gas emissions at levels comparable to 2018, despite the 8% increase in finished nickel production and 4% increase in finished cobalt production at the Moa Joint Venture.
As a result of our community investments, taxes and royalties, local procurement and wages, we contributed more than $500 million in economic benefits to host communities and countries in 2019. This support was matched by the more than 9,000 hours that Sherritt and joint venture employees volunteered towards the betterment of the local communities in which we operate.
In 2017, Sherritt announced its commitment to a more diverse and inclusive (D&I) workforce and company culture. In 2019, we formally launched our D&I Framework, which will serve as our roadmap to increase diversity and inclusion over the next five years. This commitment to increased diversity is being backed by our goal to double the number of women employees at Sherritt from 18% of our total workforce to 36% by 2030. Our current workforce and target reflect the challenges that our industry has in attracting women. Overcoming this challenge will be key. In addition, we have recently initiated a review of our D&I strategy to ensure that Sherritt is more broadly diverse and inclusive across the organization.
This year, we have elected to produce a Tailings Report, in response to the disclosure request of the Investor Mining & Tailings Safety Initiative, the Church of England Pensions Board and the Swedish Council on Ethics of the AP Funds, which was sent to 660 mining companies globally.
Today and Looking Ahead
As I write this, Sherritt is focused on two key developments.
The first centres on completing a balance sheet initiative that is aimed at addressing our liquidity constraints, pending debt maturities and the debt levels that are our Ambatovy investment legacy. Completion of this initiative is critical to our future success and our ability to maintain our commitment to sustainability.
The second centres on preventing the spread of the COVID-19 pandemic at our operations. As a result of increased employee health and safety measures that we implemented at our facilities, the impact of COVID-19 on our operations has been minimal to date.
Looking ahead more broadly, the implementation of Towards Sustainable Mining (TSM) at our operations will continue to be a focus in 2020 and beyond, particularly at the Moa Nickel Site.
We will also continue to implement our five-year enterprise-wide sustainability goals, which include the implementation of our diversity and inclusion plans as already noted.
Our journey to zero harm is also ongoing. The safety of our employees, contractors and communities in which we operate is of the utmost importance. We believe that zero harm can be achieved through our commitment to building a stronger safety culture and implementing best-practice standards. We will continue to strive for zero harm and to improve and build upon our 2019 performance and progress.
Understanding the impact of climate change on our operations will also be an area of focus. This will be a longer-term initiative, requiring careful consideration, but is critical given how climate change is dramatically affecting our planet.
David V. Pathe
President and Chief Executive Officer
Sherritt International Corporation
For commentary from David Pathe on Sherritt’s 2019 financial and operational performance, please read his annual letter to shareholders.
Our 2019 Sustainability Report – which covers the period between January 1 and December 31, 2019 – describes Sherritt’s sustainability approach and performance for the year. This report was prepared in accordance with the Global Reporting Initiative’s Standards (Core option). As required by GRI, Sherritt has notified GRI of the use of the standards and made it aware of the publication of this report.