Risk, transparency & diversity with BHP Billiton’s Caroline Cox

CLO

Caroline Cox joined BHP Billiton in 2014, and was appointed Group General Counsel of the dual listed resources company in March 2016. She is a key adviser to the BHP Billiton Board, and leads a team of more than 100 legal professionals across Europe, North and South America, Australia and Asia. Previously, Caroline enjoyed a distinguished 11 year career as Disputes Partner with leading global law firm, Herbert Smith Freehills.

Caroline graduated from Oxford University with a Bachelor of Civil Law (with Distinction) and was the Gold Medallist in Law at the University of Alberta in Canada. Caroline was born in the UK and grew up primarily in Canada, but now calls Melbourne, Australia home.

In this interview with Connect Intelligence, Caroline gives us her thoughts on managing risk, boosting diversity and committing to transparency. To hear more of Caroline’s insights, join us at the General Counsel Summit 2017.  

1. As attitudes and focus towards the resource industry have changed rapidly over the past decade, how do you prioritise risk to fortify BHP Billiton?

Identifying and properly managing risk is central to the success of BHP Billiton’s relationships with host communities, regulators, investors and employees. Managing risk effectively also opens up opportunities that may not otherwise be open to the Company. As the attitudes and focus towards the resource industry have changed, BHP Billiton’s risk framework has likewise continued to evolve.

Today, the Company strives to ensure that risk is understood and managed in a consistent way, and assessed on a holistic basis. In 2016, this culminated in BHP Billiton formally integrating its external-facing Functions (namely, Legal, Compliance, Risk Assessment and Assurance, Group Health, Safety & Environment, Group Governance and Corporate Affairs) into a single “External Affairs” Function. The bringing together of these Functions was underpinned by a recognition that the Company’s approach to risk was among the biggest influences on its social licence, and that the best way to effectively manage this risk was by approaching our internal and external stakeholder relationships in a unified manner.

Within the Legal team, we are participating in risk management activities as part of our daily work, including in risk assessments and incident investigations. As a legal leadership team, our priorities include ensuring that our lawyers are empowered to participate actively in these activities and possess the skills to make valuable contributions. We have made risk training compulsory for our Legal team and continue to seek to create an environment where our teams have the tools and support to challenge assumptions and think beyond the immediate legal issues at hand. This includes identifying potential emerging risks as well as providing a view that goes beyond the strict legal position to take into account, for example, community expectations.

2. Given the scale of BHP Billiton’s operations, why is transparency desirable to the company?

BHP Billiton’s business is inherently long term. Once developed, a mine will stay in production for decades, and often form a major part of the local economy. For our business to work, BHP Billiton has to win its ‘social license’ to operate and has to retain it over decades of changing governments, regulations and societal expectations. This ‘social license’ is based on trust in us as a Company and we see transparency as a pivotal in developing that trust.

BHP Billiton has a long-standing commitment to transparency and has delivered consistently on that commitment. For example:

Tax – in 2000, BHP Billiton first disclosed its aggregate payments of taxes and royalties around the world and since then the detail of its disclosure in relation to payments to governments has continually increased. This year BHP Billiton published all payments made by BHP Billiton to governments during the 2016 financial year on a country-by-country and project-by-project basis.

Climate change – in 2015, BHP Billiton published a comprehensive Climate Change Portfolio Analysis, providing a detailed insight into its approach to analysing the potential impacts on our portfolio of a shift to a world where global warming was limited to 2 degrees. An updated analysis was published in October 2016, following the Paris climate change agreement. In addition to these analyses, BHP Billiton sets 5 year public goals in relation to emissions and provides regular updates on its progress against these.

For a legal function, transparency can easily be counter to conventional legal wisdom. However, given that the societal demand for transparency is only likely to increase, it is incumbent upon the modern-day General Counsel to challenge this conventional wisdom and consider the broader, and often longer term, implications of not being transparent.

3. How is BHP Billiton working to achieve a more inclusive and diverse workplace?

BHP Billiton is focused on creating a work environment where our employees are able to reach their full potential, where they feel strongly connected to our values and objectives and where the diverse skills and abilities of our people are a key differentiator of our success. As a result, our aspiration is for the composition of our work environment to be inclusive and our global workforce over time to be gender-balanced and diverse.

Two of BHP Billiton’s present areas of focus are:

• Embedding flexibility in the way we work; and

• Taking steps to mitigate potential bias in our behaviours, systems, policies and processes.

Against this background, the Legal function is currently undertaking a global review of its people program to assess whether our lawyers are equipped with the right tools for personal and professional development. We are also actively supporting discussion, and adoption of, flexible work practices and implementing inclusion and diversity training, with this year’s emphasis being on unconscious bias.

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