2010
AMBATOVY SUSTAINABILITY REPORT
11
B3. Organizational Approach to Sustainability
B3.2 Governance
The Ambatovy Project is comprised of two companies:
Ambatovy Minerals, S.A. (AMSA) and Dynatec Madagascar,
S.A. (DMSA), which together are responsible for day-to-day
operations. AMSA owns the mining permit and operates the
mine site and pipeline. DMSA manages the plant site and
all activities related to it. Both AMSA and DMSA are subject
to the laws of Madagascar. Each has a board of directors.
In practice, AMSA and DMSA act in parallel and under the
purview of Ambatovy’s Executive Committee, which consists
of members from each of the four partners:
3
Sherritt International Corporation (operator, publicly
traded, TSX: S) 40% ownership
3
Sumitomo Corporation (publicly traded, TSE: 8053)
27.5% ownership
3
Korea Resources Corporation (state-run enterprise)
27.5% ownership
3
SNC-Lavalin Inc. (Engineering, Procurement and
Construction Management contractor, publicly traded,
TSX: SNC) 5% ownership
The Project received a total of US$2.1 billion in financing
from a consortium of 14 lending institutions. This consortium
includes government-sponsored export credit agencies,
international development banks and commercial banks from
around the world.
The Executive Committee, which is responsible for overseeing
the direction and execution of all Ambatovy activities, is
guided by a focus on sustainable value creation for all
stakeholders. It consists of six to ten individuals and meets on
a quarterly basis. The members are a mix of executive and
non-executive representatives of each partner company. They
do not receive compensation for their duties as committee
members. According to the Shareholders Agreement, the
chairperson of the committee rotates on an annual basis
among partners with an interest of 25% or greater. The
chair and other members are not concurrently executives
of Ambatovy, although they may be executives of a partner
company. The Shareholders Agreement sets out policies and
procedures for handling conflicts of interest.
Ambatovy’s governance structure has built-in mechanisms
to ensure accountability and performance evaluation. Under
the terms of the lending agreement, Ambatovy is required to
adhere to stringent national and international standards for
environmental management, social engagement and other
business practices. Ambatovy is audited several times a year
by third-party experts who report to the lending institutions.
Ambatovy is also subject to regular internal audits by Sherritt,
the operating partner company. Finally, the Executive
Committee has a number of sub-committees, some of which
are focused on monitoring sustainability issues covered in this
report. These sub-committees are:
3
Audit
3
Commodities
3
Environment, Health and Safety, and Community
3
Finance
3
Marketing
3
Technical
