Goldcorp Vision Statement
Organizational Description
Vision Statement
“At Goldcorp, our vision, Together Creating Sustainable Value, describes why we’re in business.”
Goldcorp’s current vision is focused towards fostering sustainable mining operations coupled with promoting long-term shareholder value. As a leading gold producer in the world, the company is dedicated to responsible mining of raw materials while ensuring that the health and well being of all stakeholders; including, local communities, partners, suppliers, employees, govt. non-governmental organizations, locals, contractors and customers are maintained to the highest standard. The unique focus towards environmental sustainability has also enabled Goldcorp. to take proactive approaches to give back …show more content…
to the environment and its local people in ways that creates sustainable prosperity .
Values
Safety and acting ethically are top priorities at Goldcorp, as the company treats employees with respect and creates a safe working environment, or at-least make the mining job, which is a high risk job, as safe as possible. Goldcorp also empowers employees through mentoring, leading by example, and fostering career opportunities. Respecting all stakeholders is another of Goldcorp’s values, as it aims to provide benefits to the various stakeholders, most importantly the shareholders, through open and honest communication. Also, in pursue of achieving competitive advantage of being the lowest cost producer, Goldcorp has determined that innovation is elemental to continuous improvement.
Generic Strategy
Goldcorp applies a broad low cost strategy, as it aims to produce gold at least cost.
Strategic Objectives
Goldcorp is pursuing “disciplined growth” through growth through acquisitions strategy. Goldcorp acquired Wheaton River in 2005, Placer Dome’s Canadian assets and Glamis Gold in 2006. (interview)
Assessment of Organizational Strategy
The lowest cost provider is the best strategy in the gold mining industry, where the product could not be differentiated. This strategy fits well with the type of product produced; gold, silver, lead, and zinc; which could not be differentiated, and the company is able to sell all of the gold it could produce at the market price. Although Goldcorp is among the largest 10 gold producers in the world, yet Goldcorp produces only a small portion of the total gold available for trade worldwide, because gold lasts forever, and so gold mined continues to trade forever. Currently, there is approximately 177,200 tonnes of gold worldwide. Total world production in 2014 was 2,982 tonnes, to increase the gold available for trade worldwide by only 1.71%. Thus, not a single supplier has the power to affect the price of gold by changing the amount it supplies. Thus, minimizing cost is the source of generating greater value from gold
production.
Good Strategic Actions
Bad Strategic Actions
The Balanced Scorecard In terms of operational performance, Gold Corp. set it’s 2013 targets at 2.55-2.8 million ounces and achieved a total of 2.7 million ounces with an increase of 115 compared to 2012. Additionally, this was achieved with all sustaining costs totaling 1031 per ounce and currently it is targeting between $950 and $1000 per ounce for this fiscal year. In terms of strategic initiatives, it’s 2013 target was to accelerate cash flow and earnings while maintaining strong balance sheet, and eventually achieved a adj. Operating cash flow of 34% decrease to $1.6 billion and adj. earnings decreased to $ 634 million and maintaining the balance sheet firmly.
Further such initiatives were solidified with the aim of maximizing shareholder returns by outperforming the gold price; the achievement was 41% return on Gold Corp. shares and a return of 28% on the gold price. Gold Corp. also emphasized its business development initiatives with setting its target by aiming to achieve a healthy asset mix to ensure long-term growth, and this was achieved by the acquisition of Osisko, divestitures of Marigold and a stake in Premero.
In terms of sustainable performance, Gold Corp. constructed the gas pipeline at Red Lake in accordance with the commitments pertaining to the five-year Energy Management plan; which was established in 2012. Additionally, Gold Corp. had set its commitment to creating greater awareness to its initiatives for creating sustainable values through successful negotiations for two collaboration agreements with First Nations groups, this in consequence has had a positive impact on company’s overall PR strategy.
