Our commitment to sustainability

Mining and energy companies use a range of terms to describe their approaches to:

  • Ensuring the safety and health of their employees and communities;
  • Protecting the environment;
  • Interacting with a wide range of stakeholders;
  • Providing benefits to local communities;
  • Respecting human rights;
  • Responsible production and supply;
  • Establishing respectful and productive relationships with all levels of government;
  • Good governance and assurance; and
  • Ensuring a long-term viable business.

At Sherritt, “sustainability” and “environmental, social, and governance (ESG)” cover these interrelated and increasingly important aspects of our business.

We are committed to providing a safe and rewarding workplace, operating ethically, demonstrating environmental responsibility, engaging stakeholders and benefitting communities. We will meet or exceed the standards where we operate and continuously improve performance.

This commitment underpins our aspiration to be a recognized industry leader in sustainability management and performance.

To access our Human Rights Policy, click here; and for our Environment, Health, Safety and Sustainability (EHS&S) Policy, click here.

Photo of a family

Governance

Sherritt has an independent chairperson, and three sub-committees to support the Board of Directors (the Board) with respect to environmental, social and governance (ESG) matters: the Audit Committee, the Human Resources Committee, and the Environment, Health, Safety and Sustainability (EHS&S) Committee.

Our Board of Directors has delegated responsibility for sustainability-related matters to its EHS&S Committee. The Committee’s mandate is to oversee, monitor and review sustainability policies, management systems, programs and performance.

This committee meets at least four times per year, visits our operating sites (physically, or when not so permitted, virtually), and receives information from corporate and divisional management on a quarterly basis, and more often when required. The committee chairperson reports to the Board on significant issues. Refer to this link to review the full mandate of the EHS&S Committee.

EHS&S oversight is included within the respective board and executive mandates of the joint ventures that Sherritt is involved in. There are dedicated environment, health and safety committees at the board level for the Moa Joint Venture, and experienced Sherritt executives serve on these committees. At Energas, EHS&S matters are reviewed by the Board, which includes directors from Sherritt’s senior management team. In 2021, changes to the committee structures have been approved by the Board to consolidate several committees, and more clearly include review of ESG and EHS&S matters.

Corporate accountability for oversight of the Sustainability Framework is the responsibility of an executive officer, the Chief Operating Officer (COO). Reporting to the COO, the Director, EHS&S implements governance and assurance measures, recommends strategy and standards, and oversees performance and reporting. The COO works closely with the management teams at all divisions and joint venture operations to ensure that business plans are aligned with the corporate strategic plans, to ensure compliance with local laws and conformance with company standards and to ensure that a continually improving approach to EHS&S is in place across our locations. Each division is led by a senior executive who reports to the COO. These individuals are accountable for all operational matters at their respective operating sites, including sustainability. At Sherritt, everyone has some accountability for safety and sustainability.

Additional information on Sherritt’s governance and financial performance can be found in the Management Information Circular (MIC), which is published yearly along with the Annual Financial Report and the Annual Information Form (AIF). These, along with other related documents, are publicly available on SEDAR (see Sherritt’s company profile) and in the Investor Relations section on Sherritt’s website.

For detailed information on the role of the Board of Directors, as well as on the board committees, compensation, expectations, directors’ composition and background, and other related information, please see Sherritt’s 2021 Management Information Circular.

Chart of Sherritt’s Board of Directors

 

BOARD GENDER DIVERSITY
Male 71%
Female 29%*
*Compared to a mining industry average of 16% female directors, per Osler’s 2020 Report on Diversity Disclosure Practices – Diversity and leadership at Canadian public companies.

Our Organizational Structure

Moa Joint Venture and Fort Site

Sherritt has a 50/50 partnership with General Nickel Company S.A. (GNC) of Cuba (the Moa Joint Venture). In addition, Sherritt has a wholly owned fertilizer business, sulphuric acid, utilities and storage, and administrative facilities in Fort Saskatchewan, Alberta, Canada (Fort Site) that provide additional sources of income.

The Moa Joint Venture is a vertically integrated nickel and cobalt mining, processing, refining and marketing joint venture between subsidiaries of Sherritt and GNC, a Cuban company. The operations of the Moa Joint Venture are carried on through three companies:

  • Moa Nickel S.A. (Moa Nickel) – owns and operates the mining and processing facility in Moa, Cuba;
  • The Cobalt Refinery Company Inc. (CRC or COREFCO) – owns and operates the metals refinery in Fort Saskatchewan, Alberta; and
  • International Cobalt Company Inc. (ICCI) – acquires mixed sulphides from Moa Nickel and other third-party feeds, contracts with CRC for the refining of such purchased materials, and then markets the finished nickel and cobalt; located in Nassau, Bahamas.

