6-K 1 anglogold_ir.htm AngloGold-IR
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
Report on Form 6-K dated March 26, 2021
Commission File Number 1-14846
AngloGold Ashanti Limited
(Name of registrant)
76 Rahima Moosa Street
Newtown, 2001
(P.O. Box 62117, Marshalltown, 2107)
South Africa
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form
20-F or Form 40-F.
Form 20-F X
Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(1):
Yes
No X

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(7):
Yes
No X

Indicate by check mark whether the registrant by furnishing the information contained in this Form
is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.
Yes
No X

Enclosure: Press release
ANGLOGOLD ASHANTI LIMITED – INTEGRATED REPORT FOR THE
YEAR ENDED DECEMBER 31, 2020
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I N T E G R A T E D
R E P O R T
2020
<IR>
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OUR VISION, MISSION AND VALUES
T O   B E   T H E
LEADING
MINING COMPANY
VISION
MISSION
To create value for our shareholders,
our employees and our business, and
social partners through safely and
responsibly exploring, mining and
marketing our products.
VALUES
Safety is our
first value.
We treat each
other with dignity
and respect.
We are accountable
for our actions and
undertake to deliver on our
commitments.
We want the communities
and societies in which we
operate to be better off for
AngloGold Ashanti having
been there.
We value
diversity.
We respect
the environment.
Tanzania – Geita
SAFELY
DELIVERING ON STRATEGY
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AngloGold Ashanti Limited <IR>
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CONTENTS
S E C T I O N 1 :
ABOUT ANGLOGOLD ASHANTI
S E C T I O N 2 :
WORLD IN WHICH WE OPERATE AND
STRATEGIC RESPONSE
S E C T I O N 3 :
DELIVERING ON OUR STRATEGY
8
Who we are – corporate profile
10
AngloGold Ashanti – 2020 at a glance
12
How we create value
14
Materiality process and material
matters
18
Our business model
28
Our external operating context
33
Managing our risks and acting on
opportunities
44
Integrated stakeholder engagement
52
Our strategy
54
The year of COVID-19 – impact,
response and management
56
CEO’s review and outlook
60
Delivering on our strategy
62
Strategic capital trade-offs
64
ESG performance
82
CFO’s report
96
Economic value-added statement
98
People are our business
100
Operating performance – an overview
115
Mineral Resource and Ore Reserve –
summary
121
Planning for the future – projects,
exploration and innovation
Supporting financial, operational, and
sustainability data are available at
www.aga-reports.com
S E C T I O N 4 :
LEADERSHIP AND ACCOUNTABILITY
S E C T I O N 5 :
REWARDING DELIVERY
S E C T I O N 6 :
CORPORATE INFORMATION
128
Audit and Risk Committee:
Chairperson’s report
134
Corporate governance
144
Remuneration and Human Resources
Committee: Chairperson’s letter
148
Remuneration – overview of policy
160
Remuneration implementation report
181
Forward-looking statements
182
Administration and corporate
information
ANGLOGOLD ASHANTI’S 2020 SUITE OF REPORTS
Throughout this report, the icons below are hyperlinked to the relevant report
<IR>
Integrated Report
<SR>
Sustainability Report
<NOM>
Notice of Annual General Meeting and Summarised
Financial Information (Notice of Meeting)
<R&R>
Mineral Resource and Ore Reserve Report
<AFS>
Annual Financial Statements
<WWW>
Reporting website
About this report
Board statement of
responsibility
Chairperson’s letter
P2
P4
P5
Stakeholder feedback
We welcome stakeholder feedback on our reporting. Should you have any
comments or suggestions on this report, contact our investor relations team at:
investor.relations@anglogoldashanti.com
AngloGold Ashanti Limited <IR>
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ABOUT THIS REPORT
Scope and objective
This integrated report covers the performance of AngloGold
Ashanti Limited and its subsidiaries and investments (collectively,
‘we’, ‘us’, the Company or the Group) for the year from 1 January
to 31 December 2020. In this report, we describe certain elements
of our operational, financial, environmental, social and governance
(ESG) performance and related information.
We aim to provide a holistic, concise and balanced review of our
overall performance, progress made in delivering on our strategy,
and our prospects to enable stakeholders to make an informed
evaluation of our ability to create value in the short, medium and
long term and the future viability of our business.
While the primary audience of this report is investors and other
providers of financial capital, it will also be useful to a broader
stakeholder audience as the report provides material information
relating to our business model, operating context, material risks,
stakeholder interests, and our governance. Supplementary
operational, geological and sustainability information is available
online
at www.aga-reports.com
.
For completeness, any significant material event that occurs
between the end of the financial year and the date on which
this report is approved, is included. Unless otherwise indicated,
information reported refers to that of the Group as a whole, and not
only continuing operations.
Reporting boundary
The reporting boundary for this report includes all AngloGold Ashanti
subsidiaries, associates and investments.
Assets sold during the year were those in South Africa –
Mponeng and Surface Operations (including Mine Waste
Solutions) – and in Mali, Sadiola and Morila. As the sale of
the South African assets was concluded on 30 September
2020, their contributions to the Group are reported for the first
nine months of the year. The Morila and Sadiola asset sale
transactions were concluded on 10 November 2020 and 30
December 2020, respectively. We have, however, not reported
on Morila and Sadiola for 2020.
This is a Group level report covering the entire Company, its joint
ventures and investments. While performance and targets are
reported regionally, we report fully on all operations managed by
AngloGold Ashanti. Kibali, in which AngloGold Ashanti has an
ownership interest but does not manage, is partially reported.
There were no significant changes to the scope, boundary or
measurement methods used in this report since 2019. Any
comparative restatements are indicated.
Information on joint ventures and other interests is provided if
considered material. Production, costs, capital expenditure,
Mineral Resource and Ore Reserve data are reported on an
attributable basis, unless otherwise indicated. Employee data,
which includes both permanent employees and contractors, and
average workforce data, is reported for AngloGold Ashanti with
joint ventures reported on an attributable basis.
For details of our assets and their relevant shareholdings, see
the
Corporate profile – who we are , and for information on our
principal subsidiaries and operating entities, refer to our <AFS>.
Approvals and assurance
The information presented in this report has been subject to either
an internal or external audit. Internal audit and approval processes
include, among others, regular management review of information
and data published.
In addition, our operations are subject to risk-based, integrated,
combined assurance reviews of the commercial, safety and
sustainability aspects of our business. The outcomes of these
internal processes and external assurances, as well as of any
independent technical reviews, provide reasonable assurance to
allow the board, on the recommendation of the Audit and Risk
Committee, to determine the effectiveness of our internal control
systems and procedures, and thus to ensure the accuracy of the
information presented.
Financial information from the <AFS> was externally audited
and signed off by Ernst & Young (EY) while certain selected
sustainability performance indicators reported in the
<SR> were
subjected to an independent external assurance conducted by
EY – see page 68 in the
<SR> .
Reporting frameworks and regulations
In compiling this report, we have applied the International
Integrated Reporting Council’s Framework on Integrated
Reporting and its guiding principles and content elements. We
have also taken into account the following:
King IV Report on Corporate Governance for South Africa,
2016 (King IV)
South African Companies Act, No.71 of 2008 (as amended)
JSE Listings Requirements
International Financial Reporting Standards (IFRS)
SAMREC Code
Sustainable Development Goals (SDGs)
We have also considered the World Gold Council’s
Responsible Gold Mining Principles, the principles of the
International Council on Mining and Metals (ICMM), the United
Nations Global Compact (UNGC), and the expectations of the
sustainability indices and related audience such as ESG ratings
agencies, the FTSE/Russell Responsible Investment Index
(FTSE4Good), the S&P Global Corporate Assessment (CSA),
and the Bloomberg Gender-Equality Index.
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AngloGold Ashanti Limited <IR>
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Reporting boundary (external operating context, risks, impacts and outcomes)
ANGLOGOLD ASHANTI LIMITED
Operating entities
Joint ventures
Australia
Africa
Americas
South Africa
Africa
100% held
100% held
100% held
100% held
Attributable
AngloGold Ashanti
Australia Limited
1
AngloGold Ashanti
(Ghana) Limited
2
AngloGold Ashanti
Córrego do Sítio
Mineração S.A.
Mponeng
3
Kibali (Jersey) Limited
4
(45%)
AngloGold Ashanti
(Iduapriem) Limited
Mineração Serra
Grande S.A.
Mine Waste
Solutions
3
Société d’Exploitation
des Mines d’Or de
Sadiola S.A.
5
(41%)
Geita Gold Mining
Limited
Société des Mines de
Morila S.A.
6
(40%)
Yatela (40%)
Attributable
Attributable
Attributable
Tropicana (70%)
Société AngloGold
Ashanti de Guinée S.A
7
(85%)
Cerro Vanguardia S.A.
(92.5%)
KEY STAKEHOLDERS
Investment
community
Employees
and unions
Governments and
regulators
Communities
Suppliers
Industry partners
and peers
1
Owner of Sunrise Dam and the Tropicana joint operation
2
Owns the Obuasi mine
3
Previously held directly by parent company. The sale of these assets to Harmony Gold Mining Company Limited was concluded
on 30 September 2020
4
Owner of Kibali Goldmines S.A., which operates the Kibali mine in the Democratic Republic of the Congo
5
Sale of Sadiola in Mali was concluded on 30 December 2020
6
Sale of Morila in Mali to Firefinch Limited (previously Mali Lithium Limited) completed on 10 November 2020
7
Owns Siguiri mine in the Republic of Guinea (Guinea)
Note:
Unless otherwise indicated, $ or dollar refers to the US dollar throughout this report.
All information is attributable unless otherwise specified
Rounding of numbers may result in computational discrepancies
Metric tonnes (t) are used throughout this report and all ounces are Troy ounces
AngloGold Ashanti Limited <IR>
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BOARD STATEMENT AND RESPONSIBILITY
Directors’ statement of responsibility and commitment
The AngloGold Ashanti board has ultimate responsibility for ensuring and confirming the integrity, accuracy and completeness of this
report, as well as of our entire suite of 2020 reports. In this the board is supported by the Audit and Risk Committee and the Social,
Ethics and Sustainability Committee.
The board believes that the report has been prepared in compliance with the International Integrated Reporting Council’s Integrated
Reporting Framework. The board is of the view that the material issues identified have been addressed, that the information reported is
correct and relevant, and that this report presents a fair and balanced view of AngloGold Ashanti’s integrated performance for the year
ended 31 December 2020.
This report was approved by the board on 26 March 2021.
Board Chairperson
Chief Executive Officer (interim)
Maria Ramos
Christine Ramon
Chairperson: Audit and Risk Committee
Alan Ferguson
Chairperson: Social, Ethics and Sustainability Committee
Dr Kojo Busia
Chairperson: Remuneration and Human Resources Committee
Maria Richter
Independent non-executive directors:
Albert Garner, Rhidwaan Gasant, Nelisiwe Magubane, Jochen Tilk
Visible gold at Nyankanga, Geita
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About AngloGold Ashanti / World in which we operate and strategic response / Delivering on our strategy / Leadership and accountability / Rewarding delivery / Corporate information
AngloGold Ashanti Limited <IR>
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The pervasive spread and complexity of the COVID-19
pandemic continues to present the world with an economic,
health and social crisis that will shape the prospects of a
generation of people, particularly in the developing world.
The outbreak tested flexibility and resilience as governments,
businesses and societies responded to a global health
emergency unprecedented in modern times. AngloGold
Ashanti was no exception.
I’m pleased to say our leadership and employees responded as
we always hoped they would in a crisis; steady under pressure
and faithfully adhering to our values in adapting to new challenges
in a rapidly evolving operating environment. Our teams designed
protocols and operating procedures for each site that helped
ensure safe business continuity, while we delivered on our
strategic objectives.
At all times our priority was the health and wellbeing of our
colleagues, their families and communities, with proactive steps
taken to protect those stakeholders and the business itself. These
measures were aligned to regulations of our host countries and the
guidelines set by the World Health Organisation. Care was taken
to safeguard employees with comorbidities, and emphasis was
placed on close cooperation with our communities, whose specific
needs helped direct our support initiatives.
Close partnerships
While society has become more adept at dealing with COVID-19
over the past year, we know that the battle is far from over.
Adherence to prevention measures – wearing masks, washing hands
and keeping a prudent social distance – will continue to be required,
even after vaccine programmes are rolled out, as subsequent waves
of infection will be spurred by new variants of the coronavirus.
The risk will remain especially high for countries without the
resources to immediately fund extensive vaccination campaigns
for all citizens. We are committed to playing our part in balancing
the scales in this regard by working hand-in-glove with our host
governments to support their public health interventions.
We learned valuable lessons during the HIV/AIDS crisis in South
Africa, the Ebola epidemic in West Africa and in fighting malaria
across the continent. Most importantly, we learned that we cannot
insulate ourselves from public health emergencies. Our fortunes
are inextricably linked to those of our hosts, so we must be at the
forefront of the public-private partnerships that will be an essential
part of turning the tide.
COVID-19’s economic impact
While the pandemic is first a public health crisis, it has also brought
the worst recession since World War II, overstretched corporate
and sovereign balance sheets and soaring unemployment. These
factors will worsen already-severe inequality, with the impact falling
disproportionately on women, particularly in Sub-Saharan Africa.
The early signs are clear that the global economic recovery will be
uneven. Developing economies have the fewest resources to spur
recovery and will be reliant on the private sector to maintain and
create vibrant, profitable businesses that improve resilience of their
overall economies through salaries, taxes and local procurement.
One of the bright spots of 2020 was the much-improved
public-private co-operation that will be essential to ensuring
that developing economies deal with the challenges of multi-
dimensional poverty – exacerbated by the pandemic – as well as
economic fragility, climate change and conflict. AngloGold Ashanti
will aim to be a strong member of that collaborative effort.
CHAIRPERSON’S LETTER
CONSISTENT
DELIVERY
Maria Ramos /
Chairperson
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Gold price
The spot gold price rose to a record $2,063/oz in August 2020,
driven by investor demand amidst increased uncertainty and the
global policy impact of to the pandemic.
The record price, however, masked an 14% reduction in physical
demand to 3,759.6t from 2019, which the World Gold Council
says was due to “far reaching effects” of the pandemic. Jewellery
purchases were down 34%, or 515.9t, while smaller demand
segments like gold coins and bars and technology, were also softer.
Central banks bought only 272.9t of bullion in 2020, 59% less than
the previous year.
These declines were partly offset by an increase of 34% year-
on-year, or 877.1 tons, in gold-backed exchange traded funds,
while annual gold supply dropped 4% to 4,633t the largest annual
decline since 2013, as lockdowns disrupted mining activities.
The gold market remains volatile. In the first quarter of 2021,
amid momentum in the global vaccine rollout and an improving
economic recovery in the US and Europe, the spot gold price fell
8% from end of 2020 to $1,744/oz on 19 March 2021. As at
19 March 2021 the Bloomberg average consensus gold price
for 2021 is $1,794/oz and $1,700/oz for 2022.
While we remain positive on the long-term prospects for the gold
price, particularly as the threat of inflation increases, the board will
continue to use conservative assumptions when allocating capital.
Business performance
Our key strategic objectives include improvement of our overall
sustainability performance, particularly the safe operation of
our mines; strengthening our balance sheet; increasing Ore
Reserve through exploration and growth projects; ensuring tight
management of costs to improve cash flow; and streamlining our
portfolio to direct capital to higher-return projects.
We made solid progress on most of these metrics. We sold our
operating assets in South Africa and Mali, more than halved our
net debt to the lowest level in more than 10 years, added six
million ounces of new reserves to extend the life of our portfolio,
and increased free cash flow almost fivefold, to $743m. Phase
2 of the Obuasi redevelopment was 90% complete at the end of
the year, while the feasibility studies on our two Colombia projects
made good progress toward completion. Dividends were up
fivefold after a decision to double the payout ratio.
That is a solid performance but we’re mindful that there is much
to do to narrow the value gap that persists with many of our
international gold-mining peers.
Obuasi must reach its ramp-up milestones during 2021, and
the board must make investment decisions on the Gramalote
and Quebradona projects, after reviewing their feasibility studies
and detailed execution plans. We are also especially focused on
cost management and capital discipline, particularly amidst the
reinvestment programme in our ore bodies given a potentially
stagnant, or declining gold price.
We learned valuable lessons during the HIV/Aids crisis
in South Africa, the Ebola epidemic in West Africa and in
fighting malaria across the continent. Most importantly,
we learned that we cannot insulate ourselves from public
health emergencies. Our fortunes are inextricably linked
to those of our hosts, so we must be at the forefront of
the public-private partnerships that will be an essential
part of turning the COVID-19 tide.
CHAIRPERSON’S LETTER CONTINUED
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Our cash conversion is below par and improving it is a focus for
the board. In this regard, the management team continues to
work on ways to ensure the release of growing cash balances in
the Democratic Republic of Congo, value added tax balances in
Tanzania and export levy rebates in Argentina. Together, these
three areas accounted for $586m at the end of 2020.
Safety performance
Safety is another area where improvement is required. It is with
a heavy heart that I report six fatalities during 2020 – four at the
South Africa operations which have now been sold, and two at
our Obuasi mine in Ghana. See <SR> . On behalf of the board,
executive committee and AngloGold Ashanti’s workforce, I convey
our heartfelt condolences to the families, colleagues and the
communities of our departed colleagues.
A thorough review of our safety strategy was conducted in the
second half of 2020, with detailed input from each of our sites and
the safety leadership across our business. Implementation of the
updated strategy – focused on technology and innovation, deeper
learning from high potential incidents, and compliance to the critical
controls that protect our employees from injury – is already well
underway and will be closely monitored.
Environment, sustainability and governance
Our strategy compels us to seek improvement in the areas of
environmental stewardship, social performance and the strength
of our governance frameworks and oversight. Excellence in these
areas will strengthen our social license to operate and improve our
sustainability and ability to create value in the long term.
Mitigating our impact on the environment – and climate change
in particular -- is non-negotiable. Work is underway to reduce
the use of scarce resources such as land and water, and to limit
greenhouse gas emissions. We’ve been doing that for some time,
reducing total GHG emissions by 48% since 2008, and recycling
76% of water use.
The board, through its Social, Ethics and Sustainability Committee,
will in the course of 2021 review an updated climate change
strategy and new medium-term emissions targets including the
pathway to net zero emissions. We will also be making our first
disclosure in line with the Task Force on Climate-related Financial
Disclosure (TCFD).
There were other ESG successes during the year (see Rewarding
delivery
), with 88.5% compliance with noise and dust monitoring
across our operations. Injury rates fell to their lowest level ever at
2.39 injuries per million hours worked, well below the global industry
average, driven by a 99% compliance to our major hazard controls.
No disruptions caused by community protests were recorded at our
operations, and no human rights violations were reported.
In addition, our value to the communities in which we operate
was clear. Procurement expenditure totalled $1.6bn, with 82%
spent in host countries. Taxes and royalties of $1.1bn were paid,
and employees’ salaries and benefits ended the year at $508m
(see
economic value-added statement). Those monies greatly
improve resilience in the communities around our operations when
several other economic sectors are under severe strain. We’re
proud of that contribution.
Leadership changes
Kelvin Dushnisky stepped down as chief executive officer on
1 September 2020. The Board thanks Kelvin for his contribution
in delivering on the company’s strategy during his two-year tenure
and wishes him well in the future.
Our Chief Financial Officer Christine Ramon, stepped in as interim
CEO and has provided leadership to the organisation as it continued
to deliver on its strategy, meeting key operational, financial and
social objectives. The board is conducting a thorough search for a
permanent CEO, considering both internal and external candidates.
Dr Kojo Busia was appointed as independent non-executive
director on 1 August 2020 and chair of the Social, Ethics and
Sustainability Committee on 1 December 2020. He brings a wealth
of experience in sustainability, governance and public policy.
On 7 December 2020, Sipho Pityana resigned from the board
after 13 years as a director, including the last six as Chairman.
The board thanks Mr. Pityana for the significant contribution
he made to AngloGold Ashanti and in particular the focus on
sustainability and safety.
Thank you
I want to thank my fellow directors, our Interim CEO, Christine
Ramon, the leadership team and every employee across the
company for their courage and resourcefulness during an especially
challenging year, and for continuing to uphold the values of
AngloGold Ashanti. To all our stakeholders, our thanks goes to
you for your support throughout this very challenging year. We will
continue to work diligently and in line with our values to ensure that
AngloGold Ashanti delivers on our commitments.
Maria Ramos
Chairperson
26 March 2021
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WHO WE ARE – CORPORATE PROFILE
ANGLOGOLD ASHANTI AT A GLANCE
Third-largest gold producer globally and the largest on the
African continent, producing 3.047Moz of gold and employing an
average of 36,952 people (including contractors) in 2020
Responsible gold miner, in partnerships with host communities
and governments – we aim to create value for all our
stakeholders over the long term
Listed on the Johannesburg, New York, Australian and Ghana
stock exchanges
A geographically diverse shareholder base includes the world’s
largest financial institutions
Market capitalisation of $9.4bn as at 31 December 2020
Included in the JSE Top 40 Index, the S&P Global CSA, the
FTSE/JSE Responsible Investment Index Series (the FTSE4Good
Index), the Responsible Mining Index and the Bloomberg 2021
Gender-Equality Index
AngloGold Ashanti Limited (AngloGold Ashanti), with its head office in South Africa, is an independent, global gold mining
company with a diverse, high-quality portfolio of operations, projects and exploration activities across nine countries on four
continents. While gold is our principal product, we also produce silver (Argentina) and sulphuric acid (Brazil) as by-products. In
Colombia, feasibility studies are currently underway at two of our projects, one of which will produce both gold and copper.
STREAMLINED
portfolio
STRONGEST
balance sheet in a decade
RAMP UP
at Obuasi continues
UNLOCKING VALUE
in Colombia
North America
South Africa
■ United Kingdom
Europe
Asia
Rest of the world
Geographic diversity
of shareholders
(%)
38
32
14
5
4
7
Gold pour, Geita, Tanzania
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Legend
Operations
Projects
Greenfields exploration
OUR FOOTPRINT
AMERICAS
1    Argentina
Cerro Vanguardia (92.5%)
2    Brazil
Serra Grande
AGA Mineração
3    Colombia
Gramalote (50%)
(1)
La Colosa
Quebradona
AFRICA
4    Guinea
Siguiri (85%)
5    Ghana
      Iduapriem
      Obuasi
(2)
6
Democratic Republic of
the Congo (DRC)
Kibali (45%)
(3)
7    Tanzania
Geita
AUSTRALIA
8    Australia
Sunrise Dam
(4)
Tropicana (70%)
Note: Percentages indicate the ownership interest held by
AngloGold Ashanti. All operations are 100%-owned unless
otherwise indicated.
(1)

Change in ownership from 51% to 50%; managed by
B2Gold
(2)

Obuasi’s redevelopment project began in 2019
(3)

Kibali is operated by Barrick Gold Corporation (Barrick)
(4)
As at 31 December 2020, a maiden Mineral Resource
was declared for Butcher Well
2
3
1
7
6
5
4
8
4
CONTINENTS
10
OPERATIONS
3
*
JOINT VENTURE
PARTNERS
3
PROJECTS
* B2Gold at Gramalote; Barrick at Kibali; and Independence Gold Corp. at Tropicana
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ANGLOGOLD ASHANTI – 2020 AT A GLANCE
FOCUSED
PORTFOLIO
2020 – another redefining year for AngloGold Ashanti
We improved the quality of our portfolio, balancing competing capital
needs, and delivered the Obuasi redevelopment project on time and
within budget, supplemented the Ore Reserve in our core portfolio, further
reduced debt and grew our dividend, all while managing our operations
through the most challenging year ever – due to COVID-19.
3.0Moz
production decline reflects
COVID-19 challenges and
streamlined portfolio
$1,059/oz
includes impact of COVID-19-related
stoppages
2.39
AIFR rate improved 28% on 2019
2018
2019
2020
Production
(000oz)
3,400
3,281
3,047
All-in sustaining cost
($/oz)
2018
2019
2020
976
998
1,059
AIFR
(per million hours worked)
2018
2019
2020
4.81
3.31
2.39
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6.1Moz
Added to Ore Reserve on a gross basis and 2.6Moz on net basis for a net increase of 10% year-on-year,
portfolio production life increased to about 11 years.
Positioning the business to sustainably grow production and margins
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AngloGold Ashanti Limited <IR>
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0.24
times
*
from 1.0 in 2019
62%
*
year-on-year
56%
*
year-on-year
Adjusted EBITDA
($m)
2018
2019
2020
1,388
1,580
2,470
Adjusted net debt
($m)
2018
2019
2020
1,659
1,581
597
Adjusted net debt to adjusted EBITDA ratio
(times)
2018
2019
2020
1.2
1.0
0.24
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About AngloGold Ashanti / World in which we operate and strategic response / Delivering on our strategy / Leadership and accountability / Corporate information
Free cash flow before growth capital
124%
year-on-year to $1bn
>
5x
Dividend increased more than fivefold
to approximately 48 US cents per share
* From continuing operations
AngloGold Ashanti Limited <IR>
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HOW WE CREATE VALUE
By understanding our context…
External operating environment
The global macro-economic, geopolitical and financial landscape,
as well as the location of our operations and their specific political
and social dynamics, all affect our ability to deliver on our strategy
and to create value over time.
See Our external operating environment
Stakeholder engagement and key relationships
In conducting our business, we have an impact on stakeholders
and they in turn, through their actions and expectations, have
an effect on our business and our social licence to operate.
Our approach to inclusive stakeholder engagement seeks to
balance the interests and expectations of material stakeholders
over time. Constructive, honest and respectful dialogue with
stakeholders is vital to manage these expectations and any
material issues identified.
Our most material stakeholders are:
See Integrated stakeholder engagement and material issues
…and identifying our material
risks and opportunities…
Risks and opportunities
Understanding the world in which we operate, the supply and
availability of the scarce resources we rely on to conduct our
business, as well as stakeholder relationships and expectations,
guides us in identifying, prioritising and managing our risks and
opportunities. This enables effective planning to mitigate such risks,
to act on opportunities and to achieve our strategic objectives.
See
Managing our risks and opportunities
Material matters
Our materiality process is aimed at identifying, prioritising
and integrating into our strategy and business model the
most material matters affecting our ability to create value.
Understanding and managing stakeholder needs, expectations
and material concerns, and how we in turn affect them, is vital
to the successful delivery on our strategy and to value creation.
See Materiality and our material matters , Integrated
stakeholder engagement
and
material issues
OUR VISION
To be the leading
mining company
OUR MISSION
To create value for our
shareholders, our employees
and our business and social
partners by safely and
responsibly exploring, mining
and marketing our products
OUR VALUES
Our six values guide all decisions
made and actions taken in the
conduct of our business. These
values link our business activities
to our environmental, social and
governance (ESG) responsibilities
To fulfil our purpose and mission, we have in place an integrated, robust business model and a strategy that is resilient and
sufficiently flexible to respond to the constantly changing world in which we operate.
We aim to sustain value creation in the longer term, and endeavour to maintain flexibility in strategic decision making to respond to a
dynamic operating environment and unpredictable economic and commodity cycles. Our business model depends on
the following:
1
2
1. Exploration and development
Establish and maintain a pipeline of
economically viable and competitive
projects to develop long-term mining
operations. Exploration is a cornerstone of
our business.
Capital inputs required:
2. Mining, processing and refining
Operate and maintain mining and processing
infrastructure and equipment, and ensure a
skilled and trained workforce to enable cost-
efficient, safe operations.
Capital inputs required:
3. Sale of product, financial management
Sale of gold and by-products to generate
revenue. Solid financial management
and disciplined capital allocation ensures
positive, sustained cash flow and returns.
Capital inputs required:
OUR BUSINESS – WHAT WE DO
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...we strategise and allocate
resources to…
Business model
We actively manage our activities as we try to mitigate
negative impacts of our operations and seek to achieve
positive outcomes.
Strategy
Mining is a long-term business, and so our strategy aims to
create sustained value over the life of our mining operations and
beyond. This involves careful allocation of key resource inputs
– the natural, human, intellectual, financial, manufactured,
and social and relationship capitals – which are essential to
achieving this aim.
Improve
portfolio quality
Ensure financial
flexibility
Maintain long-term
optionality
Optimise overhead,
costs and capital
expenditure
Focus on people,
safety and
sustainability
Supporting
our strategy for
sustainable cash
flow improvements
and returns
See
Our strategy
,
Our business model
and
Delivering on
our strategy
…create and preserve value for
stakeholders
Sustained value creation over time requires responsible
corporate citizenship and encompasses social upliftment,
careful environmental stewardship, effective governance
and the creation of economic opportunities for communities,
suppliers and governments. Our mission to create value is
supported by our emphasis on excellence in ESG performance,
through our values and the foundation of our strategy
– a relentless focus on people, safety and sustainability.
Understanding the long-term impacts of decisions made on
the allocation and the use of capital inputs, and the resulting
strategic trade-offs, is essential to the long-term creation and
preservation of value, while limiting value erosion.
Our most significant/material stakeholders and the associated
values are:
Stakeholder
Desired value creation
Shareholders
(investors,
financiers)
To generate sustained growth in total
shareholder returns. We are focused on
consistently delivering improved cash flows
through the cycle
Employees
and unions
To be an employer of choice and to provide the
opportunity to earn, learn and develop in a safe,
values-driven environment, while promoting
inclusivity, diversity and non-discrimination. We
actively promote localised employment in the
countries in which we operate
Communities
To contribute positively to socio-economic
development. Our aim is that once mining
ceases, host communities are resilient and self-
sustaining
Suppliers
To provide business opportunities and growth.
We encourage local procurement where
possible, as well as inclusivity and diversity
Environment
To be environmentally responsible, to mitigate
and limit the impact on the environment of our
mining activities and where possible to protect,
restore and rehabilitate the land and biodiversity.
We aim to reduce carbon emissions and related
intensities, and to minimise water withdrawal
Governments To be a responsible, law-abiding corporate
citizen of the countries in which we operate
and to pay our due contributions (taxes,
royalties, duties) to government. We partner
with government in the development of local
services and infrastructure when and where
necessary
See
Our business model
,
Integrated stakeholder engagement
and
material issues
,
ESG performance – overview
,
Delivering
on our strategy
and
Strategic capital trade-offs
3
4
4. Rehabilitation and mine closure
Develop and maintain constructive stakeholder relations to
support our regulatory and social licences to operate; minimise
and mitigate our environmental impact and manage closure
responsibly and in line with our values.
Capital inputs required:
AngloGold Ashanti Limited <IR>
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MATERIALITY PROCESS AND MATERIAL MATTERS
Material matters are those most likely to substantively affect our ability to preserve and create value over time. To identify
matters that are material to AngloGold Ashanti, we apply a comprehensive process to determine what these issues are, and to
consider their likely effects on our strategy, our performance and governance as well as our outlook.
Determining materiality
Our materiality process aims to identify those economic, social and environmental matters that present material risks, while simultaneously
taking into account our governance, external operating context and those issues of particular concern to stakeholders.
Analyse
Review and evaluate our external
operating context in terms of political,
economic, social, technological, legal and
environmental factors
Research and analysis of media coverage,
analyst reports and emerging industry
issues
Benchmarking of peer reporting
Engage with external stakeholders to
understand expectations and needs
Respond, monitor, report and integrate
Once identified and ranked, material
matters are reviewed and integrated
into our strategic objectives and risk
management
Key performance indicators are developed
and applied across the Group and, where
appropriate, included in incentive structures
Performance is assessed on an ongoing
basis and, where appropriate, remedial
action taken
Identify
Externally facilitated review process to
agree material matters and risks
Categorise and rank matters by subject
and area
Prioritise
Based on analysis and identification,
prioritise those matters and risks that
could potentially impact value creation
over time or that may result in value
erosion
Participants include senior management
and those responsible for risk
management and governance to ensure
an integrated approach and alignment
with all areas of the business
1
2
3
4
A materiality workshop, facilitated by external advisers was held in November 2020. Participants in the workshop represented a number
of disciplines across the business, including investor relations, finance, environmental, social (safety and health, human resources,
communities) and governance. The workshop was preceded by a review of stakeholder input and our external environment to ensure the
outcome of the workshop was balanced and constructive.
