Freeport-McMoRan Booth

As one of the world’s major producers of copper, gold and molybdenum, we recognize the importance of providing these essential metals to today’s economies. But we also have an obligation to do so in balance with our corporate and social responsibilities in order to safeguard future generations. This is the core concept of sustainable development, which we embrace both as our corporate civic duty and as a prudent business practice.

We view ourselves as neighbors who live in and are part of the fabric of the local communities, committed to their futures. At every community where we operate, we work hard to minimize, mitigate and remediate where possible our environmental impacts. In addition, we implement programs globally to protect human rights and to support social development initiatives in local communities that provide improved healthcare, education, housing and employment and business development opportunities.

Our formally adopted environmental policies outline our duty to minimize and mitigate environmental impacts, to protect and enhance the quality of the environment wherever we operate, to comply with all applicable regulations and to seek continuous improvement in environmental performance. Our environmental audit policy requires all major properties worldwide to be audited at least every two years and provides additional details on auditing procedures.

Our commitments to the International Council on Mining and Metals (ICMM) Sustainability Development Principles means we are dedicated to the continuous improvement of our environmental, safety, and social efforts from exploration through mine closure

General

Freeport-McMoRan Copper & Gold Inc. (“FCX” or “the Company”) believes that, as a responsible corporate citizen, it is the duty of the Company to foster positive social and employment relationships in every area of operation. FCX is committed to the continuous improvement of those relationships and dedicated to ensuring that its operations are conducted in a manner consistent with the Universal Declaration of Human Rights and other applicable international standards of human rights, the laws and regulations of the host countries in which FCX operates, and the culture of the people who are indigenous to the Company’s operational areas. FCX will work to be a partner in the social and economic development of the people in and around its areas of operations.

Objective

The objective of this document is to clearly establish the Company’s policy on Social, Employment, and Human Rights, specifically how it is applied to its social interaction with the community, its relationships with employees, and its conduct with regard to human rights and security.

Coverage

This policy applies to all employees of FCX and its operating affiliates, including PT Freeport Indonesia (PTFI).  Note: Employees of privatized or contractor companies doing business with PTFI must comply with this policy. Alternatively, the privatized or contractor company may implement a policy similar to this policy for their respective employees.

Policy

1. Social Interaction with the Community

FCX has always been cognizant of its multiple responsibilities toward the development of the local people. The Company has conducted its Indonesian operations with concern for and a sense of responsibility toward its Indonesian Papuan employees and the indigenous people who live around its operations area. The Company’s commitment to the community is evident from our various social programs. In addition to our contributions toward community development, we recognize the importance of understanding the perspectives and respecting the rights of the indigenous population.  To achieve these objectives, FCX and its operating affiliates will:

• Build relationships with people in the host country and especially with people indigenous to areas of operations or exploration
• Work continuously to understand the culture and social patterns of the people in the host country and especially the people indigenous to areas of operations or exploration. To accomplish this, the Company and its affiliates will undertake social, cultural, and health studies
• Consult with local populations about important operational issues that will impact their communities
• Work with the host country’s government, the local people, and responsible non-governmental organizations to create and periodically update social integration and/or sustainable development plans for all operational sites.  These plans shall address the issue of economic and social viability of each operating area after cessation of operations
• Encourage awareness among our employees of attitudes, beliefs, and values of the local community
• Recognize its significant impact on the local indigenous population and voluntarily recognize this in various ways.

2. Employee Relations

FCX is committed to supporting certain fundamental principles within the area of employment and employee relations, including the elimination of discrimination in the workplace, the freedom of association and the right to collective bargaining, the elimination of forced and compulsory labor, and the abolition of child labor.

To support these principles, FCX and its operating affiliates will:

• Obey the laws and regulations of the host country with respect to employment practices
• Adhere to applicable international standards of health and safety 1
• Employ as many citizens of the host country as practicable and, wherever practicable, employ people who are indigenous to the operational or exploration site
• Provide training to citizens of the host country with a primary focus on those indigenous to the operational or exploration area to prepare them for employment in the operation
• Promote employees on the basis of their willingness and ability to perform the job without discriminating on the basis of age, gender, ethnicity, race, color, language, sexual preference, religion, political affiliation, or tribal affiliation. However, special efforts will be made to train and hire people indigenous to each operational or exploration area
• Ensure that employees are fairly remunerated
• Establish a favorable work environment free of discrimination and harassment, including but not limited to sexual harassment
• Respect the employee’s right to join a union or other coordinated association
• Prohibit the employment of forced, bonded, or child labor.

PTFI currently has a comprehensive set of procedures and code of conduct that can be found in the Industrial Relations Guidebook and the Collective Labor Agreement.

3. Human Rights

• Definition, Commitment, and Objectives

The Universal Declaration of Human Rights (UDHR) contains a good definition of human rights.

