Journey Towards Sustainability: The Case of the Newmont Ahafo Development Foundation

1. Journey Towards Sustainability: The Case of the Newmont Ahafo Development Foundation Presented in New York – USA – March 2010 By Nick Cotts & Joseph Danso

2. Overview • Commitment to Sustainable Community Development • Ahafo Social Responsibility Forum • Community Agreements • Newmont Ahafo Development Foundation (NADeF) • Vision and Mission • Governance structure • Funding • Allocation of Funds/Development Focus • Articulation/Alignment • Foundation’s Activities • Challenges • NADeF Linkages to Newmont, COM DEV and Local Government

3. Newmont’s Commitment to Sustainable Community Development • Create value with a wider set of stakeholders through the alignment and linkage of our business and our social responsibilities • Balance economic considerations with social/environmental consequences to understand how our actions today may affect future generations • Fundamental understanding that community acceptance is paramount to a sustainable business model • Seek to maximize training, employment and business opportunities using fair and transparent processes that provide the opportunity for local communities to articulate their needs and aspirations • Maximize opportunities to leverage community development projects and empower other sectors through partnerships are sought out and encouraged

4. Ahafo Social Responsibility Forum • Community/Company initiative: Multi-stakeholder group of 55 members; independent moderator and co-moderator • Traditional Leaders, Youth, Women’s Groups, Regional Gov’t, Local Gov’t, Local NGOs, Farmer Groups, Newmont • Forum for discussion and decision-making between stakeholders on issues related to community development and the business • Forum met over 20 times during a 2 year period • Standing Committee Purpose/Function

5. Ahafo Social Responsibility Agreements • Three agreements encompassing ten communities in the Ahafo mine area: Relationship Agreement: roles and responsibilities on how the Company and Community will engage Employment Agreement: guidelines in the hiring of local workforce Foundation Agreement: Creation of the Newmont Ahafo Development Foundation (NADeF) as a structure to fund and support sustainable community development programs

6. Newmont Ahafo Development Foundation(NADeF) • Vision: To achieve community prosperity and self-reliance. • Mission: Our mission is to empower communities through grants, knowledge-sharing, partnership and capacity building to achieve sustainable development. • Stakeholders Vision for NADeF:Our vision for NADeF is to be a recognized and trusted development partner in the Ahafo Communities. • NADeF is registered under laws of Ghana. • NADeF Agreement signed between Newmont and AhafoMine Communities in May 2008. • NADeFSecretariat established with offices located in one of the Mine Communities

7. Governance Structure • Board of Trustees • Nine-member Board (4-Comapany and 4-Community + Chairperson) established by the Agreement to manage and control the funds of the Foundation • After 6 years additional community members will be appointed, including Chairperson • Secretariat • Established with 4 main employees (Exec Sec, Project Coordinator, Fin Controller, Admin Assist) and 4 supporting staff (1 driver, 1 housekeeper and 2 security guards) • Administer day-to-day activities

8. Governance Structure (cont) • Tender Board • Nine-member Board (2-Traditional Leaders, 2-Local Government Reps, 2-Youth Reps, 2-Newmont Reps and 1 member appointed by BOT as Chairman) • Responsible for any tendering process in accordance with the Ghana Procurement Act • Sustainable Development Committees (SDC) • Seven-member community-based committees in each of the ten communities (1-Youth Rep, 1-Women Rep, 1-Unit Committee Rep, 2-Trad Leaders Reps, 1- Assembly person and 1 community member nominated by the Traditional Leaders) • Responsible for planning development projects at the community level and submission of community proposals to the Secretariat through the District Assembly

9. Foundation Funding • Foundation is supported by $1 per oz &1% net profit from Ahafo Operation (about $4.7 Mn YE 2009) • Model is to partner with external donors locally, nationally and internationally • Endowment provision funded via the annual contribution (10% - first 5yrs; 15% - second 5yrs; 20% - third 5yrs; and 25% - fourth 5yrs). • Partnership funding and leveraging resources is opportunities are being evaluated

10. Allocation of Fund/Focus Areas • Social Responsibility Forum established allocation system aligned with self- determined development • Ongoing projects in the communities include: Construction of Teachers’ Quarters, Construction of Library, Drilling and mechanization of water bores, Construction of classroom blocks etc. • Funds are allocated to communities based on set criteria using impact, population, land size in mining lease area, commitment etc.

11. Articulation/Alignment with Development Partners • SDCs liaise with the District Assembly in the identification of community projects • Final approval of community proposals to the Foundation is done by the District Assembly – to ensure projects are aligned to the District Development Plan • Technical supervision of all projects are done by the District Assembly engineers • Completed projects and programs are handed over to relevant government agency and the community • Ahafo Com Dev is coordinating the setting up of the Foundation Secretariat and capacity building for the SDCs • Ahafo Com Dev discussing possibility of existing projects that could be aligned to the Foundation agenda and possible implementation by Foundation

12. Journey Towards Sustainability • Projects supported under NADeF are aligned to the District Government’s Development Plan • Broader community participation in the planning, decision making and the implementation process creates sense of ownership • Governance structure separate from the company – individuals serving on committee as equal partners • Possibility of supporting projects with community resources – land, labour etc. • Infrastructure projects handed over include operations and maintenance plan • Endowment supports future of the Foundation after mine closure • Leveraging resources through partnership approach

13. Foundation’s Activities List and Photos of key activities / some NADeF projects SDC Training Workshop SDC Refresher Training Mechanized water @ Ntotoroso Teachers Quarters @ Gyedu Classroom Block @ Wamahinso WC Toilet @ Ntotoroso

14. Our Challenges • Dependency: Newmont Ahafo cannot meet everyone’s needs! • Continuous pressure to “act” as the local government • Building a long-term vision with local communities and government • Secretariat capacity, network and partnerships • Alignment/agreement of priorities vs. resource availability • Capacity of community to engage with Foundation and provide timely feedback • Managing expectations of stakeholders on community development issues • Defining sustainability and creating a shared vision