Senior executives and functional heads of discipline have a common understanding of AngloGold Ashanti’s material issues and risks, the
changing risk landscape and the actions required to improve the sustainability of the business.
The top issues were identified and a decision taken to replace some of the issues for reporting purposes.
Iduapriem
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Our materiality matrix
3
4
5
6
7
8
9
10
Most
important
Most
important
Least
important
Significant
stakeholders
Impact on AngloGold Ashanti’s ability to create value
4
5
6
7
8
9
10
Environment
Social
Economic
Cross-cutting
Governance
Human rights
Epidemics
Tailings
management
Water
management
Rehabilitation and
biodiversity
Political instability
and interference
Security and crime
Commodity market
Corruption, ethics and
conflict of interest
Sustainability and growth
Closures and legacies
Artisanal and illegal mining
Innovation
Diversity and inclusion
Inclusive procurement
Talent management
Supply chain governance
Cultural heritage and people’s rights
Climate change and
decarbonisation
Building
thriving communities
Preventing fatalities,
accidents and injuries
Employee and
community health
2020 MATERIAL ISSUES
Social
Employee and community health
Employee safety
Building resilient, self-sustaining
communities (including inclusive
procurement)
Integrated talent management
Security
Cross-cutting
Human rights
Artisanal and small-scale mining
Integrated closure (including
environmental, economic and social
considerations)
Environment
Water
Climate change and energy use
Tailings management
Governance
Business sustainability and growth
Navigating through regulatory and
political risks
AngloGold Ashanti Limited <IR>
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Material matters, related stakeholders and capitals affected
The material issues most likely to affect our ability to create and preserve value, and to affect value created for stakeholders in the
long term, are listed in the table below.
Related:
Stakeholders
Capitals and value affected
Employee and community health
(Ebola, malaria, COVID-19 pandemic)
Employees, communities, investment
community
Employee safety
Employees, investment community
Business sustainability and growth
Employees, investment community,
governments
Building thriving communities
(including local procurement)
Communities
Human rights
Employees, communities
Tailings management
Employees, communities, investment
community, governments and regulators,
industry peers
Navigating regulatory and political risks
Governments and regulators, investment
community
Water management
Communities, governments and regulators,
investment community
Climate change crisis and energy use
Communities, investors, governments
and regulators, investment community
Integrated closure
(rehabilitation and biodiversity; legacies)
Communities, governments and regulators
Artisanal and small-scale mining
Communities, employees, governments
and regulators
Security
Employees, communities, governments
and regulators
Integrated talent management
Employees, investment community
While these material matters and their relationship to the capitals guide the content of this report, they are discussed more fully
in the
<SR>.
MATERIALITY PROCESS AND MATERIAL MATTERS CONTINUED
KEY STAKEHOLDERS
Investment
community
Employees
and unions
Governments and
regulators
Communities
Suppliers
Industry partners
and peers
OUR CAPITALS
Natural
capital
Human
capital
Manufactured
capital
Financial
capital
Social and
relationship capital
Intellectual
capital
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Creating value entails optimising and balancing
the use of these inputs, enhancing positive
outcomes and impacts, minimising those that are
negative, and delivering on our strategy.
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AngloGold Ashanti Limited
<IR>
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OUR BUSINESS MODEL
Our ability to create value depends on the use of
and access to various capital inputs – this includes
access to financial capital and economically
viable orebodies, as well as to the necessary
mining infrastructure, including utilities, plant
and equipment, and a skilled and experienced
workforce. Creating value entails optimising and
balancing the use of these inputs, enhancing
positive outcomes and impacts, minimising those
that are negative, and delivering on our strategy.
Operating context
Those risks and issues arising in our external operating
environment that have the potential to affect our ability
either positively or negatively to create and preserve
value, include:
Global health concerns – the COVID-19 pandemic
and other diseases such as malaria and Ebola
Volatile global economic and commodity markets
resulting in an unpredictable gold price and currency
movements
Relative cost competitiveness, particularly in the
resources sector
Political uncertainty and country risk – instability,
regulatory and policy challenges
Community expectations and the need to work with
stakeholders to build self-sustaining communities
Climate change and decarbonisation efforts
Management of water, a scarce resource
Increasingly comprehensive reporting and disclosure
requirements
See Managing our risks and opportunities,
external operating context and materiality and
material issues
Governance
Our all-encompassing governance framework, systems
and processes, together with our values, inform
how we conduct our business and guide all that we
do – our operations, decision-making, behaviour
and stakeholder engagement. Our governance
structures acknowledge our social and environmental
responsibilities.
Our corporate governance aims at achieving:
Responsible, ethical leadership and conduct, in line
with our values and code of ethics
Effective oversight and control of our business and
the effective delegation of responsibility
Inclusive stakeholder engagement to promote trust
and legitimacy and to aid understanding of our
impacts on stakeholders
See
Corporate governance
INPUTS
Essential capital inputs
Why important
Required inputs
Natural
capital
Our primary business
activity is the exploration
for, development and
operation of gold orebodies
to transform these into
economic and social value.
To do this, we need:
Pipeline of economically
viable Mineral Resource
and Ore Reserve
Access to various natural
resources – land, water
and energy, among
others
At the start of 2020, an inclusive
Mineral Resource of 175.6Moz and Ore
Reserve of 43.9Moz
Pipeline of economically viable orebodies
in our existing mines, greenfield projects
and exploration sites
Land – 461,511ha under management
of which 25,881ha was disturbed and
5,243ha rehabilitated at the start of
2020
Other natural resource inputs:
Energy: 25.57PJ consumed
Water: 47.37 gigalitres withdrawn
Diesel: 216.36kL consumed
Cyanide: 25.73t
Financial
capital
Access to cost-efficient
capital is vital to fund
our business, sustain
operations, ensure future
growth, and to pay for the
use of other capital inputs
necessary to our business.
Our main sources of funding
are operational cash flow,
debt and credit facilities,
and equity.
At the start of 2020, our financial capital
included:
Totally equity of $2.7bn
Cash and cash equivalents from
continuing operations of $0.456m
Adjusted net debt from continuing
operations of $1,581m
Undrawn borrowing facilities of
$1,752m
Investments in associates and joint
ventures of $1,581m, a source of
dividends
Other investments of $86m, a source
of dividends
Market capitalisation of $9.28bn
Human
capital
The conduct of our
business and delivery on
our strategy depend on
the skills and knowledge,
productivity, behaviour and
well-being of employees.
Effective talent management
enables AngloGold Ashanti
to better navigate a
volatile macro-economic
environment and to achieve
our strategic objectives
Representative, skilled, engaged and
motivated workforce
Employees with the necessary mining
and related technical skills and
expertise – employed 36,952 people,
including 16,222 contractors
$10.8m invested in training and
development
Cordial and constructive engagement
with all employees
Strong, experienced and diverse
leadership
Motivational reward structures linked to
strategic performance and delivery
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Related challenges/constraints
Related strategic pillars/ capitals affected
Availability of increasingly scarce, economically viable orebodies must be managed to
maximise returns and the value generated over their finite lives
Mining and its related processing activities have certain inevitable environmental impacts.
Challenges include:
Land rehabilitation and restoration, the protection and preservation of biodiversity
Conserving water, a scarce resource in many areas in which we operate and one which is
shared with other users/stakeholders. Water re-use is a priority
Efficient energy use, reducing the use of non-renewable energy and increasing that of
renewable energy to limit emissions and our impact on the climate
Responsible deposition and management of mining waste streams, especially tailings
Strategic pillars
Other capitals affected:
Ensure sufficient financial capital is available to conduct our business, to balance competing
demands for financial capital and optimise its allocation
Generating cash flow to fund the business as well as future growth depends on various
factors, both external and internal
We operate in a constrained global financial environment where the cost of financial capital
is dictated by company fundamentals, investor sentiment, political and country risk, and the
overall health of the global economy
Our cost efficiency impacts cash flow
Judicious balance sheet management is necessary to ensure the required level of liquidity to
sustain the business, finance growth, reduce debt and pay dividends
Sovereign ratings downgrades could increase the cost of capital
Strategic pillars
Other capitals affected:
Talent attraction, retention and succession planning ensures we have the skills and expertise
necessary to operate our business efficiently and deliver on our strategy. COVID-19-related
challenges highlight the importance of talent retention
Workforce localisation and the reduction of expatriate employees are focus areas
Inclusivity, equity and diversity is a focus for ESG investors and broader society
Internal appointments followed changes to the board and executive management
Mining can be hazardous, and a safe, healthy workforce is essential to the execution of our
strategy. COVID-19 was the single most significant challenge to employee well-being
Strategic pillars
Other capitals affected:
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INPUTS continued
Essential capital inputs
Why important
Required inputs
Manufactured
capital
Efficient conduct of our business
relies on the development and
maintenance of our mining operations
and related infrastructure and
equipment.
Ten mining operations with well-maintained infrastructure, gold processing plants and
equipment. The book value of our property, plant and equipment is $2.9bn as of
31 December 2020 (31 December 2019: $2.6bn excluding the South African portfolio)
Exploration and mining rights, permits and licences
Three projects (Obuasi, Gramalote, Quebradona) are being developed and brownfields
projects underway at Geita, Siguiri, Kibali, Cerro Vanguardia, AGA Mineração, Sunrise Dam,
and Tropicana
Consumed:
Cyanide – 23.8t
Explosives – 50.2t
Liquid fossil fuels – 270,063kL
Lubricants – 6,047kL
Total acid – 10,412t
Total alkali – 141,439t
Social and
relationship
capital
Relationships with many of our
stakeholders support our license to
operate, and must be based on trust
and transparency. These relationships
also help protect our reputation, and
enable us to deliver on our strategy.
Stakeholders include communities,
governments, NGOs, and investors,
among others.
Our Values and Code of Ethics guide our stakeholder engagement
Commitment to maintaining our integrity and reputation among stakeholders, including
investors, communities, civil society, NGOs, suppliers, governments and regulators
Dedicated community engagement structures facilitate engagement and promote supportive
communities
A reliable, cost-focused, efficient and representative supplier database, adhering to our
Supplier Code of Conduct. Local suppliers are given preference
Constructive relationship with government and regulators
Accurate, transparent and consistent disclosure
Responsible ESG practices, consistent financial and operational performance and delivery on
our strategy earns investor confidence
Intellectual
capital
An ethical, performance-based
culture, solid governance framework
and efficient management systems,
including enterprise risk management,
are vital in facilitating delivery on our
business strategy. Underpinning
these is innovation and technology
to enhance and optimise efficiencies
and outcomes.
Integrated, focused strategy supported by sound management systems, corporate
governance framework and an effective risk management framework
Our Values and Code of Ethics guide our behaviour and all decision making
Talent management programme to maintain bench strength
Competitive remuneration and clear performance management systems aim to ensure the
best skills are attracted and retained
Technology to enable the constant monitoring of all information technology (IT) assets in
real time and any possible threats
OUR BUSINESS MODEL CONTINUED
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Related challenges/issues
Related strategic pillars/ capitals affected
Continued access to reliable
manufactured capital entails
focused investment in its
development, maintenance,
upgrade and replacement
Well-maintained, functional
infrastructure, plant and
equipment, together with the
necessary technical support, are
essential to cost-efficient, steady
operations. Maintenance of
manufactured capital is included
in stay-in-business capital
expenditure
Balancing competing demands
for financial capital, while
allowing for unexpected
equipment failure and potential
supplier delays
Strategic pillars
Other capitals affected:
Stakeholder trust is vital in
securing our social licence to
operate; low levels of trust could
potentially impede the business
The importance of strong
stakeholder relationships has
been highlighted because
of declining levels of trust in
global organisations
To maintain trust, relationships
are carefully nurtured
Strategic pillars
Other capitals affected:
Attracting and retaining the
talent required to enhance our
intellectual capital is key to
obtaining the skills required
to drive innovation and
technological development
The costs of digitalisation,
technological innovation and
R&D must compete for
capital allocation
Increased cybersecurity threats
Maintaining cybersecurity across
all operations is essential
Strategic pillars
Other capitals affected:
OUTPUTS AND
RELATED CAPITALS
Key outputs of business activities
Related capitals
42.1Mt of ore treated/milled
(attributable)
(1)
Produced 3.0Moz of gold
– and 3.6Moz of silver and
188t of sulphuric acid as by-
products
Produced 140.84Mt of
overburden and waste rock
Deposited 70.52Mt
of tailings
Generated revenue of $5.5bn
from the sale of gold and by-
products
(2)
Contributed 1,123kt of
GHG emissions, through the
consumption of 5.989PJ of
grid-based electricity
(1)
Excludes surface and dump ore treated/milled
(2)
Includes equity-accounted joint ventures
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OUTCOMES OF OUR BUSINESS ACTIVITIES
Action to enhance and optimise value and prevent its erosion
Natural
capital
We work to mitigate direct environmental impacts of our activities and to offset these where possible.
The South Africa and Mali asset sales streamlined our portfolio to help ensure value creation in the longer term.
Initiated a focused Ore Reserve programme
$162m invested in brownfields and greenfields exploration to develop the Ore Reserve pipeline.
Feasibility studies on our two Colombia projects were advanced, bringing closer the introduction of new
production sources that will be mostly hydropowered
About $24m invested in the project to convert our Brazil TSFs to dry stacking, and another $72m planned for this
work in 2021
Initial, bottom-up work done in preparation for the update of our climate change strategy and the setting of
emission targets, including physical risk assessments at each site
More detailed information on our activities see: CEO’s review, ESG performance and Mineral Resource and Ore
Reserve – summary in this report; and relevant sections in the <SR>
Financial
capital
Streamlined the portfolio through the sale of assets in South Africa and Mali, generating cash proceeds of
$239m including dividends and loan payments
Most of these funds were used to reduce debt
Free cash flow generation was the highest since 2011
A doubling in the dividend payout ratio contributed to a more than fivefold increase in the annual
dividend payment
See
CFO’s report
Human
capital
We invest in technology systems and procedures to ensure workplaces are safe, employees are healthy, motivated, and
equipped to do their jobs. We provide training and development, ensure fair labour practice, promote local employment
and diversity and inclusivity.
Our safety strategy aims to minimise harm and injury in the workplace.
Our COVID-19 response saw all employees receive salaries and wages during periods of enforced lockdown
and the suspension of operations.
Our internal talent pipeline is strengthened through our established talent review and succession plan.
Diversity, inclusion and localisation, especially in the Africa region, are important focus areas
See ESG performance – an overview and People are our business in this report as well as relevant sections
in the <SR>
OUR BUSINESS MODEL CONTINUED
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Outcomes achieved
Stakeholders affected
At 31 December 2020, our mining activity, project development and sale of
assets resulted in:
Mineral Resource (inclusive) of 124.5Moz
Ore Reserve of 29.7Moz
Gross Ore Reserve increased by 6.1Moz – extending average operating life
by around 11 years
Eight reportable environmental incidents (2019: 3)
No community environment-related grievances
Land
25,881ha of land disturbed by our activities – 5.6% of land under management
5,243ha land rehabilitated – 1.1% of land under management
Water
Water re-use efficiency of 73% for 2020 compared to 76% in 2019
Energy and GHG emissions
Energy consumption improved while efficiency declined
Stakeholder
Communities
NGOs
Investors
Employees
Free cash flow rose by 485% to $743m, from $127m in 2019
Adjusted net debt from continuing operations declined by 62% to $597m
Adjusted EBITDA rose 50% year-on-year to $2.6bn
Adjusted net debt to adjusted EBITDA ratio from continuing operations fell to 0.24 times
Cash and cash equivalents were up 192% to $1.33bn
No employees lost wages or benefits during lockdowns and COVID-19
related disruptions
Improved shareholder returns:
Paid a dividend of approximately 48 US cents a share – a fivefold increase from 9 US
cents a share in 2019
Share price increased marginally over the year for a market capitalisation of $9.4bn at
year end 2020
Stakeholder
Shareholders and investors
Regrettably, six colleagues lost their lives in 2020 in workplace accidents
All injury frequency rate improved 28% to 2.39 injuries per million hours
All occupational disease frequency rate improved 47% to 0.72 cases per million hours worked
Improved employee skills, enhancing their employability – $10.8m invested in training and
Diversity – 33% of the executive committee and 44% of the board are women
Increased employee engagement and improved employee relations because of frequent
COVID-19-related communication
Paid $508m in salaries, wages and other benefits
Stakeholder
Employees
Shareholders and investors
Governments and regulators
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OUR BUSINESS MODEL CONTINUED
OUTCOMES OF OUR BUSINESS ACTIVITIES continued
Action to enhance and optimise value and prevent its erosion
Manufactured
capital
Our actions here aim to ensure our mines operate efficiently and their operating lives are optimised.
Two projects in Colombia are progressing – their feasibility studies are underway and the results are expected
by end June 2021
The first phase of the Obuasi Redevelopment Project was completed. The overall project was 90% complete
by end 2020
See Strategic capital trade-offs , CEOs review and Regional review
Social and
relationship capital
Our activities here are aimed at ensuring constructive stakeholder relations, which are vital to maintaining our
regulatory and social licences to operate
As a responsible corporate citizen, we aim to share the socio-economic benefits of our mining activities and
support resilient, self-sustaining communities
Regular and constructive engagement with local, regional and national governments
Our socio-economic activities are aligned with local development targets
Focus on human rights and human rights awareness training
Concerted effort to ensure and maintain positive community relations
For the detail on these activities, see ESG performance – an overview and relevant sections in the <SR>
Intellectual
capital
A detailed digital transformation roadmap has been developed that has defined usability for various areas with
the potential to improve operating and safety performance, and ensure reliable delivery and compliance with
strategic and business plans
For further detail, see
Planning for the future – projects, exploration and innovation
24
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Outcomes achieved
Stakeholders affected
Number of operations reduced from 14 to 10, after sale of the South Africa and
Mail assets
Obuasi – creating value over the longer term
Advancement of the Obuasi Redevelopment Project, once fully ramped up, is expected
to contribute 350,000-400,000oz of gold annually to production for first 10 years of full
production
Annual production will be equivalent to more than 10% of group production
Employs 4,210 people (of whom more than 90% are local nationals) – focus on
in-country recruitment and local procurement
Colombia projects – allowing for long-term optionality
Pending board approval, the Colombia projects are expected to contribute an
estimated 600,000oz of annual gold-equivalent production in their first five years, once
both are fully ramped up
Significant resources and reserves, and the equipment and infrastructure needed to
develop them
Stakeholder
Shareholders and investors
Employees
Communities
Governments and regulators
Communities
Overall positive relationship with communities boosted by active engagement and the
provision of local employment and procurement opportunities, infrastructure and services
Community resettlements and community demands for services, jobs, and reduced
environmental impact
Accolades received for community work in Colombia, Tanzania and Ghana
No reported human rights violations for a third consecutive year
Total local procurement spend of $2.1bn including capital purchases
Total community investment of $20m
Governments and regulators
Good regulatory compliance – no fines received for material non-compliances
$1,055m paid in total to governments
Investors
Strong financial performance and transparent engagement and disclosure, supports
investor and shareholder confidence
Dividends totalling $38m paid to shareholders
Stakeholder
Communities (including NGOs, civil
society, etc.)
Governments and regulators
Shareholders and investors
Employees
Employees
Digital disruption
Technological challenges of remote work for many employees, accelerated by the
COVID-19 pandemic and resultant move to remote working
Stakeholder
Employees
AngloGold Ashanti Limited <IR>
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About AngloGold Ashanti / World in which we operate and strategic response / Delivering on our strategy / Leadership and accountability / Rewarding delivery / Corporate information
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VALUE CREATED, PRESERVED AND ERODED
BY DELIVERING ON OUR STRATEGY
Value for stakeholder
Value for AngloGold Ashanti
Long-term value
Shareholders and investors
(including providers of capital)
Dividend payments
Share price appreciation
Repayment of debt and interest
Improved cash flows from a steady
performance and increased gold price
Debt reduced from cash flows and asset
sale proceeds
Increased earnings and cash flow
provide greater optionality in capital
allocation and investment
Improved liquidity and greater access
to capital
Reduced debt levels
Sustained positive cash flows over the
long term will provide shareholders with
positive returns
Employees
Fair pay in return for work
Wages and salaries earned
support employees’ livelihoods
Skills development and learning,
personal career growth
Employee benefits, including
healthcare
Stable workforce
Improved productivity
Ability to attract and retain talent
Motivated, engaged employees
Beneficial, co-operative labour relations
Sustained employment over the longer
term means the steady receipt of salaries
and wages, with the subsequent sustained
contributions to local expenditure and local
economic activity, boosting local economies
and creating more resilient communities
Suppliers
Reliable offtake of goods and
services
Local procurement supports local
business and workforce, and
creates resilient economies and
societies
A well-established database of
reliable, cost-efficient suppliers supports
delivery on our strategic objectives,
particularly optimising overhead costs
and operating expenditure
Strong relationships with suppliers
helped ensure business continuity during
disruptions to global supply chains (eg.
COVID-19)
As a long-term customer for suppliers, we
contribute positively to local communities,
encouraging economic growth over time.
In exchange, suppliers will help ensure
the supply chains remain resilient during
widespread disruptions
Communities
Employment and procurement
opportunities – community
members employed by the
mines in turn contribute to local
economies
Investment in socio-economic
development projects such
as agriculture, education and
infrastructure
Improved standards of living
Constructive community relationships
support our social licence to operate
Reduced incidence of operational
disruptions caused by community protests
Our social aims include contributing to,
and promoting resilient, self-sustaining
communities. Our community investment
focuses on developing socio-economic
initiatives that are economically viable and
sustainable in the long term
OUR BUSINESS MODEL CONTINUED
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Value for stakeholder
Value for AngloGold Ashanti
Long-term value
Governments
Payment of taxes, royalties and
other duties support the national
fiscus in host countries
Payment of employee personal
income tax
Partners in our operations benefit
from earnings generated
Collaborative partnerships to
develop local infrastructure
Constructive, steady relations with
governments and regulators help maintain
mining licences
Regulatory compliance ensures
licence to operate
Continued payment of taxes, royalties
and duties, by both the company and
employees, contributes to the national
fiscus of each country in which we operate,
ensuring shared value with our host
governments and communities
Environment
Mining is an environmentally
disruptive activity. We aim to
minimise our impacts and help
restore this natural capital
Environmental management
mitigates the damage caused
through land disturbance,
protecting biodiversity and the
responsible consumption of
natural resources and waste
management
Improved environmental performance aids
inclusion in ESG performance indices,
boosting responsible investment in our equity,
supporting our valuation in the long term
Reduced environmental impact and
carbon footprint in line with the SDGs
Land rehabilitation to repair damage or
restore land
Improved efficiencies (of water and energy
especially) and responsible resource
consumption contribute to lower operating
costs
Our environmental rehabilitation
and biodiversity programmes aim, over
time, to restore land for sustained,
alternative economic use. This is linked
to creating value for communities and
is aligned with our values to respect the
environment and to leave communities
better off for AngloGold Ashanti having
been there
Iduapriem – exploration core samples
Iduapriem – gold ingot
27
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OUR EXTERNAL OPERATING CONTEXT
The environment in which AngloGold Ashanti operates is dynamic and often complex, influencing delivery on our strategy and
our ability to create value.
The impact of the COVID-19 pandemic was profound, bringing a series of challenges to our operating environment and wider society,
damaging economies and leading to heightened geopolitical tensions, uncertainty, increased inequality and rising poverty. Against this
backdrop, investors increased the call for companies in which they invest to improve their own sustainability, improve governance and put in
place practices that will improve their contribution to society and reduce their impact on the environment.
Externally,
AngloGold
Ashanti was
primarily
affected by:
COVID-19 pandemic
Global macro-
economics and
geopolitics
Growing climate
crisis and growing
pressure to
decarbonise
Uncertain and
increasingly
rigorous regulatory
requirements
Increasing
stakeholder/societal
expectations
Pressure from
International credit
ratings
COVID-19 pandemic
Explanation and impact
The pandemic has had far-reaching social and economic impacts.
As governments rolled out measures to limit the spread, operations
were halted in some regions. Society has been severely impacted
by extended and repeated lockdowns which have ravaged
economies and eroded societal norms.
Our response
Actively worked to mitigate the impact of significant disruptions,
operational or otherwise, due to COVID-19
Supporting host governments, NGOs and communities
Established a cross-functional team to manage crisis response
Strict operating protocols implemented at all operations
Site contingency plans under regular testing and review
Halt non-essential travel and tighten approvals for essential travel
Increased awareness, surveillance and screening
Implement strict quarantine and isolation protocols
Outlook
Although several vaccines have been approved on an emergency basis, vaccine demand will likely far outstrip supply for some time.
Vaccine programmes are largely directed by governments and influenced by the shortage of doses globally. We are actively monitoring the
situation and have in place vaccine protocols and guidance aligned with host government policies.
We are committed to ethical and responsible sourcing of vaccines in a manner that does not disadvantage vulnerable and high-risk
groups. We are working to ensure that our high-risk employees and their families are included in national priority lists and vaccination
programmes.
Capitals affected
Related strategic focus areas
For more on how AngloGold Ashanti managed its response to the pandemic across diverse geographic regions, see <SR>
.
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Global macro-economics and geopolitics
Explanation and impact
Economic uncertainty and heightened geopolitical tensions impact
a number of factors that can influence commodity prices, exchange
rates, and interest rates. These factors together with investor
sentiment influence the gold price, which in turn affects the health of
our business.
The COVID-19 pandemic led to economic shutdowns around the
world. The International Monetary Fund estimates that the global
economy shrank by 3.5% in 2020. In response to uncertainty
created by the pandemic, and to the extraordinary measures taken
by governments to lessen its economic impact, the average gold
price rose by 27% year on year. Gold revenues in 2020 were further
boosted by weaker local currencies in Brazil, Argentina and South
Africa.
Our response
To manage the variables within our control
Renewed emphasis on our ‘Operational Excellence’ initiatives to
optimise operating processes and reduce costs, while ensuring
our workforce is fully engaged and appropriately skilled
Optimise our portfolio to reduce costs and maximise margins
Strengthen the balance sheet by reducing debt improving
available liquidity and the average cost of borrowings
Disciplined capital allocation for exploration projects to extend
mine life and improve the quality of our portfolio
Outlook
Geopolitical developments including the US-China trade war, increased nationalism and political polarisation, the conclusion of Brexit and
its uncertain long-term impacts, and the ongoing pandemic and its effects, may create ongoing uncertainty that supports the gold price.
Conversely, a robust economic recovery in the US, Europe and China, aided by a successful vaccine roll-out, may bring with it rising
interest rates and consequent downward pressure on the gold price.
Capitals affected
Related strategic focus areas
Iduapriem
29
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Growing climate crisis and increasing pressure to decarbonise
Explanation and impact
Changing rainfall patterns, rising sea levels, higher temperatures,
reduced availability of potable water and extreme weather
conditions caused by global climate change remain growing
concerns for businesses, investors, broader society and
governments. This has led to growing pressure to reduce
greenhouse gas (GHG) emissions and to limit energy and water
usage and to promote responsible practices in line with the
Conference of the Parties (COP) on Climate Change, the Paris
Agreement, the SDGs and the Task Force on Climate-related
Financial Disclosures (TCFD).
Our response
Maintain focus on improving ESG performance, and developing
an appropriate climate strategy with related targets
Identify and align corporate targets with SDGs and other
guidelines
Aim to align reporting on environmental management and
climate-related impact with guidelines and recommendations of
the TCFD – work underway for 2021 disclosure
Established a Climate Change Working group to focus on the
related strategy and transition processes, to develop metrics and
targets, and oversee implementation
Maintain compliance with company frameworks, standards and
guidelines, as well as external ones including the ICMM, the
Principles for Responsible Investment (PRI) supported by the
UN, the United Nations Global Compact and the World Gold
Council’s Responsible Gold Mining Principles, among others
Outlook
Pressure from governments, investors and broader society that companies improve environmental stewardship and reduce GHG
emissions, both absolutely and in terms of consumption rates per tonne mined, is likely to intensify. This trend is being driven by national
commitments under the Paris Agreement to limit average global temperature increases to less than 1.5 degrees Celsius by 2050. To
achieve this, global emissions are projected to need reductions of 8-10% annually between 2020 and 2050. We had in place emission-
intensity targets to achieve a 30% reduction in GHG emissions per tonne processed, by 2022, from our 2007 base. This target was met
in 2018. Work is underway during 2021 to set new medium-term targets, and then to progress work toward charting a pathway to net
zero emissions. Our power mix already includes hydro-electric energy in the DRC and Brazil, while our planned Colombia projects will be
largely hydro-powered. Our Australian operations, previously powered by diesel generators, now use natural gas.
Capitals affected
Related strategic focus areas
Uncertain and increasingly rigorous regulatory requirements
Explanation and impact
Regulatory certainty facilitates decision making in relation to
long-term investments in mining assets with lives spanning
several decades. Regulatory changes relating to mining rights,
the payment of taxes and royalties, and operating or closure and
decommissioning requirements can impact investment returns.
More onerous regulations can result in an increased cost of
compliance, which may be compounded by uncertainty in the
understanding or application of legislation. This can affect the
financial position of the business and its sustainability as well as
relationships with government and regulators.
Our response
Engage constructively with governments, local stakeholder
groups and regulators to optimise the shared value and benefits
derived from the orebody among stakeholders
Carefully monitor regulatory changes to ensure compliance and
facilitated long-term planning
Outlook
While we engage regularly with all governments and regulators, particular attention is given to negotiations with regulators in Colombia
(mining and environmental permitting), Tanzania (on taxation), and other countries in Africa (Guinea, Tanzania and Ghana) that are
considering legalising or formalising small-scale and artisanal mining. We are also committed to implementing the Global Industry
Standard on Tailings Management and remaining abreast of regulations governing the management of TSFs. Conversion of our TSFs
in Brazil to dry-stacking is underway. We engage consistently with host governments and monitor and evaluate actual or anticipated
regulatory changes, for timely implementation and compliance.
Capitals affected
Related strategic focus areas
OUR EXTERNAL OPERATING CONTEXT CONTINUED
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Increasing stakeholder/societal expectations
Explanation and impact
Companies, particularly those in the extractive industries, face
increased scrutiny worldwide from an array of stakeholders:
Providers of capital and ratings agencies have increasingly
exacting expectations relating to financial, operating performance
and ESG performance
Governments’ expectations relate to contributions to the fiscus
and to national and local economies, as well as partnerships to
facilitate service delivery and social and economic development
Communities’ expectations relate to socio-economic benefits
– local employment and procurement opportunities, and the
provision of infrastructure, healthcare and education
Our response
Engage constructively with stakeholders to better understand
their requirements, to consistently manage their expectations,
and to secure and maintain our social licence to operate
Deliver on related strategic objectives and commitments
Ensure responsible corporate citizenship, in line with our values
Maintain and improve our ESG performance – set targets and
transparently report progress made in meeting these targets
Create shared value for communities in host countries – through
employment and procurement opportunities, and by investing in
socio-economic initiatives that promote long-term resilience and
self-sufficiency
Outlook
There has been increasing expectation from governments, investors and broader society for greater disclosure on ESG performance
and sustainability metrics in general. We will continue aligning our community engagement with the principles of engagement for
Indigenous Peoples and First Nations communities where applicable. On disclosure, we have comprehensive ESG data sets available
on our website, which are updated regularly, and we will continue to participate annually in a number of ESG rating agency surveys
and aim to respond promptly to related queries. The COVID-19 pandemic has enhanced the importance of community health work;
we have reacted by engaging more closely with governments and communities and providing medical and protective equipment,
donations and delivered awareness and educational campaigns. We continue our successful malaria programmes in Ghana, Guinea
and Tanzania, initiatives to protect our sites and communities from Ebola, and our COVID-19 support initiatives, among others. For
more detail see our
<SR>
.
Capitals affected
Related strategic focus areas
Pressure from international credit ratings
Explanation and impact
As the ratings agencies assess the credit risk of a company
and their ability to honour its debt obligations, the assessments
sometimes take into account the jurisdiction within which the
company is located or operates as the country’s political, economic
and regulatory environment can have an impact on the company.
