Top Company 2010: Newmont Mining
Newmont Mining Corp. is making headlines again. But this time, it's for all the right reasons.
After years of negative press surrounding environmental and health concerns at its operations in Peru and Indonesia, the 89-year-old Denver-based gold mining company has been praised in recent years, heralded as a model of environmental stewardship and corporate responsibility at a time when the mining industry desperately needs an image boost.
In 2006, Newmont became the first gold mining company to make the prestigious Dow Jones Sustainability World Index (which recognizes companies with sustainable economic, environmental and social records) - a place it has held for four years in a row. In March, it was ranked 16th on Corporate Responsibility Magazine's 100 Best Corporate Citizens List. And in June, it was honored by the Global Business Coalition on HIV/AIDS, Tuberculosis and Malaria for its efforts to control malaria among employees and community members at its operation in Ghana.
Meanwhile, the company managed to have a banner year in a grim economy, posting a 26 percent increase in revenues - to a record $7.7 billion - in 2009, while boasting one of the best employee safety records in the gold mining industry. It has also been instrumental in founding several organizations aimed at improving safety and environmental stewardship industry-wide.
"We are not only improving our own performance, but the performance of the industry as a whole," says CEO Richard O'Brien, who took the helm of the company in 2007 and has been credited for his open, straight-talking style. "We realize that a sustainable business model cannot just be about financial results and the number of ounces we produce. It has to be about the way we conduct ourselves."
Just a decade ago, the company was mired in controversy after a truck from its mine in Cajamarca, Peru, spilled mercury along a highway, sickening residents. Newmont paid $3 million in indemnity, covered medical expenses and revamped its transportation policies, but skirmishes with mine protestors there persisted for years. Then in 2004, an environmental group from Indonesia filed suit against the company, claiming its activities had caused health problems there.
"Newmont was in the news a lot, and many stories portrayed the company in a negative light," recalls Stephen D'Esposito, president of Washington, D.C. - based RESOLVE, a nonprofit that helps businesses find solutions to environmental and public health problems.
In 2007, under pressure from socially conscious investors, Newmont made an unprecedented move for a mining company. It agreed to allow an independent team of evaluators to conduct a Community Relationships Review at six of its sites around the globe, interviewing employees, community activists and others to determine what it is doing right and what it is doing wrong.
"We realize we have an impact locally. It can be positive - in the form of employment and royalties and goods and services. But there is no question that, unless we do our business just right, it can also be negative," says O'Brien.
With the Community Relationships Review complete, the company is now in the process of revamping its policies to address its shortfalls. But already, its image has changed dramatically, says D'Esposito, and the rest of the mining industry is paying close attention.
"They are a successful example of a company that has been very transparent and open about their challenges, engaged with their stakeholders about how to address them, and worked to come up with solutions," he says. "It is a game-changing approach, and it is definitely working for them."