FCX, its affiliates, and its employees are dedicated to the promotion of the rule of law and protection of human rights at all operational sites. The Company is committed to ensuring that its operations are conducted in a manner that respects the UDHR, the Voluntary Principles on Security and Human Rights, other applicable international standards of human rights, the laws and regulations of the host country, and the culture of the people who are indigenous to the areas in which the Company operates.

FCX has instituted several methods of accountability, including an annual certification process and the engagement of an independent firm to audit the Company’s implementation of the Social, Employment, and Human Rights Policy.  Employees are expected to respect human rights principles and to report any acts that may constitute violations of human rights.

The Company and its affiliates will:

• Educate employees about human rights
• Notify all employees that the Company requires them to treat employees and non-employees in and around areas of operation with dignity and respect
• Take appropriate action against any employees who violate the human rights of others
• Report any credible accusation of human rights violation to the appropriate government authorities and other agencies
• Provide the Company’s full cooperation with any responsible human rights investigation and support appropriate punishment for any proven violations
• Protect all employees who report suspected human rights violations
• Work proactively to create a constructive climate for promotion of human rights in all areas where we operate by implementing programs and policies aimed at building positive relationships and by setting a good example
• Take appropriate steps to ensure that no party uses our property and/or equipment to engage in actions that violate human rights.

 

• Human Rights and Security

FCX, together with several other companies from the United States and the United Kingdom, helped to establish the Voluntary Principles on Security and Human Rights. This document was formulated as part of a dialogue between the governments of the United States and the United Kingdom and a number of companies and non-governmental 2 organizations. It covers both interactions between companies and public security, such as police or military, and interactions between companies and private security.

To uphold human rights standards, PTFI’s Security Personnel will:

• Carefully screen all potential new hires to avoid hiring anyone who has been credibly implicated in human rights abuses or has a criminal record
• Respect all people’s human rights throughout their daily activities; this includes those persons accused of illegal activity. Among other things, this means avoiding discrimination on the basis of age, gender, ethnicity, race, color, language, sexual preference, religion, political affiliation, or tribal affiliation; arbitrary interference with any person’s privacy; and any inhuman or degrading treatment
• Monitor our equipment and facilities to prevent misuse by parties that may be engaged in actions that violate human rights
• Consult regularly with local communities on security matters
• Ensure that all security procedures and policies are publicly available in order to mitigate distrust between operations and local communities
• Train personnel regularly to reinforce the principles set out in the Voluntary Principles on Security and Human Rights.

With respect to those security forces not under PTFI’s direct control (public security forces), PTFI will:

• Consult regularly on security, human rights, and related work-place safety issues
• Communicate Company policies regarding ethical conduct and human rights
• Support government efforts to provide human rights training and education for all
• Inform the public of any arrangements of support made by PTFI for the benefit of public security so that such support shall be transparent and publicly disclosed
• Monitor the use of equipment provided by the Company and investigate situations in which equipment is used in an inappropriate manner
• Report any credible allegations of human rights abuses by public security in our contracted area of work to the senior military or police official in the area and to the Corporate Human Rights Compliance Officer.

 

• Human Rights Reporting

Each operational site will have a Human Rights Compliance Officer (HRCO) and there will be a Corporate HRCO.  The HRCOs will be responsible for receiving all reports of possible human rights violations, evaluating those reports, investigating when necessary, forwarding them to appropriate government authorities and, where applicable, to nongovernmental organizations if deemed appropriate. The Corporate HRCO is responsible for documenting all allegations, overseeing all investigations, and making recommendations to correct any existing problems and/or to prevent problems from occurring in the future.  PTFI has set forth a supplementary method of reporting potential human rights violations, which can be found in the Human Rights Implementation Guide and Action Plan (FM-PROC.02).

 

• Annual Certification

Each year senior Staff employees, all security employees, and all community development employees will be required to fill out and submit to the Corporate HRCO a Human Rights Assurance Letter stating that they understand the Company’s Social, Employment, and Human Rights Policy and that they have neither taken part in any activities that would violate human rights nor have they witnessed any such activities. The Corporate HRCO will make a report to the Public Policy Committee of the FCX Board of Directors each year about human rights and compliance with the Company’s Social, Employment, and Human Rights Policy.  PTFI has set forth a supplementary method of annual certification, which can be found in the Human Rights Implementation Guide and Action Plan (FM-PROC.02).

 

• Audit

On a periodic basis, the Company will engage an independent firm to conduct an audit of the Company’s implementation of this Social, Employment, and Human Rights Policy to assess its effectiveness and the extent of the Company’s compliance. The findings from such an audit would be expected to note areas for improvement to 3 which the Company will respond with a plan for implementing recommended improvements. Both the audit report and the Company’s response would be made publicly available.

Procedure Referenced:

Refer to FM-PROC.02: Human Rights Implementation Guide and Action Plan.

Exceptions

There are no exceptions to this policy. 4