Our response
Engage regularly with ratings agencies to ensure an accurate
understanding of our potential operating and financial performance
We continue to look at operational efficiencies that make our mines
more consistent in production, more resilient to gold price volatility
and thus providing stable and sustainable cash flows.
Current company ratings are as follows:
S&P: BB+/positive
Moody’s: Baa3/negative
Fitch: BBB-/stable
Outlook
While we remain headquartered in Johannesburg, South Africa, and retain our primary listing on the JSE, the impact of South Africa’s
rating by Fitch, Moody’s and S&P has decreased. However, we remain exposed to other lower-rated sovereign countries. Our overall
credit rating has improved since 2019, a result of a more stable operating performance, improved cash generation, and consistent
delivery on our strategic objectives, with the agencies taking greater account of the consistent delivery on our strategic objectives.
Capitals affected
Related strategic focus areas
31
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Principal uses of gold
Investment
Jewellery
Gold is a long-term store of value independent of other assets.
As its price often moves contra-cyclically, it can protect or
enhance the performance of an investment portfolio and
reduce volatility. The volumes of gold bought by investors have
increased steadily over the past three decades. Investment
demand increased by 40% in 2020 owing to increased
economic uncertainty, increased stock of negative-yielding
debt, and uncertainty created by the COVID-19 pandemic
Central banks are also a strong source of demand, with
volumes having increased steadily over the past decade
Historically, gold jewellery has been the strongest source of
demand, accounting for around 50% of total demand. In 2020,
jewellery demand fell, largely because of curtailed economic
activity because of the pandemic. The largest markets are India
and China
Medicine and dentistry
Technology, aerospace, environment
Gold nanoparticles are used in rapid diagnostic testing, which
have helped to revolutionise the diagnosis of diseases such as
HIV/Aids
Gold-based drugs are being developed to treat diseases such
as rheumatoid arthritis
Gold nanoparticles deliver anti-cancer drugs directly to
tumours
Gold’s being malleable and non-allergenic makes it ideal for
use in dentistry
Gold wire is widely used in almost all electronic devices that
make the internet function – computers, mobile phones,
global positioning systems, etc. As an efficient and reliable
conductor and connector, it enables the rapid, accurate
transmission of data
In space, layers of gold are used to protect astronauts and
equipment from heat and radiation
Gold nanoparticles are used to improve the efficiency of solar
cells and panels
Environmentally, nanoparticles are used to clean contaminated
groundwater by breaking down pollutants
* Source: World Gold Council
OUR EXTERNAL OPERATING CONTEXT CONTINUED
2020: 2,046.1t
*
(investment and central banks)
2020: 1,411.6t
*
(global demand for use in jewellery)
2020: 301.9t
*
(includes medicine and dentistry)
32
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MANAGING OUR RISKS AND ACTING ON OPPORTUNITIES
In the complex and often unpredictable environment in which mining companies operate, effective risk management is central
to business success. We have developed structures, standards, policies, guidelines, processes and protocols under our group
risk management framework that allow us to identify, assess, respond to, manage and record risks. Our risk management
framework allows us to monitor the potential risks and opportunities associated with uncertainty, societal and political
transition, economic fluctuations, regulatory changes and operational and production risks in a proactive and systematic way
through all areas of our business and by all levels of management.
The board and the Chief Executive Officer are committed to
ensuring that risk is managed effectively through a system
that involves identifying, assessing, evaluating, mitigating,
monitoring, and managing significant risks and opportunities
to ensure we meet our strategic business objectives.
Our group risk management framework aims to provide
assurance that all material risks across the group have
been properly assessed, mitigated, and monitored, within
appropriate risk tolerance levels.
AngloGold Ashanti has a formal risk management policy and a
comprehensive set of risk management standards. We adhere to
the King IV Corporate Governance Risk Principles, ISO 31000 and
the Committee of Sponsoring Organisations (COSO) Enterprise
Risk Management Framework.
Risk management framework
This framework applies across the company and to all group-
managed entities, covering the components below.
Role of the Board, Audit and Risk Committee
and management
The board provides oversight of AngloGold Ashanti’s risk
management framework, policies and processes and has ultimate
accountability for the development and implementation of the risk
management strategy and plan.
The Audit and Risk Committee is accountable for risk governance
and risk management system oversight, approving risk policy,
determining the appropriate levels of risk appetite and tolerance
and setting limits annually for these.
Management is responsible and accountable for effective risk
management and practice.
The Chief Financial Officer is accountable for the enactment of the
policy and reports to the Audit and Risk Committee and board.
Assurance on the risk management system is provided by Group
Internal Audit, which provides periodic evaluation of controls and
compliance, as well as an objective view of delivery on the risk
management process.
Our risks and opportunities are identified at an operational and
regional level and assessed with input from senior management.
They are reviewed quarterly, or more frequently if required, based
on changes in our operating environment. Relevant risk owners are
consulted to confirm the status of risks and opportunities in terms
of their severity and likelihood, and to ensure alignment with regular
independent assessments and assurance processes.
Risk
management
process
Identifying
Responding
Assessing
Evaluating
Reporting
Mitigating
Group risk
management
framework
Policy
Appetite and tolerance
statements
Standards
Guidelines
Structures and
accountabilities
Assessment
and reporting
matrix
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MANAGING OUR RISKS AND ACTING ON OPPORTUNITIES CONTINUED
Governance
Responsibility delegated to the
CEO for design, implementation,
monitoring of a plan for a system
and process of risk management
Oversight
Responsibility for risk
management system oversight
and a clearing house for
risk policy, appetite-setting,
governance
Risk management
system
Responsibility:
Management of risk
Support
Assurance
Lines of defence
Board of Directors
Ultimate accountability
Audit and Risk Committee
Management
Identify risk,
assess, evaluate,
mitigate, monitor
and report
Ensure
compliance
with policy and
standards
Provide assertion
on risk exposure
Risk reviews
conducted
through functional
owners
Executive team
oversight
Regional oversight
Group risk
management
Group compliance
management
Group sustainability
management
Group tax
management
Legal
Business
improvement
frameworks
Lateral oversight
through functional
owners
Group planning,
technical reviews
and oversight
Group growth,
exploration
review and
oversight
Internal audit
External audit
Combined assurance reviews
ISO standards
Third party assurance
Assurance
Governance and
steering committees
Managing the risk:
Corporate, regions, exploration,
operations and projects
Support the Board:
Audit and Risk Committee,
CEO and CFO
Independent evaluation:
Controls, compliance, and
governance
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Risk appetite and risk tolerance
In conducting our business, a certain amount of risk is inevitable.
AngloGold Ashanti defines risk appetite as the level and type of risk
that the Group is willing to accept to achieve its business goals,
while risk tolerance refers to the level of risk carried at a particular
time. Both risk appetite and risk tolerance are critical elements of
the Group’s risk management process and how risk management
integrates with business planning and operational management.
The board determines the appropriate levels of group risk tolerance
and sets limits for risk appetite annually.
See Our Strategy, Delivering on our strategy and
Our external operating context
Opportunities
While AngloGold Ashanti recognises that risk is present in all
business and operational activities, we also understand that threats
in certain scenarios can present opportunities.
Significant opportunities are:
Increasing Ore Reserve
Several opportunities exist in the ongoing development of the Ore
Reserve – either by greenfield discoveries or conversion from our
Mineral Resource – which is key to the long-term sustainability of
the business. Through a targeted investment programme started in
2020, our exploration teams added 2.7Moz of Ore Reserve, net of
those depleted by production, and anticipate another net increase
in 2021 as this programme continues. For more details see Mineral
Resource and Ore Reserve – summary in this report.
New project development
Investment decisions on the two Colombian projects are
expected in the coming year. These projects are the wholly owned
Quebradona copper-gold project and the Gramalote joint venture
(50:50) with operator B2Gold. Once in production, these projects,
which are low-cost and have long operating lives, will substantially
reduce AngloGold Ashanti’s cost profile with increased margins
and cash generation, while also enhancing our life-of-mine profile
with medium- to long-term production and total Ore Reserve,
maintaining long-term optionality.
Commodity diversification
As a copper-gold project, Quebradona will diversify the range of
commodities produced. Copper is essential to renewable energy
and electric vehicle technologies, among others. As the world moves
towards decarbonisation and reduced emissions in the face of the
climate crisis, global demand for copper is expected to increase.
Managing risk during the COVID-19 pandemic
As the COVID-19 pandemic swept around the world,
AngloGold Ashanti demonstrated real-time risk management
and the ability to respond quickly to the resulting challenges,
adapting and innovating processes in reaction to the
changing COVID-19 environment across its operating regions.
Decision-making at all levels was streamlined through our
crisis management processes, which had as a centrepiece a
multi-disciplinary daily crisis meeting across all operations. This
meeting allowed for rapid sharing of information, which was
vital as the spread of the virus accelerated, and also equally
efficient sharing of emerging best practice and solutions to
challenges across our sites. All of these mitigation measures
from the risks that had been highlighted, were carefully logged
and followed through to resolution.
Government-imposed lockdowns forced certain mines to
suspend operations at different stages, and for different periods
of time during the year. We worked to ensure business continuity
while prioritising the health and safety of our employees and host
communities. We quickly put in place protocols and standard
operating procedures for all sites to help prevent the transmission
of the virus. Our teams worked closely with community
leadership around our mines and governments in our operating
jurisdictions, to provide support for efforts to ‘flatten the curve’
and cushion the economic impact of the pandemic.
Guidance was suspended in March and reinstated in
September, once there was a greater degree of certainty in our
ability to manage our operations during conditions created by
the pandemic.
As the virus spread around the globe, disrupting supply chains,
a concerted effort was made to increase inventories of critical
spares and consumable inputs at our operations. In addition,
as the threat of mine closures became a reality in Brazil, South
Africa and Argentina, we worked to ensure adequate liquidity
in the event of protracted and more widespread production
stoppages across our portfolio. This was especially important
given that our $700m, 10-year bond came up for maturity in
April 2020, which we had elected to pay from existing credit
facilities and cash on hand.
We drew down fully on our $1.4bn revolving credit facility and put
in place a short-term, $1bn emergency credit facility, to ensure
adequate liquidity as the extent and impact of the pandemic
became clearer. As the gold price rose through the course of
2020 and free cash flow improved as a result, cash balances
were bolstered and later supplemented by the issue of a new,
$700m 10-year bond at a lower coupon than the one settled
in April, and the $200m initial proceeds from the sale of our
South Africa assets. In addition we received $39m of the initial
proceeds from the sale of Sadiola, the dividend paid by Sadiola,
and the proceeds of the sale of our interest in Morila.
COVID-19 remains a risk to the business as new variants
emerge and spread across the world, but we have a
significantly more robust balance sheet than a year ago,
increased inventories on our sites, and a much improved
understanding of the practicalities of operating safely and
maintaining business continuity during periods of increased
transmission of the virus. We remain alert to unanticipated risks
emerging as the virus evolves, seeking to retain the flexibility
and cohesion that stood us in good stead during 2020. We will
work closely with our government stakeholders to support their
vaccination efforts as vaccines become available, prioritising
our employees and contractors, their dependants, and the
populations in our host communities.
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Our top 10 residual group risks
Our risks are assessed over the short, medium and long term. The heat map below shows the residual rating for each of our top 10 material
risks over a three-year view (medium term). Residual risk is the Company’s exposure to a particular risk once mitigation measures have been
applied to the inherent risk.
Risk ranking (previous year’s ranking)
1
(1)
Adverse regulatory changes
to mining rights and fiscal
requirements
2
(2)
Inability to convert Mineral
Resource to Ore Reserve
3
(8)
Adverse future implications on the
industry and our governance of
event risks
4
(5)
Failure to successfully deliver and
ramp up growth projects
5
(3)
Failure to meet our operational
and safety targets
6
(7)
Failure to attract and retain critical
skills and talent
7
(9)
Loss of or threats to social licence
to operate
8
(4)
Failure to move down the industry
cost curve – all-in sustaining cost
competitiveness
9
(6)
Adverse gold and commodity
price, and currency movements
10
(–)
Inability to meet investor
expectations on responsible
mining and increased disclosure
(ESG performance)
Very rare
Minor
Moderate
Extreme
Major
High
Unlikely
Possible
Likely
Almost
certain
Likelihood
Consequences
1
2
3
4
5
7
8
6
9
10
Nature of risk
Operational
External
Strategic
1. Adverse regulatory changes to mining rights and fiscal requirements
Description
Our experience is that political,
tax and economic laws and
policies in countries in which we
operate can change rapidly. We
operate in countries that can
from time to time experience
a degree of social and political
instability as well as economic
uncertainty.
See Navigating regulatory and
political risks in the <SR>.
Potential contributing factors
Political instability and
elections in 2020 in certain
operational jurisdictions could
elevate political risk impacting
the company
Resource nationalism
Regulatory uncertainty
Impact of COVID-19
Government imposed
lockdowns
More challenging socio-
economic conditions
Increased resource nationalism
Potential consequences
Increased tax and royalty
obligations
Increased operating costs
reduce cash flow and can
adversely impact business
plans
Compromised employee safety
and security
Adverse impact on market
capitalisation
Increased scrutiny from
governments, non-
governmental organisations
and communities
Response and mitigation
Regular, inclusive engagement
and broader collaboration with
government, communities and
NGOs
Continuous monitoring of
legislative/political landscape
Use of joint venture alliances
in line with host country’s
regulatory requirements
Assuring compliance with the
relevant country legislation
Government relations
framework
Strategic focus areas impacted
Capitals affected and at risk:
Committee responsibility:
Social, Ethics and
Sustainability Committee
Audit and Risk Committee
Risk outlook
The company anticipates
increased uncertainty and will
maintain flexibility in maintaining
long-term optionality
MANAGING OUR RISKS AND ACTING ON OPPORTUNITIES CONTINUED
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2. Inability to convert Mineral Resource and Ore Reserve
Description
It is essential to replace Ore
Reserve depleted by mining and
production in order to maintain
or increase production in the
long term. If not, operational
performance and financial
condition and prospects will be
adversely affected.
See
Mineral Resource and
Ore Reserve – summary in
this report.
Potential contributing factors
Adverse changes to geological
models
Inability to react to changing
economic factors
Regulatory uncertainty
Unfavourable feasibility studies
Project studies late or over
budget
Inability to fund projects
Inclusion of Inferred Mineral
Resource into business plans
Impact of COVID-19
Delays in regulatory permitting
Shut downs of operations
Increases in costs
Potential consequences
Ore Reserve write-down
Reduced mining flexibility
and adverse impact as
well as uncertainty on
business planning and
ability to forecast
Impairments, lower future
earnings, decline in
market capitalisation
Lower production
Premature mine closure or
mothballing of operations
Response and mitigation
Short term
Improved Ore Reserve development
to create flexibility for mines to cope
with unexpected events
Increased Ore Reserve conversion
Robust business planning, portfolio
optimisation and feasibility studies
to withstand potential risks
Long term
Focused greenfield exploration
targeting new discoveries
Continued focus on brownfields
exploration
Ranking of opportunities based on
returns and affordability
Strategic focus areas impacted
Capitals affected and at risk:
Committee responsibility:
Investment Committee
Risk outlook
There is an expectation of some
uncertainty with a willingness to
take justifiable risks to improve
portfolio quality
3. Adverse future implications on the industry and our governance of event risks
Description
Potentially catastrophic
risks include the COVID-19
pandemic and tailings dam
failure. These risks could
lead to significant financial
consequences and fundamental
changes to the way we operate.
See
COVID-19 response and
Tailings management in the
<SR>
.
Potential contributing factors
Cost of compliance with
tailings management
regulations following the
2019 Brumadinho tailings
dam failure in Brazil
COVID-19 pandemic and
subsequent events
Impact of COVID-19
Global economic uncertainty
across all sectors
Fluid regulatory environment
Changes to inspection
procedures due to social
distancing and travel
restriction
Potential consequences
COVID-19
Lockdowns that suspend operations
Threats to employee wellbeing
Supply chain disruptions
Threat to liquidity as the pandemic is
prolonged
Recovery and consequent rise in
global interest rates could have an
adverse effect on gold prices
Tailings storage facilities (TSFs)
Adverse socio-economic stakeholder
impact and reputational damage
Increased regulatory scrutiny and
control of TSFs, including permits
Costs associated with inspecting,
strengthening, maintaining and
constructing TSFs and their
conversion to dry-stacking operations
Increased pressure from communities
and elevated risk in securing social
licence to operate
Response and mitigation
Agile COVID-19 response
plans
Ensuring adequate liquidity
in anticipation of prolonged
impact of COVID-19
Comprehensive tailings
management framework,
standards and guidelines to
deal with risks
Conversion to dry stacking
operations
Strategic focus areas impacted
Capitals affected and at risk:
Committee responsibility:
Social, Ethics and Sustainability
Committee
Risk outlook
There is an expectation of
uncertainty with a willingness
to take strongly justifiable
risks whilst being cautious
and prioritising safe delivery
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4. Failure to successfully deliver and ramp up growth projects
Description
Failure to develop and
operate projects in
line with expectations
could negatively impact
business performance.
See
CEO’s review
and
Projects and
exploration – planning
for the future
in this
report
Potential contributing factors
Inability to bring the Ore
Reserve and Mineral Resource
to account
Project cost overruns and
delays
Skills deficit, permits, funding,
natural events, etc.
Poor-quality execution
Commissioning and ramp-up
problems
Impact of COVID-19
Delays in regulatory permitting
processes
Supply chain disruptions
Potential consequences and impact
on value creation
Project delays can adversely
impact costs, project returns and
earnings
Failure to achieve business plans
and deliver on strategy
Decline in investor confidence and
company valuation
Response and mitigation
A robust approach to regular stage-
gate project reviews, on assessing
projects and allocating capital
in accordance with our capital
allocation framework
Ensuring appropriate project
skills, systems, structures and
governance in place
Project steering committee
participation
Strategic focus areas
impacted
Capitals affected and at risk:
Committee responsibility:
Investment Committee
Risk outlook
There is an expectation of some
uncertainty with a willingness to take
on measured/calculated risks to
improve portfolio quality and maintain
long-term optionality
5. Failure to meet our operational and safety targets
Description
Unplanned stoppages
and unforeseen
operational
interruptions that can
impact production and
operational accidents
or injury could adversely
impact business
performance.
See
Employee safety
in the
<SR>
.
Potential contributing factors
Unplanned operational issues
affecting delivery on targets
Operations exposed to natural
catastrophes or extreme
weather
Non-compliance with critical
controls resulting in safety
incidents or potential fatalities.
Impact of COVID-19
Stoppages and lockdowns
Physical and mental health
impacts on employees due to
the spread of the COVID-19
virus
Employee illness or death
Potential consequences and impact
on value creation
Reduced cash flow, lower liquidity
Reduced earnings, uncertain
delivery on targets and penalty on
valuation
Decline in investor confidence
Credit rating downgrade
Decreased ability to invest in
projects
Injuries, deaths and related
stoppages impacting production
COVID-19 threat to workforce
health and wellbeing
Response and mitigation
Delivery of business plans by
focusing on Mineral Resource
modelling, integrated business
planning and execution
Improved reserve life and planning
certainty
Operational excellence
programmes to improve
productivity and efficiency
Focus on safe production across all
operations to achieve zero harm
Agile COVID-19 response plans
Strategic focus areas
impacted
Capitals affected and at risk:
Committee responsibility:
Investment Committee
Audit and Risk Committee
Social, Ethics and Sustainability
Committee
Risk outlook
Limited uncertainty is anticipated.
Focus on people, sustainability, and
safety as well as better understanding
of orebodies and ensuring asset
integrity to reduce uncertainty and
unforeseen operational interruptions.
Conservative and cautious with a
preference for safe delivery
MANAGING OUR RISKS AND ACTING ON OPPORTUNITIES CONTINUED
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6. Failure to attract and retain critical skills and talent
Description
Inability to retain and
attract sufficiently
skilled and experienced
employees may harm
our business and
growth prospects.
Having the right people
with the required
skills is vital to the
efficient conduct of our
business and strategic
delivery.
See People are our
business in this report
and
Integrated talent
management
in the
<SR>
.
Potential contributing factors
Insufficient talent bench strength and
succession planning pool
Better job opportunities externally
Failure to deliver skills from internal pipeline
Reduced attractiveness of mining industry,
overall state of commodity markets,
poaching, etc
Ability to deploy staff to gain relevant work
experience
Difficulty obtaining permits for expatriates
Global mobility and succession planning
challenges.
Loss of key personnel
Impact of COVID-19
Travel restrictions
Increased competition for skills
Potential consequences and
impact on value creation
Failure to deliver on strategic
objectives
Potential impact on
productivity and safety
Increased costs
Impact on market confidence
Higher cost of retention
Failure to meet localisation
targets
Response and mitigation
Implement key human
resource initiatives to ensure
productive and engaged
workforce
Identify potential future
critical skills
Integrated talent
management and
succession planning, with an
increased coverage ratio for
critical skills
Increase training capacity for
scarce artisan’s skills
Short-and long-term
incentive schemes
Employee engagement
surveys
Remote working functionality
Strategic focus areas
impacted
Capitals affected and at risk:
Committee responsibility:
Social, Ethics and
Sustainability Committee
Remuneration Committee
Risk outlook
Some uncertainty is
anticipated. Focus on people
and sustainability
7. Loss of or threats to social licence to operate
Description
Failure to operate in
a sustainable and
responsible manner
and provide benefits
to communities could
threaten our “social
licence to operate” and
adversely impact our
financial condition
See
Building resilient,
self-sustaining
communities
in the
<SR>
.
Potential contributing factors
Non-compliance with community and
security policies and leading standards
Ineffective stakeholder engagement
Land relinquishment pressure
Increase in illegal and artisanal small-scale
mining
Community perception of environmental
and other risks
Impact of COVID-19
Fewer government resources
Expectation of assistance
Increased need for support of local host
communities
Potential consequences and
impact on value creation
Disruption of operations
Reputational damage
Impact on investor
confidence, valuation and
credit ratings
Adverse regulatory response
Compromised safety and
security
Response and mitigation
Targeted stakeholder
mapping and engagement
Monitor legislative/political
landscape in anticipation of
negative impact on business
Meet local content
requirements
Share economic benefits
Sustainability performance
review with general
managers
Assessment of social licence
to operate at operations
Strategic focus areas
impacted
Capitals affected and at risk:
Committee responsibility:
Social, Ethics and
Sustainability Committee
Risk outlook
Uncertainty is anticipated
requiring flexibility and a
willingness to take measured/
calculated risks together
with focusing on people and
sustainability by being cautious
and focused on safe delivery.
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8. Failure to move down the industry cost curve – all-in sustaining cost competitiveness
Description
Margins and free
cash flow are at
risk when the gold
price remains
static or declines,
or when costs
increase.
See the
CFO’s
report
in this
report.
Potential contributing factors
Low levels of cash flow
Operational under-
performance
Company/country credit
ratings downgrade
Impact of COVID-19
COVID-19 response
measures increased costs
and reduced production
Potential consequences and impact on
value creation
Reduced profit margins or failure to
achieve efficiencies
Failure to achieve business plans and
deliver strategy given limited financial
resources
Threat to investment and credit ratings
Response and mitigation
Drive operational excellence
programmes
Introduce lower cost ounces
Capital optimisation to generate
maximum returns
Completed asset sales to focus on
higher-return options
Strategic focus
areas impacted
Capitals affected and at risk:
Committee responsibility:
Audit and Risk Committee
Investment Committee
Risk outlook
Ensuring financial flexibility including
caution with a preference for safe delivery
9. Adverse gold and commodity price, and currency movements
Description
Lower spot prices
and strengthening
of currencies in
host countries will
adversely impact
our ability to
generate free cash
flow.
See the
CFO’s
report
in this
report.
Potential contributing factors
Reduced demand for
jewellery and increased
supply of gold
US dollar strength relative
to other currencies in host
countries
Increased input prices – fuel,
steel and reagents
Increased global interest rates
providing more attractive
alternatives for gold investors
Impact of COVID-19
Period of gold price increases
Global stimulus packages
and currency movements
Potential consequences and impact on
value creation
Inadequate free cash flow/liquidity
Inability to deliver growth and execute
strategy
Recapitalisation at distressed equity
prices and in poor market conditions
Adverse investment and credit ratings
Sustained lower gold price may
adversely affect new capital projects,
continuity of existing operations and
other long-term strategic decisions
Lower market capitalisation
Response and mitigation
Enhance cost competitiveness by
improving quality of the portfolio
Focus on cost, efficiencies, and
capital discipline
Maintain long-term optionality by
ensuring competitive project pipeline
Improve debt profile and interest cost
Conservative gold price and currency
planning assumptions
Sensitivity analysis on gold price,
production, exchange rate and group
risk adjustments
Strategic focus
areas impacted
Capitals affected and at risk:
Committee responsibility:
Audit and Risk Committee
Investment Committee
Risk outlook
Some uncertainty is anticipated requiring
flexibility and a willingness to take
measured and calculated risks and a
willingness for caution with a preference
for safe delivery
MANAGING OUR RISKS AND ACTING ON OPPORTUNITIES CONTINUED
Geita
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Emerging risks
The most prominent emerging risks which are being closely
monitored are:
Cybersecurity
Cyber-related threats continue to grow and include malicious
software attempts to gain unauthorised access to data and
other electronic security, and protected information breaches.
The organisation acknowledges there is a global risk to our
systems and so maintaining cybersecurity across all operations
is an ongoing focus. The cybersecurity team operates a global
24/7 service that monitors all information and technology assets
in real-time, scanning for any imminent threats. For assurance,
all policies and procedures are regularly reviewed and audited.
Technological innovation and protecting our technology from
attack, are key to sustaining our operating environments. This
area receives ongoing focus and oversight by the board, Audit
and Risk Committee and management.
Climate challenge
Our operations are exposed to several physical risks resulting from
climate change. Climate change is a priority at board level with the
focus on setting further decarbonisation targets, charting a path
to net zero and implementing the Task Force on Climate-related
Disclosures (TCFD) recommendations. We established a climate
change working group and during 2020 began to consider high
level physical climate change risk assessments with conservative
climate change scenarios considered for all operations. See
Climate change and energy use in the <SR>.
10. Inability to meet investor expectations on responsible mining and increased disclosure
(ESG performance)
Description
Lack of disclosure
and irresponsible
mining could
lead to investors
divesting, increased
reputational risk,
and an adverse
impact on the
share price and our
social licence to
operate.
See
ESG
performance in
this report.
Potential contributing factors
Non-alignment with ESG and
standards, or disclosure requirements
Ineffective structures and processes
to ensure accountability, transparency
or responsiveness, leading to an
escalation of risk exposure and
negative impact on our social licence
to operate
Impact of irresponsible mining on
host communities
Carbon emissions target reduction
and disclosure
Impact of COVID-19
Increased social imperatives to assist
local host communities, NGOs and
governments.
Potential consequences and impact
on value creation
Reputational damage
Impact on investor confidence,
market capitalisation and credit
ratings
Adverse regulatory response
Compromised employee safety
and security
Response and mitigation
Regular engagement and
collaboration with stakeholders
Transparent reporting and public
disclosure
Ensuring good corporate citizenship
and governance
Managing and limiting
environmental impacts and
progressing in meeting our targets
Integrating climate considerations
into the business and undertaking
physical climate risk assessments
for all operations
Inclusion of stakeholders in
COVID-19 response plans
Strategic focus
areas impacted
Capitals affected and
at risk:
Committee responsibility:
Audit and Risk Committee
Investment Committee
Social, Ethics and Sustainability
Committee
Risk outlook
Uncertainty is anticipated requiring
a balance of flexibility, willingness to
take measured/calculated risks and
caution with a preference for safe
delivery.
Geita
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MANAGING OUR RISKS AND ACTING ON OPPORTUNITIES CONTINUED
Risks by region
Africa
Risk
Key areas of focus and opportunities
Adverse regulatory
changes to mining
rights and fiscal
changes
Tanzania:
Geita
In July 2017, the Government of Tanzania enacted a new legal framework for the country’s extractive industries.
We are operating in compliance with the legislation and maintaining constructive engagements with authorities.
DRC:
Kibali
Our Joint venture partner Barrick continues to engage with the DRC government on concerns related to the
2018 mining code
At June 2018, AngloGold Ashanti and many other holders of mining rights reserved their rights under the 2002
Mining Code
A VAT refund agreement was signed with the DRC Tax Administration in 2018 permitting the joint venture to
offset the amount of VAT credits eligible for repayment against other payments to government
Discussions are continuing with the authorities to progress the Article 220 Decree, with the aim of limiting the
fiscal impact of the new mining code and improving the cash repatriation process
Adverse future
implications on
the industry and
our governance of
event risks
COVID-19
There is still a significant degree of uncertainty in relation to potential impacts of COVID-19, requiring flexibility in
response planning to assist the business to recover and thrive
Failure to
successfully deliver
and ramp up
growth projects
Ghana:
Obuasi
The Obuasi Redevelopment Project continued its ramp-up, delivering a 127,000oz in production despite delays
in receiving equipment and in the arrival of skilled personnel, critical to the project as a result of COVID-19 related
lockdowns in various jurisdictions during the year. Phase 2 is on tight schedule and expected to be completed in
the first half of 2021
Management continues to work closely with government and community stakeholders to ensure the mine is
developed sustainably and creates value for all stakeholders
Failure to meet our
operational and
safety targets
Guinea:
Siguiri
Operational and technical challenges related to the commissioning of the combination plant continue to impact
performance
Plans to mitigate these challenges have been implemented and there has been an upswing in production, with
operations stabilising
The company is carrying out preparatory work, including the construction of a haul road for the higher-grade
Block 2 deposit at Siguiri
Failure to attract
and retain critical
skills and talent
Continue the Chairman’s Young Leaders Programme that targets internal talent, creating a talent pipeline for
future leadership positions
We are assessing our structural models to optimise effectiveness
Localisation of the hiring of employees and companies, in our host countries is a priority
Loss of and/or
threats to social
licence to operate
Guinea:
Siguiri
Maintaining comprehensive engagement with key stakeholders to minimise operational disruptions and secure
our licence to operate
Ghana:
Obuasi
Localisation is a focus in the community, and we work with stakeholders on the implementation of the Obuasi
Social Management Plan, creating opportunities for alternative livelihoods and skills development
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Americas
Risk
Key areas of focus and opportunities
Adverse future
implications on
the industry and
our governance of
event risks
Brazil:
COVID-19
There is still a significant degree of uncertainty in relation to the impacts of COVID-19, requiring flexibility in
response planning to assist the business to recover and thrive
Tailings storage facilities (TSFs)
AngloGold Ashanti Brazil’s existing tailings facilities introduced dewatering bays and filtration plants to reduce the
volume of material deposited
TSFs at our Brazil operations are being converted to dry stacking and will be decommissioned, as required by
legislation or their closure plans
Failure to
successfully deliver
and ramp up
growth projects
Colombia:
Quebradona Project
The feasibility study is expected to be completed in the first half of 2021 after which it will be presented to the
board for approval
Forming a broad strategic alliance with all relevant stakeholders to establish regional support for the project.
Local stakeholder support continues to grow
Gramalote Project
Having transferred operatorship of our Gramalote project to B2Gold we are able to focus our technical skills
towards the development of this project
Working closely with our partner B2Gold to advance drilling and complete the feasibility study during 2021
A request for approval is expected in 2021, followed by construction in 2022
Failure to meet our
operational and
safety targets
Brazil:
Cuiabá
The operation has been experiencing poor ground conditions. The installation of additional ground support has
been incorporated into the mining cycle. The infill drilling completed over the past year resulted in a revised
geological interpretation of the main orebody
The focus is to increase the development and drilling to expand our knowledge of the orebody and increase
confidence in the mine plan
Failure to attract
and retain critical
skills and talent
Continue the Chairman’s Young Leaders Programme that targets internal talent, creating a talent pipeline for
future leadership positions
Structural models to optimise effectiveness are being assessed
Localisation of the hiring of employees and companies in our host countries, is a priority
Australia
Risk
Key areas of focus and opportunities
Failure to
successfully deliver
and ramp up
growth projects
Tropicana
The Boston Shaker underground mine, which moved into commercial production during the third quarter of
2020, is on schedule and under the budget in the approved feasibility project
Failure to attract
and retain critical
skills and talent
Continue the Chairman’s Young Leaders Programme that targets development of internal talent, creating a talent
pipeline for future leadership positions
Initiatives include an assessment of structural models conducted at regional levels that envisage optimisation of
structures and shift accountabilities
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INTEGRATED STAKEHOLDER ENGAGEMENT
Effective management of stakeholder relationships has a direct bearing on our ability to deliver on our strategy.
