Inclusion and diversity has been a priority for the company for many years and has been integrated as a fundamental part of Freeport Edge behaviors. In 2020, as part of our broader organizational development efforts and Freeport Edge rollout, we made several advancements aimed at refocusing and strengthening the governance, resourcing and strategic direction of our global inclusion and diversity program, including the following:
Established a dedicated human resources team to focus solely on inclusion and diversity initiatives.
Formalized and published a new standalone Inclusion and Diversity Policy to specifically outline our expectations for behavior for promoting an inclusive culture and workforce, available in local languages on our website.
Created a cross-functional Inclusion and Diversity Steering Committee, sponsored by our President and CFO and including senior representatives from human resources, legal, operations, administration and finance teams, that meets on a quarterly basis to help guide the strategy and direction of our inclusion and diversity team.
In 2020, we continued to enhance our tracking and disclosure of various diversity metrics, an effort we plan to build upon in 2021. During the year, we launched initiatives to help ensure the global availability of PPE to accommodate different shapes, sizes and genders. We increased visibility into job openings across the organization and promoted the use of inclusive language and graphics in our official communications. We also began facilitating information sharing of best practices and lessons learned, and we collaborated on inclusion and diversity efforts across our global sites. For example, our El Abra team implemented Chile’s voluntary gender equality and work-life balance ordinance in 2020 and shared findings from that effort with our PT-FI team in Indonesia.
Diversity & Local Hiring
Freeport is committed to fostering a culture that is inclusive and representative of the communities where we operate. One of our greatest opportunities to contribute to our host communities is through local employment and capacity building. Local employment directly contributes to the economic and social development of surrounding communities. Moreover, hiring locally incorporates local cultures and knowledge into our company, which can strengthen our programs and enhance our global inclusion and diversity through increased awareness, understanding and perspectives. We believe varied workforce perspectives throughout our organization make us stronger.
Hiring locally is a commitment we make to our host communities. It is from this context that we must tailor our approach to inclusion and diversity — by all definitions — across our global business. We aspire for the diversity of our global workforce to reflect the diversity of the communities where we operate. In North America, 47% of our employee base is racially or ethnically diverse, including 40% Hispanic representation and 4% self-identified Native Americans / Alaskan Natives. In Indonesia, 98% of our PT-FI employee base is Indonesian, 40% of whom are Papuan.
Most people employed at our operations are host country nationals. We retain expatriate expertise for managerial and technical roles only when certain expert skills are not available in local communities. Expatriates and inpatriates receive cultural training upon their arrival to a new location. On average, expats represent less than 1% of people employed at our operations globally.
As we move forward, enhanced communications, collaboration, job opportunities and talent sharing across our sites will help us leverage the unique perspectives and local knowledge that exists within our organization. We will be considering ways to collect and gather the most meaningful data for each of our operations. We also will seek ways to encourage and promote job opportunities for our indigenous communities and other underrepresented minority groups across the organization, and we will focus on engaging with and encouraging our contractors to employ diverse and representative candidates.
Gender diversity continues to be an important focus for Freeport. We believe that progressing an inclusive workplace culture that extends beyond our operational boundaries and into our communities is a critical driver to attracting, promoting and retaining top female talent.
At year-end 2020, women represented 33% of our Board of Directors, 13% of our global workforce and 22% of new hires in 2020. Our percentage of women in executive management and management-level positions increased to 13% in both categories, from 11% and 12%, respectively. During the year, we achieved a cumulative milestone in our global women’s empowerment programs of reaching more than 100,000 women with education and training that positioned them for additional employment and advancement opportunities across our value chain and outside of the company. Refer to the Communities section of this report for more about our work to support and enhance gender diversity in our communities.
The percentage of women in our global workforce remained at 13% in 2020. Female representation ranges widely across our geographies, as high as 18% in North America and as low as 6% in Peru.
Our gender representation target remains at 15% women comprising our global workforce. Unfortunately, in 2020, female representation decreased in the Americas, partly driven by higher turnover at our North American corporate offices, which has a higher concentration of women than our operating sites, and at our operations in Peru, where retaining women in the workforce during the COVID-19 pandemic was particularly challenging due to familial roles. As a result, our 2020 global employee attrition rate was 22% among women versus 14% among men, further indicating we have room for improvement.
Part of our work moving forward is to better understand the specific regional contexts and drivers behind the lower numbers of women in these regions and to find ways to support inclusivity through capacity building, resilience, skills, knowledge and career development opportunities as well as finding ways to support our people outside the workplace. While inclusion and diversity issues take time to identify and resolve, our organizational and workforce transformation and the rollout of Freeport Edge behaviors that will guide our high-performance culture focuses on addressing these challenges, increasing overall employee engagement and satisfaction, and finding ways to retain our female talent.
FAIR & EQUAL REMUNERATION PRACTICES
Our approach to compensation and benefits is market-based and competitive and informed by annual benchmarking and analysis. We are committed to respecting the rights of our workforce, including paying fair and equal wages. This includes equal pay for equal work and compensation levels that support the acquisition of the goods and services necessary for an average-size family to meet their basic needs in the geographic locations where we operate.
In early 2021, we partnered with BSR, a global sustainability non-profit, to conduct a living wage assessment for both full-time and part-time employees at 14 of our operating and processing sites in the U.S., Chile, Peru and Indonesia. BSR’s living wage benchmark exceeds the minimum country wage in all 14 locations assessed. The analysis found that of the more than 21,000 employees in these locations, all employees met BSR’s living wage benchmark for their respective locations. We plan to complete the assessment for the remainder of our direct employees later in the year and integrate the assessment into our annual compensation review processes across our global operations. We also will seek to extend our living wage commitment to our on-site contractors in the future.
In addition to living wage, we also are committed to providing equal pay for equal work regardless of gender, race or ethnicity. We periodically conduct internal compensation reviews to identify possible pay gaps which cannot be explained through performance, distribution of jobs, experience, time in role and other related factors. To further our commitment to provide equal pay for equal work and to support our global inclusion and diversity efforts, we have engaged a third-party compensation consultant to support a formal, comprehensive evaluation of our gender pay equity practices covering our global operations.
EL ABRA IMPLEMENTS CHILEAN GENDER EQUALITY CERTIFICATION
Our El Abra operation implemented Chile’s voluntary gender equality and work-life balance ordinance to enhance gender equality in the workplace through various measures. For example, the site reviewed equal pay, enclosed changing rooms, installed independently partitioned sanitation facilities, trained employees on managing unconscious bias, provided PPE designed specifically for women, added inclusive language and graphics to formal communications, and confirmed equal gender representation on hiring panels. A third-party audit of the management system was conducted in 2019, and the certification officially was awarded in 2020, making El Abra the first private mining company to receive this certification in Chile.
BACK TO WORKFORCE > INCLUSION & DIVERSITY