Strategic Analysis & Discussion
Leadership Structure
Goldcorp’s leadership is consistent of a flat structure. As observable in Appendix … the company consists of several layers of senior management, each with a greater span of control in their respective areas of responsibility. Consistent of 11 senior managers who directly reports to the CEO, Charles Jeannes, Goldcorp resembles a pyramid like leadership structure consistent of multiple functional managers that descend down to the base of staff level employees. The company employs a de-centralized decision making process with centralized policies and regulations. Recognized as Canada’s Top 100 Employers for 2013, Goldcorp’s organizational culture is guided by integrity and inclusion (…). The mining company embraces these two principals through what it recognizes as “The 6 Pillars”.
Grow People – Providing equal opportunities for professional development for every employee
Grow Safety – Recognizing the need to promote safety before profit
Grow Partnerships – Nurturing lasting partnerships with all stakeholders of Goldcorp
Grow Safe Production – Constantly strive to improve the working technologies Goldcorp uses everyday
Grow Reserves – Strive to grow mining reserves to ensure Goldcorp’s long-term viability
Grow Margins – Be the industry leader in the production of high-quality, low-cost gold
Leadership Processes
Leading Goldcorp through some of gold industry’s toughest times Charles Jeannes of Goldcorp has continued to play a crucial role in Goldcorp’s continued success. Appointed as the Chief Executive Officer in 2009, Mr. Jeannes has been leading the company utilizing his charismatic transformational leadership skills. Since stepping-in as the new CEO of the company Mr. Jeannes has created an inspiring vision for the company’s success by spearheading several corporate social responsibility initiatives. “Safe Enough for Our Families” initiative, increased stakeholder engagement, over $500 million in community engagement initiatives and the acquisition of young, low-cost, long-life mines have been some of Mr. Jeannes key initiatives resembling his commitment to achieving the vision that is shared by all at Goldcorp.
Leadership Activities
Goldcorp’s senior executives comprise of Charles Jeannes as the president & CEO, George Burns as the COO, Lindsey Hall as the CFO. Other executives include Charlene Ripley-General Council, Russell Ball-Corporate Development and Capital Projects, Brent Bergeron-Corporate Affairs and Sustainability, Paul farrow-People and Safety, Colette Rudstad-Controller, Edurdo Villacorta-Central and South American Operations, Chris Woodall-Operations Canada and US and Anna Tudela-Regulatory Affairs.
Charles Jeannes – Appointed as the President and CEO in 2008, Mr. Jeannes previously held the position of coporate development. He also held the position of General council at Glamis Gold prior to joining Goldcorp. He holds a B.A degree from the University of Navada and graduated from the University of Arizona school of Law with honors in 1983. Prior to joining the corporate sector he practiced law until 1994. He has board experience in the mining industry, public and private sector financing.
George Burns – Mr. Burns was appointed VP and COO in 2012. Prior to his appointment he oversaw the Maxican operations as well Canada and the US. He brings over 30 years of mineral sector experience in operations and development in various areas including copper and coal. Prior to Goldcorp he served as the COO of Centerra Gold Inc.
Mr. Burns holds a BSc in Mining Engineering from the Montana College of Mineral Science and Technology.
Lindsay Hall – Mr. Hall was appointed CFO of Goldcorp in 2006. A Charted Accountant by profession he has extensive knowledge in dealing with financial aspects within the energy industry. He has held various senior positions at Duke Energy Corporation ranging from treasuer to VP-Finance. Mr. Hall holds a B.A in Economics and BComm from the University of Manitoba.
Power Base
The senior executives and board members at Goldcorp have been instrumental in establishing the corporate culture of sustainable growth and continued success. The relentless commitment to excellence and their capacity to influence a growth culture with their power base has helped Goldcorp to ensure its future success.
Legitimate Power
At Goldcorp, as evident from exhibit … , the CEO-Charles Jeannes maintains legitimate power as the head of the company. In doing so, the 11 subordinates to Mr. Jeannes responsible for vital functions of the company reports directly to the CEO. The flat hierarchical structure of the organization coupled with a de-centralized decision making process has enabled all 11 senior managers and their divisional middle managers to have a greater span of control. This has allowed decision-making and authority at lower levels of the organization enabling Goldcorp to respond to the volatile competitive environment effectively.
