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Australia, September 2013 Australian Extractive Companies in Asia Loic Dujardin Director, Research Products, Singapore.

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Presentation on theme: "Australia, September 2013 Australian Extractive Companies in Asia Loic Dujardin Director, Research Products, Singapore."— Presentation transcript:

1 Australia, September 2013 Australian Extractive Companies in Asia Loic Dujardin Director, Research Products, Singapore

2 Sustainalytics in Asia Australian Extractive Companies in Asia Discussion points

3 Covering Asia July 2013 October 2012 What does Chinas Leadership Transition Mean for ESG? Businesses in Asia | Asian businesses Exposure | Preparedness | Investment Risk Regulatory gaps | Information channels

4 Australian Extractive Companies in Asia

5 Company NameSectorSub-IndustryMarket cap. (mln. USD) BHP Billiton Ltd.MaterialsDiversified Metals & Mining168,180 Rio Tinto Ltd.MaterialsDiversified Metals & Mining95,764 Origin Energy Ltd.EnergyIntegrated Oil & Gas13,659 Newcrest Mining Ltd.MaterialsGold8,510 PanAust LimitedMaterialsDiversified Metals & Mining1,309 Linc Energy Ltd.EnergyOil & Gas Exploration & Production575 OceanaGold CorporationMaterialsGold455 Medusa Mining LimitedMaterialsGold352 ST Barbara Ltd.MaterialsGold313 Kingsgate Consolidated LtdMaterialsGold239 Intrepid Mines LimitedMaterialsGold149 Companies reviewed

6 Four ESG Risk Factors – One Investment Risk Indicator Water Health & Safety Corruption Investment Risk Community Relations Production disruption, Regulatory & Reputation Impacts Strikes, Government investigations, Reputation Reputation, Legal, Regulatory Impacts Reputation and Regulatory Impact

7 Water: one example Exposure Preparedness Track record Exposure PreparednessInvestment Risk Score: 0 Exp Prep. Sustainalytics Indicator: Programs & Targets to Reduce Water Use Source: WRI Aqueduct Investment Risk: Very High Score: 100

8 WATER EXPOSURE SCORE PREPAREDNESS SCORE WATER SPECIFIC INVESTMENT RISK LEVEL WATER SPECIFIC INVESTMENT RISK SCORE BHP Billiton Ltd HIGH3 Rio Tinto Ltd. 6775MODERATE2 Origin Energy Ltd. 500HIGH3 Newcrest Mining Ltd. 5650HIGH3 PanAust Limited 5775MODERATE2 Linc Energy Ltd. 8025HIGH3 OceanaGold Corporation 8025VERY HIGH4 Medusa Mining Limited 400HIGH3 ST Barbara Ltd. 8050VERY HIGH4 Kingsgate Consolidated 4025HIGH3 Intrepid Mines Limited 1000VERY HIGH4 Water: Results

9 Corruption: one example Exposure Preparedness Track record Exposure PreparednessInvestment Risk Score: 67 Exp Prep. Sustainalytics Indicators: Whistleblower Programs Business Ethics Related Controversies or Incidents Transparency on Payments to Host Governments Source: Transparency International Investment Risk: ModerateScore: 68

10 Corruption: Results CORRUPTION EXPOSURE SCORE PREPAREDNESS SCORE CORRUPTION INVESTMENT RISK LEVEL CORRUPTION INVESTMENT RISK SCORE BHP Billiton Ltd. 7393MODERATE 2 Rio Tinto Ltd. 6693MODERATE 2 Origin Energy Ltd. 6642HIGH 3 Newcrest Mining Ltd. 6850MODERATE 2 PanAust Limited 7942VERY HIGH 4 Linc Energy Ltd. 7642VERY HIGH 4 OceanaGold Corporation 6650HIGH 3 Medusa Mining Limited 6642HIGH 3 ST Barbara Ltd. 7542HIGH 3 Kingsgate Consolidated 6742HIGH 3 Intrepid Mines Limited 6867MODERATE 2

11 Main Findings Overall investment risks are fairly consistent across the companies. Company NameSub-IndustryMarket cap. (year end, mln. USD) Overall Investment Risk Score Overall Investment Risk Level Rio Tinto Ltd.Diversified Metals & Mining95,7641.8Low to Moderate BHP Billiton Ltd.Diversified Metals & Mining168,1802.0Moderate PanAust LimitedDiversified Metals & Mining1,3092.0Moderate Medusa Mining LimitedGold3522.0Moderate OceanaGold CorporationGold4552.3Moderate to High Kingsgate Consolidated Limited Gold2392.3Moderate to High Newcrest Mining Ltd.Gold8,5102.3Moderate to High Intrepid Mines LimitedGold1492.3Moderate to High ST Barbara Ltd.Gold3132.5Moderate to High Origin Energy Ltd.Integrated Oil & Gas13,6592.5Moderate to High Linc Energy Ltd.Oil & Gas Exploration & Production Moderate to High

12 Risk Factor contributions vary significantly Water, Corruption, H&S contributions are high. Community relations is low. Main Findings

13 Recommendations to Investors Disclose operations located in water- stressed areas and where local populations lack access to clean water Disclose an assessment of the impact of water withdrawal and wastewater discharges on local communities and ecosystems Disclose site-specific water management plan Request companies to publicly support the EITI Water Exposure scores are systematically above the Preparedness scores, except for Rio and PanAust Companies need to improve their water management plans Exposure scores are systematically above the Preparedness scores, except for Rio and BHP Companies should engage with governments on corruption Corruption

14 Thank You! For more information please contact: Loic Dujardin Director, Research Products Phone: Website: Amsterdam | Bogota | Boston | Brussels | Bucharest | Copenhagen Frankfurt | London | Paris | San Francisco | Singapore | Timisoara | Toronto

15 Disclaimer Copyright © 2013 Sustainalytics. All rights reserved. No portion of this material may be reproduced in any form without the expressed, written permission of Sustainalytics. For further information contact: Sustainalytics 49 Club Street #02-01 Singapore Tel: (+65)


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