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BHP Billiton is the world's largest diversified resources company. The long-term, stable nature of our business affords a number of advantages. Within the HSEC arena, this stability translates into a capacity to plan for the longer term, while our diversification allows us to transfer improvement and innovation across the organisation.
Central to our business, as our Charter states, is our ‘overriding commitment to health, safety, environmental responsibility and sustainable development’. Supporting this value is our HSEC Policy, providing the framework for our aspiration towards Zero Harm. In practice, the Policy and Charter are implemented via detailed HSEC Management Standards and Protocols, the requirements of which must be met at all our operations.
The implementation of the HSEC Management Standards continues to progress well, with understanding and conformance to the Standards improving. The associated audit process for the Standards is proving invaluable in accelerating the rate of improvement in all aspects of HSEC management through the identification and communication of leading practices.
During the year, the Health, Safety and Environment Committee of the Board continued to provide guidance in relation to the effectiveness of HSEC management systems and strategies. Members participated in a number of site reviews and audits, as well as acting in an advisory capacity for significant incident reviews.
To better understand and manage HSEC risks that are critical to our business, risk registers are now in place at all required operations and development sites and at Customer Sector Group and Corporate levels. With the implementation of the Enterprise-Wide Risk Management process, HSEC risks are now being embedded into core business systems and processes.
Improving health and safety performance continued to be a critical focus for the organisation. Baseline health surveys were completed at a majority of sites, incorporating the establishment of occupational hygiene monitoring and health surveillance programs. A 20 per cent reduction in our injury frequency rate was an excellent achievement during the year, reflecting efforts dedicated to safety improvement. However, we deeply regret that three people lost their lives in our controlled operations during the year.
While the number of fatalities (3) in our controlled operations was significantly lower than last year (13), each death that occurs has a profound impact on our people and their families. Our resolve to attain our goal of zero fatalities is stronger than ever, and we will continue to seek opportunities to improve. The development of Fatal Risk Control Protocols for nine key areas is a significant step towards achieving this goal. The Protocols, written by experienced teams drawn from across BHP Billiton, establish minimum performance requirements for managing risk in areas associated with the majority of our past fatalities. We are also monitoring significant incidents, including fatalities, that occur from activities related to our business but are not under our management control. We have established processes to learn from these incidents.
Environmental performance across the Company continued to be sound, reflecting our systematic approach to managing environmental risk. No significant environmental incidents (i.e. incidents rated 3 or above on the BHP Billiton Consequence Severity Table) were recorded during the period. Furthermore, in line with our target for sites to achieve certification against the international standard for environmental management ISO 14001, all sites requiring certification are now certified or have been recommended for certification by their ISO auditor. Recognising that improving environmental performance will, in many cases, improve our financial returns, plans focusing upon driving eco-efficiency gains have been developed at a majority of sites.
In line with our Policy, efforts have continued towards improving our engagement with our host communities. Community relations plans are in place at 95 per cent of the required sites around the world. Our community contributions of 1.4 per cent of our pre-tax profit, based on a rolling three-year average, once again exceeded the target of 1 per cent. Many of these contributions support programs that focus on delivering sustained benefits in areas such as health, education and training. No transgressions of the principles embodied within the United Nations Declaration of Human Rights were reported to have occurred within the Group during the year.
Some of our improvements in HSEC performance have been realised through the application of the Operating Excellence business improvement methodology. Many of these projects have not only demonstrated HSEC gains, but also importantly delivered sustainable business outcomes. For example, an energy efficiency project at Ekati has saved over one million litres of diesel usage per annum and contributed to a 21 per cent reduction in greenhouse gas intensity at that site. Incorporation of HSEC into our strategic framework recognises that good HSEC performance delivers good business performance.
During the year, we have been active in the International Council on Mining and Metals (ICMM) work program. The ICMM was established in 2001 as a global leadership body on sustainable development. An important part of the establishment process of the ICMM has been the development of the Sustainable Development Framework, a guiding set of principles, which all member companies have now endorsed. A gap analysis of our HSEC Management Standards and the Framework identified strong alignment in the majority of areas, with the exception of community relocation and human rights training and guidance. As a result, we have since committed to implement the World Bank Guidelines on Involuntary Resettlement and the US-UK Voluntary Principles on Security and Human Rights.
In June 2003, we reaffirmed our commitment to the United Nations Global Compact and associated principles (a copy of our letter to the United Nations is available on our website at www.bhpbilliton.com/bb/sustainableDevelopment/reportsAndPolicies.jsp). While fully recognising the right of our employees to freely associate and join trade unions, we have a number of locations where we have a mix of collective and individual arrangements. Prospective employees are made aware of employment arrangements prior to joining the Company. At all times, our businesses comply with local employment law requirements and treat employees in accordance with the values expressed in our Charter.
We have been delighted over the past year to receive external recognition for our performance in the areas of community partnerships, sustainable development and public reporting. Notable events have included our inclusion in the Dow Jones Sustainability Index and the FTSE4Good Index, receipt of the Special Award in Environmental Reporting at the Australasian Reporting Awards, the Banksia Award for Leadership in Sustainability in the Australian Minerals Industry, the Australian Prime Minister's Award for Excellence in Community and Business Partnerships, and the ‘Corporate Partnership of the Year Award 2003’ at The Australian Financial Review Magazine Partnership Awards.
Internally, our Employee HSEC Awards program has been highly successful, with an increased number of applications received from across the Company. The awards have proved to be invaluable in recognising excellence in HSEC and transferring those improvement ideas throughout the organisation.
This HSEC Report was prepared in accordance with the Global Reporting Initiative 2002 Sustainability Reporting Guidelines. It should be recognised that, due to the size and complexity of our business, judgements have had to be made regarding the extent of the information that can be presented in relation to each GRI indicator.
Moving forward, our efforts continue to focus on improvement of HSEC performance, consistent with our belief that this is in the interest of all of our stakeholders, as we travel the journey to sustainability.