Reward Power
As Goldcorp has undergone rapid expansion in the previous years, its workforce has also expanded drastically. With fewer than 12000 workers as of 2013, Goldcorp’s labor force has undergone dramatic diversification. In a 2012 survey conducted by the company, 83% of the labor force comes from local and regional areas it conducts mining activities with an annual turn-over of less than 9% in 2010. More recently a concerning issue that many mining companies are faced with is the lack of available labor in regional areas. Additional to offering attractive compensation, the company has spearheaded several initiatives to promote employee retention. These include performance management program for every employee that includes overseas work experience, various training and career development programs in local languages and life-long learning opportunities. By implementing such initiatives, Goldcorp has been reduce its employee turnover by more than 2.8% within 2 years and attract talent to meet its growing demand especially in Central and South America.
Key Initiatives
Dare to Grow – In an effort to promote personal and professional development of all front-line employees, Goldcorp initiated this pilot program in 2011. To date, the company reports as much as 95% of all employees have completed this program.
Creating Choices – Focused on creating professional advancement opportunities for women at Goldcorp the program has seen great cause, well beyond company boundaries since its inception in 2011. As a consequence company’s female employee retention has increased by nearly 3% since 2011.
New Performance Management Program – In 2010, the company introduced new performance measures, promoted at creating equal opportunities for promotions and to recognize employees who deliver above and beyond throughout their time at Goldcorp.
Strategy Execution
Resources for the Strategy Execution Effort
Goldcorp’s strategy for number of years has been to become the industry leader in producing high-quality low-cost gold. In an effort realize this Goldcorp’s leadership recently acquired Probe Mines Ltd. at a cost of $526 million. Through the acquisition of resources such as Probe Mines, Goldcorp is able to utilize pre-existing operations to further realize its potential with less start-up costs.
Policies and Procedures used for Facilitate the Strategy Execution
Goldcorp’s various policies and procedures have ensured the company maintains its focus on producing quality gold. In an effort to improve its strategy execution capabilities, Goldcorp utilizes a top-down guidance mechanism to perform organizational activities, along with conducting various operations and accomplishing various objectives. They help ensure consistency in how execution critical activities are performed. These policies include:
• Code of Conduct
• Human Rights Policy
• Corporate Social Responsibility (CSR) Policy
• Environment, and Sustainability Policy
• Occupational Health and Safety Policy
• Donations policy
• Diversity Policy
Best Practices
Goldcorp is heavily vested in training and development of its employees across all regions and operational areas. In 2010, the company executive team took the decision to spearhead an organizational wide campaign labeled “Safe Enough for Our Families”- A vision to create a company with 0 on the job fertilities. A campaign built on industry best practices to promote mining job safety, although the company drastically reduced its count it is yet to reach its objective. In an effort to further increase its stance, Goldcorp chaired the industry’s safety body – The Mining Industry Roundtable on Safety. Additionally, Goldcorp has adapted several voluntary codes and external benchmarks, including
• International Cyanide Management Code
• United Nations Global Impact
• Carbon Disclosure Project
Corporate Governance
Stakeholder Relations
As a mining company, Goldcorp strives to build and maintain strong relationship with local stakeholders where mining sites are in operation. Since 2010, the company implemented a Corporate Social Responsibility framework aimed at all areas of its mining work to ensure on-going dialogue and engagement with local communities. Other initiatives include:
• Investing $12.8 million in local communities to develop local schools, infrastructure and hospitals
• Employing local talent for key regional operations
Governance Structure
The Board of Directors The board members of the company bring a vast array of area expertise to the strategic direction of the company. Comprising of 7 directors, the board consists of independent, knowledgeable directors. Together the board oversees the management of the company as well as business affairs while acting in the best interest of its shareholders. Furthermore, while abiding to the national governance guidelines set-out in National Policy 58-201, the board of directors strives to create a company that is vested in promoting good corporate governance.
Board Structure
The board fulfills its mandate through various committees which consists of the Audit Committee, the compensation committee, the governance and nominating committee, and the sustainability, environment, health and safety committee. All committees are independent from management and only reports to the board. All committees are chaired by independent directors. It contains no company management apart from President and CEO, Mr. Jeannes. The board structure is annually assessed by the Governance and Nominating Committee to ensure the board continues to act and make recommendations independent of management.
