Hudbay 2018 Annual and CSR Report Summary

CSR Approach

Hudbay’s corporate social responsibility (CSR) efforts are led by a team of dedicated, experienced professionals, and guided by our values and by policies, systems and practices that uphold our commitment to responsible, sustainable development. The perspectives of employees, shareholders, suppliers, government officials, communities, rights holders and other key stakeholders help us make better decisions and continuously improve.

100%
of employees required to participate in compliance training completed course

20%
Hudbay’s Board of Directors ranked among the top 20% for overall governance quality by Institutional Shareholder Services

Engaging Traditional Knowledge Holders on Mill Refurbishment Project

At our Lalor mine, we evaluated options for processing the gold and copper-zones, and this evaluation included refurbishing the New Britannia mill, which has been on care and maintenance for around 14 years.

The mill refurbishment plan includes using as much existing infrastructure as possible. However, we will need to construct some new facilities to store and process ore, and we will need to make some minor adjustments to the tailings pipeline path between the mill, the concentrator and the tailings impoundment area.

In assessing the impacts of the project on the environment and the community, we seek to attain the traditional knowledge of the indigenous people near the mine. Because of their in-depth knowledge of the land and their ability to distinguish project impacts from natural changes in the environment, during two terrestrial field programs in the spring and fall, traditional knowledge holders joined biologists to walk the entire length of the proposed pipeline corridor and identify medicinal plants, local wildlife and heritage resources. Along with obtaining valuable insight, the engagement helped strengthen the relationship between Hudbay and the community.

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Improving the Systems That Help Optimize Performance

Hudbay’s environmental, health and safety (EHS) management systems have been in place for many years, and have been compliant with international standards for 15 years. These systems provide the structure for conducting business in a way that manages our impact on the environment and minimizes and controls our health and safety risks. Our EHS systems are designed to support compliance with standards and reporting frameworks (both internal and external), drive continuous improvement and align with our business strategy.

During the year, we conducted a review of our EHS management systems, gathering feedback from operations managers on what is working well, what is not and how we can improve. We also tested how well the managers understood the systems and how they worked.

Key findings from the review included:

Managers felt that there is a need for more training on the systems across all levels of their business unit, and that the training needs to highlight why the systems are in place and how they are applied.
The systems and associated audits and certifications added value and were deemed important, but the documentation was onerous and opportunities existed to reduce complexities.
Some system elements need to be better tailored to the specific operation.
The concept of routine – such as the safety calendars in Manitoba that detail tasks, frequency and accountability for safety-related activities – was viewed as an effective tool for making sure teams are focused on the right tasks.

Each site is working to address these findings. Providing support to the sites’ efforts is the EHS Management Review Committee (comprising the CEO, COO, operations VPs and corporate CSR group) and the principles of our OneHudbay initiative.

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CSR Governance

To build stakeholders’ trust and ensure we operate in a responsible and sustainable manner, our Board of Directors and senior leaders have a dedicated focus on corporate responsibility issues and ensure social and environmental risk mitigation programs are being integrated throughout the business.

Tailings Stewardship

As a member of MAC, we are implementing TSM’s updated Tailings Management Protocol, which builds on a continual improvement process for tailings management to achieve the goal of zero catastrophic failures of tailings facilities and no significant adverse effects on human health and the environment.

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Industry Associations and Memberships

In 2018, Hudbay participated in industry associations and multi-stakeholder groups through membership, funding, sharing of expertise, and participation in committees and working groups.

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Human Rights

We respect the dignity of all people, along with their cultural traditions and values. Our fair labour practices include zero tolerance for forced, compulsory and child labour, and we work to prevent any infringement upon human rights within our sphere of influence.

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security practices

Respecting the human rights of neighbouring communities while providing a secure work environment and protecting our people defines our security approach. The operations, projects and exploration sites where we employ security personnel apply the Voluntary Principles on Security and Human Rights (the VPs). All contracts with security services require personnel to work within the VPs framework and relevant guidelines developed by the United Nations.

MATERIALITY

We define our material CSR issues as those economic, environmental and social issues most important to our stakeholders and to our business. In 2017, we reviewed our priorities in relation to what we had been hearing from our key stakeholder groups, and confirmed our 11 priority issues. Our report discusses how we are managing each issue in the diagram and how we performed in 2018.

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Responsible Supply Chain

We focus our supply chain responsibility efforts on activities where we can have the greatest influence: our own operations, contractors working at our sites, local suppliers, and Hudbay products up to the point from which they are shipped.

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