Stakeholder engagement helps improve our understanding of our external operating environment, allowing for informed
decision-making. We engage regularly with key stakeholders to better appreciate their views of AngloGold Ashanti, to
understand their ambitions and requirements, and to identify potential risks, opportunities and material issues.
Our stakeholder engagement approach
We are committed to collaborative stakeholder engagement.
Our stakeholder engagement process is integrated and inclusive
and aims to balance the needs, interests and expectations of
stakeholders with those of the company. It is critical at every stage
of our business, from exploration through to mine closure.
Oversight and accountability
The board has ultimate responsibility for stakeholder
engagement. The Social, Ethics and Sustainability Committee
assists with oversight of material stakeholders and their
issues. A formal stakeholder engagement framework provides
for structured and constructive engagements at appropriate
management and operational levels.
Identifying our key stakeholders
We identify and prioritise our key stakeholders based on their ability
to impact our business and influence decision-making, taking into
account the:
Extent to which AngloGold Ashanti depends on their support to
achieve our strategic objectives
Extent to which they can affect AngloGold Ashanti and its
performance
Significance of the both the stakeholder and their respective
issues to the company
Risk to AngloGold Ashanti of not effectively engaging with the
stakeholder, or addressing their issues
We have identified our key stakeholders and have conducted an
internal assessment of the quality of our relationship with each,
based on the following broad classification:
Strong
= collaborative and mutually advantageous
Cordial
= sufficiently involved to achieve common goals
Weak
= requires some effort and consultation to achieve
   consensus
Iduapriem
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Engaging key stakeholders
In determining the key stakeholders, we identified the significance of our engagement with each, their primary concerns and expectations,
our response to those concerns and expectations, and the potential value for each stakeholder.
Investment community
Quality of engagement: Strong
Significance
Includes: Shareholders, debt funders and other providers of
capital, investment and ESG analysts, prospective investors and
financial media
Invest in the company, provide financial capital or information to
facilitate investment-decision making
Transparent and consistent engagement on our performance,
management of expectations and delivery on our strategy can
enhance investor sentiment and our reputation, improving access to
capital and our valuation
How we engage
By email, telephone, meetings or video conference
Interim and annual results presentations
Media Interviews
Annual reports
Website
Investor days
Site visits
Investor conferences, roadshows and one-on-one meetings
Corporate action and regulatory announcements
Annual general meeting
Stakeholder’s concerns
ESG performance and concerns
The valuation gap between AngloGold Ashanti and many of its
international peers
Potential to change primary listing
Asset sales and their consequences
Impact and management of COVID-19
Long-term financial viability
Progress on Obuasi redevelopment
TSFs and their management
Relations with Indigenous Peoples and First Nations
Performance and disclosure on critical metrics such as safety,
operational, financial and ESG metrics
Jurisdictional risk and cash conversion challenges
Silicosis settlement
Remuneration – policy and implementation
Changes at executive and board level
AngloGold Ashanti’s concerns
Providing a clear understanding of our strategy and the plans in
place to address risks
Information on plans to grow and sustain the company
Highlighting the skills in place to achieve our strategy
Our response
Consistent reporting of company performance, improved
transparency of ESG performance,
Continued direct engagement with shareholders, analysts and
media
Successful conclusion of asset sales
Regular reporting on protocols and systems to closely manage
and monitor the effects of COVID-19
Reduced debt and significantly improved balance sheet
Improved cash flow generation and increased dividend
pay-out ratio
Maintaining financial discipline and deliver on our strategy
Tshiamiso Trust initiating work on the silicosis settlement, albeit
with impact on timing due to COVID-19
Improved the quality of our asset portfolio to unlock value for
shareholders
Concluded significant work aimed at improving remuneration
practices and disclosures
Prioritisation of CEO recruitment
Address underlying catalysts to valuation gap
Value to stakeholder
Return on investment – share price and dividends
Long-term sustainability of business
Comprehensive and transparent reporting
Effective risk management, and ethical conduct and
corporate governance
Good corporate citizenship and overall ESG performance
Related capitals
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Employees and unions
Quality of engagement: Cordial
Significance
Includes: Employees at all levels of the Company and labour unions
representing employees at certain operations
Represents our human capital that provides the manpower,
knowledge, skills and expertise necessary to the conduct of our
business
Employees are fundamental to delivery on our mission and
strategy. Constructive employee engagement promotes stable
employee relations, enhances productivity, and ensures alignment
in delivering on our strategic objectives
How we engage
Employees – frequent and ongoing:
Internal electronic newsletters, briefs, emails, intranet
Management meetings, staff briefings, town hall sessions
Safety and health awareness campaigns
Employee surveys
Performance and exit reviews
Unions – more formal and structured:
Regular, diarised meetings
More frequent during wage negotiations
Stakeholder’s concerns
COVID-19 – response and management
Asset sales and their implications for employees
Job security
Terms of employment – employee benefits and incentives
Career and personal growth/development
Safety and safe workplaces, health and wellness
Gender equality and inclusivity
AngloGold Ashanti’s concerns
Productivity and maintaining focus on strategy and meeting
guidance on production and other performance metrics
Succession planning
Our response
Implemented COVID-19 protocols tailored to address
circumstances at each operation – accompanied by a focused
communications plan and ongoing feedback to central crisis
management team
Ensured no employee lost wages or benefits during 2020
related to COVID-19 lockdowns and other disruptions
Continued strengthening of the balance sheet to better weather
short- and medium-term volatility in the gold price and general
operating environment
Successfully concluded asset sales in South Africa and Mali,
minimising job losses in the process
Debt consolidation
Steady delivery on our strategy by maintaining financial
discipline, reducing debt, tight cost control, increasing
shareholder dividends, portfolio re-investment
Improvements to quality of our asset base and unlocked value
for shareholders by adhering to strict investment criteria
Concluded significant work to improve remuneration practice
and disclosure
Value to stakeholder
Improved job security
Reward and recognition
Education and training
Talent management and career planning
Inclusivity, equity and diversity
Related capitals
INTEGRATED STAKEHOLDER ENGAGEMENT CONTINUED
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Governments and regulators
Quality of engagement: Cordial
Significance
Includes: National, regional, local government and various
regulators (mining, environmental, social, labour, taxation)
Government and regulators develop and implement legislation
and associated regulations that can significantly affect AngloGold
Ashanti as a whole or one or more of our operations; impact varies
by region and country
Ongoing engagement aims to communicate the condition of
the business, its challenges and opportunities, and to mitigate
regulatory and political risk, encourage certainty, strengthen
our licence to operate and generally promote an environment
conducive to investment and development. Proactive engagement
with governments includes collaborating on their service delivery
responsibilities
How we engage
Engagement is regular and ad hoc, depending on matters
arising or company developments, industry-related changes
and opportunities for dialogue specific forums like industry
conferences and government-organised events
In person, virtual, direct or indirect, at company level or through
industry partners which lobby on behalf of the mining industry.
See Industry partners below for indirect engagement with
governments and regulators
Stakeholder’s concerns
The reason for and impact of asset sales
Project development updates – e.g. in Ghana and in Colombia
Investment time lines and benefits for local communities
TSF management, especially with the Brazilian authorities
Ensuring flow of benefits from mining to the state at national,
local and community levels
Monitoring of regulatory compliance – safety, local economic and
community development, and taxation
AngloGold Ashanti’s concerns
Mitigation of political and regulatory risk
Policy development and regulatory proposals
Dispute resolution – repatriation of funds (DRC) and tax refunds
(Tanzania)
Our response
Continued engagement with government stakeholders at all
levels
Improved internal systems and activities to meet requirements
of regulatory changes
Maintained dialogue in the DRC on the repatriation of funds held
in the country through our joint venture partner and operator,
Barrick
Maintained dialogue in Tanzania and Colombia
Continued payment of taxes, royalties and duties
Engaged with governments and relevant regulators in countries
in which asset sales were underway to ensure the transactions
were in line will local legislation. Also obtained the necessary
approves to conclude the transactions as well as to fulfil
conditions precedent for the respective sale agreements
Complying with all laws and regulations relating to TSFs
Value to stakeholder
Contributions to the national fiscus through the payment of
taxes, royalties and duties
Collaboration on infrastructural projects
Investment in local economic development
Compliance with and reporting on regulatory obligations that
demonstrate constructive partnerships with government
Related capitals
47
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AngloGold Ashanti Limited <IR>
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Communities
Quality of engagement: Cordial
Significance
Includes: Those communities in the vicinity of our operations on
whose goodwill we depend, and who are directly impacted by
mining operations
We are accountable to our host communities to be a responsible
corporate citizen. Communities can directly affect our social license
to operate. In line with our values, we aim to leave them better off
for our having been there once mining has ceased
We aim to manage expectations, uphold human rights and ensure
community and asset security. Mutually beneficial partnerships with
host communities enhance shared value creation, which help in
retaining our social licence to operate
How we engage
A forward-looking community engagement strategy is in place
to identify potential areas of concern within local communities
Engagement is focused on local economic development
programmes, developed and run in partnership with local
governments and host communities. These contribute to
economic growth, stimulate income-generating opportunities,
create employment, and aim to nurture sustainable livelihoods
beyond the life of mine
Directly, through various community forums, depending on the
host country and the matter at hand. These forums include
representatives from the company, the community and local
authorities
Grievance mechanisms enable communities to lodge their
complaints, which are followed up until resolution is reached
Stakeholder’s concerns
Employment and procurement opportunities
Sale of assets in South Africa and Mali, including the
incorporation of mine areas into local municipalities and donation
of facilities to local communities in South Africa
Legacy issues (social and environmental), post asset sale in
South Africa
Local enterprise and economic development programmes
Environmental and social impact of mining activities on
communities (noise, dust, water issues)
Education and infrastructure
AngloGold Ashanti’s concerns
Social licence to operate
Potential business interruptions
Legacy issues (social and environmental), post asset
sale in South Africa
Our response
Ensured the redevelopment of Obuasi is in line with
commitments made to the Government in Ghana and the
community
Optimised participation by local companies and the transfer of
skills in the Obuasi redevelopment project, while continuing with
localisation in other areas
Ensured implementation of the corporate social responsibility
plan for Geita
In Brazil, engaged on the management and safety of TSFs, and
implementation of emergency preparedness plans
In the South Africa region, various engagement forums held
with local authorities and host communities relating to the sale
of assets
Honouring long-term obligations to certain former employees
and their dependants
Maintained engagement with host communities
Value to stakeholder
Investment in community socio-economic development projects
Local employment opportunities
A stimulus for local economic growth
Community health and safety, including malaria, Ebola, silicosis
and more recently COVID-19
Related capitals
For more information on our work to establish self-sustaining communities, see <SR> .
INTEGRATED STAKEHOLDER ENGAGEMENT CONTINUED
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Suppliers
Quality of engagement: Strong
Significance
Includes: Range of suppliers – from established multi-national
corporations to smaller, more localised businesses – and labour
contractors
Provide vital inputs required to conduct our business activities –
raw materials, products and services
We endeavour to ensure suppliers are aligned with our business
ethics and values, internal policies and standards, and codes of
behaviour
How we engage
Direct engagement via our supply chain/procurement teams
Management of service level agreements
Website
Service delivery feedback meetings
Stakeholder’s concerns
Procurement opportunities – continuity of contracts and
sustainability of business, especially with the COVID-19
challenges
Promotion of local procurement and capacity building to
empower local communities
AngloGold Ashanti’s concerns
Responsible ESG practice – includes ensuring alignment with
our Code of Ethics, and encompasses human rights, labour
relations, employment and environmental practices, anti-bribery
and corruption, and safety procedures
Contract terms and performance – negotiating prices and cost
increases aligned with our strategic focus areas
Our response
Well-developed and implemented policies relating to suppliers,
local procurement
Promote increased participation by local companies, for
example, the Obuasi redevelopment project
Regular, ongoing engagement and communication with key
suppliers
Increased focus on procurement with local suppliers
Timely payment to and support for small, medium, and micro-
enterprises (SMMEs) to create business opportunity and growth
Value to stakeholder
A source of business and local economic activity in host
communities and host countries
Longevity of our business supports the economic survival
of suppliers
Multiplier effect
Related capitals
49
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Industry partners and peers
Quality of engagement: Strong
Significance
Includes: National or local mining/industry bodies, the ICMM, WGC,
among others
Provides a joint platform for addressing industry-related
developments and concerns, as well as initiatives for sharing
lessons learnt and best practice
Engagement aims to garner support and promote collaboration
with other shared stakeholders – governments, regulators,
employees, unions and communities – on matters of mutual
concern, to work together to reduce regulatory and political
uncertainty, and to promote long-term partnerships. This includes
joint efforts to find solutions to sector or industry challenges, and
on any new developments to promote the future of the industry
How we engage
Various engagement platforms including conferences, meetings
and other industry forums
As members of the ICMM, we attend two virtual membership
meetings/calls annually, and participate in several ICMM
working groups focused on different industry-related matters
World Gold Council provides a platform to share with and learn
from international gold industry peers
Stakeholder’s concerns
(varies by region/country)
Regulatory changes in Tanzania
Community challenges
Silicosis settlement (South Africa)
TSF management
Growing demands for responsible mining practices and related
ESG performance
Industry safety performance
Environmental management and compliance
Climate crisis and impact of climate change – reporting
requirements
AngloGold Ashanti’s concerns
As above
Our response
Collaboration with industry bodies to share lessons in important
areas, and to co-create solutions to common challenges,
including the design of safer, cleaner mining vehicles
Collaboration with industry bodies to manage and improve
regulatory and political certainty
Participated in the establishment of the Tshiamiso Trust which
will oversee the payment of claims, among others
Collaborated in development of the WGC’s Responsible Gold
Mining Principles
Enhanced TSF management – have begun process to convert
to dry stacking in Brazil
Value to stakeholder
Provides a platform for dialogue and joint lobbying on sector-
specific issues and concerns and to raise awareness of mining-
related concerns
Facilitates development of sector-based strategies and best
practice guidelines on topics of shared interest such as safety
and TSFs, among others
Enables collaboration on matters of joint concern such as
the roll-out of COVID-19 programmes to provide PPE and
sanitisation, among others
Sharing of technical expertise and advice
Community and infrastructural development
Related capitals
Engaging with media
Media engagement facilitates the understanding of AngloGold Ashanti, among government stakeholders, the investment community
and general public, promotes transparent and accurate reporting, and supports constructive relationships with other stakeholders. It
aids management of our reputation and improves transparency and credibility, contributes to our social licence to operate, and can
address speculation and misinformation in the public domain.
INTEGRATED STAKEHOLDER ENGAGEMENT CONTINUED
50
About AngloGold Ashanti / > World in which we operate and strategic response / Delivering on our strategy / Leadership and accountability / Rewarding delivery / Corporate information
AngloGold Ashanti Limited <IR>
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About AngloGold Ashanti / > World in which we operate and strategic response / Delivering on our strategy / Leadership and accountability / Rewarding delivery / Corporate information
AngloGold Ashanti Limited
<IR>
About AngloGold Ashanti / > World in which we operate and strategic response / Delivering on our strategy / Leadership and accountability / Rewarding delivery / Corporate information
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Five key strategic focus areas have been identified
to enable us to deliver on our overall strategic objective
– to generate sustained and improved cash flows and
returns over the longer term. These strategic areas,
which guide decision-making, are aimed at generating
increased cash flows; extending mine lives; creating an
organic pipeline of economically viable orebodies; and
enhancing our licence to operate. The overall aim is
creating and preserving value for all our stakeholders.
OUR STRATEGY
OUR FIVE KEY
STRATEGIC FOCUS AREAS
Improve
portfolio quality
Ensure financial
flexibility
Maintain long-term
optionality
Optimise overhead,
costs and capital
expenditure
Focus on people,
safety and
sustainability
Supporting
our strategy for
sustainable cash
flow improvements
and returns
See Delivering on our strategy for how we have delivered on our strategic focus areas.
Improve portfolio
quality
We have a portfolio
of assets that must
be actively managed
to improve the overall
mix of our production
base as we strive for a
competitive valuation
as a business.
Maintain long-term
optionality
While we are focused
on ensuring the most
efficient day-to-day
operation of our
business, we maintain
a close eye on
creating a competitive
pipeline of long-term
opportunities.
Focus on people,
safety and
sustainability
People are the
foundation of our
business. To remain
sustainable in the
long term, we must
clearly exhibit our
values in the conduct
of our business. This
encompasses being
accountable for our
actions and respecting
all stakeholders and
the environment. ESG
principles are integrated
into every aspect of our
business.
Ensure financial
flexibility
We must ensure our
balance sheet always
remains able to meet
our core funding
needs.
Optimise overhead,
costs and capital
expenditure
All spending decisions
must be thoroughly
scrutinised to ensure
they are optimally
structured and
necessary to fulfil
our core business
objective.
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STRATEGIC ENABLERS
Streamlined,
margin-focused
portfolio
Disciplined capital
allocation and a strong
balance sheet
Engaged workforce;
prioritising the safety and
health of employees
Values-driven
culture
Responsible citizenship
with good governance as
the foundation
Our vision
To be the leading mining company
Our mission
To create value for our
shareholders, our employees and
our business and social partners
through safely and responsibly
exploring, mining and marketing
our products
Our strategic aim
To generate sustainable cash flow
improvements and returns
OUR VISION, MISSION AND STRATEGIC AIM
Our vision, mission and values are embedded in our strategy. Introduced in 2014, our current strategy allows us to be agile
in navigating a dynamic operating environment. It enables AngloGold Ashanti to create value throughout the business cycle.
Our strategy considers the external macro-economic environment, resulting risks and opportunities as well as our most
material issues.
STRATEGIC GOALS OVER TIME
Unlock full underlying value of the portfolio
Support a self-funded project pipeline for our
long-term production plans
Continue replenishing and
increasing Ore Reserve pipeline
to sustain the business
Short term (1 to 3 years)
Medium term (3 to 5 years)
Long term (5 to 7 years)
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THE YEAR COVID-19 – IMPACT, RESPONSE AND MANAGEMENT
RELEVANT SDGs
VALUES
Safety is our
first value.
We respect
the environment.
We want the communities and
societies in which we operate
to be better off for AngloGold
Ashanti having been there.
Focus on people,
safety and
sustainability
STRATEGIC FOCUS AREA:
STAKEHOLDERS
Investment
community
Employees
and unions
Governments
and regulators
Communities
Suppliers
Industry partners
and peers
The global spread of the COVID-19 pandemic during 2020
impacted every aspect of our business, our stakeholders, and
our risks and material issues. It took an unprecedented toll
on businesses and socio-economic systems across the globe.
This forced businesses, including AngloGold Ashanti, to take
extraordinary measures to protect the health of employees
and communities, and to protect our business.
In tackling the pandemic, clear and consistent communication
and co-operation, both within AngloGold Ashanti and with a broad
range of external stakeholders, was fundamental in navigating
the pandemic amid a rapidly evolving regulatory landscape. In
responding, we acted quickly with a plan that not only enabled
business continuity and delivery on our strategic objectives, but
also supported our people and communities throughout.
Responding to and managing the pandemic
It quickly became apparent how vital it was to ensure close and
ongoing co-operation between health ministries, local government
departments, community leadership and our own site management
and health teams. The mechanisms and effectiveness of this
collaboration was one of the more positive outcomes of the pandemic
that we will work to make a feature of our business in the years
ahead, enabling us to be more proactive in anticipating both short-
and long-term health risks, and to design appropriate responses.
The rapid evolution of the COVID-19 pandemic, and the multiple
risks presented, required closer monitoring and shorter, faster
internal reporting systems. A multidisciplinary committee that
initially met daily was established at the outset of the outbreak
to implement a crisis management plan and steer the business
through the pandemic.
The centrepiece of this strategy was our five-phase preparedness
and response plan, based on lessons learnt during the Ebola
outbreak, and an associated risk monitoring system. A risk matrix
and reporting dashboard was and is still reviewed weekly, covering
travel management, supply chain, human resources and information
management, as well as government and community collaboration.
The various multi-disciplinary COVID-19 protocols include
the screening of employees and referral of suspected cases
for testing and further management. Daily temperature and
symptom screening on access to the workplaces continues as
we closely monitor and reinforce interventions around education
and awareness; personal hygiene and disinfection of equipment,
working environments and infrastructure; social distancing and
the prohibition of gatherings; remote work arrangements; and the
wearing of masks, among others.
Systems were also put in place to test and treat those with
COVID-19 and to assist with isolation and quarantine of contacts
as soon as possible. Given some limitations in local health
systems in certain jurisdictions, we augmented testing capacity
on and off mine sites by strengthening infrastructure support for
hospitalisation, isolation and quarantine.
Intensive communication awareness campaigns on the new
operating parameters were rolled out for both employees and
communities, in line with our COVID-19 protocols and those laid
out in the applicable jurisdictions. We continuously update these
communication campaigns to address emerging themes such as
prevention through responsible behaviour, testing, gender-based
violence and mental health, among others.
See Managing our risks in this report and the <SR>
for further detail.
COVID-19
PREVENTION
IS IN OUR HANDS
As COVID-19 remains with us, there are prevention measures that are within our control
WE
DO
BECAUSE
G U I D E L I N E S
avoid crowded places and wherever we
go, allow ourselves a space of at least
1.5 metres from other people
the evidence still supports this behaviour
as droplets from an infected person are
unlikely to spread past 1.5 metres
Avoid crowded spaces and
follow the guidelines when
attending gatherings
Make sure rooms
and vehicles are
well ventilated
sigamos lavando y desinfectando nuestras
manos y las cosas que tocamos
se sabe que los desinfectantes a base
de jabón, agua y alcohol matan el virus
cuando se deposita en manos y superficies
Lavate las
manos
regularmente
Lavate las
manos durante
20 segundos
Usa jabón y agua o
desinfectante de manos a
base de alcohol
Nunca te toques la
cara sin lavarte las
manos primero
COVID-19
LA PREVENCIÓN
ESTÁ EN NUESTRAS MANOS
Mientras el COVID 19 permanece entre nosotros, mantengamos las medidas de prevención que están bajo nuestro control
LO QUE TENEMOS
QUE HACER
PORQUE
I N D I C A C I O N E S
Lavate las
manos
regularmente
Lavate las
manos durante
20 segundos
Usa jabón y agua o
desinfectante de manos a
base de alcohol
Nunca te toques l
cara sin lavarte la
manos primero
I N D I C A C I O N E S
Chukulia uvaaji barakao, ukaaji mbali
baina ya mtu na mtu na utakasaji mikono
kuwa tabia zitakazofanya kuendelea kuona
wakati ujao
Vitendo hivi vimethibitisha kusaidia na
vimekuwa ni kama utamaduni kwa kuwa
hatufahamu wimbi jipya la maambukizi
litaibuka tena lini
Kohoa au kupiga chafya
kwenye karatasi laini
au kiwiko cha mkono
Acha vyumba na magari
yakiwa wazi ili kuruhusu
hewa kupita vizuri
Epuka
misongamano
UVIKO-19
UZUIAJI
UPO MIKONONI MWETU
Kama ambavyo UVIKO-19 unavyoendelea kubaki na sisi, zipo hatua za kuzuia ambazo zipo ndani ya uwezo wetu
TUNA
FANYA
KWA SABABU
M I O N G O Z O
la
as
Sigamos usando tapabocas, cubriendo
nariz y boca, cada vez que salimos de
nuestros hogares
los tapabocas, usados correctamente, se
consideran una barrera importante para
inhalar gotas en el aire que podría resultar
en infección
Limpiate las manos
antes de ponerte o
quitarte el tapacobas
Evita
tocar el
tapabocas
Asegurate que
cubra la nariz
y la boca
Si el barbijo es de tela, lavalo
después de cada uso. Si usas uno
descartable, desechalo después
de su uso
COVID-19
LA PREVENCIÓN
ESTÁ EN NUESTRAS MANOS
Mientras el COVID 19 permanece entre nosotros, mantengamos las medidas de prevención que están bajo nuestro control
LO QUE TENEMOS
QUE HACER
PORQUE
I N D I C A C I O N E S
Communication awareness poster campaign
In multiple
languages:
English, Spanish
and Swahili
Obuasi COVID-19 community intervention
54
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Primary impacts of the pandemic
On the business
Various levels of national lockdown were implemented across our
operating regions, with the most significant being at the South
Africa operations where underground operations were suspended
for nearly one month from the end of March 2020. Operations were
gradually resumed with full production resumed during May, 2020.
In the Americas region, after an initial lockdown, the Brazilian
operations returned to full production. The rate of infection among
employees reflected that in broader Brazilian society. However, at
Cerro Vanguardia, operations were suspended several times, most
recently in November/December 2020.
In Australia, although there was no official national lockdown, shift
arrangements and the fly-in-fly-out roster was impacted by national
travel restrictions. The impact on production was minimal.
In the Africa region, the most significant consequence of the
pandemic was the adjustment to the Obuasi Redevelopment
Project’s schedule. This was delayed by a quarter, largely as a
consequent of restrictions to travel by expatriate employees.
Impact on production and costs
The total combined impact on production in 2020 is estimated at
140,000oz while the contribution to the all-in sustaining cost is
estimated at $55/oz, equivalent to around 5%.
On stakeholders
Stakeholder collaboration around managing the pandemic and its
impacts was essential to ensure the health and safety of employees
and those in the communities surrounding our operations.
On employees
We ensured that no employee lost salaries or benefits because of
pandemic-related lockdowns. Their financial security, in addition to
our socio-economic support for our host communities, has greatly
reinforced the interconnectedness of our mines and communities.
As at 19 March 2021, AngloGold Ashanti had conducted more
than 50,800 COVID-19 tests of which 2,794 employees had tested
positive. About 94.4% of the confirmed cases have fully recovered.
Sadly, 13 of our employees succumbed to COVID-19-related
illnesses.
Communities
We implemented a series of humanitarian initiatives to keep our
employees and communities surrounding our operations safe
and healthy.
AngloGold Ashanti also extended COVID-19 controls to
dependants and communities. Collaboration and partnerships
to address the outbreak at local, industry and national level
were key pillars of our strategy to control and manage the
pandemic. We provided support in terms of food, personal
protective equipment, medical supplies and equipment; personal
and environmental hygiene facilities and services; infrastructure
support; remote mental health and medical services as well as
cash donations at various levels of governments. In the Africa
region, given the challenges of the region’s healthcare systems,
collaboration with local and national health authorities was key
to mitigating risk. AngloGold Ashanti contributed to various
community control measures. Obuasi received an award for the
best COVID-19 educational response initiative at the fourth edition
of the Sustainability and Social Investments awards in Ghana in
November 2020, in recognition of the nature and quality of the
awareness campaigns at the mine, in host communities and the
nation at large.
Governments and local municipalities
The rapid escalation of the seriousness of the pandemic
necessitated close co-operation between national health
ministries, local governments and our own health teams. This was
vital in helping to limit infections. This co-operation allowed us to
build trust and create solutions together – whether it was securing
access to testing, designing social distancing plans, or bolstering
the availability of hospital beds.
In addition, we continue to support and explore opportunities
for partnerships and to collaborate with national authorities and
contribute to efforts towards equitable access to safe, good
quality and approved vaccines. Given the anticipated delays in
the vaccine roll-out efforts in many of our operating countries,
current controls are being re-enforced and maintained.
Key COVID-19-related statistics as of end of March 2021
Total number of confirmed cases
2,261
Total number of deaths
13
Total number of tests conducted
12,107
$44m
spent on COVID-19-related community efforts and to
manage direct impact on business.
Obuasi COVID-19 community intervention
55
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CEO’S REVIEW AND OUTLOOK
It is an honour for me to review our 2020 performance and
provide information on the exciting prospects for AngloGold
Ashanti in the coming years.
The start to the year was unexceptional. We provided the
market our guidance for 2020 and outlined our key priorities
as normal, but this was quickly overtaken by events, and
the need to refocus our efforts on managing through a virus
outbreak unprecedented in recent times.
COVID-19
We will likely be counting the cost of this COVID-19 pandemic
for generations to come, in both the loss of human life and the
massive economic toll that it has taken. As of writing this letter, the
global death toll had reached 2.5 million and new cases continue
to edge – and sometimes leap – ever higher across every country
in the world. Whole economic sectors have been decimated by the
steps taken to check its spread, with unprecedented lockdowns,
border closures and social distancing.
The manner of our response to COVID-19 highlighted the best of
AngloGold Ashanti and its people. Daily calls in the months following
the first government lockdown orders brought together dozens
of experienced professionals from every corner of our company.
These were the centrepiece of our crisis response and allowed our
teams to provide the latest news from their sites and communities,
to discuss the cascade of new challenges that seemed to arise
almost by the hour, and – importantly – to offer encouragement and
share solutions. We were able to work together seamlessly as a
global organisation across nine countries, ensuring we protected our
people while working towards our business objectives. We continued
to pay our employees throughout this period, despite COVID-19
related lockdowns in certain jurisdictions.
We continued to manage the business focusing on risk mitigation
and maintaining a tight rein on costs. Inventories of critical
spares have been built to cover between three and six months
at operations. We also implemented contingency plans early in
2020 to counter potential disruptions and built ore stockpiles to
provide additional operating flexibility where possible. We ensured
the continued transport and refining of our gold doré across our
operations through accredited private charters when commercial
airlines had suspended operations.
This business continuity ensured we were able to pay $1.1bn in
royalties and taxes, $508 million in salaries, wages and benefits and
more than $1.6 billion in procurement expenditures, of which 82%
is spent in our operating jurisdictions. Those numbers will take on a
particular significance for governments as they survey a devastated
economic landscape and see pockets of resilience around mines,
and as they see the continued inflows into the fiscus from mineral
exports. We’re immensely proud of that contribution.
From the outset, our guiding principle was to do the right thing by
our employees, their families and our surrounding communities.
We appreciated the need to work closely with the authorities,
civil society and community leadership at each step of the way,
with the clear understanding that our fortunes and those of our
host societies, are inextricably linked. That principle drove our
own response internally and informed the external assistance we
provided in the form of equipment and infrastructure.
We learnt valuable lessons along the way that will stand us in
good stead as this public health emergency remains with us for
some time yet. There are also learnings that will stay with us well
beyond that, particularly around information sharing, cooperating
more effectively across our global footprint, and in creating a more
resilient organisation.
Safety
Regrettably our safety performance – the pride of our 2019 report
back – took a major step backward during the first half of 2020,
with six operating fatalities on our mines. Tragically three of our
colleagues were killed at Mponeng mine in March, when a seismic
event hit immediately behind the workface. A fourth was killed in a
locomotive incident in the TauTona area barely three weeks later.
At Obuasi, in June 2020, an experienced equipment operator was hit
by an underground load-haul dumper, while in July a security guard
was hit and killed by a car driven by a private citizen, at the gate to
one of Obuasi’s housing estates. See In memoriam in the <SR>.
Each one of these deaths is a terrible tragedy for the families, loved
ones and colleagues, and a tough reminder that our work to banish
injury and death from our sites, is never done. We have taken
a decision to implement a revitalised safety strategy across the
business, a process that will unfold over the coming two years. We
STRATEGIC AND
OPERATING SUCCESS
Christine Ramon /
Interim Chief Executive Officer
56
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will continue to learn from high potential incidents, or ‘near misses’,
which are invaluable leading indicators for the high consequence, low
frequency incidents that claim lives on heavy industrial worksites.
