Anglo American Annual Report 2012

GOVERNANCE AUDIT COMMITTEE REPORTObtaining assurance on theinternal control environmentThe system of internal control, whichis embedded in all key operations,provides reasonable rather thanabsolute assurance that the Group’sbusiness objectives will be achievedwithin the risk tolerance levels definedby the Board. Regular managementreporting, which provides a balancedassessment of key risks and controls,is an important component of boardassurance. In addition, certain Boardcommittees focus on specific riskssuch as safety and capital investmentand provide assurance to the Board.The chief financial officers of theGroup’s business units provideconfirmation, on a six-monthlybasis, that financial and accountingcontrol frameworks have operatedsatisfactorily. The Board also receivesassurance from the Audit Committee,which derives its information, in part,from regular internal audit reports onrisk and internal control throughout theGroup and external audit reporting.The Group’s internal audit function hasa formal collaboration process in placewith the external auditors to ensureefficient coverage of internal controls.The Anglo American internal auditfunction is responsible for providingindependent assurance to executivemanagement and the Board on theeffectiveness of the risk-managementprocess throughout the Group.Anglo American seeks to have a soundsystem of internal control, based onthe Group’s policies and guidelines,in all material associates and jointventures. In those companies that areindependently managed, as well asjoint ventures, the directors who arerepresented on these organisations’boards seek assurance that significantrisks are being managed.Assurance regarding the accuracyand reliability of Mineral Resourcesand Ore Reserves disclosure isprovided through a combination ofinternal technically proficient staffand independent third parties.Whistle-blowing programmeThe Group has had a whistle-blowingprogramme in place for a number ofyears in all its managed operations.This facility operates in addition to astandardised Group-wide stakeholdercomplaints and grievance procedurethat is operated at all managedoperations (see the 2012 SustainableDevelopment Report for more details).The whistle-blowing programme,which is monitored by the AuditCommittee, is designed to enableemployees, customers, suppliers,managers or other stakeholders on aconfidential basis to raise concerns incases where conduct is deemed to becontrary to our values. It may include:• Actions that may result in danger tothe health and/or safety of peopleor damage to the environment• Unethical practice in accounting,internal accounting controls, financialreporting and auditing matters• Criminal offences, includingmoney laundering, fraud, briberyand corruption• Failure to comply with anylegal obligation• Miscarriage of justice• Any conduct contrary to the ethicalprinciples embraced in our businessprinciples or any similar policy• Any other legal or ethical concern• Concealment of any of the above.The programme makes availablea selection of telephonic, email,web-based and surface mailcommunication channels to anyperson in the world who hasinformation about unethical practicein Anglo American and its managedoperations. The multilingualcommunication facilities are operatedby independent service providers whoremove all indications from informationreceived as to the identity of the callersbefore submission to designatedpersons in the Group.During 2012, 332 reports werereceived via the global ‘Speakup’facility, covering a broad spectrumof concerns, including:• Ethical• Criminal• Supplier relationships• Health and safety• HR issues.Reports received were kept strictlyconfidential and were referred toappropriate line managers withinthe Group for resolution. Whereappropriate, action was taken toaddress the issues raised. Thereports are analysed and monitoredto ensure the process is effective.106 Anglo American plc Annual Report 2012