2011
AMBATOVY SUSTAINABILITY REPORT
8
Governance
Ambatovy is actually 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 and 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 partner companies:
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, (KORES, state-run
enterprise) 27.5% ownership
3
SNC-Lavalin Inc., (SLI, Engineering, Procurement and
Construction Manager, publicly traded, TSX: SNC) 5%
ownership
The Executive Committee, which is comprised of eight
individual members, is responsible for overseeing the direction
and execution of Ambatovy’s activities. The committee
meets at least quarterly or more frequently as circumstances
require for the efficient management of the company. The
members are all representatives of each partner company.
While Ambatovy executives are not disqualified from sitting
on the Committee, neither the chair nor other members of
the committee were concurrently executives of Ambatovy
in 2011. The chairperson of the committee rotates on an
annual basis among partners with an interest of 25% or
greater. The partners have developed a formal Shareholders
Agreement, which lays the framework for how the Executive
Committee will function, including policies and procedures
for handling potential conflicts of interest. The Committee’s
focus is on sustainable value creation for all stakeholders.
In addition to the Executive Committee, there are currently
five sub-committees whose members are also employees of
each of our partners:
3
Audit
3
Environment, Health and Safety, and Community
3
Finance
3
Marketing
3
Technical
Each partner company selects its representatives internally
and strives to provide qualified people who will offer unique
expertise and insight to their role.
Ambatovy’s governance structure has informal mechanisms
to ensure accountability and performance evaluation.
Ambatovy’s senior management is held accountable by the
Executive Committee for Ambatovy’s performance. At each
meeting, managers present an assessment of their activities
and achievements either to the relevant sub-committee or
directly to the Executive Committee. Employees may provide
recommendations to supervisors and managers, who can in
turn present these views through these quarterly updates to
the Committee. During this time, the Committee evaluates
performance and mandates changes as necessary. We also
have regular internal audits by Sherritt, the operating partner
company, to provide monitoring and evaluation on a range
of issues.
In addition to these internal governance mechanisms,
Ambatovy is required to adhere to stringent national and
international standards for environmental management, social
engagement and other business practices under the terms
of our lending agreement. This monitoring provides, to both
our lenders and our own management, an indication of our
performance and highlights areas for improvement.
