Monitoring of contract implementation

Ensuring that contractors implement the CSMP in accordance with the contract is one of the most important aspects of Anglo American’s responsibilities about contractor social performance management. This can be done through one or more of the following, depending on the associated potential risks and impacts and their severity:

• Regular progress meetings: As part of the regular progress meetings with the contractor, social performance issues must be discussed, including upcoming and past activities and progress in relation to social performance measures.
• Reporting: Contractors must report on their social performance at an agreed frequency and as per the KPIs and other reporting requirements outlined in the contract and in the CSMP. Examples of KPIs and other reporting requirements for social performance can be found in Box 4B.9.
• Audits and inspections: Audits and inspections can be announced as appropriate. Audits and inspections should focus on verification and validation of implementation of social performance requirements, as stipulated in the contract. This typically includes record checks, and visits to offices and worker accommodation. The frequency of audits and inspections should be commensurate with the associated potential social and human rights impacts and risks in relation to the scope of work.

Timely resolution of non-compliances or other issues is required, and additional reporting and/or monitoring may be needed to follow up on their close-out. A failure to act, unsatisfactory management of social performance issues, or ignoring notices and warnings should merit a decision for the contractor to stop work until the issues are resolved.

Box 4B. 9 Examples of Key Performance Indicators and reporting requirements

• Local employment:
  • performance and progress against set objectives or targets
  • the number and percentage of workers, indication of origin (expatriate, local, non-local nationals), gender, and skill level (unskilled, skilled, supervisory, professional, management)
  • performance and progress against local employment training plans, including the number of people from host community trained, and the number of local employees trained
• Local procurement:
  • performance and progress against local procurement targets
  • number of local companies recruited as sub-contractors
  • payment-status reports
  • number and location of local suppliers
  • value of locally procured goods and services
• Worker grievances:
  • number of new grievances received, broken down by topic, actions taken to resolve issues, percentage of grievances closed-out as per policy, number and type of repeat grievances
  • unresolved and still-outstanding grievances
• External grievances related to contractor SoW:
  • number of new grievances received, broken down by topic, actions taken to resolve issues, percentage of grievances closed-out as per policy, percentage of grievances resolved to a satisfactory level, number and type of repeat grievances
  • unresolved and still outstanding grievances
• Incidents related to contractor SoW
  • number of incidents related to contractor activities, topic of incidents, root-cause analysis, and actions taken to prevent incident from happening again in the future
• Off-site activities and impacts:
  • details of any work outside site boundaries
  • description of any potential off-site impacts (previously identified or not) and actions taken to prevent negative impacts
• Social performance staffing:
  • any new hires and departures, and listing of current staff working on social performance issues
• Training:
  • performance and progress against training plan
• Worker accommodation:
  • results of inspections and audits of accommodation conducted by the contractor or by third parties (including authorities), including date, inspector or auditor name, sites visited, records reviewed, major findings, and actions taken
• Labour inspections
  • results and inspections of labour-related issues conducted by the contractor or by third parties (including authorities), including date, inspector or auditor name, sites visited, records reviewed, major findings, and actions taken
• Other potential social and human rights impacts and risks
  • progress and evidence of implementation of any plans submitted by the contractor relating to social management.

Some social and human rights impacts and risks may have an environmental or other non-social cause, such as those social and human rights impacts and risks related to hazardous-materials spills, water management, vehicles using public roads, and the generation of dust, noise and vibration. Monitoring of implementation of requirements in relation to these risks and impacts is typically covered by the SHE team.

Review of effectiveness of contractor social management

The site’s social performance team should assess whether the approach to contractor social management is effective, and take corrective action as required.

This should include a review of:

• Contractor inspections, audits, and validation and verification of the implementation of contractor social performance requirements.
• The categories for social materiality and whether these are correctly defined.
• Whether potential social and human rights impacts and risks associated with the contract were adequately assessed.
• Whether the mitigation measures, controls, and other requirements were effective in managing potential social and human rights impacts and risks.
• Incidents and grievances related to contractor activities, whether these were resolved effectively, and whether the issues were adequately identified/ updated in the SHIRA process.
• Whether contractual language adequately covered social performance issues, and whether the contract was effectively enforced.