Vision Statement
“At Goldcorp, our vision, Together Creating Sustainable Value, describes why we’re in business.”
Goldcorp’s current vision is focused towards fostering sustainable mining operations coupled with promoting long-term shareholder value. As a leading gold producer in the world, the company is dedicated to responsible mining of raw materials while ensuring that the health and well being of all stakeholders; including, local communities, partners, suppliers, employees, govt. non-governmental organizations, locals, contractors and customers are maintained to the highest standard. The unique focus towards environmental sustainability has also enabled Goldcorp. to take proactive approaches to give back …show more content…
to the environment and its local people in ways that creates sustainable prosperity .
Values
Safety and acting ethically are top priorities at Goldcorp, as the company treats employees with respect and creates a safe working environment, or at-least make the mining job, which is a high risk job, as safe as possible. Goldcorp also empowers employees through mentoring, leading by example, and fostering career opportunities. Respecting all stakeholders is another of Goldcorp’s values, as it aims to provide benefits to the various stakeholders, most importantly the shareholders, through open and honest communication. Also, in pursue of achieving competitive advantage of being the lowest cost producer, Goldcorp has determined that innovation is elemental to continuous improvement.
Generic Strategy
Goldcorp applies a broad low cost strategy, as it aims to produce gold at least cost.
Strategic Objectives
Goldcorp is pursuing “disciplined growth” through growth through acquisitions strategy. Goldcorp acquired Wheaton River in 2005, Placer Dome’s Canadian assets and Glamis Gold in 2006. (interview)
Assessment of Organizational Strategy
The lowest cost provider is the best strategy in the gold mining industry, where the product could not be differentiated. This strategy fits well with the type of product produced; gold, silver, lead, and zinc; which could not be differentiated, and the company is able to sell all of the gold it could produce at the market price. Although Goldcorp is among the largest 10 gold producers in the world, yet Goldcorp produces only a small portion of the total gold available for trade worldwide, because gold lasts forever, and so gold mined continues to trade forever. Currently, there is approximately 177,200 tonnes of gold worldwide. Total world production in 2014 was 2,982 tonnes, to increase the gold available for trade worldwide by only 1.71%. Thus, not a single supplier has the power to affect the price of gold by changing the amount it supplies. Thus, minimizing cost is the source of generating greater value from gold
production.
Good Strategic Actions
Bad Strategic Actions
The Balanced Scorecard In terms of operational performance, Gold Corp. set it’s 2013 targets at 2.55-2.8 million ounces and achieved a total of 2.7 million ounces with an increase of 115 compared to 2012. Additionally, this was achieved with all sustaining costs totaling 1031 per ounce and currently it is targeting between $950 and $1000 per ounce for this fiscal year. In terms of strategic initiatives, it’s 2013 target was to accelerate cash flow and earnings while maintaining strong balance sheet, and eventually achieved a adj. Operating cash flow of 34% decrease to $1.6 billion and adj. earnings decreased to $ 634 million and maintaining the balance sheet firmly.
Further such initiatives were solidified with the aim of maximizing shareholder returns by outperforming the gold price; the achievement was 41% return on Gold Corp. shares and a return of 28% on the gold price. Gold Corp. also emphasized its business development initiatives with setting its target by aiming to achieve a healthy asset mix to ensure long-term growth, and this was achieved by the acquisition of Osisko, divestitures of Marigold and a stake in Premero.
In terms of sustainable performance, Gold Corp. constructed the gas pipeline at Red Lake in accordance with the commitments pertaining to the five-year Energy Management plan; which was established in 2012. Additionally, Gold Corp. had set its commitment to creating greater awareness to its initiatives for creating sustainable values through successful negotiations for two collaboration agreements with First Nations groups, this in consequence has had a positive impact on company’s overall PR strategy.