Notwithstanding these setbacks, overall injury rates at our mines
continued their downward trend, ending the year at 2.39 injuries
per million hours worked. Looking at our existing portfolio, without
the South Africa and Mali assets sold last year, the number falls
to 1.68. Both numbers are significantly below the 2019 ICMM
member average of 3.14. These injury rates are a good indicator of
the strength of the safety culture across our business, underscored
by the fact that our managed operations in Africa (excluding Kibali
operated by Barrick, and Obuasi, which was in project phase last
year), went the entire second half of the year without a single injury.
It’s an astonishing feat, especially given the COVID-19 backdrop.
Strategic and operating success
The fundamental performance of the business was strong in 2020,
which was a pivotal year for us.
From a strategic perspective, we made solid progress across
several fronts; we met guidance for the eighth year in a row and
succeeded in our aim of streamlining the portfolio by exiting
operations in South Africa and Mali. The asset sale proceeds were
applied to debt reduction, further strengthening the balance sheet.
The trimmed down portfolio allows us to focus our capital on high
return, longer life opportunities.
Operating performance was solid, particularly given the COVID-
19-related mine closures in Brazil, Argentina, and South Africa, at
different points during the year. We ended the year with production
of 3.047Moz, which included a nine-month contribution from South
Africa before completion of its sale to Harmony Gold. Production
from continuing operations was 2.806Moz. All-in sustaining costs,
including South Africa, were $1,059/oz, which included $55/oz for
COVID-19 impacts, linked in part to the production losses from the
pandemic of 140,000oz.
The financial performance of the business was especially strong.
All-in sustaining cost margins from continuing operations widened
to 40%, helped on one end by conscientious cost management
and the other by the higher gold price, which averaged 27% higher
year-on-year. While the higher gold price is welcome, we continue
to apply conservative long-term assumptions in our planning, well
below the spot price. We believe this is the best way to protect
our balance sheet over the long term and ensure that we don’t get
carried away by a bullish consensus.
The business generated $1.0bn in headline earnings for the year –
around three times the level in 2019 – while free cash flow before
growth capital, the measure on which we calculate dividends, also
came in at just over $1bn.
That figure would have been considerably higher if not for cash
lock-up challenges we faced in the DRC, where our attributable
share of the cash totalled $424 million in the Kibali joint venture’s
local US dollar-bank accounts at the end of December, and
Tanzania, where value added tax receivables, accumulated over
more than three years, were $139 million. We remain in close
dialogue with Tanzania’s revenue authorities regarding offsetting
those tax balances against future corporate tax payments. In the
DRC, our partner and the operator of the Kibali mine, Barrick Gold,
continues to work diligently to have the cash released.
Performance was also competitive from a shareholder return
perspective. We reported a fivefold increase in our final dividend
year-on-year, with the total payment at just over $200m, supported
by stronger cash flows and a more competitive dividend policy.
Crucially, we achieved those returns and kept all our projects
funded, without any equity funding top-up for the tenth consecutive
year. This tight rein on our share capital continues to set us apart in
our peer group, as a true, self-funded gold producer.
Our ability to maintain that record depends on a strong balance
sheet, and once again we ended the year with a lower net debt
than what we started with. At 31 December 2020, our adjusted
net debt was $597m, and our leverage from continuing operations
(adjusted net debt to adjusted EBITDA ratio), was 0.24 times.
That’s well below both our covenant ratio of 3.5 times, and our
through-the-cycle target of 1.0 time. We also had strong liquidity of
$2.8bn, including $1.3bn in cash and $1.4bn in undrawn facilities,
a position boosted by our successful issuance of a 10-year, $700m
bond in September, at the lowest-ever coupon for AngloGold
Ashanti at 3.75%.
We lear nt valuable lessons along the way that will
stand us in good stead as this public health emergency
remains with us for some time yet. There are also
lear nings that will stay with us well beyond that,
particularly around infor mation sharing, co-operating
more effectively across our global footprint, and in
creating a more resilient organisation.
57
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CEO’S REVIEW AND OUTLOOK CONTINUED
Ore Reserve increases and five-year outlook
Another plank of our strategy is the increase in the Ore Reserve
across the portfolio. You’ll remember that 12 months ago we
started a focused plan to increase investment in brownfield
exploration and Ore Reserve development. The aim there was to
improve mining flexibility and orebody knowledge, to increase the
Ore Reserve and extend mine life. I’m pleased to say that we got
off to a promising start in 2020, with 6.1Moz added to the Ore
Reserve on a gross basis, which more than offset our depletion and
extended the operating mine life of the portfolio to about 11 years.
We saw Ore Reserve additions at key assets – notably adding
1.4Moz at Geita, opening a new, surface deposit and 1.8Moz at
Obuasi. We see this programme continuing through to 2023 as we
push out our Ore Reserve runway ahead of us.
Another benefit of this enhanced orebody knowledge is our ability
to provide a longer-term outlook for the business, a first in several
years for AngloGold Ashanti as we try to provide shareholders with
a view into how we think about the business, the exciting potential
that resides in our base of operating assets, and the world-class
pipeline of projects we are considering taking to development.
We are at an exciting inflection point in our growth strategy primed
to generate returns and unlock latent resource potential. Over the
next five-years, we expect to see c.5.0% compound annual growth
in gold production, with growth in the first four years coming mainly
from brownfields options in our existing portfolio. Obuasi makes
big additions in the first two years, while the Australia, Brazil and
African operations each make valuable contributions through the
period before Colombia kicks in from years four and five.
Over the same period, we see costs improving, as this year’s
investment in tailings compliance in Brazil comes to an end,
followed by the completion of deferred-stripping programmes at
Tropicana and Iduapriem. Also, at the end of 2022, the current
intensive investment programme in Ore Reserve development
tapers off, taking further pressure off margins.
So, while we see an increase in all-in sustaining costs in the short
term, we believe that bringing in new ounces to our Ore Reserve
base and existing production profile – at a competitive cost – is
the highest-return capital we can spend. The added benefit is the
longer valuation runway for the assets, as we start to stretch their
lives out further ahead of them.
In short, after years of rationalising our portfolio by selling and
closing mines, we have a clear and credible path back to
disciplined, high-return and low-risk growth.
Closing the value gap
We are alive to the valuation gap that exists with some of our peers,
and aware that closing it will not be down to any single measure.
We have a clear strategy so execution is key. We have three world
class projects in our portfolio, in Obuasi – which was 90% complete
at the end of 2020 – and two Colombian projects, the Gramalote
Production
(000oz)
2,000
2,400
2,800
3,200
3,600
4,000
2025
2024
2023
2022
2021
2,900
Guidance
Indicative outlook
3,450
3,025
CAGR: 5%
3,150
3,600
2,700
3,150
2,825
2,900
3,200
CAGR: Compound annual growth rate
Total
capex
($m)
AISC
($/oz)
2025
2024
2023
2022
2021
1,140
1,230
1,130
1,230
1,130
1,200
1,150
1,150
Guidance
Indicative outlook
1,200
1,270
1,250
800
990
950
1,120
1,050
1,100
950
900
1,050
Economic assumptions for 2021 are as follows: $/A$0.72, BRL5.00/$, AP98.00/$, ZAR16.95/$; and Brent $50/bbl.
Production, cost and capital expenditure forecasts include existing assets as well as the Quebradona and Gramalote projects that remain subject to approval,
Mineral Resource conversion and high confidence inventory. Cost and capital forecast ranges are expressed in nominal terms. In addition, both production
and cost estimates assume neither operational or labour interruptions, or power disruptions, nor further changes to asset portfolio and/or operating mines
(except as described above) and have not been reviewed by our external auditors. Other unknown or unpredictable factors could also have material adverse
effects on our future results and no assurance can be given that any expectations expressed by AngloGold Ashanti will prove to have been correct. Measures
taken at our operations together with our business continuity plans aim to enable our operations to deliver in line with our production targets; we, however,
remain mindful that the COVID-19 pandemic, its impacts on communities and economies, and the actions authorities may take in response to it, are largely
unpredictable. Accordingly, actual results could differ from guidance and/or indicative outlook and any deviation may be significant. Please refer to the Risk
Factors section in AngloGold Ashanti’s annual report on Form 20-F which has been filed with the United States Securities and Exchange Commission (SEC).
Furthermore, our five-year indicative outlook assumes that AngloGold Ashanti proceeds with the Quebradona and Gramalote projects. However, the board
has not yet made a final decision on those projects and there can be no assurance that they will materialise. A negative decision or other discontinuation of
those projects may have a material adverse impact on our indicative outlook.
58
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joint venture and the wholly-owned Minera de Cobre Quebradona,
which will come to the board of directors for approval during
2021. Ramping up Obuasi to full production by the end of 2021,
amidst the challenges presented by the COVID-19 pandemic, is an
important catalyst to release value. Similarly, the positive finalisation
of two key feasibility studies, that will bring two additional low-cost,
long-life assets into our portfolio, will create significant value . That
will need to be followed by flawless execution.
Solving our cash conversion challenges, by creating a smoother
mechanism to release cash flows from the DRC, and a reliable
manner of offsetting VAT balances from Tanzania, will also lift the
value of two key assets, Kibali and Geita.
Then there is the bread and butter work of ensuring that our
existing mines – ten in all – deliver to their budgets, and reach
their potential with the capital investments that we plan to make in
them over the coming years. Each of our mines has real potential
and each has a plan to improve in the coming years, whether it be
through the addition of life, production, or increased efficiencies.
Our top-class operators, backed by an industry leading exploration
team and excellent support staff across each of our operating
jurisdictions will ensure operational excellence.
The true measure of success will be to meet these development,
operational and financial milestones, while creating sustainable
value for our shareholders and other stakeholders. This means
maximising the direct benefit our host countries and communities
receive – through taxes, royalties, jobs and procurement – while
limiting our impact on the environment, by further lowering
greenhouse gas emissions and reducing the amount of scarce
natural resources we use.
Climate
Later this year we plan to complete an updated Climate Strategy,
with new, medium-term goals, and to publish our inaugural
report in line with the Task Force on Climate-related Financial
Disclosures, or TCFD. Bottom-up work from each site, starting
with climate risk assessments, have been done, and our initial
steps to mitigate the risks we will face in several aggressive
climate scenarios, has begun.
Of course, we are not newcomers to this field. We reduced the
greenhouse gas (GHG) intensity of our portfolio, measured in
tonnes of CO
2
per tonne of ore treated, by 43% since 2008.
Absolute emissions are 48% lower. These improvements are
the result of selling and closing high GHG-emitting assets and
implementing a host of efficiency measures over the past decade,
leaving our portfolio considerably improved from a climate
perspective.
Once these new targets are set, we will start to chart a pathway
to net zero emissions from our portfolio, in line with the Paris
Agreement on Climate Change. We are firmly committed to this
course, as are the governments in our operating jurisdictions.
Conclusion
I am honoured to have been requested by our Board to lead
AngloGold Ashanti as Interim Chief Executive Officer from
1 September 2020, following the resignation of Kelvin Dushnisky
at the end of July 2020. I am grateful for the unwavering support
received from our Board, from my colleagues in the executive,
from senior leaders across our sites and corporate disciplines, our
business partners and countless others during this time. My trips
to Geita, Obuasi and Iduapriem during the last quarter of the year
were enormously inspiring as I saw first-hand the dedication and
commitment of our teams who continue to make this company the
great business it is. In these people, 36,952, all across our business,
lies the true key to unlocking the latent value that lies in our portfolio.
Keeping our people safe and well and supporting our host
communities through this incredibly difficult time, is a top priority.
That includes finding innovative – and effective ways – to help our
host governments in their vaccination efforts, so we can work
together to find a return to a more normal life.
We continue to follow a very clear strategy endorsed by our
Board. It’s about being prudent and disciplined, in line with our
commitment to remain a self-funding gold producer, which benefits
a range of stakeholders and drives improving shareholder returns
over the long term.
Across all of this is our commitment to ESG. A great ESG performance
often equals overall business performance.
We’ve seen in countless ways how this mutually reinforcing cycle
creates value for a wide range of stakeholders. It makes our
communities stronger, makes our jobs more fulfilling, and is good
for shareholders, too. The product of this equation is clear -- more
efficient operations, with lower risk profiles, more supportive
communities, and increased access to growth opportunities. We
aim to be leaders in this area, and we’re making real, measurable
progress towards our goals, goals that we know will push us to do
better and strive for more.
We have an exciting growth story – and the building blocks to unlock
value are already in place. We’re taking a long-term view, and we’ve
already demonstrated a track record of delivery. Our commitment
to our shareholders is unwavering, and we have and will continue to
assess all options to improve shareholder value.
We’ll remain disciplined and steadfast in our approach and in
delivering on the strategy through the cycle, within the guardrails of
our balance sheet. We’ll maintain this discipline even as we benefit
from a suite of visible catalysts in the short, medium, and long term
to unlock value. Our investment case is indisputable, and I look
forward to AngloGold Ashanti’s next chapter as we build on our
momentum to unlock the value of our unique portfolio.
Finally, I would like to express my deep gratitude to the entire
AngloGold Ashanti leadership team and to our global employees
for their exceptional commitment and efforts in delivering on our
business priorities, despite all the challenges during this past year.
I would like to thank our shareholders and all stakeholders for your
continued support and trust in our Company. Our aim remains – very
clearly – to build a solid, predictable business that delivers value for
all stakeholders through the cycle.
Christine Ramon
Interim Chief Executive Officer
26 March 2021
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DELIVERING ON OUR STRATEGY
AngloGold Ashanti delivered a solid performance in 2020 and continued to make progress in meeting its strategic commitments,
despite the continuing COVID-19 pandemic.
Performance against our strategy
Ensure financial
flexibility
Maintain long-term
optionality
Capital resource allocation
Related risks
1
9
1
4
Performance outcomes
Strong cash flows used to reduce debt and for
reinvestment for long-term growth
Adjusted net debt to adjusted EBITDA ratio
reduced to 0.24x, now >76% below 1.0x
through-the-cycle target
Strengthened balance sheet provides flexibility
and optionality throughout the cycle – strong
liquidity position of ~$2.8bn, including cash and
cash equivalents at year-end of $1.3bn
Investment grade credit ratings from Fitch and
Moody’s Investor Services
Track record of discipline capital allocation
Improved financial performance leading to a
more than five-fold increase in dividend to
around 48 US cents a share, from 9 US cents
in 2019. The dividend payout ratio was doubled
to 20% of free cash flow before growth capital
expenditure, payable bi-annually from 2021
Good progress – on time and on budget – with
ramp up of phase 2 of the Obuasi redevelopment
nearing completion
Advanced project development at Sunrise Dam
and Geita
Feasibility studies advanced for Gramalote and
Quebradona in Colombia - nearing decision
Greenfield options being explored in the United
States, Australia and Brazil
Ongoing brownfield development across
the portfolio: Sunrise Dam targets drill out;
Tropicana Havana expansion and underground;
opportunities in the Africa region with new
additions at Geita, Obuasi, Siguiri, Kibali and
Iduapriem; drilling programmes underway in
Brazil and Argentina.
Minimise the Inferred Mineral Resource in the first
two years and delaying use of blue sky material
for as long as possible
Outlook – priorities
Maintain shareholder confidence
Excess cash flow generated used to boost
shareholder returns
Reduce debt and maintain liquidity
Deliver on commitments/guidance
Use cash generated to reinvest in our
asset base to support long-term business
sustainability
Action planned
Strong financial discipline
Exploring for value to establish a system that
goes beyond the norm, that allows us capture
of geological understanding from the earliest
stage of development
Link to executive
remuneration:
DSP
performance metric weighting
20.0%
12.5%
Legend for risks
Nature of risk
Operational
External
Strategic
1
Adverse regulatory changes to mining
rights and fiscal requirements
2
Inability to convert Mineral Resource
to Ore Reserve
3
Adverse implications of significant events for AngloGold
Ashanti and the industry and for our governance
4
Failure to successfully deliver and ramp
up growth projects
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WWWWWWW W
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Improve portfolio
quality
Optimise overhead, costs
and capital expenditure
Focus on people, safety
and sustainability
1
2
4
1
5
6
8
9
1
3
6
7
10
Streamlined and improved overall
portfolio quality with completion of the
sale of assets in South Africa and Mali
Embarked on a multi-year initiative to
increase investment in Ore Reserve
development and brownfields
exploration aimed at increasing Ore
Reserve conversion, extending the life
of assets, improving mining flexibility
and enhancing knowledge of orebodies
Increased the portfolio’s operating life by
two years to about 11 years
Added 6.1Moz of Ore Reserve on a
gross basis
Maintained capital discipline
Margin-focused operations through a
streamlined portfolio
Given the COVID-19 pandemic, health and safety of
employees and communities are a priority
$44m spent on COVID-19-related initiatives to prevent
the spread of the pandemic, to protect employees,
to provide public health and economic relief to host
communities and governments, and to manage the
direct COVID-19 impact on the business
Safety and health performance:
Fatalities increased with six deaths recorded
for 2020
All-injury frequency rate continued to decline,
reaching a record low of 2.39 per million hours
worked (or 1.68, excluding South Africa and Mali)
all occupational disease frequency rate fell to 0.72
improved employee mental health support
People
Greater emphasis on inclusivity and diversity
Environment
improved water efficiency
reduced emissions
Communities
no human rights violations were reported
community investment of $22m
Pursue value accretive opportunities
Self-funded portfolio improvements with
no equity issuance
Demonstrate capital discipline
Deliver on commitments
Optimise operational efficiencies
Apply technology and innovation to
enhance efficiencies
Ensure and maintain stakeholder trust and confidence
Invest in stakeholders
Maintain focus on excellence in ESG performance
Motivate and engage employees
Embed diversity and inclusion
Ongoing brownfield development
across the portfolio in Tanzania, Ghana,
Guinea, Argentina and Australia
42.5%
25.0%
5
Failure to meet our operational and
safety targets
6
Failure to attract and retain critical
skills and talent
7
Loss of or threats to social licence
to operate
8
Failure to move down the industry cost curve:
all-in sustaining cost competitiveness
9
Adverse gold and commodity prices,
and currency movements
10
Inability to meet investor expectations on responsible
mining and increased disclosure (ESG performance)
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STRATEGIC CAPITAL TRADE-OFFS
Strategic focus area Rationale
Capitals affected
Depleted
Increased
Managing the COVID-19 pandemic
Focus on people,
safety and
sustainability
Protecting employees and communities is a
top priority, and especially so during a global
pandemic. We provided personal protective
equipment (PPE) and sanitisers, medical care
and facilities, and implemented communication
and awareness campaigns on prevention,
among other things.
See
The year of COVID-19 impact reponse
and management and the <SR> for more
information on the impact of the pandemic on
our employees, operations and communities,
and how this has been managed.
Human capital: The pandemic
presented a threat to the health and
safety of employees. A total of 2,261
employees contracted COVID-19 as
of end of March 2021. Most were
asymptomatic, and the recovery rate
is 94.4%.
Financial capital: Since the
outbreak of the pandemic, we
have invested $6m in combatting
it and protecting employees and
communities.
Manufactured capital: production
was impacted with enforced operational
shut downs in a number of countries;
as estimated 140,000oz of production
were lost and its impact on all-in
sustaining cost is estimated at $55/oz
for the year
Social and relationship
capital:
In managing
the pandemic and its
consequences, we collaborated
with stakeholders at all levels.
This resulted in improved
relationships and close
collaboration in preventing
infection and responding to the
public health and economic
aspects of the pandemic
Human capital: employees
received full salaries and
benefits, even those unable to
work during lockdowns and mine
closures. Demonstrations of
good faith enhanced the quality
of relationship with employees
Rationalisation of portfolio/asset sales
Improve portfolio
quality
The latest review to streamline our portfolio
of assets started in 2018 and resulted in the
sales of our remaining South Africa assets, and
Morila and Sadiola in Mali. The review aimed
to sharpen focus on higher-margin, longer life
operations and projects that delivered higher
returns than those available in the assets sold.
See
CEO’s review and outlook
Natural capital: Mineral Resource
and Ore Reserve reductions of
53.9Moz and 16.8Moz respectively,
related to the assets sold; with
respect to GHG emissions intensity,
the South African asset sales are
expected to reduce our impact in
2021, from 2019 levels
Manufactured capital: Fewer
operations in our portfolio has
decreased
Financial capital: The asset
sales in 2020 generated $239m
in total, most of which was used
to reduce debt. The South African
asset sale also contributed to
reduced environmental and other
liabilities totalling close to $198m
as well as a reduced wage bill
Manufactured capital: The
quality of the remaining assets
overall is enhanced
Natural capital: In 2020, on
the back of our aggressive
exploration programme, we
recorded a 45% increase in the
average grade of our Ore Reserve
in our remaining portfolio
Focused initiative to develop and convert Ore Reserve
Improve portfolio
quality
Optimising our mining portfolio and focusing our
management attention and capital on longer-
life, higher-return assets, was a particular focus
once asset sales were completed. A three-year
Ore Reserve development and conversion
programme started in early 2020. Replenishing
the Ore Reserve pipeline is critical to the long-
term sustainability and success of our business.
The programme is intended to enhance mining
flexibility and extend operating mine lives. In
terms of capital allocation, this is expected to
be a low-risk, high-return investment. Related
work is underway at Geita, Siguiri, Iduapriem,
Obuasi, AGA Mineração, Serra Grande, Cerro
Vanguardia, Tropicana and Sunrise Dam.
See
CEO’s review and outlook
Financial capital: Sustaining capital
expenditure totaled $532m, while
growth capital was $260m
Natural capital: In 2020,
the Ore Reserve increased by
6.1Moz on a gross basis, and
2.7Moz on a net basis, once
depletion was taken into account
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Strategic focus area Rationale
Capitals affected
Depleted
Increased
Progressing Colombian projects
Maintain
long-term
optionality
Greenfields exploration in Colombia has led
to three new ore discoveries. Two of those
– Quebradona and Gramalote – are at an
advanced stage, with final feasibility study
results expected in 2021, after which the board
will make an investment decision in each case.
These are high-quality projects that, if
approved, would improve the average cost
and reserve life of AngloGold Ashanti’s overall
portfolio.
Quebradona, a copper-gold project, also
brings commodity diversification to the
portfolio. Copper is essential in renewable
energy and electric vehicle technologies, which
are increasingly sought after as demand for
materials that facilitate decarbonisation and
reduced emissions grows.
See Planning for the future – projects,
exploration and innovation for details
Financial capital: $77m invested
in 2020 to advance Gramalote and
Quebradona
Natural capital: Impact on the
environment, including water
and land, with detailed mitigation
plans in place, including large-
scale reforestation, restoration of
indigenous ecosystems, and the
development of an ecopark at the
Quebradona site.
Natural capital: Potentially
adding to our Mineral Resource
and Ore Reserve
Social and relationship
capital: At Quebradona, work
continued on the integration
of social, environmental and
economic imperatives into
the project and subsequent
mining operations - in
line with promoting the
‘#Miningwithpurpose’ campaign.
Local stakeholder support
from the Jericó community
has been stable with the most
recent survey conducted
indicating that a significant
majority of residents support
the project. In December 2020,
the Gramalote project received
the “Sello Social de La Minería
en Antioquia” in recognition of
Gramalote’s commitment to
community support. The award
is presented by the Ministry of
Mines of Antioquia to large-scale
operations.
Manufactured capital:
If approved
Human capital: If approved
Obuasi redevelopment
Maintain
long-term
optionality
The Obuasi Redevelopment Project has an
estimated Mineral Resource of 29.5Moz. The
project is in the process of ramping up to a
steady state production rate of 4,000t a day,
expected in the second half of 2021. At full
production, Obuasi will contribute between
350,000oz and 400,000oz annually during its
first 10 years of production, at an estimated all-
in sustaining cost of around $825/oz, in 2018
money terms. This is an improvement on the
company’s average costs and falls in the lower
half of the industry cost curve. Obuasi has an
estimated mine-life of more than 20 years, with
production increasing and costs improving in
the second decade of production as higher
grade areas are mined.
See
Regional review – Africa for details
Financial capital: $455m invested
to date in the redevelopment of the
Obuasi mine.
Natural capital:
Obuasi’s Ore
Reserve increased markedly during
2020 as confidence in the orebody
was enhanced owing to the detailed
mine planning process. AngloGold
Ashanti has relinquished about
60.53km
2
of land to the government
of Ghana, for use by local
communities in line with government
initiatives. A comprehensive
programme is in place to rehabilitate
areas of the mine site and address
legacy issues.
Human capital:
Providing
employment with priority given
to locals and Ghanaian nations.
Skills transfer programmes are
in place to create skills in areas
of scarcity.
Manufactured capital: Adding
to our mining infrastructure,
plant and equipment.
Social and relationship
capital:
Through the Obuasi
redevelopment, we have created
local procurement opportunities,
partnered with local companies,
invested in socio-economic
development programme, and
fostered positive relationship
with government and regulators.
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E  S  G
PERFORMANCE 2020
An overview
Environment, social and governance – ESG – matters encompass those material issues and risks which could potentially impact our
ability to create sustained long-term value. These factors are integrated into our strategy through our foundational strategic pillar –
Focus on people, safety and sustainability – and are thus vital aspects underpinning our business model.
Our ESG commitments are informed by a comprehensive
materiality assessment which determines our key priorities, risks
and opportunities. Our activities are underpinned by strong
governance systems and a world-class set of policies, standards
and management systems.
COVID-19 has further intensified stakeholders’ focus on ESG
issues, ranging from how we treat employees, our approach to
climate change and human capital, and our efforts to promote
sustainable supply chains and communities in which we operate.
Contributing positively to employees, communities and
demonstrating responsible environmental stewardship are critical
to ensuring our social licence to operate. It is a responsibility we
take seriously that covers resource use and land rehabilitation,
social justice, good governance, good corporate citizenship,
diversity and inclusion, and human rights.
Strong ESG performance is important in maintaining our
stakeholder confidence and trust, and in creating sustained value
in the long term. This is another area which receives focus at all
levels of the business. Consequently, the board, supported by its
committees, is actively engaged in oversight and monitoring of the
Company’s performance, promoting an ethical culture, being a
responsible corporate citizen, and ensuring inclusive stakeholder
relationships – see our ESG governance framework below.
Our ESG governance framework
Board
Robust, active oversight and
engagement on ESG and
sustainability issues
Supported by:
Social, Ethics and Sustainability Committee, which oversees detailed ESG and
sustainability performance
Audit and Risk Committee, which oversees effective risk management, including that of
sustainability-related issues, and ensures ethical conduct through related company policies
Human Resources and Remuneration Committee, which ensures remuneration
policies are in place and that all employees are remunerated fairly and responsibly, taking into
consideration delivery on value creation
Policies, frameworks and standards
Aligning with global best practice
Policies, standards and frameworks that seek to align with global best practice
Policies operationalised through robust management systems
Systems include safety, health, human resources, environment, community affairs, tailings
management, security, human rights and closure
Management
Active engagement, delegation
and oversight on execution
Executive management team has direct accountability for all aspects of the business,
including ESG matters and sustainability
An internal Climate Change Working Group oversees corporate climate change strategy
Monthly and ad hoc reporting on key issues across all operating sites and disciplines
Assurance
Systematic, well-planned and
co-ordinated
Comprehensive risk and assurance review process includes
AuRisk: a proprietary risk management system, identifies risks and tracks performance on
mitigation measures
Internal: detailed combined assurance audits of all sites conducted annually/biannually, led
by Internal Audit and supported by all functional sustainability disciplines
External: ensuring alignment with global best practice (see below)
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Sustainability and ESG frameworks and standards
We have ESG standards, policies and frameworks and are signatories to, or members of, several external organisations, frameworks
and standards with ESG principles aligned with our values. These affiliations provide another avenue for stakeholders to asses our
performance in these areas. Our participation in industry initiatives also enables us to inform and influence global standards and
practices, while gaining insight into emerging expectations, risks and best practice.
These include:
45001
ESG performance and the SDGs
AngloGold Ashanti is committed to the United Nations SDGs to support its 2030 Agenda to end poverty and inequality, protect
the planet and ensure prosperity for all. While the SDGs were aimed at national governments initially, the private sector and public
companies are increasingly being encouraged to support them.
Our sustainable development strategy, which supports our overall business strategy, is aligned with the SDGs. The SDGs also speak to
our ESG performance and are aligned with the 10 principles of the ICMM.
We have categorised and prioritised the SDGs, based on the extent to which each is relevant to our business, as follows:
SDGs identified as those to which we can make a material, positive contribution
Core to our business, and we are committed to making a
positive contribution:
Other SDGs affected in the conduct of our business
Not core to our business but we can positively contribute:
SDGs we indirectly or negatively affect
Potentially impacted by our activities and require mitigation:
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E  S  G
PERFORMANCE 2020 CONTINUED
An overview
Responsible Mining Index
The Responsible Mining Index (RMI) assesses the extent to which
large-scale mining companies address a range of economic and
ESG issues across their mining activities. AngloGold Ashanti ranked
fourth out of 38 global mining companies, and first for emerging
market companies, for our mine-site results in the latest RMI
rankings. We scored in the top five for performance in economic
development, lifecycle management, community wellbeing and
environmental responsibility. Other areas which are assessed by the
index are business conduct and working conditions.
We were commended for, among others, our transparency in
relation to the negative impacts our operations can have, our
formalised approach to supporting local procurement and local
business development, for our comprehensive approach to
mitigating the impacts of collective retrenchment and relatively
detailed disclosure of environmental incidents.
Sustainability indices
We voluntarily engage with several entities that rank our sustainability/ESG performance, according to their own methodologies. These
rankings are based on our ESG-related disclosures and also ESG risks and performance and provide useful external feedback on our
performance and benchmarks against our peers. We are proud where we do well but are more focused and work hard on those areas
highlighted for improvement. These indices are:
Resposible Mining Index rating
0
0.5
1.0
1.5
2.0
2.5
3.0
Environment
Working
conditions
Community
wellbeing
Lifecycle
management
Business
conduct
Economic
dimension
2.4
1.2
2.3
2.8
1.1
1.9
2.8
2.5
2.8
2.4
2.7
2.6
AngloGold Ashanti
Industry average
S&P Global CSA (formerly DJSI Robeco SAM CSA)
0
10
20
30
40
50
60
70
80
ESG rating
overall score
Social
dimension
Environmental
dimension
Governance &
Economic dimension
60
21
73
17
15
74
69
26
AngloGold Ashanti
Industry average
S&P Global Corporate Sustainability Assessment (CSA)
(formerly SAM CSA)
S&P Global CSA enables directing reporting of key sustainability
metrics and benchmarking of performance on a wide range of
industry-specific ESG criteria. CSA results are not only an important
resource to the financial community but also to employees,
customers and critical NGOs.
In the 2020 assessment, AngloGold Ashanti was ranked number
10 out 134 metals and mining companies in the industry and
achieved an overall ESG rating score of 69 versus an industry
average of 26.
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FTSE4Good
The FTSE/JSE Responsible Investment Index Series (FTSE4Good)
is designed to measure the performance of companies
demonstrating strong ESG practices. AngloGold Ashanti achieved
an overall rating of 4.3 out of 5. This compares favourably with
average scores of 2.6 for the gold mining sector, 2.1 for the basic
materials industry and 3.5 for South Africa.
ESG practices rating
0
1
2
3
4
5
ESG rating
overall score
Governance
score
Social
score
Environmental
score
3.9
1.7
4.0
1.8
3.0
5.0
4.3
2.1
AngloGold Ashanti
Industry average
Bloomberg Gender-Equality Index
This index tracks the financial performance of public companies
committed to disclosing their efforts to support gender equality
through policy development, representation and transparency.
AngloGold Ashanti has been included in the 2021 Bloomberg
Gender-Equity Index (GEI) in recognition of the work being done to
improve diversity and inclusion across the group. Our overall score
of 67% compares with an average score across all sectors of 67%
for the mining sector.
Our highest scores were for disclosure, equal pay and gender
parity, our sexual harassment policies and our pro-women
branding. Although we improved in some areas, opportunities exist
to better our performance in others – such as female leadership
and talent pipeline, and gender inclusivity. With the support of the
board and executive committee to promote gender diversity and
create an inclusive working environment, we are well placed to
achieve this. See
People are our business and the Remuneration
report for more information.