The Moa Joint Venture operates in Moa, Cuba, and Fort Saskatchewan, Canada. Within the report, the operations in Moa will be referred to as “Moa Nickel” and the operations in Fort Saskatchewan will be referred to as “COREFCO”. On occasion, information is aggregated for COREFCO and the Fort Site due to co-location; where this is done, the term “Fort Site” will be used, although these are distinct legal entities.

The Moa Joint Venture mines, processes and refines nickel and cobalt for sale worldwide (except in the United States).

Oil & Gas

Sherritt’s Oil & Gas Division (100% ownership) explores for and produces oil and gas primarily from reservoirs located offshore, but in close proximity to the coastline along the north coast of Cuba.

Power

Sherritt holds a one-third interest in Energas S.A. (Energas), a Cuban joint venture corporation established to operate facilities for the processing of raw natural gas and the generation of electricity for sale and delivery to the Cuban national electrical grid system.

The remaining two-thirds interest in Energas is held equally by two Cuban government agencies: Unión Eléctrica (UNE) and Unión Cubapetróleo (CUPET).

Within the report, the Oil & Gas operations will be referred to as “Oil & Gas” and the Power operations will be referred to as “Energas”. On occasion, information is aggregated for both Oil & Gas and Energas due to a common management structure; where this is done, “OGP” (Oil, Gas & Power) will be used.

Technologies

Sherritt’s Technologies group (Technologies) provides technical support, process optimization and technology development services to the Moa Joint Venture and Fort Site operations and identifies opportunities for the Corporation to commercialize its research and development for natural resource–based industries. Technologies has a particular focus on making next generation lateritic ore mining more economically viable and more sustainable and on the hydrometallurgical recovery of non-ferrous metals.

A more detailed overview of our business and corporate structure can be found in our 2020 Annual Information Form.

Sustainability Framework

We uphold our commitment to sustainability through our Sustainability Framework, which provides a focused and practical approach to addressing material sustainability issues, risks and opportunities, and to managing performance. The framework consists of an overall core commitment and a series of issue-specific commitments, which fall under the four pillars of our framework: Providing a Safe and Rewarding Workplace; Operating Ethically; Demonstrating Environmental Responsibility; and Engaging Stakeholders and Benefitting Communities. Our commitments are supported by an integrated management system that sets company-wide standards for planning, implementation, measurement, reporting and assurance of sustainability efforts.

Providing a safe and rewarding workplace

Health and safety We are committed to providing a safe workplace. Our ultimate goal is zero harm. Zero harm means zero fatalities, no injuries and no work-related illnesses among employees and contractors.

Public Safety Maintain public safety around our sites through risk management, active communication and ongoing community engagement.

Site Security Safeguard our people, assets, reputation and the environment while respecting the rights of the public.

Employee Relations Provide a rewarding and inclusive workplace that engages and develops a diverse workforce, compensates workers competitively, supports talent development, and offers employees exposure to world-class operations, projects, processes and people.

Operating Ethically

Responsible Production and Supply Extract and produce minerals that meet our stakeholders’ environmental, social and governance expectations.

Human Rights Operate our business in a way that respects human rights as set forth in the Universal Declaration of Human Rights.

Business Conduct Foster a culture and environment that require and support ethical conduct.

Demonstrating Environmental Responsibility

Tailings Management Design and operate tailings management facilities – throughout the mine life cycle – to meet or exceed applicable regulatory and company standards.

Biodiversity and Land Achieve no net loss, and preferably a net gain, of biodiversity for greenfield projects and significant expansions of current operations; and practise progressive reclamation as part of normal operations at all mines, working with local jurisdictions.

Water Manage water responsibly by optimizing water use, addressing water-related risks to future operational viability and growth, and engaging communities on the use of, and impacts to, shared water resources.

Waste Monitor and track mining waste and solid waste production at each site. Manage waste responsibly by optimizing and reducing waste production while following proper classification, handling, disposal and storage requirements.

Energy and Climate Change Monitor and track energy use and greenhouse gas emissions at each site and identify opportunities to reduce impacts; and understand and mitigate the potential impacts of climate change on our assets.

Environmental Liabilities, Closure and Reclamation Provide adequate financial resources and comply with regulatory requirements to address the closure of our properties once operations are complete.

Engaging Stakeholders and Benefitting Communities

Stakeholder Engagement Engage stakeholders early on and throughout the asset life cycle; and build relationships based on mutual trust, respect and transparency.

Community Development Contribute to a lasting improvement in quality of life in the communities where we operate.

Management Systems

Sherritt takes an enterprise-wide approach to managing sustainability, which includes an integrated system with a series of sustainability standards. Given the differences between the operating environments in Canada and Cuba, the divisions have some flexibility in the way they implement these standards at their operating sites.

Specific requirements in the standards reflect our experience, our risk profile and industry best practice.

Mining Association of Canada logo As members of the Mining Association of Canada (MAC), we are implementing the requirements of the Towards Sustainable Mining (TSM) protocols.
Voluntary Principles on Security and Human Rights logo As a member of the Voluntary Principles on Security and Human Rights (VPSHRs) Initiative, we are working to apply the Principles at our operating sites.
Incident Command System logo Our approach to crisis management is further informed by the Incident Command System (ICS).

