Independence Group Sustainability Report 2019

Contractor management From time-to-time, IGO engages contractors, as both businesses and individuals to provide various services. At IGO we treat our contractors as part of our team. We refer to them as being ‘our people’. When contractors are at an IGO site, their safety and welfare is IGO’s responsibility. IGO expects that its contractors work in accordance with our values, and that they provide their workforce with a safe system of work and a safe place of work. We expect our contractors to monitor and report on their performance, and we expect to see improved trends in measured outcomes. Put simply, we expect to see the same high standards we require of our direct employees. All contractors working at IGO managed sites are provided with an IGO representative to manage their contract. This provides IGO with a direct opportunity to maintain ongoing management. Supporting local and Aboriginal businesses IGO applies a preferential selection process when sourcing goods and services local to our operations. We support and favour businesses in close proximity to the areas in which we operate and actively seek to engage and build capacity where suitable works are available. Providing opportunities for Aboriginal businesses is important to IGO. Our approach is guided by our Community Policy and Group Community Standard – Aboriginal Employment and Business Development to drive the creation of Aboriginal employment opportunities across our business. We deliberately and specifically seek to identify contract works that might be suitable for local Aboriginal businesses, and preference Aboriginal business where they have capability to perform works. In FY19, our total spend on Aboriginal owned or managed businesses was $5.1M. This was predominantly to CV LOMAG Joint Venture for primary crusher and earthmoving services at the Nova Operation. Meeting customer requirements The value from our metal resources and market positions is optimised by IGO’s Operations team. Our Executive Leadership Team and Board collectively drive commercial decisions across IGO’s value chain in consultation with the operations. This also includes working with our customers to ensure we meet their specific needs and to optimise downstream uses. In FY19, IGO’s key customers were: • BHP and Glencore International AG - purchase of nickel concentrate produced from the Nova Operation. • Trafigura - purchase of copper concentrate produced from the Nova Operation. • The Perth Mint and financial institutions ANZ, CBA and NAB - purchase of gold produced from the Tropicana Operation. Vertical integration We believe there are significant opportunities to grow our business by harnessing the value potential at the next stages of material refinement. During 2018, IGO commenced a project to understand the downstream processing potential to directly produce nickel sulphate using a hydrometallurgical process rather than producing nickel metal via conventional smelting and refining. Test work successfully produced nickel sulphate hexahydrate crystals and demonstrated technical feasibility. Processing our nickel concentrate from the Nova Operation to produce a nickel sulphate, targeted specifically for the battery market, has the potential to reduce capital expenditure and operating costs. It also reduces the amount of waste material transported to our customers, reducing both shipping costs and our carbon footprint. During FY19, we progressed the pre- feasibility study, achieving high extraction rates for nickel and cobalt in excess of 96 per cent, and high-quality, battery grade nickel sulphate and saleable copper-cobalt mixed sulphide products. Further work remains to be done to optimise the process design to minimise waste and maximise saleable by-product, as well as completion of trade-off studies to determine the optimum project location, with key drivers being access to and availability of power, water, transportation options, workforce and environment and community considerations. The objective of the downstream processing study is to demonstrate whether or not the project can deliver a compelling value to IGO relative to conventional nickel sulphide concentrate offtake arrangements. Consequently, in parallel to the downstream processing studies, we continue to engage with concentrate offtake customers to understand strengthening demand and pricing for Nova-style Class I nickel sulphide concentrates. IGO SUSTAINABILITY REPORT 2019 — 67