Bloomberg Gender-Equality Index rating
0
20
40
60
80
100
Overall GEI*
average
Pro-Women
Brand
Sexual
Harassment
Policies
Inclusive
Culture
Equal Pay &
Gender Pay
Parity
Female
Leadership
& Talent Pipeline
Data
Excellence
Score
Disclosure
Score
67
67
98
96
55
40
72
51
68
53
38
49
60
60
80
46
AngloGold Ashanti
Industry average
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E  S  G
PERFORMANCE 2020 CONTINUED
An overview
ENVIRONMENT
RELEVANT SDGs
VALUES
Geita
We respect
the environment.
Focus on people,
safety and
sustainability
STRATEGIC FOCUS AREA:
STAKEHOLDERS
Communities
and suppliers
Governments
and regulators
Mining, by its very nature, has a negative impact on the
environment. Our primary business activity is to extract
gold-bearing rock from the earth. In so doing, land is
disturbed. Mining consumes water and energy, generates
air emissions and produces various forms of waste that
must be safely and responsibly disposed of. Air, water and
energy management, the protection of biodiversity, and
land rehabilitation are principal environmental focus areas.
AngloGold Ashanti acknowledges the extent of our impacts on
the natural environment as well as on host communities and
is committed to mitigating those impacts.
Our approach to environmental management is based on
responsible stewardship, with the goal of minimising impacts to the
environment and the equitable use of natural resources.
Key areas of environmental responsibility are protecting biodiversity,
including land rehabilitation, and mitigating impacts on water,
energy, and air and climate change. We work actively to integrate
environmental management with our operational functions and to
formalise cross-functional collaboration.
Our active management aims to minimise impacts, to enhance
efficiencies in the use of natural resources, to encourage
responsible consumption, and to mitigate and remediate
environmental impacts.
Our most material environmental issues are:
Energy and climate change: Innovative methods are used to
reduce GHG emissions intensity and we continue to search for
ways to improve in this important area. In 2008, we set our first
target to cut GHG emissions intensity of our portfolio by 30%
over 15 years. We achieved a 43% reduction in carbon intensity
by 2018, well before the 2022 self-imposed deadline. New
medium-term targets are in the process of being set and will be
followed by a pathway to achieve net zero carbon emissions.
Hydropower, already used at Kibali in the DRC and at our
operations in Brazil, will also feature strongly at our Colombia
projects once mining begins there.
Water management: We aim to continuously optimise the
volume of water imported for production, and to maximise water
re-use within the operations, while preventing the contamination
of natural water resources by our activities. We currently recycle
about 76% of our total water requirement.
Tailings management: We are committed to implementing the
Global Industry Standard on Tailings Management. Our detailed
tailings management framework sets principles, standards and
guidelines for the construction, management and oversight of
our tailings storage facilities (TSFs), and focuses on the sound
management of all phases of the TSF lifecycle. Oversight at all
levels - from board to site – covers planning and investigation;
design, construction and operation; monitoring and checking;
and taking corrective action where necessary. In Brazil, we
have begun converting our TSFs to dry-stacking structures in
compliance with new legislation.
Integrated closure management: Managing the social aspects
of closure is perhaps the most difficult element of mining,
particularly given the growing emphasis on contributing toward
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Geita
Compliance
Our Group Environmental Policy, Standards and Guidelines guide
our environmental activities while allowing flexibility to adapt to
the varying operational, geographical, climate and regulatory
contexts. Each operation’s unique set of controls is maintained
through its Environmental Management System (EMS), which is
ISO 14001: 2015 certified.
We are in material compliance with all relevant
environmental legislation.
80% of sites 15014001 certified
75% of sites Cyanide code certified
All our gold processing plants are certified in terms of the Cyanide
code with the exception of Obuasi mine and Mine Waste Solutions
(MWS). MWS was sold on 30 September
2020 while Obuasi has been under
construction and redevelopment. Obuasi
and will initiate processes for recertification
once construction and ramp up to full
production is achieved.
the development of resilient and sustainable communities. We aim to
identify social transition projects by engaging closely with communities
during the life of the mining operation, to promote sustainable local
businesses and to continue rehabilitating disturbed land as we operate
to reduce final restoration and decommissioning costs. In recent years
we have managed to steadily reduce the area of land disturbed. See
table on page 72.
Environmental performance – summary
Energy and climate change
Our aim is to mitigate our carbon footprint through gains in energy
efficiency while insulating our operations and host communities
against physical climate risks as a result of the climate crisis.
AngloGold Ashanti has been proactive in acting on climate change
and provided early leadership. We are now focused on setting new
targets.
Preparatory work is currently underway to set new targets. A
new internal Climate Change Working Group (CCWG) has been
established with members drawn from key group functions and from
all operations. The primary aims of the working group are to review
our climate change performance, develop an updated climate change
strategy, update our understanding of physical and transition risks
and opportunities relating to climate change, develop and update
mitigation and adaption priorities for operations and host communities,
update climate change metrics and targets, including a revision of
related metrics used in management’s discretionary remuneration, and
oversee implementation of mitigation and adaptation projects.
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2016
2017
2018
2019
2020
Energy usage
*
(petajoules)
28.55
29.76
25.38
26.32
25.57
* South Africa reported for nine months to the date of sale – 30 September 2020
2016
2017
2018
2019
2020
GHG emissions
*
(kilotonnes of GHG)
4,062
3,953
2,571
2,570
2,337
* South Africa reported for nine months to the date of sale – 30 September 2020
Energy usage by region
(petajoules)
2016
2017
2018
2019
2020
Africa
8.46
9.16
9.36
9.93
10.29
Americas
3.94
4.23
4.13
4.31
4.17
Australia
5.62
6.32
6.72
7.68
7.77
South Africa
10.54
10.05
5.17
4.40
3.34
AngloGold Ashanti
28.55
29.76
25.38
26.32
25.57
GHG emissions by region
(kilotonnes of GHG)
2016
2017
2018
2019
2020
Africa
682
666
676
825
770
Americas
180
182
168
177
166
Australia
336
372
395
449
451
South Africa
2,864
2,733
1,322
1,218
949
AngloGold Ashanti
4,062
3,953
2,571
2,570
2,337
E  S  G
PERFORMANCE 2020 CONTINUED
An overview
Energy and climate change (continued)
Quebradona
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2016
2017
2018
2019
2020
Number of reportable environmental incidents
*
1
3
2
3
8
* South Africa reported for nine months to the date of sale – 30 September 2020
2016
2017
2018
2019
2020
Water usage
*
(gigalitres)
56.7
52.2
45.9
47.9
47.4
* South Africa reported for nine months to the date of sale – 30 September 2020
Water usage by region
(gigalitres)*
2016
2017
2018
2019
2020
Africa
11.9
16.7
15.6
15.8
17.4
Americas
8.1
8.3
7.8
8.8
10.6
Australia
7.6
6.8
7.7
8.7
8.7
South Africa
23.2
20.5
7.7
8.7
10.7
AngloGold Ashanti
56.7
52.2
45.9
47.9
47.4
Number of reportable environmental incidents by region
2016
2017
2018
2019
2020
Africa
2
1
1
6
Americas
1
2
Australia
0
South Africa
1
1
2
0
AngloGold Ashanti
1
3
2
3
8
Water
Water is a valuable and often
scarce resource. It is also one
which we share with other users
such as farmers, local industries
and communities. Our aim is to
prevent any contamination of water
sources and improve our water
use efficiencies by minimising the
volumes of water imported/drawn
for use in our mining and processing
activities and maximising its re-use
and recycling at the operations.
Geita
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Tailings management
At the start of 2020, AngloGold Ashanti managed 34 tailings
facilities – 60% active, 20% being remined and 20% inactive
(dormant). At the end of the year, after the sale of assets, the
portfolio had been reduced to 22 TSFs, of which 15 were active
and seven inactive.
The ICMM’s Global Industry Tailings Standard on Tailings
Management was launched in August 2020. As a member of
the ICMM, we have committed to implement the standard at all
facilities within five years. The group’s tailing engineers staff have
prepared a gap assessment against the Standard’s requirements to
be rolled out to operations starting in 2021.
We have also developed a detailed framework for tailings
management practice that sets principles, standards and guidelines
for the construction, management and oversight of TSFs.
The framework focuses on the sound management of all phases of
the lifecycle of a TSF and recognises that each TSF is unique and that
no single design or operating technique can be universally adopted.
Integrated closure management
Our integrated closure management standard aims to ensure that
our activities minimise adverse impacts on people, the environment
and broader society. Our Closure Planning Standard, implemented
in 2013, sets a consistent benchmark across all operations and
ensures a multi-disciplinary approach in identifying and managing
current and future closure risks and liabilities.
The social aspects of managing mine closure is increasingly
important with a growing emphasis on contributing towards resilient
and sustainable communities during the lifecycle of the mining
operation that will leave a positive impact long after closure. See
Resilient, self-sustaining communities in the <SR>
.
Land under management, land rehabilitated, and rehabilitation liabilities
Land (ha)
Rehabilitation liabilities ($m)
Region
Under
management
Rehabilitated
to date
Disturbed and not
yet rehabilitated
Restoration
Decommissioning
Total 2020
Total 2019
Africa
243,188
2,173
9,248
248.1
164.4
412.5
408.7
Americas
77,471
688
2,943
126.2
33.0
159.2
167.0
Australia
121,681
1,050
4,803
68.7
42.2
110.9
96.8
South Africa
19,171
1,331
8,887
96.6
Less equity-
accounted
investments
(3.1)
(20.6)
(23.7)
(54.0)
Less liabilities held
for sale
(96.4)
AngloGold Ashanti
461,511
5,243
25,881
439.9
219.0
658.9
618.7
More detail on each of these material environmental issues is provided in the <SR>
A detailed breakdown of our environmental statistics by operation is available online – see ESG data tables at www.aga-reports.com
E  S  G
PERFORMANCE 2020 CONTINUED
An overview
Iduapriem – TSF
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SOCIAL
RELEVANT SDGs
VALUES
Iduapriem
We treat each
other with dignity
and respect.
We want the communities and
societies in which we operate
to be better off for AngloGold
Ashanti having been there.
We are accountable for our
actions and undertake to
deliver on our commitments.
Focus on people,
safety and
sustainability
STRATEGIC FOCUS AREA:
STAKEHOLDERS
The health and safety of our employees and host communities
is central to our ability to operate sustainably. In helping to
build livelihoods in host communities, we work with a range of
stakeholders at local and national level, on projects and initiatives
in the areas of health, education, infrastructure and business
development, among others.
Creating direct economic opportunity can help build trust and
acceptance of the mining industry and can lead to increased
community collaboration and economic growth. While community
demands and the complexity of social challenges faced may
at times be felt more acutely at mining operations in emerging
economies, where the challenges of poverty, unemployment and
inequality are most visible, the concept of shared value is relevant
across all of our operating jurisdictions.
Our social conduct is critical for us to maintain our social licence
to operate.
Our most material social matters are:
Employees
Employee safety
Employee health
Integrated talent
management
Communities
Community health
Resilient, self-sustaining communities
Integrated closure
(see
environmental performance)
Artisanal and small-scale mining
Social performance – summary
Employee safety
Our goal is to have workplaces that are free of injury and harm by
2030. AngloGold Ashanti has made significant strides in improving
safety in recent years and our systematic and integrated safety
strategy is embedded through our executive and senior operational
leadership teams.
Compliance
All our operating mines are OHSAS 18001:2007 certified, with
Geita, Iduapriem, Siguiri, Cerro Vanguardia, Sunrise Dam and
Tropicana Mines already migrated to ISO 45001:2018, with the
remaining operations to follow. The certification process has
however been impacted by COVID-19 travel restrictions.
W
ot
an
W
ac
de
W
so
to
As
Employees
and unions
Governments
and regulators
Communities
NGOs
Occupational fatalities
(number of fatalities)
2020
2019
2018
2017
2016 5
7
2
5
7
2
2
3
1
0
Employees
Contractors
4
2
6
Notwithstanding this improvement, we deeply regret the loss of
six colleagues during the past year. We extend our condolences
to all affected by their passing. The deceased are Justice Cudjoe
and Justice Obeng Sarkodie (Obuasi), and Xolani Ngqwemese,
Mokhethe Johannes Radebe, Luca Maapea and Thabo Reuben
Rakometsi (Mponeng).
We continue to consolidate progress made in recent years by
reviewing the safety strategy. We have developed detailed action
plans at a group level for the next three years, with the regional
and operational leads adapting and incorporating the strategy
into site improvement plans considering local circumstances and
relevance. Specific emphasis has been on analysing the correlation
between critical control failures in critical control monitoring and
control failures that contributed to High Potential Incidents. Through
this work we seek to establish a more holistic and proactive risk
management approach to prevent high consequence incidents.
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E  S  G
PERFORMANCE 2020 CONTINUED
An overview
Group all ocupational disease frequency rate
(per million hours worked)
0
1
2
3
4
5
6
7
8
2020
2019
2018
2017
2016
7.13
7.03
3.29
1.36
0.72
All occupational disease frequency rate
(per million hours worked)
2016
2017
2018
2019
2020
Africa
0.13
0.00
0.03
0.03
0.00
Americas
3.56
3.67
0.16
0.32
0.00
Australia
0.00
0.50
0.00
0.21
0.00
South Africa
11.80
12.39
10.18
4.81
5.06
AngloGold Ashanti
7.13
7.03
3.29
1.36
0.72
Silicosis class action and the Tshiamiso Trust
In July 2019, a full bench of the Johannesburg High Court
approved the settlement of the silicosis and TB class action
suit in South Africa, providing a route to compensation for
affected mineworkers and their families. The settlement was
between the Occupational Lung Disease Working Group
– representing African Rainbow Minerals, Anglo American
South Africa, AngloGold Ashanti, Gold Fields, Harmony and
Sibanye-Stillwater – and the settlement classes’ attorneys,
Richard Spoor Inc, Abrahams Kiewitz Inc and the Legal
Resources Centre.
The settlement agreement relating to the silicosis and TB
class action became effective on 10 December 2019,
following the legal processes that had to be in place for a
trust to be established. The Tshiamiso Trust was subsequently
registered on 7 February 2020. The trust has begun its work
tracking class-action members, processing claims submitted,
undertaking medical examinations and paying benefits to
eligible claimants, in accordance with the terms of the historic
silicosis and TB class action settlement agreement.
For more details and updated information on the trust’s
work, see:
https://www.tshiamisotrust.com/wp-content/
uploads/2020/11/13-11-2020-Tshiamiso-Trust-Progress-
report.pdf
.
Employee and community health
The COVID-19 pandemic led to improved integration of health risk
management across the company, beyond occupational health and
into our over-arching business strategy.
The pandemic required significant focus and resources across
AngloGold Ashanti as we worked to limit the spread of the
virus and safely maintain operational continuity. Given the close
association between employees and communities, the measures
we took focused on both stakeholder groups. As at 19 March
2021, AngloGold Ashanti had conducted more than 50,800
COVID-19 tests of which 2,794 employees had tested positive.
About 94.4% of the confirmed cases have fully recovered. Sadly,
13 of our employees succumbed to COVID-19-related illnesses.
We remained focused on reducing occupational illnesses and
recorded a reduction of 47% year-on-year. When excluding the
assets sold, there were no occupational illnesses recorded on our
existing portfolio. We continue work to improve employee wellness,
including fitness for work and general physical and mental well-
being. See
<SR> for further details.
Our most significant and successful community health initiative is
our malaria control programme which is in place at all operating
sites in our Africa region, and protects more than 1 million people.
Group all injury frequency rate
(per million hours worked)
0
1
2
3
4
5
6
7
8
2020
2019
2018
2017
2016
7.71
7.49
4.81
3.31
2.39
All injury frequency rate
(per million hours worked)
2016
2017
2018
2019
2020
Africa
0.51
0.39
0.49
0.62
0.55
Americas
3.96
3.29
3.97
3.84
3.68
Australia
9.49
8.53
9.14
7.33
3.74
South Africa
12.02
12.68
10.25
6.60
6.12
AngloGold Ashanti
7.71
7.49
4.81
3.31
2.39
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Average number of employees
(including contractors)
2016
2017
2018
2019
2020
Africa
12,691
13,593
14,833
15,786
16,829
Americas
8,126
8,511
7,973
8,114
8,789
Australia
925
974
1,051
1,140
1,230
South Africa
28,507
26,245
18,803
7,870
8,297
Other
2,400
2,157
1,589
1,353
1,807
AngloGold Ashanti
52,649
51,480
44,249
34,263
36,952
Integrated talent management
Having productive employees with the necessary talents, skills,
knowledge and experience enables AngloGold Ashanti to
deliver on its strategy and create value. Managing our talent and
ensuring a pipeline of appropriately skilled employees to sustain
the business in the long term, is key. We achieve this through our
talent management strategy, which is supported by learning and
development initiatives. In 2020, $11m was invested in employee
learning and skills development (2019: $12m) in total.
Diversity and inclusion is central to our human resources strategy,
and to this end a Global Diversity and Inclusion Framework,
approved by the board in 2019, is designed to foster the
empowerment of all staff, irrespective of race, gender, ethnicity,
religion and sexual orientation, or disability. This framework is
aligned with the principles of the ICMM and UNGC as well as
AngloGold Ashanti’s human resource objectives. For more detail,
see
<SR>
.
Building resilient, self-sustaining communities
Communities are a material stakeholder in our business and
creating and sharing value with them helps secure our social
licence to operate. As a responsible mining company, we aim to
ensure stakeholders see meaningful benefit from our operations.
We do this through ongoing engagement that allows us to
identify projects relevant to communities and support them
so they can have measurable and sustainable impacts on the
communities in which we operate. For more detail see
<SR> page.
Our performance
Gender diversity – female representation by region
(%)
Americas
10%
Australia
20%
Africa
10%
South Africa
16%
Corporate office
44%
%
Board gender representation
Male
56%
Female
44%
%
Male
67%
Female
33%
Board – female directors
4
Executive Committee – female members
2
Executive management gender representation
%
Paid to employees (salaries,
wages and benefits)
(2019: $591m)
$508m
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E  S  G
PERFORMANCE 2020 CONTINUED
An overview
Our community development initiatives are aimed at maximising
the impact in the following areas:
Infrastructure – includes water security, renewable energy
initiatives, waste management and sanitation, roads, and health
and education facilities
Socio-economic development – includes a focus on food
security and economic activities independent of mining
Skills development – education and training initiatives aimed
at increasing local talent pools as well as skills to reduce
dependence on commercial mining, and artisanal and small-
scale mining; a focus on youth and women development
Community awareness initiatives – these have focused
on campaigns related to the COVID-19 pandemic, to the
environment and climate change, greening initiatives and
climate adaptation. In Brazil and the DRC, we use mainly
hydropower, and we are planning to use it in Colombia, once
the projects start operating. In Australia, both Sunrise Dam and
Tropicana use power generated by liquified natural gas (LNG)
Artisanal and small-scale mining
Artisanal and small-scale mining (ASM) is the informal and
sometimes illegal mining of either previously mined areas or in some
cases sites belonging to AngloGold Ashanti. Many of those involved
are subsistence miners, working in dangerous conditions to earn a
living. Others are part of collectives, mining for larger operatives, with
little consideration for safety or the environment.
We have long advocated for the formalisation of ASM, helping
to educate and provide safer work environments and alternative
avenues to secure a living.
Community investment ($m)
2016
2017
2018
2019
2020
Africa
7.6
9.0
8.1
17.9
11.3
Americas
9.0
9.8
9.4
9.8
5.6
Australia
0.6
0.7
0.7
0.7
0.8
South Africa
4.6
6.0
5.2
4.0
2.3
Equity-accounted
investments
(1.6)
(1.5)
(1.2)
(1.1)
0
AngloGold Ashanti
20.2
24.1
22.2
27.7
20.0
At Siguiri in Guinea, where artisanal small-scale miners are active
on our concession, we work with local and regional authorities,
community leaders and other stakeholders to assist in mitigating
or reducing this risk to communities and our operations. A
memorandum of understanding was signed with the community and
authorities in late 2019, which helped keep our active pits clear of
illegal mining.
We have also initiated a multi-stakeholder ASM formalisation
process, led by the Guinean government. In Tanzania, Ghana, Mali
and Colombia, we are part of ongoing multi-stakeholder initiatives to
advance co-existence and formalisation.
We will continue to co-operate with governments, communities,
civil society, the private sector and international bodies, focusing on
dialogue with all stakeholders, as we seek to build resilient self-
sustaining host communities. For more information on this, see
<SR>
.
Indigenous peoples
Australia is the only country in which we operate where
Indigenous Peoples and their communities are adjacent
to our sites. Over the past 30 years, we have developed a
solid foundation for constructive community engagement
and relationships, with good levels of co-operation with the
traditional owners in the Eastern Goldfields of Western Australia
have adopted a comprehensive community investment
strategy that targets: education support; health and wellbeing;
indigenous employment; and progressive contracting and
procurement practices supporting the development of
Aboriginal-owned businesses. See the case study on the
partnership with Aboriginal contractor, Carey Mining Pty Ltd on
the website.
As standard practice, we consult with Indigenous Peoples
and their representatives on new exploration programmes or
new mining projects. Heritage surveys, field inspections and
monitoring of exploration activities are practical aspects of our
heritage protection process. This process is
designed to ensure full compliance with applicable
federal and state legislation.
There are potential legislative changes regarding indigenous
heritage laws in Australia, given the risks highlighted by
the destruction of Juukan Gorge in Western Australia. The
Indigenous Affairs Minister of Western Australia (WA), the
Chamber of Minerals and Energy of WA (CMEWA) and its
members, which include AngloGold Ashanti Australia, have
been actively engaged in, and are supportive of, the reform
process of the Aboriginal Heritage Act 1972 (WA), and will
continue to support the ongoing, extensive consultation
process. We believe that reforming the Act will deliver a
modernised legislative framework, which will further empower
traditional owners and local knowledge holders to make
informed decisions about their own cultural heritage.
In addition, AngloGold Ashanti Australia is working with the
Minerals Council of Australia, as a member of the newly
established Indigenous Partnerships Committee, to develop a
collective industry response to rebuild trust and drive the next
generation of partnerships with Aboriginal and Torres Strait
Islander landowners and communities.
Community investment spend
(by focus area)
0
5
10
15
20
25
30
35
40
Social
infrastructure
SME
support
Donations
and capacity
building
Health
Environment
Education
and youth
Arts,
culture
and heritage
1%
8%
17%
1%
22%
10%
40%
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GOVERNANCE
RELEVANT SDGs
Geita
Focus on people,
safety and
sustainability
STRATEGIC FOCUS AREA:
STAKEHOLDERS
VALUES
We are accountable
for our actions and
undertake to deliver on
our commitments.
We treat each
other with dignity
and respect.
Safety is our
first value.
We want the communities
and societies in which we
operate to be better off for
AngloGold Ashanti having
been there.
We value
diversity.
We respect
the environment.
AngloGold Ashanti has robust corporate governance measures
in place and applies the principles and recommendations set out
in the South African governance report, King IV, together with
other relevant laws and regulations. We comply with the listings
requirements of the stock exchanges on which we are listed
and are committed to promoting good governance. Our Code of
Business Principles Ethics , together with our values, guides our
conduct, our decision-making and that of our contractors.
The board, recognising that good governance underpins value
creation for all stakeholders and the sustainability of the business,
provides ethical leadership and is ultimately responsible for our
corporate governance.
Our most material governance matters are:
Navigating regulatory and political uncertainty and risk
Human rights (in terms of promoting an ethical culture)
Corruption, ethics and conflicts of interest
Remuneration – rewarding performance
For more information on our governance framework, structures
and processes, see Corporate governance in this report.
Governance performance– summary
Compliance – navigating regulatory and political
uncertainty and risk
AngloGold Ashanti’s geographical spread makes its legal and
regulatory environment diverse and complex. Given the critical
importance of compliance in building a sustainable business, the
group compliance function plays an essential role in co-ordinating
and ensuring compliance with laws and regulations, standards and
contractual obligations, and in assisting and advising the board and
management on designing and implementing appropriate compliance
policies and procedures. See
Managing our risks and acting on
opportunities
in this report
and also Navigating regulatory and
political risk
in the <SR>
.
Furthermore, regulatory and political uncertainty escalated
dramatically during a year marked by a complex interplay of
political, economic and social factors in the face of the COVID-19
pandemic. As we navigate the geopolitical landscape in which we
operate, our approach is guided by our Government Relations
Policy.
Human rights
Respect for human rights is fundamental to our business and
embodied in our values – from valuing the safety and health of
individuals, and treating every individual with dignity and respect, to
valuing and respecting communities and the environment.
Investment
community
Employees
and unions
Governments
and regulators
Communities
Suppliers
Industry partners
and peers
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The issue of human rights cuts across the entire business and
our Global Human Rights Policy extends to our business partners
including supply chain, state and joint venture partners, and public
and private security providers.
Our approach to human rights is guided by our Human Rights Policy,
and Human Rights Due Diligence Standard and Guideline. Our
human rights framework is informed by the Universal Declaration
of Human Rights and the United Nations Guiding Principles for
Business and Human Rights (UNGPs). We refer to all internationally
recognised human rights as expressed in the International Bill of
Human Rights and the International Labour Organisation Declaration
on Fundamental Principles and Rights at Work.
Our policy is consistent with the 10 principles of the UNGC and our
commitment includes the rights of Indigenous Peoples, women, and
other groups in society whose situation may render them particularly
vulnerable to adverse impacts on their rights.
Due diligence self-assessments of our human rights performance
have been conducted at all sites and we continue to provide
human rights awareness training in the form of induction,
classroom-based, refresher or online training. All operations
have grievance and independent anonymous whistle-blowing
mechanisms to ensure that all grievances and/or allegations are
investigates and acted on. Currently, a comprehensive review of the
human rights framework is underway ahead of a relaunch of these
programmes and initiatives during 2021.
Our approach to human rights encompasses issues related to
security management, responsible sourcing, gender-based
violence and Indigenous Peoples. Although only our operations
in Australia are close to indigenous communities. AngloGold
Ashanti seeks to ensure that our interactions with Indigenous
Peoples are in keeping with the basic human rights and their
social, economic and environmental interests.
Our approach to responsible sourcing considers the possible
severity of potential human rights infringements in our supply chain,
and the reputational risks this could hold for the Company. As
such, we maintain our commitment to ensuring that we assess and
investigate the ethics, labour and environmental practices of our
direct and indirect suppliers. During 2020, we updated our supplier
self-assessment questionnaire to encompass modern slavery
requirements which focus on potential related risks in our
supply chain.
Performance 2020
No human rights violations were reported for the third
consecutive year
99.7% of security personnel attended VPSHR training
11,574 people employees attended human rights
awareness training
Human rights due diligence self-assessments conducted
at all sites
Corruption, bribery and conflicts of interest
In line with our governance framework and Code of Ethics, ethical,
responsible corporate citizenship entails combatting corruption,
bribery and conflicts of interest. During 2020, key activities
undertaken in this regard by the Group Compliance team included
the global roll out of online anti-bribery and anti-corruption training
to all employees with computer access. All employees without
online access received annual DVD training. In line with good
governance, all governance body members
were also required
to complete this training. More than 5,600 employees, including
governance body members, successfully completed the training,
which included rigorous self-assessments. The training covers
anti-bribery and anti-corruption; payments to government officials,
gifts, hospitality and sponsorships, engagement of agents and
intermediaries, conflicts of interest, reporting wrongdoing, political
donations and activities, interacting with government officials, and
procedures for hiring agents and intermediaries. The training and
communications are in addition to our posters, corporate email
communications, compliance intranet portal communications, and
SMS communications in certain jurisdictions.
Given our geographic footprint and the many languages spoken
across our jurisdictions, whistle-blower hotlines are active by country
and/or operation. Around 15 such lines are operational. While these
lines are used for all complaints, a dedicated ethics email address is
available. Complaints can also be reported via the tip-offs website.
E  S  G
PERFORMANCE 2020 CONTINUED
An overview
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In all, 176 complaint reports were received across the group in 2020
versus 142 in 2019.
For more related information, see the <SR>
Remuneration – rewarding performance
Our renumeration policy aims to hold senior executives
accountable for the success of the business by remunerating
based on performance.
Our remuneration policy aims to:
promote an ethical culture and responsible corporate citizenship
motivate and reward the right behaviour and performance
of employees and executives in delivering on all aspects of
our strategy.
Our long-term share incentive plan, the Deferred Share Plan (DSP), is
designed to encourage employees to meet strategic short-, medium-
and long-term objectives that will enable value creation for all
stakeholders, by achieving defined objectives. ESG factors – safety,
health, environment, community, people – together have a combined
weighting of 25% in the DSP performance scorecard for 2020.
AngloGold Ashanti is committed to gender and pay equality. In line
with recent market best practice, the Company has amended its
methodology for determining the gender pay gap ratio, using 2020
as the base year for future comparisons. This revised methodology
includes development of a robust approach to measuring progress
made with the aim of continuously improving gender equality.
The gender pay-gap differentials at middle management level
and above indicate that men are paid 8.14% more than women.
Attention will be directed to addressing this disparity.
The proportion of women employees, particularly in senior roles,
remains low. This is being steadily addressed and greater attention
is being given to attracting, developing and retaining women in the
mining workforce. Furthermore, metrics included in the incentive
scheme are designed to improve the gender ratio. We will continue
to monitor pay differentials and will take action as appropriate. See
Rewarding delivery in this report for more detail.
For more detailed remuneration information, see Rewarding
delivery
in this report
AGA Mineração – Lamego
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E  S  G
PERFORMANCE 2020 CONTINUED
>
Group summary
ENVIRONMENT
E
GOVERNANCE
G
Land under management
Environmental
incidents
rehabilitated with total
rehabilitation liabilities
of $658.9m
461,511ha
8
Total current taxes paid
Royalties and other taxes paid
Taxes paid on behalf of employees
$562m
$284m
$209m
Energy consumption
GHG (CO2e) emissions
Water used
25.57PJ
2,337kt
47,405ML
(Efficiency: 0.65GJ/tonne treated)
(Efficiency: 33kg/tonnes treated)
(Efficiency: 0.69kl/tonne treated)
Committed to promoting gender, ethnic and cultural
diversity, inclusivity and tolerance within the region
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SOCIETY
S
Security and human rights
Compliance
People employed on average
Salaries, wages and
other benefits
Training and development
36,952
$508m
$11m
(includes contractors)
Local procurement
Enhanced, robust Responsible
Sourcing Programme implemented
to ensure consistency,
fairness and parity in screening
of suppliers
Community investment
$2.12bn
$20.1m
82% of total procurement spend of $2.58bn
ISO 14001
80% of sites certified
Cyanide Code
88% of sites certified
99.7%
No incidents or
allegations
of security personnel
attended VPSHR training
The Voluntary Principles on
Security and Human Rights
(VPSHR) applied
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CFO’S REPORT
The Company reported solid operational and financial
performances for 2020, with progress made in delivering on
strategic commitments, despite the COVID-19 pandemic. At
the start of the year, AngloGold Ashanti outlined a series of
important objectives as it sought to streamline the business,
further strengthen its balance sheet, improve the overall
quality of its portfolio, increase the lives of its key assets and
ensure improved direct returns to its shareholders.
Executive summary
(1)
AngloGold Ashanti demonstrated its ability to balance the
competing capital needs of the business while delivering improved
value to shareholders.
Progress was made on each of these objectives, with the increased
investment in its ore bodies yielding net increases in Ore Reserve
and Mineral Resource of continuing operations; the redevelopment
of the Obuasi mine tracking to its revised schedule; the portfolio
streamlined following the sale of operating assets in South Africa
and Mali; the balance sheet further strengthened with debt at
its lowest levels in a decade and a marked improvement in cash
generation; and feasibility studies for two Colombian projects
progressing to schedule ahead of investment decisions in 2021.
The improved performance of the business, coupled with a higher
dividend payout ratio, ensured a fivefold increase in the annual
dividend payment for 2020. The Company achieved all of these
strategic milestones without approaching shareholders for new
equity in the last decade.
