Page 7 - Annual Report 2020

1.2 Chief Executive Officer’s Report 1

Strategic Report

Dear Shareholder, Governance at BHP
Thank you for your continued support and investment in BHP through In this regard, we recently announced further steps in the continued
what has been an extraordinary 12 months. We have a resilient optimisation of our portfolio, including the intended divestment
portfolio, great people and strong relationships. These contributed to of some of our coal assets whose value will be best realised outside
a strong set of results, safely achieved in the face of some significant BHP, and our non-operated interest in the Bass Strait joint venture.
challenges in our markets and in our operating regions. We will create and secure more options in future-facing commodities
It is my privilege to have been selected by your Board to lead through innovation, exploration, early stage entry and well-timed
BHP. I want to thank my predecessor, Andrew Mackenzie, for his acquisitions of attractive resources and assets. We have also Remuneration Report
leadership in creating a simpler, more focused company, setting announced new roles on the Executive Leadership Team. These
up BHP for the future. changes will help ensure operational and technical excellence are
front and centre for the company and that we are successful in
Performing in extraordinary times creating and securing more options in future facing commodities,
The COVID-19 pandemic is having a devastating effect on lives, which will benefit successive generations of shareholders.
society and the global economy. BHP supports communities, Sustainability and resilience
customers and countries around the world with the jobs, business BHP’s commitment to sustainability is important and enduring.
and materials that will help the world navigate through the We have refreshed our approach to sustainability reporting.
pandemic, and then rebuild. We have prioritised keeping our people Key information and performance data is included in this Report
and communities safe, supporting those who rely on BHP, and and we have significantly expanded our sustainability content on
keeping our operations running reliably. our website, including the provision of a databook to make core Directors’ Report
We have taken action to protect our workforce against COVID-19 information more accessible.
by investing in more transportation capacity, restricting travel to The BHP Climate Change Report 2020 details our approach to
our operations and protecting at-risk workers. We have shortened climate change and the role we will play in addressing it. We have
payment terms for small, local and Indigenous suppliers to help committed to reducing our operational greenhouse gas emissions
address the financial pressures they are otherwise facing as a result (Scope 1 and Scope 2) by at least 30 per cent from FY2020 levels (1)
of the pandemic. We have funded social and health programs in our by FY2030. For Scope 3 emissions, we have set goals for 2030.
communities globally, have hired 1,500 more people temporarily, We will support industry to develop technologies and pathways
and the BHP Foundation is funding vaccine and treatment research. capable of 30 per cent emissions intensity reduction in integrated
In the face of this crisis, people across BHP have rallied in line with steel-making, with widespread adoption expected post 2030.
our purpose and values in a way that has seen them stay safe while We will also support 40 per cent emissions intensity reduction
keeping the business running and performing strongly. of BHP-chartered shipping of our products. Financial Statements
We had no fatalities during the year and our total recordable injury Conclusion
frequency fell 11 per cent to 4.2 per million hours worked. A number
of our operations achieved production or throughput records and We are proud of our operational and financial performance
unit costs were lower across all of our major assets. Our major in FY2020, which was achieved safely and in the face of some
capital projects are tracking well. extraordinary challenges.
Our continued focus on disciplined allocation of capital saw us We expect that the global economy will take some time to stabilise
invest US$7.6 billion in our assets while maintaining net debt at the and recover from the ongoing COVID-19 pandemic. Commodity
markets will likely remain volatile. The trailing consequences
lower end of our target range, ensuring a strong balance sheet in
these volatile times. We declared a final dividend to shareholders of high unemployment and spiralling debt are likely to reinforce
of US$0.55 per share, taking our annual dividend distribution global concern about inequality and systemic disadvantage. Additional information
to US$1.20 per share. This is the third year in a row we have Environmental sustainability will remain a global priority.
returned more than US$6 billion to shareholders, highlighting BHP’s values, strategy and actions position us well to navigate the
the resilience of our portfolio and our people. period ahead and to play a role in the recovery process. We remain
Growing value and returns committed to addressing climate change, creating social value and
to an inclusive workforce. We have structured our business to thrive
We create value through our purpose: ‘To bring people and resources through changing times, and we are set up well to deal with
together to build a better world’. Just prior to starting in the CEO role, near-term market uncertainty and to prosper as the world returns
I spent six weeks engaging with people in BHP’s operations and to its trajectory of long-term growth.
offices around the world. I came away energised by what I heard BHP’s performance in the past year illustrates this resilience
and confident in the potential for BHP to create even greater value and our potential to continue to grow value and returns for
for shareholders and society – an even safer, more reliable, and lower shareholders and society.
cost BHP, with social value core to everything we do. We will grow Shareholder information
value and returns for all those who have a stake in a successful BHP. To all our shareholders, thank you for your ongoing commitment
and support.
Value and returns will be underpinned by embedding social value,
being excellent at operations and at allocating capital, and by
ensuring we have a portfolio with options that allow us to invest
in meeting society’s needs in the short, medium and long term.
Mike Henry
Chief Executive Officer
(1) FY2020 baseline will be adjusted for any material acquisitions and divestments based on greenhouse gas emissions at the time of the transaction. Carbon offsets will
be used as required.
BHP Annual Report 2020 5