Strategic Analysis & Discussion
Leadership Structure
Goldcorp’s leadership is consistent of a flat structure. As observable in Appendix … the company consists of several layers of senior management, each with a greater span of control in their respective areas of responsibility. Consistent of 11 senior managers who directly reports to the CEO, Charles Jeannes, Goldcorp resembles a pyramid like leadership structure consistent of multiple functional managers that descend down to the base of staff level employees. The company employs a de-centralized decision making process with centralized policies and regulations. Recognized as Canada’s Top 100 Employers for 2013, Goldcorp’s organizational culture is guided by integrity and inclusion (…). The mining company embraces these two principals through what it recognizes as “The 6 Pillars”.
Grow People – Providing equal opportunities for professional development for every employee
Grow Safety – Recognizing the need to promote safety before profit
Grow Partnerships – Nurturing lasting partnerships with all stakeholders of Goldcorp
Grow Safe Production – Constantly strive to improve the working technologies Goldcorp uses everyday
Grow Reserves – Strive to grow mining reserves to ensure Goldcorp’s long-term viability
Grow Margins – Be the industry leader in the production of high-quality, low-cost gold
Leadership Processes
Leading Goldcorp through some of gold industry’s toughest times Charles Jeannes of Goldcorp has continued to play a crucial role in Goldcorp’s continued success. Appointed as the Chief Executive Officer in 2009, Mr. Jeannes has been leading the company utilizing his charismatic transformational leadership skills. Since stepping-in as the new CEO of the company Mr. Jeannes has created an inspiring vision for the company’s success by spearheading several corporate social responsibility initiatives. “Safe Enough for Our Families” initiative, increased stakeholder engagement, over $500 million in community engagement initiatives and the acquisition of young, low-cost, long-life mines have been some of Mr. Jeannes key initiatives resembling his commitment to achieving the vision that is shared by all at Goldcorp.
Leadership Activities
Goldcorp’s senior executives comprise of Charles Jeannes as the president & CEO, George Burns as the COO, Lindsey Hall as the CFO. Other executives include Charlene Ripley-General Council, Russell Ball-Corporate Development and Capital Projects, Brent Bergeron-Corporate Affairs and Sustainability, Paul farrow-People and Safety, Colette Rudstad-Controller, Edurdo Villacorta-Central and South American Operations, Chris Woodall-Operations Canada and US and Anna Tudela-Regulatory Affairs.
Charles Jeannes – Appointed as the President and CEO in 2008, Mr. Jeannes previously held the position of coporate development. He also held the position of General council at Glamis Gold prior to joining Goldcorp. He holds a B.A degree from the University of Navada and graduated from the University of Arizona school of Law with honors in 1983. Prior to joining the corporate sector he practiced law until 1994. He has board experience in the mining industry, public and private sector financing.
George Burns – Mr. Burns was appointed VP and COO in 2012. Prior to his appointment he oversaw the Maxican operations as well Canada and the US. He brings over 30 years of mineral sector experience in operations and development in various areas including copper and coal. Prior to Goldcorp he served as the COO of Centerra Gold Inc.
Mr. Burns holds a BSc in Mining Engineering from the Montana College of Mineral Science and Technology.
Lindsay Hall – Mr. Hall was appointed CFO of Goldcorp in 2006. A Charted Accountant by profession he has extensive knowledge in dealing with financial aspects within the energy industry. He has held various senior positions at Duke Energy Corporation ranging from treasuer to VP-Finance. Mr. Hall holds a B.A in Economics and BComm from the University of Manitoba.
Power Base
The senior executives and board members at Goldcorp have been instrumental in establishing the corporate culture of sustainable growth and continued success. The relentless commitment to excellence and their capacity to influence a growth culture with their power base has helped Goldcorp to ensure its future success.
Legitimate Power
At Goldcorp, as evident from exhibit … , the CEO-Charles Jeannes maintains legitimate power as the head of the company. In doing so, the 11 subordinates to Mr. Jeannes responsible for vital functions of the company reports directly to the CEO. The flat hierarchical structure of the organization coupled with a de-centralized decision making process has enabled all 11 senior managers and their divisional middle managers to have a greater span of control. This has allowed decision-making and authority at lower levels of the organization enabling Goldcorp to respond to the volatile competitive environment effectively.