Financial highlights of the year under review include:
Free cash flow increased 485% year-on-year to $743m in 2020 –
excluding asset sale proceeds – from $127m in 2019
Free cash flow before growth capital up 124% year-on-year to
$1,003m in 2020, from $448m in 2019
Net cash inflow from operating activities increased 58% to
$1,654m in 2020, from $1,047m in 2019
Achieved revised 2020 full-year guidance: Production of
3.047Moz in 2020, notwithstanding COVID-19 impacts
estimated at 140,000oz
All-in sustaining costs (AISC) margin from continuing operations
rose to 42% in 2020, from 30% in 2019
Basic earnings from continuing operations increased 160%
year-on-year to $946m in 2020, from $364m in 2019
Adjusted EBITDA for continuing operations up 56% year-on-year
to $2,470m in 2020, from $1,580m in 2019; highest since 2012
Dividend increased more than fivefold to approximately 48 US
cents per share in 2020, from 9 US cents per share in 2019
Adjusted net debt from continuing operations down by 62%
year-on-year to $597m in 2020, from $1,581m in 2019; lowest in
the last ten years
Group financial performance
Net cash inflow from operating activities for the year increased by
58% to $1,654m in 2020 compared to $1,047m in 2019. Free cash
flow for the year improved by 485% to $743m in 2020 compared
to $127m in the prior year, primarily driven by the increase in
received gold prices.
Production for 2020 decreased by 7%, mainly due to the sale of
our remaining South African producing assets, the cessation of
mining activities at Sadiola and Morila in Mali, and the impact of
the COVID-19 pandemic. The group’s AISC came in at $1,059/oz
in 2020, compared with $998/oz in 2019. The COVID-19 impact
on production in 2020 was estimated at 140,000oz or 5% and
its impact on AISC was estimated at $55/oz or 5%. Production
from continuing operations for 2020 was 2.806Moz at a total
cash cost of $790/oz, compared with 2.862Moz at a total cash
cost of $746/oz in 2019. AISC for these continuing operations
was $1,037/oz in 2020, compared with $978/oz in 2019. On
a continuing operations basis, the impact on production from
COVID-19 in 2020 was estimated at 59,000oz or 2% and its
impact on AISC was estimated at $32/oz or 3%.
DISCIPLINED
GROWTH
Ian Kramer /
Interim
Chief Financial Officer
(1)
The information included in the Chief Financial Officer’s review is provided for the AngloGold Ashanti group (including South Africa for the nine months to
September 2020), unless otherwise indicated as continuing operations. Following the announcement of the South African asset sale and the conclusion of the
sale in September 2020, the South African operations are recorded as discontinued operations in the 2020 financial results.
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The performance for the year was underpinned by Geita’s highest
annual production level in 15 years, while steady performances at
Kibali, Iduapriem, Siguiri, Sunrise Dam, and AGA Mineração helped
offset declines in production at Tropicana, Cerro Vanguardia and
Serra Grande. The Obuasi Redevelopment Project continued its
ramp-up, delivering 127,000oz in production despite delays in
receiving equipment and in the arrival of skilled personnel, critical to
the project, as a result of lockdowns in various jurisdictions during
the year.
The higher gold price helped drive the improved financial
performance year-on-year. Adjusted earnings before interest, tax,
depreciation and amortisation (Adjusted EBITDA) rose 50% year-
on-year to $2,593m in 2020, from $1,723m in 2019.
Basic earnings attributable to equity shareholders for the year
ended 31 December 2020 were $953m, or 227 US cents per
share, compared with a $12m loss, or 3 US cents loss per share
in 2019. Basic earnings for the continuing business for the year
ended 31 December 2020 were $946m, or 225 US cents per
share, compared with $364m or 87 US cents per share in 2019.
Headline earnings for the year ended 31 December 2020 were
$1,000m, or 238 US cents per share, compared with $379m, or
91 US cents per share in 2019. Headline earnings benefitted from
the higher gold price net of increased profit-related taxes. In line
with the capital allocation discipline strategy, the Company has
demonstrated its ability to balance the competing capital needs of
the business while delivering improved dividends to shareholders.
In 2020, AngloGold Ashanti demonstrated its
ability to balance the competing capital needs
of the business while delivering improved
value to shareholders
Among the key financial milestones achieved in 2020 were:
Free cash flow up more than fivefold to $743m, driving Adjusted net debt to its lowest level in ten years, at $597m
Annual guidance met or improved upon for the eighth consecutive year on production, cost and capital expenditure
Dividend pay-out ratio doubled to 20% of free cash flow before growth capital; annual dividend increased fivefold, a 2% yield
Improved balance sheet flexibility with new $700m, 10-year bond at a record low coupon for AngloGold Ashanti of 3.75% per annum
Commercial production achieved at Obuasi Phase 1; Phase 2 90% complete
Achieved commercial underground production at Tropicana’s Boston Shaker - on schedule and within budget
Began development of a third underground mine at Geita, waste-stripping at Iduapriem Cut 2 and Tropicana Havana Stage 2
Ensured tight cost management to maximise the benefit of a higher gold price
Streamlined the portfolio with the sale of the South African operating assets, as well as the Sadiola and Morila operations in Mali
Strategic priorities
Maintaining a reliable track record of consistent and prudent
behaviour as custodians of shareholder capital continues to be
central to our approach. Capital allocation continues to remain
disciplined and focused on improving value creation through
effective management and without placing undue financial or
operating risk on the business. This approach does not prioritise
scale, but rather focuses on sustainable margins and free cash flow
growth to improve total returns to shareholders over time.
The integrity of the balance sheet is fundamental to the long-term
health of the business and enforces disciplined decision-making
in allocating capital. This means that the Company will continue to
rank and prioritise its investments, assessing them not only on their
returns but also on their affordability with respect to maintaining
leverage ratios at or around targeted levels. Importantly, the
Company will weigh these competing priorities and consider the full
suite of financing opportunities available when determining whether
or not to proceed with an investment.
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Our free cash flow generation is applied in a balanced manner to the four pillars of our capital allocation strategy, consisting of sustaining capital
expenditure to prioritise Ore Reserve growth; maintaining a strong and solid balance sheet to provide optionality and flexibility through the
cycle; return of value to shareholders through a policy of competitive dividends; and self-funding any major growth capital projects.
In order for the continued successful application of this capital allocation discipline, from a financial perspective the strategic focus remains
mostly on the following three aspects:
Margin improvement
We have maintained a good margin, while self-funding our business, through years of a difficult market. In 2020, we continued to focus our
efforts on driving operational excellence and cost efficiencies across our business thereby enhancing our margins. We have seen the AISC
margin step up to around 40% this past year from continuing and discontinued operations, given our continued cost discipline and as the
gold price moved higher. For our continuing operations, the margin is even higher at 42%.
CFO’S REPORT CONTINUED
Disciplined, shareholder-focused capital allocation
* World Gold Council standard
** Spot – 19 March 2021
Reinvesting in our asset base to support
the long-term sustainability of our
business
Commitment to cash returns to
shareholders
Solid balance sheet underpins flexibility
and optionality through the cycle
Growth focused on risk-adjusted returns
Allocation of excess cash tested against
shareholder returns
All-in sustaining costs (AISC)* vs. gold price received
($/oz)
40%
margin
28%
margin
23%
margin
16%
margin
21%
margin
21%
margin
19%
margin
14%
margin
Spot**
$1,744/oz
AISC*
Average Gold price
500
1,000
1,500
2,000
2020
2019
2018
2017
2016
2015
2014
2013
Operating and capital productivity
Sustaining capital
Prioritising Ore Reserve growth
Strong balance sheet
<1.0x adjusted net debt/EBITDA through the cycle
Dividends
20% of free cash flow pre-growth capital
Growth capital
Targeting a return in excess of our hurdle rate
Further debt
reduction
Additional
dividends should
capacity exist
Growth
Net operating cash flow
Sustaining free cash flow
Excess cash flow
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Improve balance sheet strength and
preserve liquidity
On 18 March 2020, the Company drew $900m under the US dollar
RCF to fund the repayment of the $700m 5.375% bonds that
matured on 15 April 2020 and to support short-term liquidity in the
event of continuing disruptions in the global financial markets as a
result of the outbreak of the COVID-19 pandemic. A further $450m
was drawn on the remainder of the US dollar RCF and received on
27 March 2020.
Since there was significant uncertainty with regards to the potential
impact of the global pandemic, the Company entered into a $1bn
standby facility in April 2020 in order to bolster liquidity.
As a result of the pandemic driven gold price rally, the Company’s
ability to generate free cash flow improved markedly during the
year, with total free cash flow for the year increasing more than
fivefold to $743m. In parallel to this, in September 2020 we issued
a new $700m, ten-year bond, at a coupon of 3.75%, the lowest
in the history of the Company. The combination of substantial free
cash flow and the new bond issued allowed the Company to repay
its drawn US dollar RCF in full in the second half of the financial
year. We also cancelled the $1bn standby facility in October 2020.
Our focus on maintaining a strong balance sheet remained
unchanged throughout all of the above, even after our net debt
level reached its lowest level in a decade, falling to $597m as at 31
December 2020, with the adjusted net debt to adjusted EBITDA
ratio from continuing operations improving to 0.24 times.
Cash proceeds from the South African asset sale were partly used
to settle remaining South African debt and allowed us to cancel our
South African facilities, save for a R500m overnight facility.
We ended 2020 with strong liquidity including cash balances of
$1.33bn, which excluded the Kibali cash lock-up in the DRC of
$424m. Our US dollar RCF remained undrawn through the year
end and up to the date of this report.
This position allows us to consider optionality with regards to
liquidity management efforts focused on the 2022 $750m bond.
It further provides optionality with regards to the funding of the
Colombia projects, allowing us to consider whether we self-fund
these projects or enter into any other available funding alternatives.
Our current liquidity levels provide us with reasonable comfort
should we be faced with unfavourable and unforeseen impacts of
this pandemic in the foreseeable future.
The Company will continue targeting an adjusted net debt to
adjusted EBITDA ratio of 1.0 times through the cycle. We believe
this target level is sustainable, even as we invest inward, service
debt obligations and pay dividends to shareholders at the
discretion of the board of directors.
We remain strongly levered both to the gold price and currencies
and we expect cash flow generation across the business to
continue to benefit from prevailing market conditions as well as
from efficiency and operational improvements in our business.
ZAR
■ RCFs
Cash
Facilities and cash
available
c.$2.8bn*
$1,330m
$1,441m**
R500m
Adjusted net debt* down 62% year-on year to lowest since 2011
($m)
500
1,000
1,500
2,000
2,500
3,000
3,500
2020
2019
2018
2017
2016
2015
2014
2013
Self-funded development of Tropican, Kibali
Self-funded redevelopment of Obuasi
81% down
from peak
* From continuing operations
Adjusted net debt to adjusted EBITDA ratio improves to 0.24 times
0
1
2
3
2020
2019
2018
2017
2016
2015
2014
2013
2.04x
1.00x
1.49x
1.94x
1.20x
1.46x
1.24x
*0.24x
Last-12-months Adjusted net debt to Adjusted EBITDA ratio
*Calculations based on continuing operations
1.00x
Target
through
the cycle
* Total calculated with ZAR500m O/N facility at R14.6878/$
** US$1.4bn RCF includes a capped facility of AU$500m
Tanzania – Geita
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CFO’S REPORT CONTINUED
Continued cash flow momentum
We continued our focus on positive free cash flow generation while
reinvesting in our portfolio. After board approval in November 2020,
we increased the dividend pay-out percentage from 10% to 20%
of free cash flow, before growth capital, subject to board discretion.
The board also approved the dividend pay-out to be increased from
annual to bi-annual from 2021.
Free cash flow before growth capital was $1,003m (2019: $448m).
The board approved a dividend of 705 SA cents or approximately
48 US cents per share (2019: 165 SA cents or 9 US cents per share),
representing a 433% increase in US dollar terms.
The increase of the dividend pay-out is a reflection of our continued
capital discipline and commitment to improving shareholder returns
on the back of improved free cash flow generation. Importantly,
we will maintain adequate balance sheet flexibility and utilise our
cash flows and available facilities to fund our ongoing capital and
operational requirements, including self-funding sustaining and
growth capital expenditure, should we wish to do so.
Free cash flow generation
Free cash flow before growth capital ($m)
Growth capex
Free cash flow
2020
2019
2018
2017
2016
2015
2014
2012
2013
821
(666)
155
703
(1,064)
(361)
249
391
(1)
371
(2)
424
(3)
174
(4)
278
(5)
448
1,003
142
169
202
116
308
124
50
150
128
321
127
260
743
Tanzania – Geita
(1)
Adjusted for Obuasi redundancy costs of $210m and Rand Refinery loan of $44m.
(2)
Adjusted for bond redemption premium of $61m on part settlement of $1.25bn high-yield bonds.
(3)
Adjusted for bond redemption premium of $30m on settlement of remaining $1.25bn high-yield bonds.
(4)
Adjusted for South Africa retrenchment costs paid of c.$49m.
(5)
Adjusted for South Africa retrenchment costs paid of c.$61m.
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Delivery against 2020 financial and operational objectives
1. Continued focus on sustainability and safety improvements
We continue to focus on material sustainability risks, while considering the best approach to further enhance the managing and reporting
of ESG related matters. Details of this can be found in our Sustainability Report <SR>
.
The Company continues to focus on safe production and the health of employees across all operations. Regrettably, we recorded six
workplace fatalities during the year. These comprised four deaths in South Africa and two deaths at Obuasi in Ghana.
The group all-injury frequency rate (AIFR), which is the broadest measure of workplace safety, improved 28% to a record 2.39 injuries per
million hours worked in 2020, from a rate of 3.31 injuries per million hours worked in 2019. The portfolio of managed operations outside
of South Africa reported an AIFR of 1.68 during the year, their best performance ever. The Company’s safe production strategy, which
continues its focus on achieving our goal of zero harm, is aided by safety campaigns and has yielded safety-performance improvements
over time.
2. Target increased Ore Reserve conversion through additional investment in Ore Reserve development and
Mineral Resource conversion
AngloGold Ashanti embarked on a multi-year initiative at the beginning of 2020, to increase investment in Ore Reserve development and
brownfields exploration. The aim of this investment was to increase the rate of Ore Reserve conversion, extend the reserve lives of our
assets, enhance mining flexibility and further improve knowledge of the ore bodies in the portfolio. This programme is designed to use
incremental sustaining capital investment to unlock latent value from within the existing portfolio.
One year into this initiative, solid progress has been made with the gross addition of 6.1Moz of Ore Reserve. This was achieved primarily
by exploration activities across the portfolio, with only 14% of the gross increase attributable to the $100/oz increase in Ore Reserve
pricing, to $1,200/oz. This increased the reserve life of the portfolio to about 11 years.
At Geita, a key asset where extending the reserve life is a priority, 1.4Moz of Ore Reserve were added, with 0.6Moz of depletion. Geita
Ore Reserve ended the year at 2.34Moz, 55% higher year-on-year after accounting for depletion. As a result, Geita’s reserve life, based
on Ore Reserve and a normalised long-term production base (525koz) increased by almost 80%, to five years. Across the rest of
the group, Obuasi added 1.8Moz in gross Ore Reserve and there were steady gross gains totaling 2.8Moz at Kibali, Iduapriem, AGA
Mineração, Siguiri, Serra Grande, Cerro Vanguardia and Sunrise Dam.
3. Aim to complete divestment processes
South Africa assets
AngloGold Ashanti completed the sale of its remaining South African producing assets to Harmony Gold on 30 September 2020,
following receipt of all regulatory approvals. Harmony Gold acquired full ownership of these assets and related liabilities on
1 October 2020. The silicosis obligation and the post-retirement medical obligation relating to South African employees are
retained by AngloGold Ashanti.
Mali assets
AngloGold Ashanti together with its joint venture partner Barrick Gold Corporation (Barrick) completed the sale of the Morila gold mine in
Mali to Firefinch Limited (previously named Mali Lithium Limited) on 10 November 2020. In addition, the Company, together with its joint
venture partner IAMGOLD Corporation completed the sale of their entire interests in Société d’Exploitation des Mines d’Or de Sadiola
S.A. to Allied Gold Corp on 30 December 2020.
On 14 February 2019, Sadiola Exploration Limited (SADEX), the subsidiary jointly held by AngloGold Ashanti Limited and IAMGOLD
Corporation, entered into a share purchase agreement with the Government of Mali, whereby SADEX agreed to sell to the Government
of Mali its 80% participation in Société d’Exploitation des Mines d’Or de Yatela (Yatela), for a consideration of USD 1. At the date of
this report, the transaction remained subject to the fulfillment of a number of conditions precedent, including the approval of the Share
Purchase Agreement by the Council of Ministers and the adoption of two laws (the Endorsement Law and Establishment Law).
Objective met
Objective partly met or ongoing
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4. Obuasi Phase 2 commissioning complete by year-end
Commercial production at Obuasi for Phase 1 (2,000 tonnes per day mining and milling rate) was achieved. Effective
1 October 2020. The COVID-19 pandemic caused some construction delays and had the effect of limiting mining volumes, which in turn
delayed the commercial production date for Phase 1 by two quarters and continues to have a knock-on effect on Phase 2 operational
readiness. The project’s production for the full year ended 31 December 2020 was 127,000oz, with 30,000oz produced in the fourth
quarter of the year. This included a 22-day planned stoppage in December, for the tie-in of Phase 2 of the project.
Phase 2 construction reached 90.1% completion at the end of December 2020. Commissioning of the Phase 2 milling circuit has
commenced and will continue in early 2021. The KRS shaft, paste-fill plant and the GCVS ventilation shaft continue to target completion
at the end of the first half of 2021. The ramp-up of Phase 2 capacity to 4,000 tonnes per day is targeted on a tight schedule to
commence during the second quarter of 2021 and may continue into the third quarter of 2021.
Mining rates continued to be constrained by skilled labour challenges caused by Australian international travel restrictions during the
year, which have again been tightened in January 2021, with a further reduced quota of weekly travelers allowed to enter and exit the
country’s airports. This challenge is being resolved through continued focus on in-country recruitment and training to help bridge the
gap. As a result, the mine plan for 2021 was revised to take into account these COVID-19 limitations. This plan intends to achieve the
required ramp-up in production in parallel with the construction schedule and good progress is being made in the second production
area at Block 8-Lower.
5. Optimise margins and cash conversion
Our margins on revenue from continuing operations for total cash costs, AISC, and All-in Costs (AIC) were 56%, 42% and 33%,
respectively. These margins reflected increases from 2019 (total cash costs: 46%; AISC: 30%; and AIC: 17%). Margins were positively
affected by the higher gold price received during the year.
Although free cash flow generation was the highest since 2011 and in aggregate more than the last 4 years together, it continues to
be impacted by the continued slow cash repatriation from the DRC. Cumulative cash receipts from Kibali for 2020 amount to $140m.
However, the Company’s attributable share of the outstanding balances awaiting repatriation from the DRC were $424m, after a
further build-up of $222m of cash lock-up in 2020. Barrick, the operator of the Kibali joint venture, continues to engage with the DRC
government regarding the 2018 Mining Code and the cash repatriation.
6. Enforce capital discipline in a rising gold price environment
Total capital expenditure (including equity accounted investments) decreased by 3% to $792m in 2020, compared to $814m in
2019. This included growth capital expenditure of $260m relating to Obuasi, Siguiri, Geita, Tropicana, Sunrise Dam and Quebradona
in 2020, compared to $321m invested in growth projects in the prior year. Sustaining capital expenditure was 8% higher in 2020 at
$532m, compared with $493m in 2019 as the Company steadily progressed its reinvestment programme, focusing on Ore Reserve
Development and Reserve Conversion at sites with high geological potential. A further $112m was spent on exploration, of which $67m
was spent on Greenfields exploration and study costs, largely in Colombia and North America while $45m was spent on non-sustaining
exploration drilling to improve the Mineral Resource at current operations.
Due to the improved ability in 2020 to generate free cash flow, our earnings margins were substantially improved and the board
approved an increase in our dividend pay-out percentage, thereby ensuring that we maintain an appropriate balance between internal
and external allocation of our capital resources.
7. Proactively manage the emerging risks relating to the COVID-19 pandemic from an operational, liquidity,
working capital and supply chain perspective
AngloGold Ashanti continues to respond to the evolving COVID-19 pandemic while contributing to the global effort to stop the spread of
the virus and provide public health and economic relief to local communities.
The impact on production in 2020 from COVID-19 was estimated at 140,000oz, and its impact on AISC was estimated at $55/oz, or
about 5% (of this, $22/oz is estimated to be related to costs incurred and $33/oz to lost production). Consumable inventory levels were
increased at certain operations to mitigate potential supply chain challenges resulting from the pandemic.
All of AngloGold Ashanti’s mines are operating normally subject to updated protocols and various travel restrictions, except for Cerro
Vanguardia which, at 31 March 2021, was running at between 60% to 80% mining capacity due to continuing inter-provincial travel
restrictions in Argentina, which prevent certain employees from getting to site.
CFO’S REPORT CONTINUED
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8. Focus on cash conservation measures including reducing corporate costs and AISC
Cash conversion constraints were discussed in item 5 above.
Corporate administration, marketing and other expenses decreased to $68m in 2020, from $82m in 2019. This equates to $24/oz sold
from continuing operations, which makes it one of the lowest corporate cost structures amongst the gold mining peer group. The main
reasons for this decrease are as a result of the weakening of the South African rand against the US dollar since most of these costs are
rand-based, together with reductions in travel and training costs reflective of the impact of the COVID-19 pandemic.
9. Pursue optimal financing alternatives for the group and focus on reducing finance costs
During 2020, we concluded a 10-year $700m bond offering, priced at 3.75% per annum - the lowest ever coupon ever achieved by the
Company for a bond offering - with the net proceeds directed to repaying a portion of outstanding borrowings. The initial proceeds of
$200m received from the sale of the South African producing assets were utilised to further reduce debt.
The South African R1.4bn RCF, R2.5bn RCF and R1bn RCF facilities were cancelled voluntarily in 2020. The $1bn standby facility put in
place at the onset of the COVID-19 pandemic in order to provide additional liquidity was cancelled on 1 October 2020.
We are continuing to assess our options with regards to the $750m bond maturing in 2022 and our options available with regards to the
two Colombian projects – in addition to self-funding options, we are also considering alternative funding arrangements.
Looking ahead to 2021
Guidance and indicative outlook
Following the key strategic objectives set out by the Company
in 2019, related to streamlining the portfolio and reinvestment in
assets with high geological potential, AngloGold Ashanti is pleased
to provide a two-year guidance, as well as a five-year indicative
outlook.
The Company expects to see an average 2.0% compound annual
growth rate (CAGR) in gold production from continuing operations
over the next two years relative to 2020 production. The primary
driver of production growth is related to Obuasi operating at
steady-state, Tropicana reverting to normalised production
levels following the reinvestment in its life extension, and AGA
Mineração, Siguiri and Sunrise Dam expected to increase
production to higher levels.
Sustaining capital expenditure for each of 2021 and 2022 is
expected to range between $720m to $820m, which includes
investments in Ore Reserve Development and Exploration ($330m
to $380m) and Brazil tailings compliance capital for 2021 ($70m
to $80m). On a per ounce basis, however, sustaining capital will
decline in 2022 as production increases further.
On a five-year indicative outlook, the Company expects to see
an average of 5.0% CAGR in gold production between 2021
and 2025. This is underpinned by the Company’s ten operating
assets, as well as the Company potentially moving forward with
investments in the Quebradona and Gramalote projects.
As a result of these investments, non-sustaining capital expenditure
is expected to increase in 2022 to 2024, before declining. Following
the completion of these projects, as well as the expected return
of sustaining capital to normalised levels following the current
intensive brownfields investment campaign, the Company is
expected to be well positioned to operate at an AISC between
$900/oz - $1,150/oz – in nominal terms – in 2025.
The Gramalote and Quebrdona projects in Colombia – should they
be approved – will have a material impact on the production and
cost trajectory of the business over the long term. These are long-life
and low-cost projects, and at steady-state production, are expected
to improve the Company’s long-term AISC by about 10%. The
Quebradona project would give AngloGold Ashanti exposure to the
copper market.
The development of Ore Reserve is key to the long-term success
and sustainability of AngloGold Ashanti, and the Company is
committed to enhance operating flexibility and extend the lives of
its existing mines by converting its Mineral Resource into better
defined Ore Reserve as well as growing its Mineral Resource base.
This focused investment programme, now in its second year,
continues to build on the positive momentum of 2020, and these
investments are expected to position the Company to add Ore
Reserve as well as, where applicable, Mineral Resource.
We continue to enforce capital and cost discipline across the business,
ensuring that we continue to deliver strong cash flow generation in
the elevated gold price environment, while prioritising the health and
wellbeing of our employees and our host communities.
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CFO’S REPORT CONTINUED
Guidance
Actual
(1)
Guidance
Indicative outlook
2020
2021
2022
2023
2024
2025
Production (000oz)
2,806
2,700 - 2,900
2,825 - 3,025
2,900 - 3,150
3,150 - 3,450
3,200 - 3,600
Costs
All-in sustaining costs ($/oz)
1,037
1,130 - 1,230
1,130 - 1,230
1,050 - 1,200
950 - 1,150
900 -1,150
Total cash costs ($/oz)
790
790 - 850
800 - 840
Capital expenditure
Total ($m)
757
990 - 1,140
1,120 - 1,270
1,050 - 1,250
950 - 1,200
800 - 1,100
Sustaining capex ($m)
497
720 - 820
720 - 820
Non-sustaining capex ($m)
260
270 - 320
400 - 450
Overheads
Corporate costs ($m)
68
85 - 90
85 - 90
Expensed exploration and
study costs ($m)
124
165 - 185
125 - 135
Depreciation and amortisation ($m)
570
600
660
Depreciation and amortisation ($m) - included in
equity accounted earnings
104
130
130
Interest and finance costs ($m) - income statement
138
125
115
Other operating expenses ($m)
57
50
30
(1)
Actual results from continuing operations
Economic assumptions for 2021 are as follows: $/A$0.72, BRL5.00/$, AP98.00/$, ZAR16.95/$; and Brent $50/bbl.

Production, cost and capital expenditure forecasts include existing assets as well as the Quebradona and Gramalote projects that remain subject to approval,
Mineral Resource conversion and high confidence inventory. Cost and capital forecast ranges are expressed in nominal terms. In addition, both production
and cost estimates assume neither operational or labour interruptions, or power disruptions, nor further changes to asset portfolio and/or operating mines
(except as described above) and have not been reviewed by our external auditors. Other unknown or unpredictable factors could also have material adverse
effects on our future results and no assurance can be given that any expectations expressed by AngloGold Ashanti will prove to have been correct. Measures
taken at our operations together with our business continuity plans aim to enable our operations to deliver in line with our production targets; we, however,
remain mindful that the COVID-19 pandemic, its impacts on communities and economies, and the actions authorities may take in response to it, are largely
unpredictable. Accordingly, actual results could differ from guidance and/or indicative outlook and any deviation may be significant. Please refer to the Risk
Factors section in AngloGold Ashanti’s annual report on Form 20-F which has been filed with the United States Securities and Exchange Commission (SEC).
Furthermore, our five-year indicative outlook assumes that AngloGold Ashanti proceeds with the Quebradona and Gramalote projects. However, the board has
not yet made a final decision on those projects and there can be no assurance that they will materialise. A negative decision or other discontinuation of those
projects may have a material adverse impact on our indicative outlook.
Sensitivities to key economic metrics based on budgeted economic assumptions for 2021 are as follows:
Sensitivity*
AISC ($/oz)
Cash from operating
activities before
taxes for 2021 ($m)
10% change in the oil price
5
14
10% change in local currency
49
103
10% change in the gold price
6
402
50,000oz change in production
20
70
* All the sensitivities based on $1,450/oz gold price and assumptions used for guidance.
Currency and commodity assumptions
2021
A$/$ exchange rate
0.72
$/BRL exchange rate
5.00
$/ARS exchange rate
98.00
$/R exchange rate
16.95
Oil ($/bbl)
50
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COVID-19
AngloGold Ashanti continues to respond to the evolving COVID-19
pandemic while contributing to the global effort to stop the spread
of the virus and provide public health and economic relief to local
communities. The Company has taken a number of proactive steps
to protect employees, host communities and the business itself. See
The year of COVID-19 – impact, response and management on
page 54.
These initiatives have complemented government responses in
each of its operating jurisdictions. Our thoughts and prayers are
with the families, colleagues and loved ones of those who have
been impacted by the virus.
As of the end of March 2020, second waves of the outbreak
are being experienced in several of our operating jurisdictions,
coinciding with the prevalence of new, more contagious variants
of the virus. As with the first wave, the increase in cases is
being countered by government-imposed restrictions, including
mandatory isolation and quarantine measures. Continued diligence
is being observed to strict health protocols and vigilance in relation
to business continuity including supply chain. We remain mindful
that the COVID-19 pandemic, its impacts on communities and
economies, and the actions authorities may take in response to it,
are subject to change in response to current conditions.
Acknowledgement
The past year was not only tumultuous for the gold market; in
March 2020, the broader finance team was required to quickly
embrace remote working arrangements - this transition occurred
seamlessly with minimal disruptions and I am grateful to the team
for their efforts in this regard under trying circumstances.
From a personal perspective, I stepped into the Interim Chief
Financial Officer position for AngloGold Ashanti with effect from
1 September 2020, shortly after the announcement of the
resignation of Kelvin Dushnisky as Chief Executive Officer and
then Chief Financial Officer, Christine Ramon, taking up the reigns
as Interim Chief Executive Officer. I wish to record my gratitude to
Christine and the rest of the executive team for providing me with
advice and support during this transition as well as to thank them
for their continued support.
The broader finance team across the group, which includes the
financial reporting, tax, treasury, information management, global
supply chain and internal audit functions continues to work
together seamlessly to ensure that we proactively manage risk,
ensuring that we have robust financial systems in place to maintain
a strong internal control environment whilst enabling relevant, timely
financial reporting that inform business decisions - all of this in an
environment of a continuing global pandemic. I wish to commend
this team for their continued enthusiasm in the ongoing delivery
of quality work and the ongoing support provided to me in my
current role. I look forward to the year ahead, and the opportunities
it will offer as we simultaneously become accustomed to the new
business normal, while continuing our focus on achieving our
strategic objectives and improving returns to our shareholders.
Warm regards
Ian Kramer
Interim Chief Financial Officer
26
March 2021
Priorities for 2021
Our financial priorities for 2021 are:
Continue to grow Ore Reserve and Mineral Resource through our continued reinvestment strategy
Maintain strong cost and capital discipline
Continue our efforts to optimise margins and generate strong free cash flows
Improve our cash conversion efforts, with a specific focus on unlocking cash lock-up in the DRC
Continued efforts to reduce debt and maintain a healthy balance sheet
These financial priorities are underpinned by the following operational and sustainability priorities:
Continued focus on the safety and well-being of employees and communities through the COVID-19 pandemic, while supporting
host government vaccination efforts
Achieve Phase 2 completion and commence ramp-up to steady state at Obuasi
Make investment decisions for the Gramalote and Quebradona projects in Colombia
Achieving these priorities will position the Company favourably to achieve its longer-term indicative outlook, and underpin a competitive
return to shareholders.
