UK Modern Slavery Act
Modern Slavery Statement
This statement has been published in accordance with the Modern Slavery Act 2015. It sets out the steps taken by Fresnillo plc (“Fresnillo” or the “Company”) to prevent any involvement in slavery and human trafficking. Fresnillo plc is strongly committed to continuing to evolve its approach to manage this risk.
Modern slavery is a grave violation to human rights. It comprises all forms of contemporary slavery such as forced labour, servitude, human trafficking and the worst forms of child labour1. Fresnillo has a zero tolerance approach to modern slavery and expects its employees, suppliers and contractors to reject any and all of its forms.
2. Business Structure
Fresnillo is the world’s leading silver producer and one of Mexico’s largest gold producers. The Company seeks to create value for stakeholders across precious metal cycles, focusing on high potential silver and gold projects that can be developed into low cost, world-class mines.
Fresnillo purchases goods and services across all stages of the mining cycle, from exploration and construction to mining operations. Mining contractors are key partners, representing 65% of the Company’s workforce. In 2016, the Company paid over US$894 million to suppliers and contractors. Where possible, Fresnillo plc buys local goods and services to develop procurement opportunities and economic wealth within the communities where we operate.
3. Modern Slavery Context in Mexico
The majority of Fresnillo’s people and operations are located in Mexico and for that reason, country-specific factors should be considered in order to better understand Fresnillo’s exposure to modern slavery risks.
Women and migrants (including men, women, and children) are the most vulnerable individuals in Mexican society regarding forced labour2. Evidence suggests that this illegal practice may be more common in the agricultural, domestic service, food processing, construction, informal economy, begging, and street-vending industries, both in Mexico and the United States.
The groups considered most vulnerable to human trafficking in Mexico include women, children, indigenous persons, persons with mental and physical disabilities, migrants, and the LGBT community. The vast majority of foreign victims of forced labour and sex trafficking in Mexico are from Central and South America countries3.
The legal framework in Mexico and relevant Governmental institutions are presented below.
Relevant Government Agencies in Mexico
4. Policies and Governance
Fresnillo respects and supports human rights, avoids complicity with abuses, addresses grievances related to its business activities where relevant and does not tolerate human rights violations committed by its employees, contractors and public or private security providers acting on its behalf.
Our policy framework is consistent with our overarching human rights commitments. We aspire to act in a manner consistent with the United Nations (UN) Universal Declaration of Human Rights and the UN Global Compact Principles. We are strongly committed to continuing to evolve our approach to manage human rights risk following the UN Guiding Principles on Business and Human Rights.
Along with the laws of Mexico that protect human rights, we have internal policies and procedures in place to protect the human rights of our communities, employees and contractors. Our Sustainability Policy and our Code of Conduct outline this commitment. We consider that modern slavery is a human rights violation linked to unethical behaviours. Therefore our risk control framework is closely linked to our ethics initiatives in order to ensure an integrated approach.
“As one of the leading precious metals companies, we aspire to have a well-established business ethics corporate culture demonstrated by our behaviours and actions”.
Our Code of Conduct applies to all employees and related third parties (clients, suppliers, community and other entities who have some kind of business relationship with Fresnillo). We require mining contractors and suppliers to comply with our Code of Conduct through contracts that stipulate compliance with Mexican labour regulations, our health and safety policies and operating procedures. All contractors must register their employees with the Mexican Social Security Institute (IMSS), which in turn requires disclosure of compensation and working hours. All employees and contractors are encouraged to report any incident to our whistleblowing line “Fresnillo Plays Fair”.
Our employees and contractors must treat all workers and members of the community with dignity and respect. Their behaviour must not impact the wellbeing of vulnerable members of the community by engaging them in activities such as compulsory labour or sexual exploitation. Environmental, livelihood and other community concerns may be reported through our grievance mechanism, or brought to light via our perception studies.
The Health, Safety, Environment & Community Relations (HSECR) Committee of the board evaluates, on behalf of the Board, the Company’s effectiveness of Management in preventing modern slavery.
5. Risk Assessment and Mitigation
We integrate human rights, including modern slavery, into our own operations’ risk management processes. To better understand human rights risks and our exposure in Mexico, we take into consideration public information such as the Global Slavery Index, the Business and Human Rights Guide for Mexico (developed by the Danish Institute for Human Rights) and Country Reports on Human Rights Practices by the United States Department of State. The Transparency International Corruption Perceptions Index is also useful to understand exposure to related issues such as corruption. In addition, we use perception studies to gain insights into the Company’s human rights risks at the community level.
A cross-functional Management team has conducted a risk assessment to evaluate human rights risks, including modern slavery. This evaluation has identified the areas of the business, including vulnerable groups, which are most exposed to the risk of human rights violations. From these insights and certain best practice guidelines, the Company is adapting its Due Diligence procedures in regards to contractors and suppliers to include the appropriate steps so as to consider modern slavery risks in their selection and retention processes.
Our Fresnillo Plays Fair whistleblowing line offers a secure channel to report violations. Our Honours commission is responsible for investigating and addressing ethical misconduct and human rights abuses. Moreover, our grievance mechanisms allow the Company to address issues raised by the communities, including any and all human rights concerns.
We recognise that additional work is still required on an ongoing basis to further develop our ability to correctly identify other potential signs of modern slavery that are less evident.
Our methodology to conduct social impact assessments is under review to better understand the potential human rights impacts that the Company might have in the communities where we operate or where we plan to operate. In order to reduce exposure to related issues such as working conditions, the Company is launching a process to upgrade its procurement standards in order to set expectations on working conditions and prevention of modern slavery throughout our supply chains and contractors.
6. Training and Raising Awareness
Raising awareness and developing our competences are crucial to preventing any involvement in modern slavery and human rights abuses throughout our organisation as well as our partners in the value chain.
Our people, from the time that they join Fresnillo plc, are provided with the Code of Conduct and are expected without exception to comply with the provisions of our Code. We make clear that behaving in accordance with the Code is a condition of employment.
We plan to carry out risk-based training for our staff in areas of the business exposed to modern slavery risks. This training will also be valuable to our suppliers and contractors. To ensure an integral approach, we are making the link between these risks and our ethics and compliance framework. We intend to use an e-learning platform to train employees and contractors on human rights risks, including human trafficking and forced labour.
7. Looking Ahead
In 2017 we will pursue our efforts to embed the necessary controls in our operations and best practices to prevent modern slavery. For our mining operations, this includes further developing our risk and mitigation procedures, as well as monitoring compliance with our standards. We will focus our efforts on developing the competences of mining contractors to prevent any human rights risks. We welcome multi-stakeholder dialogue and collaboration to prevent modern slavery.
 BEYOND COMPLIANCE: EFFECTIVE REPORTING UNDER THE MODERN SLAVERY ACT. A civil society guide for commercial organisations on the transparency in supply chains clause.
 The National Human Rights Commission is the national human rights institution (NHRI) accredited before the United Nations.
 The National institute of Migration controls and supervises migration in Mexico.