Reward Power
As Goldcorp has undergone rapid expansion in the previous years, its workforce has also expanded drastically. With fewer than 12000 workers as of 2013, Goldcorp’s labor force has undergone dramatic diversification. In a 2012 survey conducted by the company, 83% of the labor force comes from local and regional areas it conducts mining activities with an annual turn-over of less than 9% in 2010. More recently a concerning issue that many mining companies are faced with is the lack of available labor in regional areas. Additional to offering attractive compensation, the company has spearheaded several initiatives to promote employee retention. These include performance management program for every employee that includes overseas work experience, various training and career development programs in local languages and life-long learning opportunities. By implementing such initiatives, Goldcorp has been reduce its employee turnover by more than 2.8% within 2 years and attract talent to meet its growing demand especially in Central and South America.
Key Initiatives
Dare to Grow – In an effort to promote personal and professional development of all front-line employees, Goldcorp initiated this pilot program in 2011. To date, the company reports as much as 95% of all employees have completed this program.
Creating Choices – Focused on creating professional advancement opportunities for women at Goldcorp the program has seen great cause, well beyond company boundaries since its inception in 2011. As a consequence company’s female employee retention has increased by nearly 3% since 2011.
New Performance Management Program – In 2010, the company introduced new performance measures, promoted at creating equal opportunities for promotions and to recognize employees who deliver above and beyond throughout their time at Goldcorp.
Strategy Execution
Resources for the Strategy Execution Effort
Goldcorp’s strategy for number of years has been to become the industry leader in producing high-quality low-cost gold. In an effort realize this Goldcorp’s leadership recently acquired Probe Mines Ltd. at a cost of $526 million. Through the acquisition of resources such as Probe Mines, Goldcorp is able to utilize pre-existing operations to further realize its potential with less start-up costs.
Policies and Procedures used for Facilitate the Strategy Execution
Goldcorp’s various policies and procedures have ensured the company maintains its focus on producing quality gold. In an effort to improve its strategy execution capabilities, Goldcorp utilizes a top-down guidance mechanism to perform organizational activities, along with conducting various operations and accomplishing various objectives. They help ensure consistency in how execution critical activities are performed. These policies include:
• Code of Conduct
• Human Rights Policy
• Corporate Social Responsibility (CSR) Policy
• Environment, and Sustainability Policy
• Occupational Health and Safety Policy
• Donations policy
• Diversity Policy
Best Practices
Goldcorp is heavily vested in training and development of its employees across all regions and operational areas. In 2010, the company executive team took the decision to spearhead an organizational wide campaign labeled “Safe Enough for Our Families”- A vision to create a company with 0 on the job fertilities. A campaign built on industry best practices to promote mining job safety, although the company drastically reduced its count it is yet to reach its objective. In an effort to further increase its stance, Goldcorp chaired the industry’s safety body – The Mining Industry Roundtable on Safety. Additionally, Goldcorp has adapted several voluntary codes and external benchmarks, including
• International Cyanide Management Code
• United Nations Global Impact
• Carbon Disclosure Project
Corporate Governance
Stakeholder Relations
As a mining company, Goldcorp strives to build and maintain strong relationship with local stakeholders where mining sites are in operation. Since 2010, the company implemented a Corporate Social Responsibility framework aimed at all areas of its mining work to ensure on-going dialogue and engagement with local communities. Other initiatives include:
• Investing $12.8 million in local communities to develop local schools, infrastructure and hospitals
• Employing local talent for key regional operations
Governance Structure
The Board of Directors The board members of the company bring a vast array of area expertise to the strategic direction of the company. Comprising of 7 directors, the board consists of independent, knowledgeable directors. Together the board oversees the management of the company as well as business affairs while acting in the best interest of its shareholders. Furthermore, while abiding to the national governance guidelines set-out in National Policy 58-201, the board of directors strives to create a company that is vested in promoting good corporate governance.
Board Structure
The board fulfills its mandate through various committees which consists of the Audit Committee, the compensation committee, the governance and nominating committee, and the sustainability, environment, health and safety committee. All committees are independent from management and only reports to the board. All committees are chaired by independent directors. It contains no company management apart from President and CEO, Mr. Jeannes. The board structure is annually assessed by the Governance and Nominating Committee to ensure the board continues to act and make recommendations independent of management.