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FINANCIAL REVIEW
Three-year summaries
Summarised group financial results – income statement
US dollar million
2020
2019
2018
Continuing operations
Revenue from product sales
4,427
3,525
3,336
Cost of sales
(2,699)
(2,626)
(2,584)
(Loss) gain on non-hedge derivatives and other
commodity contracts
(19)
5
(2)
Gross profit
1,709
904
750
Corporate administration, marketing and other expenses
(68)
(82)
(76)
Exploration and evaluation costs
(124)
(112)
(98)
Impairment, derecognition of assets and profit / (loss) on
disposal
(1)
(6)
(7)
Other expenses
(57)
(83)
(79)
Operating profit
1,459
621
490
Interest income
27
14
8
Dividends received
2
-
2
Foreign exchange and other losses
-
(12)
(9)
Finance costs and unwinding of obligations
(177)
(172)
(168)
Share of associates and joint ventures' profit
278
168
122
Profit before taxation
1,589
619
445
Taxation
(625)
(250)
(212)
Profit after taxation from continuing operations
964
369
233
Discontinued operations
Profit (loss) from discontinued operations
7
(376)
(83)
Profit (loss) for the year
971
(7)
150
Allocated as follows:
Equity shareholders
- Continuing operations
946
364
216
- Discontinued operations
7
(376)
(83)
Non-controlling interests
- Continuing operations
18
5
17
971
(7)
150
26% increase in revenue from 2019
supported by 28% higher average gold
price received of $1,778/oz, with 1% lower
gold sold of 2,834,000oz in 2020 largely
due to COVID-19 related production
impacts at Cerro Vanguardia in Argentina
and Serra Grande in Brazil.
3% increase in cost of sales from 2019
primarily due to a 3% increase in cash
operating costs ($50 million), and a 32%
increase in royalties paid ($44 million) partly
offset by a 40% decrease in rehabilitation
and other non-cash costs ($21 million).
The increase in cash operating costs
are due to higher labour and contractor
costs, consumable stores, COVID-19
pandemic related spend, services and
other charges partly offset by lower
fuel and power costs. The decrease in
rehabilitation and other non-cash costs
arose from the changes to restoration
provision cash flows, inflation rates
and discount rates compared to 2019.
Inflationary increases were mostly offset
by weaker local currencies in South
Africa, Australia and Brazil.
Other expenses decreased during
2020 largely due to ceasing care and
maintenance activities at Obuasi as the
redevelopment project progressed to
commercial level of production in 2020,
partly offset by increased cost of indirect
taxes and other duties expensed and a
Brazilian power utility legal settlement
received in 2019 not repeated in 2020.
A taxation expense of $625 million in 2020 increased by 150% ($375 million) compared to 2019. Charges for current tax in 2020
amounted to $562 million, an increase of 89% compared to 2019 mainly due to higher earnings in Australia, Ghana, Tanzania and
Argentina. Charges for deferred tax in 2020 amounted to a net deferred tax expense of $63 million, compared to a net deferred
tax benefit of $48 million in 2019. The increase mainly relates to the derecognition of deferred tax assets in South Africa during the
fourth quarter of 2020.
Share of associates and joint ventures’ profit increased by $110 million (65%) from 2019 mainly as a result of an increase in
equity earnings of $95 million at Kibali. AngloGold Ashanti, together with its joint venture partner Barrick, completed the sale of the
Morila gold mine in Mali to Firefinch Limited (previously named Mali Lithium Limited) on 10 November 2020. On 30 December 2020,
AngloGold Ashanti together with its joint venture partner IAMGOLD, completed the sale of their entire interests in SEMOS (Sadiola)
in Mali to Allied Gold Corp. Profit on sale of joint ventures during the year totalled $19 million.
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Tangible, right of use and intangible
assets
increased by $284 million from
2019 mainly due to project capital
expenditure of $331 million and stay-in-
business capital expenditure of
$394 million incurred in 2020.
$17 million of finance cost was capitalised
as part of the Obuasi redevelopment
project and $39 million of tangible
assets were recognised as part of the
Joint Operation accounting change for
Gramalote in Colombia. A further increase
of $66 million is due to foreign currency
translations to the group reporting
currency. Amortisation charges amounted
to $579 million in 2020.
Investments includes investments in
associates and joint ventures which increased
by $70 million from $1,581 million in 2019
to $1,651 million in 2020 is largely due
to the continued slow cash repatriation
from Kibali joint venture located in the
Democratic Republic of the Congo (DRC).
Cumulative cash receipts from the DRC in
2020 totalled $140 million.
At 31 December 2020, AngloGold
Ashanti’s attributable share of the
outstanding cash balances awaiting
repatriation from the DRC amounted to
$424 million. Barrick Gold Corporation,
the operator of the Kibali joint venture,
continues to engage with the DRC
Government regarding the 2018 Mining
Code and the cash repatriation. Since
the third quarter of 2020, VAT offsets and
refunds have also been impacted by the
COVID-19 pandemic in the DRC.
Cash and cash equivalents increased by $874 million from 2019 supported
by the highest free cash flow generation since 2011, aided by the improved gold
price, but partly offset by lower gold output, higher operating costs, royalties
and taxation, and further impacted by the continued slow cash repatriation from
the Democratic Republic of the Congo (DRC). Free cash flow was impacted by
unfavourable working capital movements, related mainly to inventories, the VAT
lock-up at Geita and increased export-duty receivables at Cerro Vanguardia.
On 1 July 2020, the Finance Act, 2020 (No. 8) became effective in Tanzania,
amending the Value Added Tax Act, 2014 (No. 5), without retrospective effect,
specifically by deleting the disqualification of refunds due to exporters of ‘raw
minerals’. This allows for the recovery of VAT refunds for mineral exporters from
July 2020 onwards. CVSA had a cash balance of $137 million equivalent as at
31 December 2020, of which $50 million is currently eligible to be declared as
dividends. Application has been made to the Central Argentine Bank to approve
$11 million of this eligible amount to be paid offshore to AngloGold Ashanti,
however, approval remains pending. The cash is fully available for CVSA’s
operational requirements.
Borrowings and lease liabilities decreased by $120 million from 2019 and together with the increased cash balance resulted in
adjusted net debt of $597 million at 31 December 2020, down from $1,581 million at 31 December 2019.
During 2020, we concluded a 10-year $700 million bond offering, priced at 3.75% per annum - the lowest coupon achieved by the
Company for a bond offering - with the net proceeds directed to repaying a portion of outstanding borrowings. The initial proceeds
of $200 million received from the sale of the South African producing assets were utilised to further reduce debt. The balance sheet
remains robust, with strong liquidity comprising the $1.4bn multi-currency Revolving Credit Facility (RCF) which is undrawn, the $150m
Geita RCF of which $41 million is undrawn, the $65 million Siguiri RCF which is fully drawn, the South African R500 million ($34 million)
RMB corporate overnight facility which is undrawn, and cash and cash equivalents of $1.3bn at 31 December 2020. The South African
R1.4bn RCF, R2.5bn RCF and R1bn RCF facilities were cancelled voluntarily in 2020. The $1bn standby facility that was put in place at

the onset of the COVID-19 pandemic in order to provide additional liquidity was cancelled on 1 October 2020.
Summarised group financial results – statement of financial position
US dollar million
2020
2019
2018
Assets
Tangible, right of use and intangible assets
3,157
2,873
3,504
Investments
1,839
1,667
1,675
Inventories
802
725
758
Cash and cash equivalents
1,330
456
329
Assets held for sale
-
601
-
Other assets
544
541
377
Total assets
7,672
6,863
6,643
Equity and liabilities
Total equity
3,740
2,676
2,694
Borrowings and lease liabilities
2,084
2,204
2,050
Provisions
814
797
927
Deferred taxation
246
241
315
Liabilities held for sale
-
272
-
Other liabilities
788
673
657
Total equity and liabilities
7,672
6,863
6,643
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FINANCIAL REVIEW CONTINUED
Summarised group financial results – statement of cash flows
US dollar million
2020
2019
2018
Cash flows from operating activities
Cash generated from operations
1,828
1,102
931
Dividends received from joint ventures
148
77
91
Net taxation paid
(431)
(221)
(166)
Net cash inflow from operating activities from continuing
operations
1,545
958
856
Net cash inflow from discontinued operations
109
89
1
Net cash inflow from operating activities
1,654
1,047
857
Cash flows from investing activities
Capital expenditure
(701)
(703)
(575)
Net receipts (payments) from acquisition and disposal of
subsidiaries, associates and joint ventures
2
(5)
(8)
Net proceeds (payments) from disposal and acquisition
of investments, associate loans, and acquisition and
disposal of tangible assets
241
17
21
Interest received
27
14
5
Increase in cash restricted for use
(9)
-
(6)
Other
(8)
(6)
2
Net cash outflow from investing activities from continuing
operations
(448)
(683)
(561)
Net cash (outflows) inflows from discontinued operations
(31)
(54)
226
Cash in subsidiaries sold and transferred to held for sale
3
(6)
-
Net cash outflow from investing activities
(476)
(743)
(335)
Cash flows from financing activities
Net (repayments) proceeds from borrowings and lease
liabilities
(131)
3
(214)
Finance costs and lease finance costs paid
(118)
(137)
(130)
Dividends paid
(47)
(43)
(39)
Other
(33)
-
(10)
Net cash outflow from financing activities from
continuing operations
(329)
(177)
(393)
Net cash outflows from discontinued operations
-
-
-
Net cash outflow from financing activities
(329)
(177)
(393)
Net increase in cash and cash equivalents
849
127
129
Translation
25
-
(5)
Cash and cash equivalents at beginning of year
456
329
205
Cash and cash equivalents at end of year
1,330
456
329
Movements in working capital:
US dollar million
2020
2019
2018
Increase in
inventories
(83)
(67)
(2)
Increase in trade,
other receivables
and other assets
(163)
(138)
(74)
Increase (decrease)
in trade, other
payables and
provisions
8
40
(46)
(238)
(165)
(122)
Inventory grew as a result of ramp up
to commercial production at Obuasi
during the year, transition to underground
owner mining at Geita’s Star and Comet
mine and increased safety stocks
of consumables and reagents as a
COVID-19 preventative measure.
The increase in Trade, other
receivables and other assets
is
mainly due to the delay in recovery of
reimbursable indirect taxes and duties in
Tanzania, Ghana and Argentina.
Free cash flow reconciliation:
US dollar million
2020
2019
2018
Net cash inflow from operating activities
1 654
1 047
857
Net cash outflow from investing activities
(476)
(743)
(335)
Finance costs
(138)
(143)
(140)
Other borrowing costs
(33)
-
-
Repayment of lease liabilities
(47)
(42)
-
Movement in restricted cash
9
-
6
Acquisitions, disposals and other
3
2
(12)
Proceeds from sale of assets
(226)
-
(309)
Cash in subsidiaries disposed and transferred to
held for sale
(3)
6
-
Free cash flow
743
127
67
Capital expenditure remained in line
with the prior year at $701 million in 2020.
This included growth capital expenditure
of $256 million relating to Obuasi, Siguiri,
Geita, Tropicana, Sunrise Dam and
Quebradona in 2020, compared to
$313 million invested in growth projects in
the prior year. Sustaining capital expenditure
was 14% higher in 2020 at $445 million,
compared with $390 million in 2019 as
the Company steadily progressed its
reinvestment programme, focusing on Ore
Reserve Development and Ore Reserve
Conversion at sites with high geological
potential. A further $112 million was spent
on exploration, of which $67 million was
spent on Greenfields exploration and
study costs, largely in Colombia and North
America while $45 million was spent
on non-sustaining exploration drilling
to improve Mineral Resource at current
operations.
Net proceeds from disposal of
investments, associated loans and
tangible assets includes $200 million cash
proceeds received on the disposal of
the South African assets and associated
liablities as well as $25 million proceeds
received on the disposal of the investment
in Sadiola and $4 million proceeds received
on the disposal of the investment in Morila.
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Three-year summaries (continued)
Ratios and statistics
Units
2020
2019
2018
Operating review - gold
Production from continuing operations
(1)
000oz
2,806
2,862
2,913
Gold sold from continuing operations
(1)
000oz
2,834
2,854
2,922
Continuing operations
Closing spot price at year-end
$/oz
1,896
1,517
1,268
Average gold price received
$/oz
1,778
1,394
1,266
Total cash costs
$/oz
790
746
729
All-in sustaining costs
$/oz
1,037
978
942
All-in costs
$/oz
1,185
1,151
1,034
Earnings
Gross profit
$m
1,709
904
750
Gross margin
%
40
26
23
Adjusted EBITDA
(2)
$m
2,470
1,580
1,388
Interest cover
times
16
11
10
Asset and debt management
Adjusted net debt
$m
597
1,581
1,659
Adjusted net debt to Adjusted EBITDA
(2)
times
0.2
1.0
1.2
Profit attributable to equity shareholders
$m
946
364
216
Profit attributable to equity shareholders
US cents
225
87
52
Capital expenditure
(3)
$m
757
754
646
Net cash inflow from operating activities
$m
1,545
958
856
Asset and debt management
Equity
$m
3,740
2,676
2,694
Net capital employed
$m
4,424
4,422
4,657
Net asset value - per share
US cents
897
644
653
Market capitalisation
$m
9,430
9,278
5,180
Return on net capital employed
%
31
11
8
Adjusted net debt to equity
%
16
59
62
Other
Weighted average number of shares
million
419
418
417
Issued shares at year-end
million
417
415
413
Exchange rates
Rand/dollar average
16.45
14.44
13.25
Rand/dollar closing
14.69
13.99
14.35
Australian dollar/dollar average
1.45
1.44
1.34
Australian dollar/dollar closing
1.30
1.42
1.42
Brazilian real/dollar average
5.15
3.94
3.66
Brazilian real/dollar closing
5.20
4.03
3.87
Argentinean peso/dollar average
70.71
48.29
28.14
Argentinean peso/dollar closing
84.15
59.90
37.81
(1)
Includes pre-production ounces.
(2)
The Adjusted EBITDA calculation is based on the formula included in the revolving credit agreements for compliance with the debt covenant formula.
(3)
Includes attributable share of equity-accounted investments.
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ECONOMIC VALUE-ADDED STATEMENT
For the year ended 31 December 2020
ECONOMIC VALUE GENERATED
US dollar million
%
2020
%
2019
Gold sales and by-product income
(1)
94
4,836
96
4,080
Interest received
1
30
1
20
Royalties received
0
-
0
3
Profit from sale of assets
0
2
0
1
Income from investments
5
261
3
139
Other Income
0
5
0
16
Total Economic value generated
100
5,134
100
4,259
Economic value distributed
(2)
US dollar million
2020
2019 Contributing to the SDGs
Employees
508
591
Salaries and wages
497
579
Training and development
11
12
Government
1,055
736
Current taxation
(3)
562
298
Royalties
(4)
175
131
Employee taxes
(4)
209
221
Production, property and other taxes
(4)
109
86
Community
(5)
22
26
Suppliers and services
(6)
1,664
1,755
Providers of capital
221
208
Finance costs and unwinding
183
181
Dividends
38
27
Total
3,470
3,316
(1)
Gold income increased by 19% due to a higher gold price received for the year 2020
(2)
Economic distribution providing human, financial, social, natural and manufactured capital, guided by business objectives and material issues identified
through the operating process to ensure sustainable long-term value retention for stakeholders, underpinned by our key behavioural programme operational
excellence, implemented at every step of the business from exploration through the entire chain to divestment / disposal
(3)
Current taxation includes normal taxation and withholding taxation on dividends paid per jurisdiction in which the group operates
(4)
Employee, production, property and other taxes and royalties are reported on a cash basis and exclude equity-accounted joint ventures
(5)
Community and social investments exclude expenditure by equity-accounted joint ventures
(6)
Suppliers and services excludes capital expenditure
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(2019: $3.32bn)
$3.47bn
Total distributed
Suppliers and services
■ Government
Employees
Providers of capital
Communities
Economic value
distributed
2020
48%
30%
15%
6%
1%
(2019: 22%)
(2019: 78%)
32%
68%
Value retained
Total distributed
Community investment by region ($000)
Region
$000
Africa
11.3
Americas
5.6
Australia
0.8
South Africa
2.3
South Africa
Australia
Americas
Africa
Community investment
by region (%)
4%
28%
57%
12%
97
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AngloGold Ashanti Limited <IR>
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PEOPLE ARE OUR BUSINESS
People are the foundation of our business and our human resources framework is central to motivating and developing our
employees, ensuring we have a workforce with the relevant skills to deliver on our strategy. The five strategic pillars of the
framework are to: optimise overhead costs and capital expenditure; improve portfolio quality; maintain long-term optionality;
focus on people safety and sustainability; and ensure financial flexibility.
For more detail on how we work to build talent and promote diversity and inclusion through our human resources strategy, see
Integrated talent management
in the
<SR>
.
Strategic pillars
We have identified areas that are key to delivering a successful
human resources strategy, including ensuring an organisational
design and operating model aligned with our business strategy and
the implementation of health-of-discipline frameworks to enable
operational excellence, that allow us to:
develop capable ethical global leaders across the organisation
focus on employee engagement and commitment
provide an integrated talent management programme to ensure
succession planning and retention
simplify and integrate global human resources systems across
the company
The Health of Discipline framework supports our continuous drive
for operational excellence and efficiency across the business. We
use competency frameworks for several technical and functional
roles. The leadership competency framework that gives effect to the
development of global and ethical leaders was introduced and is
embedded into recruitment practices. Our mentorship programme
continues to grow and supports the transfer of knowledge and skills
and promotes broader exposure within the business
Focus for 2021
It is clear that attracting, retaining and developing critical and
scarce skills is a key human resources priority and we are
developing a comprehensive response to address this. We have
adapted our approach towards employee engagement as a result
of COVID-19 to ensure that we maintain levels of engagement
despite significant changes to the working environment.
COVID-19 has altered the working landscape significantly and there
is a need to re-imagine the future of work. This need, together with
a number of leadership changes during the year, led to the decision
to carry out a company-wide organisational culture assessment
during the year.
COVID-19 response
AngloGold Ashanti has adopted a risk-based approach in
responding to the COVID-19 pandemic. This was led by group
health specialists who worked closely with regional and country-
based health professionals.
Consistent people management practices were established
based on the philosophy that no AngloGold Ashanti employee
should be negatively affected from an employment perspective
as a result of COVID-19. This led to an effective response
that included identifying and protecting vulnerable employees,
introducing and administering special COVID-19 sick leave,
and reinforcing employee wellness programmes as well as
focusing on physical and mental wellness for our employees
and their families.
We introduced remote working where possible and leveraged
technology to facilitate and adapt to new ways of working. Where
remote working was not practical, for example on mining and
processing sites, operating procedures were modified to ensure
social distancing, mask wearing, good hand hygiene and frequent
hand washing.
Business travel was restricted to essential and business-
critical travel to reduce the risk of exposure for employees,
including expatriates.
Obuasi
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Talent management, learning and development
Talent and succession planning
AngloGold Ashanti talent review and succession planning process
continued to deliver on its aim to strengthen our internal talent
pipeline. Annual bottom-up reviews are conducted to identify,
develop, engage and retain a cross-section of talent pools with
particular focus on succession pools for executive and senior
leadership positions (including general managers), critical and scare
skills talent, and high-potential future leaders.
During 2020, we succeeded in further strengthening our talent and
succession pipelines across the company. Some 90% of vacancies
during 2020 were filled by internal candidates which indicates
the efficacy of talent and succession planning practices. We also
achieved a retention rate of ~90% within the executive and senior
leadership talent pool.
For more detail on how we work to build talent through our
Chairman’s Young Leadership Programme and Mentorship
Programme, see
Integrated talent management in the <SR>.
Learning and development
We continue to focus on the development of employees with the
requisite skills to ensure operational excellence, support talent
development and succession management and give effect to key
priorities including localisation and gender inclusivity.
During 2020, the Company spent approximately $5.6m on learning
and development interventions, with the main focus on technical
skills training to enhance safety and productivity, supervisory
training, graduate development, mentorship and coaching, and
management and leadership development.
Online learning
The COVID-19 pandemic accelerated the shift from traditional
classroom to online and virtual learning. Online interventions
were piloted across the company, with targeted interventions
covering project management skills, leadership essentials, team
management, business communication, self-management and
various technical courses.
The pilot phase offered a large selection of content, offering formal
courses, videos, online books, audiobooks and podcasts and
involved 107 employees.
We are rolling out personalised online learning with the aim of
providing a comprehensive online curriculum to support AngloGold
Ashanti’s blended learning approach.
Diversity and inclusion
During 2020, the company progressed to further entrench its
Diversity and Inclusion Framework approved by the Board in 2019.
For more detail, see
Integrated talent management in the <SR>.
Localisation
Working with local companies and employing people from host
countries and communities remains a priority for AngloGold
Ashanti, particularly in Africa. We have seen a 34% reduction in the
deployment of expatriate employees since 2016, with the number
falling from 216 to 142.
Several deliberate interventions contributed to this reduction:
Internal capacity building through initiatives such as technical
assessments, structured development plans, local talent
pool mentorship, and international exposure have helped to
strengthen local talent pipelines
The regional recruitment policy has been revised and reinforced
and the company has entered into strategic partnerships
with local and international recruitment agencies to advance
localisation objectives
An extensive talent mapping process to identify external pools of
national talent
Graduate programmes across the Africa region
The appointment of high-potential local talent in key roles
Extensive mentoring and career guidance for local talent across
the group
Ongoing support and development of young leaders in the
Africa region
There is still much work to be done to further reduce dependence
on expatriate employees and improve gender representation
in local talent pools. We have set a target to further reduce the
number of expatriate employees and accelerate development of
critical skills in the next three years. The focus will be to develop
leadership skills and key technical mining and artisanal skills in
partnership with local training institutions.
Employee engagement
AngloGold Ashanti appreciates the importance employee
engagement plays in helping to run a successful business. Biennial
global engagement surveys, conducted by an external provider,
monitor levels of employee engagement. The level of employee
engagement increased from 69% in 2014 to 76% in the last survey
in 2019, against a global benchmark for large companies of 70%.
Remote working and social distancing measures in place last year
likely impacted employee engagement.
Several measures were implemented across the business in
response to COVID-19. See
Employee and community health in
the <SR>
.
The engagement survey will not be conducted in 2021. This will be
replaced by a company-wide organisational culture assessment.
Employee relations
AngloGold Ashanti works to establish constructive relations
with our employees and their union representatives. Working
closely with our sites, we are also at the forefront of ensuring that
we comply with local legislation as well as with our regulatory
obligations.
Positive employee relations is central to our business and,
employees at our operations in the Africa and Americas regions are
unionised and have a right to collective bargaining, in line with the
relevant country labour legislation. See
Employee and community
health
in the
<SR>
.
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OPERATING PERFORMANCE
Regional Reviews – Africa
2
DRC
Tanzania
Ghana
Guinea
1
3
4
LEGEND:
1
Guinea Siguiri (85%)
2
Ghana Iduapriem/Obuasi
3
DRC Kibali (45%)
4
Tanzania Geita
Operation Project
2,000km
0
Kibali
■ Iduapriem
Obuasi
Siguiri
Geita
Contribution to
regional production
(%)
23
17
8
13
39
53%
contribution to group production*
Africa
Rest of AngloGold Ashanti
Contribution to group
Mineral Resource
(Moz)
65.8
58.7
Africa
Rest of AngloGold Ashanti
Contribution to group
Ore Reserve
(Moz)
10.6
19.1
Obuasi
* For 2020, group production includes the South African operations
to September 2020
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At year end, we had five operations in the Africa region, of
which we manage four. The Obuasi redevelopment project is
on track to achieve steady-state production during 2021.
Our operations in this region are:
Ghana
Iduapriem, a 137km
2
concession which includes Ajopa South
West, is located in the western region of Ghana, some 70km north
of the coastal city of Takoradi and about 10km south-west of the
Tarkwa mine. Iduapriem is an open- pit mine with two circuits each
comprising two-stage milling – a gravity circuit and a carbon-in-leach
(CIL) plant. The gravity circuit recovers about 30% of the gold and the
remainder is recovered by the 418ktpm capacity CIL plant.
Obuasi, which is an underground operation, mining to a depth
of 1,500m, is in the Ashanti region, approximately 60km south of
Kumasi. Obuasi was on care and maintenance from 2016 to the
start of its redevelopment early in 2019, following the receipt of the
requisite approvals from the Government of Ghana. The first face
blast took place in February 2019 with first gold poured in December
2019. Phase 1 of the redevelopment project was completed by end
September 2020 and began commercial production on 1 October
2020. Phase 2, construction and mine development, is in progress
and expected to be completed in 2021.
Democratic Republic of the Congo
Kibali, one of the largest gold mines of its kind in Africa, is situated
adjacent to the town of Doko, 210km from Arua on the Ugandan
border. Kibali is co-owned by AngloGold Ashanti (45%), Barrick
Gold Corporation (Barrick) (45%), and Société Minière de Kilo-
Moto (SOKIMO) (10%), a state-owned gold mining company. The
metallurgical plant comprises a twin-circuit sulphide and oxide
plant with conventional carbon-in-leach (CIL), including gravity
recovery. Barrick manages the mine which has both open-pit and
underground operations.
Guinea
Siguiri is a multiple open-pit gold mine in the relatively remote district
of Siguiri, around 850km north-east of the country’s capital, Conakry.
The gold processing plant is designed to treat 12Mt per annum.
A combination plant conversion project was completed and first
material fed through the plant in March 2019. This allows the mine
to treat 6Mt of sulphide ore and 6Mt of oxide ore. AngloGold Ashanti
holds an 85% interest in Siguiri, with the remaining 15% held in trust
for the nation by the government of Guinea. Siguiri is contractor-
mined using conventional open-pit techniques.
Attributable production
(000oz)
0
500
1000
1500
2000
2020
2019
2018
2017
2016
1,321
1,453
1,512
1,538
1,603
Productivity
(oz/TEC)
0
5
10
15
20
25
2020
2019
2018
2017
2016
20.70
23.01
20.70
19.17
18.98
AIFR
(per million hours worked)
0,0
0,1
0,2
0,3
0,4
0,5
0,6
0,7
2020
2019
2018
2017
2016
0.51
0.62
0.39
0.49
0.55
Total cash costs and all-in sustaining costs
(US$/oz)
0
200
400
600
800
1000
2020
2019
2018
2017
2016
717
905
720
773
759
757
953
904
896
935
Total cash costs
All-in sustaining costs
(1)
(1)
World Gold Council Standard
“After a solid performance in 202O, we
remain committed to and focused on
ensuring that our Africa operations fulfil
their potential in the years ahead.”
Sicelo Ntuli / Chief Operating Officer: Africa
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OPERATING PERFORMANCE
Regional Reviews – Africa continued
Tanzania
Geita, is located in north-western Tanzania, in the Lake Victoria
goldfields of the Mwanza region, about 120km from Mwanza and
4km west of the town of Geita. The mine is currently an underground
operation following the completion of open-pit mining in the
third quarter of 2020. Management is exploring further open-pit
opportunities of which development will begin during 2021. The
mine is serviced by a CIL processing plant with an annual capacity
of 5.1Mt.
Mali
AngloGold Ashanti continued its divestment strategy in Mali in 2020.
We concluded the sale of our interest in the Morila mine on
10 November 2020. The mine had been held by AngloGold Ashanti
and Barrick, each with a 40% interest, with the government of Mali
holding the remaining 20%. AngloGold Ashanti also concluded the
sale of Sadiola on 30 December 2020. Sadiola has been jointly held
by AngloGold Ashanti (41%), IAMGOLD Corporation (41%) and the
government of Mali (18%).
The third mine in Mali is Yatela in respect of which, on 14 February
2019, Sadiola Exploration Limited (SADEX), the subsidiary jointly held
by AngloGold Ashanti Limited and IAMGOLD Corporation, entered into
a share purchase agreement with the Government of Mali, whereby
SADEX agreed to sell to the Government of Mali its 80% participation
in Société d’Exploitation des Mines d’Or de Yatela (Yatela), for a
consideration of USD1.
At the date of this report, the transaction remained subject to the
fulfillment of several conditions precedent, including approval of
the Share Purchase Agreement by the Council of Ministers and the
adoption of two laws (the Endorsement Law and Establishment Law).
Operational performance
Production
Strong production performance was delivered by the Africa region,
increasing to 1.603Moz in the current year compared to 1.538Moz
in 2019. This was largely due to record production at Geita, and
solid production performances at Kibali and Iduapriem.
Geita’s production of 623,000oz was the highest annual production
level achieved in the last 15 years and 3% higher than the
preceding year’s 604,000oz. The increase was attributed to the
greater volumes treated as the underground operations continued
to ramp-up, providing finer fragmentation and higher grades to the
mill. The processing plant benefited from higher run time, resulting
in a 14% increase in underground tonnes mined for the year.
Iduapriem had a solid performance with gold production of
275,000oz maintaining the record production level of the previous
year. This performance was primarily due to the 2% improvement in
plant feed, supported by higher grades following implementation of
the grade improvement project during 2020. Improved grades were
partly offset by a 2% decline in tonnes treated due to challenges
experienced in treating harder ore material. An additional tertiary
ore crushing stage is being constructed to reduce the feed size
to the milling circuit to deal with the increased rock hardness as
deeper ore is extracted. In the second half of 2020, a decision was
made to accelerate waste stripping at the Teberebie Cut 2 at the
Block 7 and 8 pit, with some of the waste stripping planned for
2021 brought forward to the fourth quarter in 2020. As a result,
mined volumes increased on the back of this investment, with the
operation on track to accelerate ore delivery to the mill. Waste
stripping here will continue into 2021. This strategic investment will
assist the operation to reach the ore zone earlier, thus increasing
confidence in planned gold production for 2021.
Geita
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Siguiri increased production marginally in 2020 to 214,000oz
compared with 213,000oz in 2019. Improvements in hard-
rock processing capability resulted in higher plant feed grade.
Conversion of three leach tanks to CIL and the Mill 1 discharge
pump upgrade were successfully completed and commissioned
on schedule. These will together help to improve overall plant
recovery rates. Plant interventions and the effective use of plant run
time increased throughput to 11.2Mt during the year. Progressive
improvements were already delivered in the second half of the year,
up 8% when compared with the previous year.
Kibali had steady performance with production of 364,000oz,
marginally lower than the 366,000oz produced in 2019. Record
underground production was achieved in December 2020 and
for the fourth quarter. Steady plant performance resulted in a 2%
increase in plant throughput compared to 2019. This was partly
offset by 2% decline in the recovered grade due to the impact of
ore feed blend to the plant. The mine invested further in technology
to allow multiple, autonomous machines to operate on the same
haulage and production levels, and to provide real-time visibility of
all operations, including automated control of ventilation fans.
Costs
All-in sustaining costs for the region increased by 4% to $935/oz for
2020, compared to $896/oz the previous year. This increase was a
result of higher underground mining costs at Geita due to the step-
up in ore and waste volumes, partly offset by lower open pit mining
cost following the completion of mining in Nyakanga Cut 8 by end
September 2020; higher stay-in-business capital spend as a result
of waste stripping at Teberebie Cut 2 at Iduapriem and additional
Ore Reserve development at Geita and Obuasi; as well as higher
royalty costs across the operations due to the increase in the gold
price received.
The Operational Excellence programme continued during 2020.
This programme is a group-wide efficiency-driven initiative
focused on optimising mine plans and systems and on improving
operational cost management. This translated into a review of
asset potential and the further entrenchment of capital discipline.
Various enhancement projects are tracked through a project
management system as we strive to meaningfully move down the
cost curve. Through this process, mine planning and forecasting
improvement have been reflected in improved consistency in our
reported cost performance.
Capital expenditure
Total capital spend for the region was $397m in 2020 compared to
$410m in 2019. Capital investment was challenged by the global
COVID-19 pandemic, resulting in delayed deliveries and a difficult
execution environment. Growth capital of $168m was spent mainly
on the redevelopment of the Obuasi mine.
Underground Ore Reserve development projects continued at
Geita and pre-stripping began at Iduapriem for Teberebie Cut
2. These projects will provide access to orebodies identified
for future gold extraction. The balance of the sustaining capital
investment was used for capitalised exploration and stay-in-
business projects to improve asset integrity and realise business
improvements across the operations, to ensure safe and
sustainable growth and production.
Growth and improvement
Siguiri’s combination plant project ramp-up progressed to achieve
design throughput rates in the three-stage crushing plant and
milling circuit. Recovery improved to 83.2% following completion
of three additional CIL tank conversions and other supplementary
projects. Commissioning of the fines screening plant planned for
Geita
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OPERATING PERFORMANCE
Regional Reviews – Africa continued
2021 will increase the hard rock capacity of the crushing plant
and improve the potential for high-grade hard rock optimisation.
Furthermore, following approval of the Siguiri Block 2 feasibility
study in 2020, execution is sched