Towards Sustainable Mining

Sherritt is a member of the Mining Association of Canada and, as such, is committed to implementing the TSM program – a series of sustainability management protocols – at its Canadian operations. As Sherritt is committed to leadership in sustainability and continuous improvement, the company plans to implement relevant protocols of TSM at all divisions and to target Level A conformance.

The first year of public, facility-level reporting for Sherritt will be in 2021 for the 2020 reporting year. An external TSM verification assessment took place at Sherritt’s Fort Site in early 2021. The verification assessment validated the Fort Site’s self-assessment scores.

We are currently carrying out a multi-year plan to enhance and implement the following corporate standards for sustainability management:

Standards under implementation by the sites
  • Anti-Corruption
  • Biodiversity and Land Management
  • Community Investment
  • Crisis Management System
  • Fatality Prevention
  • Grievance Management
  • Health and Safety
  • Mine Closure
  • Security and Human Rights
  • Significant Potential Incident Reporting
  • Stakeholder Engagement
  • Tailings Management
  • Water Management
Standards under development by Corporate
  • Air Management
  • Waste Management
  • Climate Change

“Towards Sustainable Mining is a key reference for our environmental and social management systems. The TSM protocols are increasingly recognized as industry leading practices around the world and are accepted by various responsible sourcing frameworks. We are working hard to fully implement and embed our TSM-based management systems. This effort will enable us to meet or exceed society’s expectations that mineral producers do zero harm and provide a net benefit in the communities in which they operate.”

– Steve Wood, EVP and COO

Materiality

Our materiality assessment involved identifying the sustainability issues of greatest interest to Sherritt’s stakeholders and those that could have the greatest impact on our business. We defined a list of key sustainability topics, conducted surveys and desktop research, and then ranked stakeholder interest and evaluated business impacts on the environment and society. We validated the assessment results with Sherritt’s senior management, operational management team, and sustainability personnel.

Those aspects with the highest combined rating of stakeholder interest and expected business impacts on the environment and society are considered “material” for Sherritt, and are addressed through our Sustainability Framework and management system.

Sherritt updated its materiality assessment in 2020 to reflect changes in its operations. As a result, some sustainability topics that were heavily influenced by the inclusion of Ambatovy in previous years have shifted.

The following graph maps our material issues against the four pillars of our Sustainability Framework and details the boundary of impact for each material issue.

Commentary on a broader set of material issues and risk factors that affect Sherritt – including U.S. sanctions on Cuba – can be found in our 2020 Annual Information Form.

Stakeholder Interest Business Impact
High Climate Change Adaptation Energy & GHG Emissions Environmental Liabilities, Closure & Reclamation Tailings
Medium Governance Waste Public Safety Stakeholder & Indigenous Engagement Community Development Human Rights* Water Diversity, Inclusion & Talent Management Health & Safety Economic Performance Responsible Sourcing Country Risks
Low Business Conduct & Transparency Biodiversity & Land Cultural Heritage Employee Relations Local Economic Benefits Air & Other Emissions Security
*The Cuban government and Sherritt both understand and value the protection and respect of human rights and the inherent importance (i.e., materiality) of this issue. Canada and Cuba are not identified as high-risk jurisdictions for human rights violations pertaining to operating companies.

Sustainability Goals

FIVE-YEAR SUSTAINABILITY GOALS

In 2018, Sherritt launched a suite of five-year sustainability goals. These strategic goals include our external commitments and focus on areas that advance and protect our interests and those of our stakeholders. These goals help to shape priorities, long-range planning, and investments in sustainable development across all of Sherritt’s operations. During 2020, we focused on benchmarking assessment, workshops, and the setting of divisional and company-wide targets. Read more about our newly set targets in this link.

Sherritt established a series of five-year sustainability goals that:

  • Align the enterprise by focusing on those sustainability priorities shared across Sherritt’s business;
  • Address existing and emerging industry-wide issues and societal concerns;
  • Clearly link Our Purpose and Our Promises, strategic priorities and the Sustainability Framework;
  • Drive improved performance across the business;
  • Demonstrate our commitment to sustainability excellence; and
  • Align with the Sustainable Development Goals (SDGs).

Our sustainability goals are as follows:

Goal 1 1. Achieve Level A requirements in Towards Sustainable Mining (TSM) protocols across all operations.
Goal 2 2. Strengthen our safety culture, behaviour and performance.
Goal 3 3. Improve environmental management.
Goal 4 4. Create community benefit footprints that support local priorities and the SDGs.
Goal 5 5. Improve diversity at all levels throughout the company.
Goal 6 6. Be recognized as a “preferred supplier” of responsibly produced products.

For more information on our goals and performance against our newly set targets, see the Performance section.