Page 39 - Annual Report 2020

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Community and human rights
Risks that have the potential to impact human rights and/or communities and affect support for our business with stakeholders, including
communities, governments or the general public. Strategic Report

Why is this important to BHP?
We recognise that our everyday interactions, activities, behaviours and decisions are intricately linked to the long-term viability of our business and
to the social and economic wellbeing of the communities where we have a presence.
Impacts could be in relation to our environmental, community, legal and regulatory performance (such as human rights, community wellbeing, water
and biodiversity, climate change, Indigenous peoples and local, regional and national economies), and also the effect of shareholder or civil society
activism on our business. Changes in society and the evolving expectations of communities and our other stakeholders have the potential to change
and increase these impacts.
Although our community and environmental performance is intended to go beyond managing threats to actively contributing to the resilience, Governance at BHP
rehabilitation and conservation of the natural environment and communities with which we work, we may not always be successful in doing
so if our social value proposition is inadequate or we are unable to implement it.

Threats
BHP may engage in activities that have or are perceived to have adverse • loss or limited access to commercial partners or employee talent
impacts on communities, society, cultural heritage, human rights and • increased taxes, royalties and other governmental or
the environment. These activities, such as exploration, production, administrative charges
construction or expansion of our operations, vary depending on the • reduced access to equity and capital markets
social, economic and environmental context of each of our operations • civil unrest, industrial relations disputes or action, negotiations, litigation
and may take place on or adjacent to Indigenous peoples’ territories or regulatory action, resulting in higher costs and a loss of productivity
or areas of importance for biodiversity or cultural conservation. • reputational damage Remuneration Report
These activities, or a failure to effectively engage with communities
and relevant stakeholders, can affect our relationships with or be The COVID-19 pandemic has affected community health, safety and
viewed negatively by the community and other stakeholders and may quality of life, and had economic impacts on livelihoods and supply
result in adverse impacts on human rights (for example, disruption of chains, particularly to regional communities and Indigenous peoples.
community access to water, including through contamination of potable All of these impacts and our response to them may amplify existing
water supplies). In addition, they could result in the following impacts risks and have the potential to affect our business. This may include
to our business: production interruptions, delays or refusals of regulatory approvals
and reputational damage (for example, an outbreak of COVID-19 in
• loss of rights to explore, operate or expand our current asset base, a community that is or is perceived to be caused by BHP may result
delays in approvals, increased costs or reduced production for new in criticism from our stakeholders, including investors).
or existing projects Directors’ Report
• withdrawal of consent or support from Indigenous peoples Heightened societal expectations can also result in changes to legal
requirements, as well as litigation, inquiries, regulatory action or
• opposition to our projects or our entry into new jurisdictions, government responses against BHP. For example, the transportation
including through legal or social action of our commodities by third parties or procurement of materials needed
• increased costs for mitigation, offsets or financial compensatory for our mining operations, such as personal protective equipment, tyres
actions or obligations or conveyor belts, may be connected to a breach of legislation intended
• loss of customer base or restriction of the countries to which we can to prevent modern slavery or a breach of human rights within our supply
supply products chain by a direct or indirect supplier.

Management
In FY2020, social value was integrated into asset plans, which is intended These requirements and our practices also include: Financial Statements
to enhance our contribution to the natural environment, communities • conducting regular impact assessments for each operated asset
and our many stakeholders at an asset and Group-wide level. to understand the social, environmental, human rights and
BHP’s standards for communications, community and external economic context
engagement, and supply chain management provide mandatory • identifying and analysing stakeholder, community and human rights
minimum requirements and practices that are designed to strengthen impacts, including modern slavery risks
our social and human rights performance. In addition, our Human • engaging in regular, open and honest dialogue with stakeholders
Rights Policy Statement, Climate Change Position Statement, Water to understand their expectations, concerns and interests
Stewardship Position Statement and Indigenous Peoples Policy • contributing to environmental and community resilience through
Statement set out our commitments to human rights, climate change, social investment
water security and access to safe water for all, and the traditional rights • completing due diligence on all current and new suppliers through
of Indigenous peoples (including our approach to engaging with our Ethical Supply Chain processes
Indigenous peoples). These activities also assist us to identify, mitigate or manage key Additional information
potential social, environmental and human rights risks, as described
in section 1.7.

FY2020 insights
The Group’s exposure to risks associated with the community and human rights is expected to increase as societal, community and political pressures
continue to grow, as evidenced by recent civil unrest in Chile, the United States and other countries where we have a presence. The COVID-19
pandemic has amplified risks and impacts associated with pre-existing factors that affect communities and society across some of our locations
(such as inadequate community services and community health and safety). This highlights the need for a rapid and coordinated response by BHP
in partnership with relevant stakeholders and, along with adjustments required for the recovery of local and national economies, may present an
opportunity for BHP as strong social performance could generate competitive advantage in Australia and other countries in which we operate.
For information on our community response to the COVID-19 pandemic, refer to section 1.4.6. Shareholder information

BHP Annual Report 2020 37