Safety, Health and Environment Committee Terms of Reference 9 November 2016
LONMIN PLC Safety, Health and Environment Committee - Terms of reference These terms of reference were approved by the Board on 9 November 2016. 1 Composition and resources 1.1. The Board may, on the recommendation of the Nomination Committee, appoint or remove members of the Committee, subject to there being at least three members at all times. The Committee shall at all times comprise a minimum of two non-executive directors of the Company and a minimum of one executive director. The Chairman of the Committee may co-opt additional members from senior management who shall be required to attend all or part of any Committee meeting; 1.2. The Board shall nominate one of the non-executive directors serving as a member of the Committee to act as Chairman, and may remove or replace the Chairman at any time. In the event of his/her absence, the Chairman may nominate any other non-executive director to act as chairman in his/her place. All directors, senior executives and external and internal auditors shall have independent access to the Chairman of the Committee at any time; 1.3. The company secretary (or, with the approval of the Committee Chairman, his/her nominee) shall be the secretary of, and provide full support to, the Committee and its members; and 1.4. The Committee Chairman, with the support of the secretary, shall ensure that Committee members are provided with any induction, training or other education necessary on first appointment and then on an ongoing and timely basis, to ensure that they are able to discharge their duties satisfactorily. 2 Powers The Committee is authorised by the Board to: 2.1 investigate any matter within its remit; 2.2 seek any information that it requires from any director or employee of the Group in order to perform its duties, and all directors and employees are hereby directed to co-operate with any request made by the Committee; 2.3 co-opt any in-house resources the Committee may reasonably feel necessary to support it in fulfilling its duties; and 2.4 obtain independent legal or independent professional advice, at the Company s expense, and secure the attendance of outsiders with relevant experience and expertise if the Committee considers this necessary. However, nothing in these terms of reference shall create any executive power of the Committee, and (for the avoidance of doubt) all executive directors and operational managers retain their full legal authority, responsibility and accountability for the management of each of the functional areas listed in 3.2. 3 Objectives The Committee shall have the following objectives: 3.1 assist the Board by ensuring management sets aspirational standards for SHE matters and implements a culture in which these goals are promoted and enforced; 2
3.2 have oversight of and provide advice to the Board in the areas of safety, health and environment (SHE) (including, where relevant, public safety, security and the impact of the Company s activities and of its products and services) and including the risks in each of these areas; 3.3 have oversight of and provide advice to the Board on the Group s compliance with applicable SHE related legal and regulatory requirements; 3.4 report to the Board developments, trends and/or forthcoming significant legislation in relation to SHE matters which may be relevant to the Group s operations, its assets or employees; 3.5 ensure a robust and independent assurance and/or audit process is implemented by management; and 3.6 review the Group s external SHE reporting and regulatory disclosures. 4 Duties Without limiting the scope of the objectives set out above, the Committee should carry out the duties below for the parent company, major subsidiary undertakings and the Group as a whole, as appropriate: 4.1 SHE performance 1. review the SHE performance of the Group and the consequences of decisions and actions from a stakeholder and wider reputational perspective; 2. review significant SHE related incident reports having regard to the causative factors, consequences of decisions and actions on stakeholders, the environment and the Group s reputation and consider the recommendations made in such reports; 3. monitor management compliance with agreed policies, standards, systems and procedures, including the Group s standing in terms of the goals and purposes of Principles 7 to 9 relating to environmental matters in the UN Global Compact; 4. review the progressive implementation of newly developed policies, standards, systems and procedures (including the firearms policy and rules of engagement); and 5. review the outcome of the external assurance review. 4.2 SHE related risk 1. review the effectiveness of the policies, systems and controls for identifying and managing SHE related risks; 2. assess the effectiveness of management s attitudes and approach towards managing SHE related risks; 3. highlight to operational management any SHE related risks which the Committee believes have not been appropriately considered or addressed; and 4. track SHE performance indicators as they pertain to material SHE related risks and other data trends and performance measures as appropriate; and and in each case highlight any perceived issues and provide advice as appropriate. 3
4.3 Policy statements and external reporting and disclosures 1. provide a critical review of the policies proposed by management in connection to SHE matters and related risks and, if thought fit, a recommendation that they be accepted by the Board; and 2. review, and challenge where necessary, any external disclosures relating to SHE matters, specifically including the Group s annual report and accounts and the Sustainable Development Report 4.4 Performance evaluation 1. conduct periodic reviews of the Committee s performance and that of the Chairman of the Committee and recommend any changes it considers necessary to the Board for approval; and 2. at least biennially, review the Committee s terms of reference to ensure it is operating at optimal effectiveness and recommend any changes it considers necessary to the Board for approval. 5 Reporting line 5.1 Internally The Committee shall report formally to the Board on its proceedings after each meeting on all matters within its duties and responsibilities, particularly where there are matters in respect of which the Committee considers that action or improvement is needed, including recommendations as to the steps to be taken. The secretary shall circulate the minutes of meetings of the Committee to all members of the Board. The Committee Chairman shall attend and report to the Board at Board meetings of the company and shall attend the AGM to answer shareholders questions on the Committee s actions. 5.2 Externally The Committee shall prepare a statement on its role and responsibilities and the actions it has taken to discharge those responsibilities within the annual report and accounts. Such a report should specifically include the number of Committee meetings, attendance by each member and a summary of the material items of business discussed at its meetings. These terms of reference shall be made publicly available on the company s website and in hard copy format from the company secretary s office. 6. Meeting arrangements 6.1 The Committee will be governed by the provisions of the Articles of Association relating to board and board committee meetings, but may otherwise make its own arrangements. A quorum shall be two directors, one of whom must be a non-executive director; 6.2 Meetings shall be held not less than twice in each financial year and otherwise as required. Any member of the Committee shall be entitled to convene additional meetings as required; 6.3 No one other than Committee members shall be entitled to attend Committee meetings as of right, but a standing invitation to attend all meetings is extended to the Chief Operating Officer and the Executive Manager responsible for sustainability. 4
6.4 Upon the invitation of the Committee, any director or executive of the Company shall, or a representative of an external advisor, may attend all or part of any meeting as required; and 6.5 Unless otherwise agreed, notice of each meeting confirming the venue, time and date together with an agenda of items to be discussed, shall be forwarded to each member of the Committee and any other person required to attend, no later than five working days before the date of the meeting. Supporting papers shall be sent to Committee members and to other attendees, as appropriate, at the same time. 5