MELBOURNE, OCTOBER 2006 INTERNATIONAL MINE MANAGEMENT MELBOURNE, OCTOBER 2006 “Leadership in the minerals sector – challenges and opportunities for management of the 21 st century Don Larkin FAusIMM CEO, The AusIMM

MY PROPOSITION Economic output = f (land, labour, capital, environment)

1992 Rio Summit Sustainable development Natural capital Manufactured capital Human capital Social capital

SEVEN BASIC PROPOSITIONS Significance of labour in output equation Significance of labour in sustainability Relatively low employer of labour No one predicted skills shortage Cyclical nature of industry – labour a commodity Culture of industry needs to change (Aesop’s fable) Our demographic destiny

EXHIBIT 1

RESPONSES TO – A VISION FOR 2020 THE CHANGING WORLD The New Labour Market Retirement disappears ▪ Career planning beyond 50 ▪ Changes to superannuation ▪ Improving educational attainment ▪ Knowledge management New generation of older workers ▪ Ageing workforce benchmarking ▪ Lifelong learning ▪ See flexibility below

RESPONSES TO – A VISION FOR 2020 (continued) THE CHANGING WORLD The New Labour Market Three generations in the ▪ Understanding and generation workplace specific management skills ▪ Communication and collegiate skills ▪ Empathy ▪ Satisfaction = reality/expectations

RESPONSES TO – A VISION FOR 2020 (continued) THE CHANGING WORLD The New Global Economic Order China and India emerge as ▪ Multiple culture, language and massive economies time zones ▪ Promote global opportunities ▪ Negotiation and cultural sensitivity Offshoring takes off, whole▪ Managing spatially dispersed economy affected networks, plants, attitudes and suppliers ▪ Manage large, complex adaptive systems of businesses ▪ Around the clock access

RESPONSES TO – A VISION FOR 2020 (continued) THE CHANGING WORKPLACE Focus on human ▪ Human resources vital component optimisation of business planning, budgeting, risk management ▪ Talent, knowledge management, mission critical employees ▪ Graduate programs, CPD, mentoring, succession planning, etc. Workplace flexibility▪ Individual contracts becomes key to ▪ Flexible environments and terms attracting and retaining and conditions of employment staff ▪ Telecommuting, flexi time, rosters ▪ Part time, parental leave, career break, etc. ▪ Google environment

RESPONSES TO – A VISION FOR 2020 (continued) THE CHANGING WORKPLACE People and creativity ▪ Encourage diversity and creativity logic emerges ▪ Indigenous and new sources of labour ▪ Outsourcing – contract management Taking accountability▪ Improving child care facilities for outcomes for ▪ Improving health women ▪ Undertaking welfare reform ▪ All the above regarding flexibility

RESPONSES TO – A VISION FOR 2020 (continued) THE CHANGING MINDSET Servicing all ▪ Higher order communication skills stakeholders and transparency ▪ Emphasis on social interactions/ complex interactions Cult of the top team▪ Team skills – leading teams ▪ Communication/emotional intelligence skills ▪ Recruitment, delegation and motivation

RESPONSES TO – A VISION FOR 2020 (continued) THE CHANGING MINDSET Experts dominate▪ Building and maintaining personal expertise and deep industry or systems expertise ▪ Use of independent specialists/ contractors ▪ CPD Managing substantial▪ Financial/health/superannuation wealth advice ▪ Work and life choices ▪ Extent of working life/when to peak

IN SUMMARY – LEADERSHIP CHALLENGES Doing more with less People leadership and management Reducing uncertainty Understanding and addressing demographic destiny Mission critical employees – management of talent and knowledge Managing creativity and embracing diversity Emphasis on complex interactions Forecasting and planning Not just a commodity

LAST WORDS Reality Satisfaction = ____________ Expectations